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Note 2 - Concentration of Credit Risk and Major Customers
3 Months Ended
Mar. 31, 2023
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, accounts receivable, and contract asset. 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 $2,633 in cash and restricted cash at March 31, 2023, approximately $1,229 and $13 was held at banks located in China and Mexico, respectively. We grant credit to customers in the normal course of business and do not require collateral on our accounts receivable.

 

We have certain customers whose revenue individually represented 10% or more of net sales, whose accounts receivable balances individually represented 10% or more of gross accounts receivable, or whose contract asset balances individually represetend 10% or more of contract assets. One customer accounted for 29% and 23% of net sales for the three months ended March 31, 2023 and 2022, respectively. Accounts receivable for one customer accounted for 24% and 21% of gross accounts receivable at March 31, 2023 and December 31, 2022, respectively. Contract assets for one customer accounted for 20% and 22% of gross contract assets at March 31, 2023 and December 31, 2022, respectively.

 

Export sales represented approximately 4% and 5% of net sales for the three months ended March 31, 2023 and 2022, respectively.