The following information is taken from the 2018 financial report of a company I am not revealing its name, a software development company headquartered in Luxembourg. Founded in Buenos Aires, this company has its central operating locations in Latin America and mainly serves commercial clients from the United Kingdom and the United States. The next page shows footnote information about the company's accounts receivable.

Clarifying information:

1.Trade receivables is another name for Accounts receivable.

2.The allowance table only includes receivables that are past due. Therefore, the <30 category represents receivables that are between 1 and 30 days past due. Receivables that are current and not past due are not included in the table.

3.Lifetime ECL is an acronym for excepted credit losses, or allowances for doubtful accounts (i.e., receivables the firm does not expect to collect).

4.Estimated total gross carrying amount is another way to say the gross amount of trade receivables (before any allowance).

Required:

a.Record the company's bad debt expense and write-offs in 2018. Identify the income statement impact of each entry.

b.Complete the aging table as of December 31, 2018.

c.What percentage of the total trade receivables is past due on December 31, 2018? What percentage of the total trade receivables is the allowance for doubtful accounts on December 31, 2017 and on December 31, 2018? Comment, briefly, on your answers to this item.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As of December 31, 2018, and 2017 and for the three years in the period ended December 31, 2018 (amounts are expressed in thousands of U.S. dollars)

NOTE 11 - TRADE RECEIVABLES

As of December 31,

2018

2017

Trade Receivables

114,855

80,687

Less: Allowance for doubtful accounts

(3,957)

(609)

TOTAL

110,898

80,078

.

Allowance for doubtful accounts

Thefollowingtables detail therisk profileof tradereceivables based on theCompany's provision matrixas of December 31, 2018 and 2017.

December 31, 2018Trade receivables - days past due

< 30

31 - 60

61 - 90

91-120

> 120

Total

Expected credit loss rate

%

1.90

%

4.40

%

11.90

%

85.90

%

Estimated total gross carrying amount

17,815

6,843

2,778

3,801

34,051

Lifetime ECL

107

331

3,957

December 31, 2017Trade receivables - days past due

< 30

31 - 60

61 - 90

91-120

> 120

Total

Expected credit loss rate

0.19

%

0.84

%

2.74

%

8.58

%

100.00

%

Estimated total gross carrying amount

18,513

4,140

878

902

438

24,871

Lifetime ECL

35

35

24

77

438

609

The following table shows the movement in ECL that has been recognized for trade receivables:

As of December 31,

2018

2017

2019

Balance at beginning of year

(609)

(617)

(438)

Additions, net of recoveries

(3,421)

5

(928)

Write-off of receivables

73

3

749

Balance at end of year

(3,957)

(609)

(617)