(2) RECEIVABLES:

Receivables consist of:	April 30,
	2013		2012
	(in thousands)
Media Services operations:
Subscription Fulfillment Services	$	12,751	$	11,989
Newsstand Distribution Services, net of estimated returns		33,956		26,438
Product Packaging and Fulfillment Services and Other		2,675		2,698
		49,382		41,125
Less allowance for doubtful accounts		(2,179)		(581)
	$	47,203	$	40,544
Real estate operations and corporate:
Mortgage notes and other receivables	$	107	$	55

The Company extends credit to various companies in its real estate and Media Services businesses that may be affected by changes in economic or other external conditions. Financial instruments that may potentially subject the Company to a significant concentration of credit risk primarily consist of trade accounts receivable from wholesalers in the magazine distribution industry. Approximately 68% and 53% of Media Services net accounts receivable were due from three wholesalers at April 30, 2013 and 2012. As a result of the concentration of accounts receivable in three wholesalers, the Company could be adversely affected by adverse changes in their financial condition or other factors negatively affecting these companies. As industry practices allow, the Company’s policy is to manage its exposure to credit risk through credit approvals and limits and, on occasion (particularly in connection with real estate sales), the taking of collateral. The Company also provides an allowance for doubtful accounts for potential losses based upon factors surrounding the credit risk of specific customers, historical trends and other financial and non-financial information.

The real estate mortgage note receivable from land sales at April 30, 2013 bears interest at 8.50%. Fiscal year maturities of principal on real estate receivables at April 30, 2013 were as follows: 2014 - $35,000 and none thereafter.

Because the publications distributed by the Newsstand Distribution Services business are sold throughout the distribution chain on a fully-returnable basis in accordance with prevailing industry practice, the Company provides for estimated returns from wholesalers at the time the publications go on sale by charges to income that are based on historical experience and most recent sales data for publications on an issue-by-issue basis, and then simultaneously provides for estimated credits from publishers for the related returns. The financial impact to the Company of a change in the sales estimate for magazines returned to it from its wholesalers is substantially offset by the simultaneous change in the Company’s estimate of its cost of purchases since it passes on the returns to publishers for credit. Newsstand Distribution Services accounts receivable were net of estimated magazine returns of $75,897,000 and $69,973,000 at April 30, 2013 and 2012.

During the fourth quarter of 2013, Mercury Retail Services (“Mercury”), a wholesaler and customer of Kable Distribution Services, Inc. (“Kable Distribution”), announced that it was encountering liquidity issues and presented a restructuring plan to all national magazine distributors. Under the terms of the proposed plan, Mercury plans to sell certain operations and other assets outside of its core operations in Texas and its secured lender would receive most of the proceeds of any such sales. As part of its restructuring plan, Mercury anticipated continuing doing business with the national magazine distributors, including Kable Distribution, with the intent of making payments for current magazine sales. The Mercury restructuring plan contemplated that any amounts due the national magazine distributors for prior magazine sales would be paid over an extended period of time, if at all. Kable Distribution is exploring all options to maximize the payment of all past due amounts from Mercury, including the possibility of pursuing its claims through an involuntary petition for bankruptcy against Mercury. While the terms of the proposed restructuring plan have not been accepted by Kable Distribution, the company recorded a charge to operations of $2,000,000 in the fourth quarter of 2013, which is substantially all of the net accounts receivable due to Kable Distribution and is based on current expectations of Mercury’s payment of amounts owed to Kable Distribution and estimates of future magazine return activity, both of which may differ from Kable Distribution’s estimates.

Media Services operations provide services to publishing companies owned or controlled by a major shareholder. Commissions and other revenues earned on these transactions represented approximately 2% of consolidated revenues in 2013, 2012 and 2011.