v3.6.0.2

Balance Sheet Components | 12 Months Ended
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Dec. 31, 2016
Balance Sheet Components |
Balance Sheet Components | 5. Balance Sheet Components Allowance for Doubtful Accounts The following table presents a reconciliation of the allowance for doubtful accounts:
|  | December 31, |  | December 31, |
|  | 2016 |  | 2015 |
|  | (in thousands) |
Beginning balance |  | $ | 971 |  | $ | 527 |
Provision for estimated bad debts |  |  | 984 |  |  | 529 |
Write offs |  |  | (65) |  |  | (85) |
Ending balance |  | $ | 1,890 |  | $ | 971 |
Property and Equipment, net The Company’s property and equipment consisted of the following:
|  |  |  | December 31, |  | December 31, |
|  | Useful Life |  | 2016 |  | 2015 |
|  |  |  | (in thousands) |
Machinery and equipment |  | 3-5 years |  | $ | 27,303 |  | $ | 20,670 |
Furniture and fixtures |  | 3 years |  |  | 1,087 |  |  | 217 |
Computer equipment |  | 3 years |  |  | 861 |  |  | 911 |
Capitalized software held for internal use |  | 3 years |  |  | 2,172 |  |  | 1,037 |
Leasehold improvements |  | Life of lease |  |  | 10,444 |  |  | 1,686 |
Construction-in-process |  |  |  |  | 9,759 |  |  | 1,979 |
|  |  |  |  | 51,626 |  |  | 26,500 |
Less: Accumulated depreciation and amortization |  |  |  |  | (19,337) |  |  | (13,790) |
Total Property and equipment, net |  |  |  | $ | 32,289 |  | $ | 12,710 |
All of the Company’s long-lived assets are located in the United States. In September 2015, the Company paid off the Equipment Financing Facility, thus none of the Company's equipment is subject to pledge. The Company periodically evaluates the carrying value of long-lived assets when events or circumstances warrant such a review. The carrying value of a long-lived asset is considered impaired when the estimated realizable value of the asset is less than the carrying value of the asset. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined based on the estimated realizable value of the long-lived asset. The Company recorded asset impairment charges totaling $2.1 million in cost of product, licensing and other revenues in the statements of operations and comprehensive loss during the year ended December 31, 2016 following its impairment analysis on certain sequencing and automation equipment whose service lives were determined to be significantly shorter than initially expected. Total impairment charge of $2.1 million also included the write-off of $0.3 million unamortized maintenance service contract prepayments related to the impaired equipment described above. Those equipment were phased out in January 2017 as the Company began its transition to the next generation of sequencing and automation equipment to help streamline its production workflows. Another impairment charge of $0.2 million was recorded in general and administrative expenses in the statements of operations and comprehensive loss to write off the carrying value of an equipment that was not actively used in production. The Company recorded an asset impairment charge of $1.0 million against a specific group of machinery and equipment during the year ended December 31, 2015. The Company no longer uses this specific group of machinery and equipment because of outsourcing to its partners. The impairment charge was recorded to reflect reductions in the estimated realizable value of the machinery and equipment as a result of planning for its sale in the secondary market. The Company recorded the total impairment charge of $1.0 million in cost of product, licensing and other revenues. The Company sold some of the impaired machinery and equipment during the fourth quarter of 2015 for $0.5 million and classified the remaining impaired machinery and equipment as held for sale at the estimated realizable value of $0.2 million. The remaining impaired machinery was sold in January 2016 for $0.2 million. Other Assets In April 2016, the Company entered into a four-year agreement with an insurance carrier whereby in return for partial exclusivity and the right to pricing benefits the Company paid total consideration of $3.2 million. As of December 31, 2016, $2.6 million in deferred costs was included in other assets. The deferred costs are being amortized ratably over the four-year term of the agreement. During the year ended December 31, 2016, the Company has amortized $0.6 million of the deferred costs, which was recorded as a reduction of product revenues in the statements of operations and comprehensive loss. Accrued Compensation The Company’s accrued compensation consisted of the following:
|  | December 31, |  | December 31, |
|  | 2016 |  | 2015 |
|  | (in thousands) |
Accrued paid time off |  | $ | 1,892 |  | $ | 2,024 |
Accrued commissions |  |  | 3,868 |  |  | 3,691 |
Accrued bonuses |  |  | 2,387 |  |  | 1,348 |
Other accrued compensation |  |  | 2,920 |  |  | 1,489 |
Total accrued compensation |  | $ | 11,067 |  | $ | 8,552 |
Other Accrued Liabilities The Company’s other accrued liabilities consisted of the following:
|  | December 31, |  | December 31, |
|  | 2016 |  | 2015 |
|  | (in thousands) |
Overpayments from insurance carriers |  | $ | 7,535 |  | $ | 3,306 |
Other accrued expenses |  |  | 4,521 |  |  | 4,344 |
Testing and laboratory materials from suppliers |  |  | 3,804 |  |  | 7,736 |
Marketing and corporate affairs |  |  | 202 |  |  | 1,118 |
Leasehold improvement projects in progress |  |  | 1,659 |  |  | — |
Accrued specimen service fees |  |  | 469 |  |  | 454 |
Accrued shipping charges |  |  | 467 |  |  | 401 |
Sales tax payable |  |  | 459 |  |  | 346 |
Clinical trials and studies |  |  | 388 |  |  | 90 |
Accrued rent |  |  | 195 |  |  | 450 |
Legal, audit and consulting fees |  |  | 180 |  |  | 421 |
Deferred lease obligation |  |  | — |  |  | 42 |
Total other accrued liabilities |  | $ | 19,879 |  | $ | 18,708 |

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