the company 's class 8 truck sales accounted for 5.2 % of the u.s. class 8 retail truck sales market in 2011. the increase in the class 8 truck sales was primarily the result of continued strong demand by oilfield services customers and replacement purchases by large fleet customers . similarly , rush 's u.s. class 4 through 7 medium-duty commercial vehicle sales were up 94 % over 2010 , significantly outpacing the u.s. class 4 through 7 market , which increased by 23 % . rush 's medium-duty retail sales accounted for 3.8 % of u.s. class 4 through 7 retail sales in 2011. the majority of our medium-duty growth was achieved through navistar division dealerships and ford and isuzu dealerships in texas , florida , oklahoma and california that were acquired during 2010 and 2011. the company continues to pursue its acquisition strategy . in the fourth quarter , the company purchased certain assets of west texas peterbilt , which included five locations in west texas , and peck road ford in whittier , california . the company now operates five ford franchises and sixteen isuzu franchises in its network of rush truck centers . the acquisition of west texas peterbilt expanded the company 's representation of peterbilt in texas to include the entire state . improvements to the company 's existing network of rush truck centers continue . the company relocated its dealerships in ft. worth , texas and orlando , florida at the end of 2011. in 2012 , the company plans to relocate its phoenix , arizona , open a new rush bus center in houston to better serve its bus customers in the houston market and construct a new dealership facility in corpus christi , texas . in 2011 , the company also expanded operations to take advantage of strong demand for ancillary services not traditionally performed by truck dealerships . the company leased a 237,000 square foot facility in houston to support demand from several long-term oilfield services customers for oilfield vehicle preparation and service , and also established a new 50,000 square foot modification center in the dallas area . the company continues to evaluate opportunities to expand its navistar division . the 17 locations in the navistar division have now become a solid contributor to the company 's overall profitability and represent a significant opportunity to enlarge the network of rush truck centers . the company remains committed to work with navistar to expand its navistar division . key performance indicator absorption rate . management uses several performance metrics to evaluate the performance of its commercial vehicle dealerships , and considers rush truck centers ' absorption rate to be of critical importance . absorption rate is calculated by dividing the gross profit from the parts , service and body shop departments by the overhead expenses of all of a dealership 's departments , except for the selling expenses of the new and used commercial vehicle departments and carrying costs of new and used commercial vehicle inventory . when 100 % absorption is achieved , then gross profit from the sale of a commercial vehicle , after sales commissions and inventory carrying costs , directly impacts operating profit . in 1999 , the company 's commercial vehicle dealerships ' absorption rate was approximately 80 % . the company has made a concerted effort to increase its absorption rate since 1999. the company 's commercial vehicle dealerships achieved a 113.9 % absorption rate for the year in 2011 and 105.5 % absorption rate for the year in 2010 . 24 critical accounting policies and estimates the company 's discussion and analysis of its financial condition and results of operations are based on the company 's consolidated financial statements , which have been prepared in accordance with u.s. generally accepted accounting principles . the preparation of these consolidated financial statements requires the company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period . there can be no assurance that actual results will not differ from those estimates . the company believes the following accounting policies , which are also described in note 2 of the notes to the consolidated financial statements , affect its more significant judgments and estimates used in the preparation of its consolidated financial statements . inventories inventories are stated at the lower of cost or market value . cost is determined by specific identification of new and used commercial vehicles inventory and by the first-in , first-out method for tires , parts and accessories . as the market value of our inventory typically declines over time , reserves are established based on historical loss experience and market trends . these reserves are charged to cost of sales and reduce the carrying value of our inventory on hand . an allowance is provided when it is anticipated that cost will exceed net realizable value plus a reasonable profit margin . goodwill goodwill and other intangible assets that have indefinite lives are not amortized but instead are tested at least annually by reporting unit for impairment , or more frequently when events or changes in circumstances indicate that the asset might be impaired . goodwill is reviewed for impairment utilizing a two-step process . the first step requires the company to compare the fair value of the reporting unit , which is the same as the segment , to the respective carrying value . the company considers its segment to be a reporting unit for purposes of this analysis . if the fair value of the reporting unit exceeds its carrying value , the goodwill is not considered impaired . if the carrying value is greater than the fair value , there is an indication that an impairment may exist and a second step is required . story_separator_special_tag 29 the company sold 4,649 used commercial vehicles in 2011 , a 34.3 % increase compared to 3,461 used commercial vehicles in 2010. the company expects to sell approximately 5,200 to 6,000 used commercial vehicles in 2012. the company expects used commercial vehicle sales to be largely dependent upon our