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Device Payment Plan and Wireless Service Receivables (Tables)

9 Months Ended

Sep. 30, 2020

The following table presents information about accounts receivable, net of allowances, recorded in our condensed consolidated balance sheet:


	At September 30, 2020
(dollars in millions)	Device payment plan agreement		Wireless service		Other receivables⁽¹⁾		Total
Accounts receivable⁽²⁾	$	11,856	$	5,497	$	6,493	$	23,846
Less Allowance for credit losses	615		290		324		1,229
Accounts receivable, net of allowance	$	11,241	$	5,207	$	6,169	$	22,617

⁽¹⁾Other receivables primarily include wireline receivables, Verizon Media receivables and other receivables, the allowances for which are individually insignificant.

⁽²⁾Following the adoption of Topic 326 on January 1, 2020, accounts receivable are measured at amortized cost.

The following table displays device payment plan agreement receivables, net, recognized in our condensed consolidated balance sheets:


	At September 30,		At December 31,
(dollars in millions)	2020		2019⁽¹⁾
Device payment plan agreement receivables, gross	$	16,597	$	19,493
Unamortized imputed interest	(424)		(454)
Device payment plan agreement receivables, at amortized cost	16,173		19,039
Allowance ⁽²⁾	(833)		(472)
Device payment plan agreement receivables, net	$	15,340	$	18,567

Classified in our condensed consolidated balance sheets:
Accounts receivable, net	$	11,241	$	13,045
Other assets	4,099		5,522
Device payment plan agreement receivables, net	$	15,340	$	18,567

⁽¹⁾ Balances reflected are prior to the adoption of Topic 326 on January 1, 2020.

(2) Includes allowance for both short-term and long-term device payment plan agreement receivables. The allowance at September 30, 2020 and December 31, 2019 relate to our provision for credit losses and doubtful accounts, respectively.

Financing Receivable Credit Quality Indicators

The following table presents device payment plan agreement receivables, at amortized cost, as of September 30, 2020, by credit quality indicator and year of origination:


	Year of Origination
(dollars in millions)	2020		2019		2018		Prior to 2018⁽¹⁾		Total
New customers	$	1,332	$	1,132	$	54	$	42	$	2,560
Existing customers	7,180		6,019		386		28		13,613
Total	$	8,512	$	7,151	$	440	$	70	$	16,173

⁽¹⁾ Includes accounts that have been suspended at a point in time.

The data presented in the table above was last updated on September 30, 2020.

Activity in Allowance for Credit Losses for Device Payment Plan Agreement Receivables

Activity in the allowance for credit losses by portfolio segment of receivables were as follows:


(dollars in millions)	Device Payment Plan Agreement Receivables⁽¹⁾		Wireless Service Plan Receivables
Balance at January 1, 2020	$	472	$	156
Opening balance sheet adjustment related to Topic 326 adoption	265		—
Adjusted opening balance, January 1, 2020	737		156
Current period provision for expected credit losses	561		342
Write-offs charged against the allowance	(501)		(256)
Recoveries collected	36		48
Balance at September 30, 2020	$	833	$	290

⁽¹⁾ Includes allowance for both short-term and long-term device payment plan agreement receivables.

Balance and Aging of Device Payment Plan Agreement Receivables on Gross Basis

The balance and aging of the device payment plan agreement receivables, at amortized cost, were as follows:


	At September 30,
(dollars in millions)	2020
Unbilled	$	15,042
Billed:
Current	961
Past due	170
Device payment plan agreement receivables, at amortized cost	$	16,173