ALLOWANCE FOR CREDIT LOSSES

Trade Receivables The Company evaluates the collectability of trade receivables based on (1) a percentage of sales related to historical loss experience and current trends and (2) periodic adjustments for known events such as specific customer circumstances and changes in the aging of accounts receivable balances. After all efforts at collection have been unsuccessful, the account is deemed uncollectible and is written off.

Financing Receivables The Company evaluates the collectability of notes and finance lease receivables (collectively, financing receivables) on a customer-by-customer basis and evaluates specific customer circumstances, aging of invoices, credit risk changes and payment patterns and historical loss experience. When the collectability is determined to be at risk based on the above criteria, the Company records the allowance for credit losses, which represents the Company’s current exposure less estimated reimbursement from insurance claims. After all efforts at collection have been unsuccessful, the account is deemed uncollectible and is written off. The following table summarizes the Company’s allowance for credit losses for the nine months ended September 30, 2013 and 2012:



	Finance Leases			Notes Receivable			Total
Allowance for credit losses
Balance at January 1, 2013	$	525		$	2,047		$	2,572
Provision for credit losses	8			—			8
Recoveries	3			—			3
Write-offs	(90		)	(2,047		)	(2,137		)
Balance at September 30, 2013	$	446		$	—		$	446

Balance at January 1, 2012	$	210		$	2,047		$	2,257
Provision for credit losses	261			—			261
Recoveries	48			—			48
Write-offs	—			—			—
Balance at September 30, 2012	$	519		$	2,047		$	2,566

The Company's allowance of $446 and $2,566 at September 30, 2013 and 2012, respectively, all resulted from individual impairment evaluation. As of September 30, 2013, balances of finance leases and notes receivable were $88,216 and $16,343, respectively. As of September 30, 2012, balances of finance leases and notes receivable were $100,436 and $12,882, respectively.

The Company records interest income and any fees or costs related to financing receivables using the effective interest method over the term of the lease or loan. The Company reviews the aging of its financing receivables to determine past due and delinquent accounts. Credit quality is reviewed at inception and is re-evaluated as needed based on customer-specific circumstances. Receivable balances 60 days to 89 days past due are reviewed and may be placed on nonaccrual status based on customer-specific circumstances. Receivable balances are placed on nonaccrual status upon reaching greater than 89 days past due. Upon receipt of payment on nonaccrual financing receivables, interest income is recognized and accrual of interest is resumed once the account has been made current or the specific circumstances have been resolved.

As of September 30, 2013 and December 31, 2012, the recorded investment in past-due financing receivables on nonaccrual status was $2,489 and $2,060, respectively, and there were no recorded investments in finance receivables past due 90 days or more and still accruing interest. The recorded investment in impaired notes receivable was $0 as of September 30, 2013 and was $2,047 as of December 31, 2012 ,which was fully reserved. The following table summarizes the Company’s aging of past-due notes receivable balances:



	September 30, 2013		December 31, 2012
30-59 days past due	$	—	$	—
60-89 days past due	—		—
> 89 days past due	—		1,840
Total past due	$	—	$	1,840