Apple 2014 Annual Report Download - page 63

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Accounts Receivable
Trade Receivables
The Company has considerable trade receivables outstanding with its third-party cellular network carriers, wholesalers,
retailers, value-added resellers, small and mid-sized businesses, and education, enterprise and government customers. The
Company generally does not require collateral from its customers; however, the Company will require collateral in certain
instances to limit credit risk. In addition, when possible, the Company attempts to limit credit risk on trade receivables with
credit insurance for certain customers or by requiring third-party financing, loans or leases to support credit exposure. These
credit-financing arrangements are directly between the third-party financing company and the end customer. As such, the
Company generally does not assume any recourse or credit risk sharing related to any of these arrangements.
As of September 27, 2014, the Company had two customers that represented 10% or more of total trade receivables, one of
which accounted for 16% and the other 13%. As of September 28, 2013, the Company had two customers that represented
10% or more of total trade receivables, one of which accounted for 13% and the other 10%. The Company’s cellular network
carriers accounted for 72% and 68% of trade receivables as of September 27, 2014 and September 28, 2013, respectively.
The additions and write-offs to the Company’s allowance for doubtful accounts during 2014, 2013 and 2012 were not
significant.
Vendor Non-Trade Receivables
The Company has non-trade receivables from certain of its manufacturing vendors resulting from the sale of components to
these manufacturing vendors who manufacture sub-assemblies or assemble final products for the Company. The Company
purchases these components directly from suppliers. Three of the Company’s vendors accounted for 51%, 16% and 14% of
total vendor non-trade receivables as of September 27, 2014 and three of the Company’s vendors accounted for 47%, 21%
and 15% of total vendor non-trade receivables as of September 28, 2013. The Company does not reflect the sale of these
components in net sales and does not recognize any profits on these sales until the related products are sold by the Company,
at which time any profit is recognized as a reduction of cost of sales.
Note 3 – Consolidated Financial Statement Details
The following tables show the Company’s consolidated balance sheet details as of September 27, 2014 and September 28,
2013 (in millions):
Inventories
2014 2013
Components $ 471 $ 683
Finished goods 1,640 1,081
Total inventories $ 2,111 $ 1,764
Property, Plant and Equipment
2014 2013
Land and buildings $ 4,863 $ 3,309
Machinery, equipment and internal-use software 29,639 21,242
Leasehold improvements 4,513 3,968
Gross property, plant and equipment 39,015 28,519
Accumulated depreciation and amortization (18,391) (11,922)
Net property, plant and equipment $ 20,624 $ 16,597
Apple Inc. | 2014 Form 10-K | 61