Accounts Receivable - Current and Long Term

9 Months Ended

Sep. 30, 2011

Accounts Receivable - Current and Long Term [Abstract]

ACCOUNTS RECEIVABLE - CURRENT AND LONG TERM

NOTE — 3 ACCOUNTS RECEIVABLE — CURRENT AND LONG TERM

The Company sells a significant amount of its product on credit terms to its major distributors. The Company estimates losses from the inability of its customers to make payments on amounts billed. A majority of credit sales are due within sixty days from invoicing. In 2010, the Company shipped a significant order to a major international distributor. At the time of the shipment, regulatory approval to sell the product in the respective country was in process. Obtaining such regulatory approval was not a condition of the purchase order and sale to the distributor. The regulatory approval has been delayed and as such the customer has not paid the full amount of the invoiced shipment. The Company is receiving periodic payments from the international distributor. Based on the periodic payment plan prepared by the international distributor, the Company has recorded a long term net accounts receivable of $257,160 as of September 30, 2011 and $361,160 at December 31, 2010. The current portion of this net accounts receivable was approximately $163,000 and $163,000 at September 30, 2011 and December 31, 2010, respectively. The Company reserved $552,000 of the total accounts receivable from this distributor at September 30, 2011 and $636,000 at December 31, 2010.