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Note 2 - Concentration of Credit Risk and Major Customers
6 Months Ended
Jun. 30, 2021
Notes to Financial Statements  
Concentration Risk Disclosure [Text Block]

NOTE 2. CONCENTRATION OF CREDIT RISK AND MAJOR CUSTOMERS

 

Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and accounts receivable. With regard to cash, we maintain our excess cash balances in checking accounts at primarily two financial institutions, one in the United States and one in China. The account in the United States may at times exceed federally insured limits. Of the $1,253 in cash at June 30, 2021, approximately $274 was held at banks located in China. We grant credit to customers in the normal course of business and do not require collateral on our accounts receivable.

 

Our largest customer has two divisions that together accounted for 10% or more of our net sales during the three and six months ended June 30, 2021 and 2020. One division accounted for approximately 23% and 24% of net sales for the three and six months ended June 30, 2021, respectively, and approximately 20% and 22% for the three and six months ended June 30, 2020, respectively. The other division accounted for approximately 2% and 3% of net sales for the three months and six ended June 30, 2021, respectively, and approximately 3% and 2% of net sales for the three months and six ended June 30, 2020, respectively. Together they accounted for approximately 25% and 27% of net sales for the three and six months ended June 30, 2021, respectively, and approximately 23% and 24% of net sales for the three and six months ended June 30, 2020, respectively. Accounts receivable from the customer at June 30, 2021 and December 31, 2020 represented approximately 19% and 20% of our total accounts receivable, respectively.

 

Export sales represented approximately 2% and 3% of net sales for the three months ended June 30, 2021 and 2020, respectively. Export sales represented 3% of net sales for the six months ended June 30, 2021 and 2020.