Investment in Leasing Operations:

9 Months Ended

Sep. 24, 2011

Investment in Leasing Operations:

Investment in Leasing Operations:

5. Investment in Leasing Operations:

Investment in leasing operations consists of the following:

	September 24, 2011			December 25, 2010
Direct financing and sales-type leases:
Minimum lease payments receivable	$	27,300,600		$	30,244,700
Estimated residual value of equipment	2,774,300			3,449,400
Unearned lease income net of initial direct costs deferred	(3,887,700		)	(4,925,200		)
Security deposits	(2,374,100		)	(2,044,900		)
Equipment installed on leases not yet commenced	6,549,800			4,806,000
Total investment in direct financing and sales-type leases	30,362,900			31,530,000
Allowance for credit losses	(876,400		)	(907,800		)
Net investment in direct financing and sales-type leases	29,486,500			30,622,200
Operating leases:
Operating lease assets	1,118,400			520,200
Less accumulated depreciation and amortization	(425,800		)	(483,200		)
Net investment in operating leases	692,600			37,000
Total net investment in leasing operations	$	30,179,100		$	30,659,200

As of September 24, 2011, the $30.2 million total net investment in leases consists of $13.0 million classified as current and $17.2  million classified as long-term.  As of December 25, 2010, the $30.7 million total net investment in leases consists of $13.9 million classified as current and $16.8 million classified as long-term.

As of September 24, 2011, leased assets with one customer approximated 13% of the Company’s total assets.

Future minimum lease payments receivable under lease contracts and the amortization of unearned lease income, net of initial direct costs deferred, is as follows for the remainder of fiscal 2011 and the full fiscal years thereafter as of September 24, 2011:

	Direct Financing and Sales-Type Leases:				Operating Leases:
	Minimum Lease Payments Receivable		Income Amortization		Minimum Lease Payments Receivable
2011	$	4,710,300	$	883,200	$	235,300
2012	13,095,300		2,035,000		1,424,400
2013	5,482,600		669,700		1,444,900
2014	2,305,100		210,900		120,400
2015	1,208,400		82,900		—
Thereafter	498,900		6,000		—
	$	27,300,600	$	3,887,700	$	3,225,000

The activity in the allowance for credit losses for leasing operations during the first nine months of 2011 and 2010, respectively, is as follows:

	September 24, 2011			September 25, 2010
Balance at beginning of period	$	907,800		$	1,339,400
Provisions charged to expense	8,200			142,400
Recoveries	248,500			350,200
Deductions for amounts written-off	(288,100		)	(832,900		)
Balance at end of period	$	876,400		$	999,100

The Company’s investment in direct financing and sales-type leases (“investment in leases”) and allowance for credit losses by loss evaluation methodology are as follows:

	September 24, 2011				December 25, 2010
	Investment In Leases		Allowance for Credit Losses		Investment In Leases		Allowance for Credit Losses
Collectively evaluated for loss potential	$	30,362,900	$	876,400	$	31,530,000	$	907,800
Individually evaluated for loss potential	—		—		—		—
Total	$	30,362,900	$	876,400	$	31,530,000	$	907,800

The Company’s key credit quality indicator for its investment in direct financing and sales-type leases is the status of the lease, defined as accruing or non-accruing.  Leases that are accruing income are considered to have a lower risk of loss.  Non-accrual leases are those that the Company believes have a higher risk of loss.  The following table sets forth information regarding the Company’s accruing and non-accrual leases.  Delinquent balances are determined based on the contractual terms of the lease.

	September 24, 2011
	0-60 Days Delinquent and Accruing		61-90 Days Delinquent and Accruing		Over 90 Days Delinquent and Accruing		Non-Accrual		Total
Middle-Market	$	25,800,700	$	30,200	$	—	$	—	$	25,830,900
Small-Ticket	4,494,400		10,100		—		27,500		4,532,000
Total Investment in Leases	$	30,295,100	$	40,300	$	—	$	27,500	$	30,362,900

	December 25, 2010
	0-60 Days Delinquent and Accruing		61-90 Days Delinquent and Accruing		Over 90 Days Delinquent and Accruing		Non-Accrual		Total
Middle-Market	$	23,474,400	$	—	$	—	$	—	$	23,474,400
Small-Ticket	7,832,200		138,800		—		84,600		8,055,600
Total Investment in Leases	$	31,306,600	$	138,800	$	—	$	84,600	$	31,530,000