7. Accounts and Notes Receivable:
The Company’s current trade accounts receivable consisted of the following (in thousands):
| AS OF SEPTEMBER 30, |
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| 2012 | 2011 | |||||||
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Trade accounts receivable |
$ | 16,509 | $ | 20,172 | ||||
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Allowance for doubtful accounts |
(280 | ) | (411 | ) | ||||
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| $ | 16,229 | $ | 19,761 | |||||
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The allowance for doubtful accounts represents the Company’s best estimate of probable credit losses. The Company determines the allowance based upon historical experience and a review of its balances. Accounts receivable balances are charged off against the allowance whenever it is probable that the receivable will not be recoverable. The Company does not have any off-balance-sheet credit exposure related to its customers.
Notes receivable are reflected in the following table (in thousands):
| September 30, 2012 |
September 30, 2011 |
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Notes receivable |
$ | 5,493 | $ | 5,806 | ||||
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Allowance for doubtful notes |
— | — | ||||||
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| 5,493 | 5,806 | |||||||
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Less current portion |
3,806 | 2,100 | ||||||
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| $ | 1,687 | $ | 3,706 | |||||
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Notes receivable are generally collateralized by the products sold, and bear interest at rates ranging up to 11.0% per year. The notes receivable of $5.5 million will be mature at various times through December 2015. The Company has, on occasion, extended or renewed notes receivable as they mature, but there is no obligation to do so.