Company: DXPE
Filing Date: 2025-03-10
Form Type: 10-K
Source: 0001020710-25-000036
Chunk: 63

Company: DXP ENTERPRISES INC
Filing Date: 2025-03-10
Form: 10-K
Item: Item 8
Chunk 63
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 of such accounts under the current expected credit losses model. The Company writes-off uncollectible trade accounts receivable when the accounts are determined to be uncollectible. No customer represents more than 10% of consolidated sales.Changes in this allowance for 2024 and 2023 are as follows (in thousands): 20242023Beginning balance, January 1$5,584 $7,610 (Recoveries) Charges to expense(887)(885)Foreign currency translation(42)13 Write-offs517 (1,154)Ending balance, December 31$5,172  $5,584 InventoriesInventories are made up of equipment purchased for resale, and materials utilized in the fabrication of industrial and wastewater equipment stated at lower of cost and net realizable value, primarily determined using the weighted average cost method. The Company regularly reviews inventory and records provisions for the difference between cost and net realizable value arising from excess and obsolete items on hand based upon the aging of the inventories, market trends, and continued demand.The carrying values of inventories are as follows (in thousands):December 31, 20242023Finished goods$89,780 $94,031 Work in process13,333 9,774 Inventories$103,113 $103,805 Property and EquipmentProperty and equipment are recorded on a historical cost basis. Depreciation of property and equipment is computed using the straight-line method over their estimated useful lives. Maintenance and repairs of depreciable assets are charged against earnings as incurred. When properties are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and gains or losses are credited or charged to earnings.

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The principal estimated useful lives used in determining depreciation are as follows:Buildings20-39 yearsBuilding improvements10-20 yearsFurniture, fixtures and equipment3-20 yearsLeasehold improvementsShorter of estimated useful life or related lease termImpairment of Goodwill and Other Intangible AssetsThe Company tests goodwill for impairment on an annual basis on October 1st and when events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company assigns the carrying value of these intangible assets to its reporting units and applies the test for goodwill at the reporting unit level. A reporting unit is defined as an operating segment or one level below a segment (a “component”) if the component is a business and discrete information is prepared and reviewed regularly by segment