ability to acquire quality used commercial vehicles and maintain an adequate used commercial vehicle inventory throughout 2012. truck lease and rental revenues increased $ 16.0 million , or 23.7 % , in 2011 , compared to 2010. the increase in lease and rental revenue is consistent with management 's expectations , which are based upon the increased number of units put into service in the lease and rental fleet during 2010 and 2011 and increasing rental fleet utilization . the company expects lease and rental revenue to increase 20 % to 25 % during 2012 , compared to 2011 based on the increase of units in the lease and rental fleet . finance and insurance revenues increased $ 2.9 million , or 37.2 % , in 2011 , compared to 2010. the increase in finance and insurance revenue is primarily a result of the increase in new and used commercial vehicle sales . the company expects finance and insurance revenue to fluctuate proportionately with the company 's new and used commercial vehicle sales in 2012. finance and insurance revenues have limited direct costs and , therefore , contribute a disproportionate share of the company 's operating profits . other income increased $ 2.3 million , or 34.7 % in 2011 , compared to 2010. other income consists primarily of the gain on sale realized on trucks from the lease and rental fleet , document fees related to commercial vehicle sales and mineral royalties . gross profit gross profit increased $ 138.4 million , or 48.6 % , in 2011 , compared to 2010. gross profit as a percentage of sales decreased to 16.4 % in 2011 , from 19.0 % in 2010. this decrease in gross profit as a percentage of sales is primarily a result of a change in our product sales mix . commercial vehicle sales , a lower margin revenue item , increased as a percentage of total revenue to 69.8 % in 2011 , from 61.9 % in 2010. parts and service revenue , a higher margin revenue item , decreased as a percentage of total revenue to 26.2 % in 2011 , from 32.7 % in 2010. gross margins from the company 's parts , service and body shop operations increased to 39.5 % in 2011 , from 38.5 % in 2010. gross profit for the parts , service and body shop departments increased to $ 266.7 million in 2011 , from $ 188.5 million in 2010. the company expects gross margins on parts , service and body shop operations to range 39.0 % to 41.0 % in 2012. gross margins on class 8 truck sales decreased to 7.1 % in 2011 , from 7.4 % in 2010. in 2012 , the company expects overall gross margins from class 8 truck sales of approximately 6.5 % to 7.5 % . the company recorded expense of $ 1.6 million to increase its new heavy-duty truck valuation allowance in 2011 and $ 1.9 million in 2010. gross margins on medium-duty commercial vehicle sales decreased to 4.8 % in 2011 , from 5.6 % in 2010. gross margins on medium-duty commercial vehicles are difficult to forecast accurately because gross margins vary significantly depending upon the mix of fleet and non-fleet purchasers and types of medium-duty commercial vehicles sold . for 2012 , the company expects overall gross margins from medium-duty commercial vehicle sales of approximately 4.5 % to5.5 % , but this will largely depend upon general economic conditions and the mix of purchasers and types of vehicles sold . the company recorded expense of $ 1.9 million to increase its new medium-duty commercial vehicle valuation allowance in 2011 and $ 0.6 million in 2010. gross margins on used commercial vehicle sales decreased to 9.4 % in 2011 , from 12.2 % in 2010. in 2012 , the company expects margins on used commercial vehicles to remain between 8.0 % and 10.0 % , but this will largely depend upon general economic conditions and the availability of quality used vehicles . the company recorded expense of $ 2.3 million to increase its used commercial vehicle valuation allowance in 2011 and $ 1.5 million in 2010. gross margins from truck lease and rental sales increased to 16.5 % in 2011 , from approximately 14.9 % in 2010. the increase in lease and rental gross profit is primarily attributable to increased utilization of vehicles in the company 's rental fleet and increased variable rental revenue that is based on the miles that vehicles being leased are driven . the company expects gross margins from lease and rental sales of approximately 16.0 % to 18.0 % during 2012. the company 's policy is to depreciate its lease and rental fleet using a straight line method over the customer 's contractual lease term . the lease unit is depreciated to a residual value that approximates fair value at the expiration of the lease term . this policy results in the company realizing reasonable gross margins while the unit is in service and a corresponding gain or loss on sale when the unit is sold at the end of the lease term . 30 finance and insurance revenues and other income , as described above , have limited direct costs and , therefore , contribute a disproportionate share of gross profit . selling , general and administrative expenses selling , general and administrative ( sg & a ) expenses increased $ 78.8 million , or 34.6 % , in 2011 , compared to 2010. sg & a expenses as a percentage of total revenue decreased to 11.9 % in 2011 , from 15.2 % in 2010. sg & a expenses as a percentage

