Company: MGRC
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0000950170-25-023116
Chunk: 20

Company: MCGRATH RENTCORP
Filing Date: 2025-02-19
Form: 10-K
Item: Item 8
Chunk 20
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  These unbilled contract assets are included in Accounts receivable on the Company’s Consolidated Balance Sheets and totaled $13.0 million and $8.7 million at December 31, 2024 and 2023, respectively.  The Company did not recognize any material contract asset impairments during the years ended December 31, 2024 and 2023.The Company's uncompleted contracts with customers which meet the criteria for over-time revenue recognition have unsatisfied or partially satisfied performance obligations.  As of December 31, 2024, approximately $57.0 million of revenue is expected to be recognized for unsatisfied or partially satisfied obligations.  We expect to recognize revenue for approximately one half of these unsatisfied or partially satisfied performance obligations over the next 12 months, with the remaining balance recognized thereafter.  As of December 31, 2024, approximately $267.4 million of revenue was recognized for sales and non-lease services transferred at a point in time and approximately $51.7 million of revenue was recognized for sales and non-lease services transferred over time. The Company generally rents and sells to customers on 30 day payment terms.  The Company does not typically offer variable payment terms, or accept non-monetary consideration.  Amounts billed and due from the Company’s customers are classified as Accounts receivable on the Company’s Consolidated Balance Sheets.  For certain sales of modular buildings, progress payments from the customer are received during the manufacturing of new equipment, or the preparation of used equipment.  The advance payments are not considered a significant financing component because the payments are used to meet working capital needs during the contract and to protect the Company from the customer failing to adequately complete their obligations under the contract. Lease RevenuesRental revenues from operating leases are recognized on a straight-line basis over the term of the lease for all operating segments.  Rental billings for periods extending beyond period end are recorded as deferred income and are recognized in the period earned.  Rental related services revenues are primarily associated with relocatable modular building and portable storage container leases.  For modular building leases, rental related services revenues for modifications, delivery, installation, dismantle and return delivery are lease related because the payments are considered minimum lease payments that are an integral part of the negotiated lease agreement with the customer.  These revenues are recognized on a straight-line basis over the term of the lease. Certain leases are accounted for as 

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sales-type leases.  For these leases, sales revenue and the related accounts receivable are