The information on the next two pages is taken from the disclosures on accounts receivable in the 2018 financial statements of Cementos Pacasmayo, a cement company from Peru and one of the country's largest employers. Answer all of the following questionsusing the data for total receivables classified as financial assets, and only those. Be careful to interpret the data correctly. All amounts are in thousands of Peruvian soles.

a.Record the changes in the allowance for doubtful accounts in 2018, excluding recoveries. State the income statement impact of each entry.

b.Calculate the probability, given the data provided, that a receivable outstanding at the end of 2018 will become uncollectible. Do the same calculation for 2017 and compare.

c.Consider the probability of non-collection for past-due receivables only. Explain, with reference to the data, whether this probability (on average across all past-due balances) should have increased or decreased from 2017 to 2018. Explain whether and why your conclusion differs from the change in the default probability for total receivables, as calculated above. Assume that the company has not changed its accounting policies since 2017.

Trade receivables (b) 77,083 81,299 Indemnification from insurance 10,366 9,380 - Other receivables from sale of fixed assets 3,967 3,574 923 3,221 Accounts receivable from Parent company 3,209 1,372 and affiliates, note 27 Loans to employees 1,032 1,091 - Interests receivables, note 6(c) 164 159 - Funds restricted to tax payments 331 73 - Other accounts receivable 3,353 2,036 - Allowance for expected credit losses (c) (2,295 (1,685) - Financial assets classified as receivables (d) 97,210 97,299 923 3,221 Value-added tax credit 2,308 2,177 3,402 3,745 Tax refund receivable 206 42 9,241 9,241 Allowance for expected credit losses (c) 9,034) Non-financial assets classified as receivables 2,514 2,219 3,609 12,986 99,724 99,518 4,532 16,207(c) The movement of the allowance for expected credit losses is as follows: 2018 2017 2016 81(000) 811000) 81(000) Opening balance 1,685 781 667 Additions 9,717 1.190 114 Recoveries (62) Write-off (1 1 ) (286) Ending balance 11,329 1,685 781 As of December 31 , 2018. the additions include 819,034,000 related to the allowance for expected credit losses for other receivables (see note 23), and 811383.000 related to the allowance for expected credit losses for trade receivables (811,190,000 as of December 31, 2017), which are presented in the sales line of the consolidated statement of profit or loss. (d) The aging analysis of trade and other accounts receivable as of December 31 , 2018 and 2017, is as follows: Past due but not impaired Total Neither past due 120 nor impaired days days days days days 84000) 34000) 34000) 81(000) 81(000) 81(000) 34000) 2018 98.133 29.346 43.441 9.303 3.364 620 12.059 2017 100,520 79,795 7,549 1.612 1,710 453 9,401 See Note 31 on credit risk of trade receivables. which explains how the Group manages and measures credit quality of trade receivables that are neither past due nor impaired