cash flows cash and cash equivalents increased by $ 38.8 million during the year ended december 31 , 2011 , and increased by $ 19.9 million during the year ended december 31 , 2010. the major components of these changes are discussed below . cash flows from discontinued operations are included in the components of the statement of cash flows as described below . cash flows from operating activities cash flows from operating activities include net income adjusted for non-cash items and the effects of changes in working capital . during 2011 , operating activities resulted in net cash used in operations of $ 81.4 million . cash used in operating activities was primarily impacted by the increased levels of inventory and the increase in accounts receivable , offset by increases in accounts payable and accrued expenses . the majority of commercial vehicle inventory is financed through the company 's floor plan credit agreement . during 2010 , operating activities resulted in net cash provided by operations of $ 66.4 million . cash flows from operating activities as adjusted for all draws and ( payments ) on floor plan notes ( adjusted cash flows from operating activities ) was $ 188.3 million for the year ended december 31 , 2011 , and $ 110.2 million for the year ended december 31 , 2010. generally , all vehicle dealers finance the purchase of vehicles with floor plan borrowings , and our agreements with our floor plan providers require us to repay amounts borrowed for the purchase of such vehicles immediately after they are sold . as a result , changes in floor plan notes payable are directly linked to changes in vehicle inventory . however , as reflected in our consolidated statements of cash flows , changes in inventory are recorded as cash flows from operating activities , and draws and ( payments ) on floor plan notes are recorded as cash flows from financing activities .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```cash flows cash and cash equivalents increased by $ 38.8 million during the year ended december 31 , 2011 , and increased by $ 19.9 million during the year ended december 31 , 2010. the major components of these changes are discussed below . cash flows from discontinued operations are included in the components of the statement of cash flows as described below . cash flows from operating activities cash flows from operating activities include net income adjusted for non-cash items and the effects of changes in working capital . during 2011 , operating activities resulted in net cash used in operations of $ 81.4 million . cash used in operating activities was primarily impacted by the increased levels of inventory and the increase in accounts receivable , offset by increases in accounts payable and accrued expenses . the majority of commercial vehicle inventory is financed through the company 's floor plan credit agreement . during 2010 , operating activities resulted in net cash provided by operations of $ 66.4 million . cash flows from operating activities as adjusted for all draws and ( payments ) on floor plan notes ( adjusted cash flows from operating activities ) was $ 188.3 million for the year ended december 31 , 2011 , and $ 110.2 million for the year ended december 31 , 2010. generally , all vehicle dealers finance the purchase of vehicles with floor plan borrowings , and our agreements with our floor plan providers require us to repay amounts borrowed for the purchase of such vehicles immediately after they are sold . as a result , changes in floor plan notes payable are directly linked to changes in vehicle inventory . however , as reflected in our consolidated statements of cash flows , changes in inventory are recorded as cash flows from operating activities , and draws and ( payments ) on floor plan notes are recorded as cash flows from financing activities .
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 Suspicious Activity Report : the company 's class 8 truck sales accounted for 5.2 % of the u.s. class 8 retail truck sales market in 2011. the increase in the class 8 truck sales was primarily the result of continued strong demand by oilfield services customers and replacement purchases by large fleet customers . similarly , rush 's u.s. class 4 through 7 medium-duty commercial vehicle sales were up 94 % over 2010 , significantly outpacing the u.s. class 4 through 7 market , which increased by 23 % . rush 's medium-duty retail sales accounted for 3.8 % of u.s. class 4 through 7 retail sales in 2011. the majority of our medium-duty growth was achieved through navistar division dealerships and ford and isuzu dealerships in texas , florida , oklahoma and california that were acquired during 2010 and 2011. the company continues to pursue its acquisition strategy . in the fourth quarter , the company purchased certain assets of west texas peterbilt , which included five locations in west texas , and peck road ford in whittier , california . the company now operates five ford franchises and sixteen isuzu franchises in its network of rush truck centers . the acquisition of west texas peterbilt expanded the company 's representation of peterbilt in texas to include the entire state . improvements to the company 's existing network of rush truck centers continue . the company relocated its dealerships in ft. worth , texas and orlando , florida at the end of 2011. in 2012 , the company plans to relocate its phoenix , arizona , open a new rush bus center in houston to better serve its bus customers in the houston market and construct a new dealership facility in corpus christi , texas . in 2011 , the company also expanded operations to take advantage of strong demand for ancillary services not traditionally performed by truck dealerships . the company leased a 237,000 square foot facility in houston to support demand from several long-term oilfield services customers for oilfield vehicle preparation and service , and also established a new 50,000 square foot modification center in the dallas area . the company continues to evaluate opportunities to expand its navistar division . the 17 locations in the navistar division have now become a solid contributor to the company 's overall profitability and represent a significant opportunity to enlarge the network of rush truck centers . the company remains committed to work with navistar to expand its navistar division . key performance indicator absorption rate . management uses several performance metrics to evaluate the performance of its commercial vehicle dealerships , and considers rush truck centers ' absorption rate to be of critical importance . absorption rate is calculated by dividing the gross profit from the parts , service and body shop departments by the overhead expenses of all of a dealership 's departments , except for the selling expenses of the new and used commercial vehicle departments and carrying costs of new and used commercial vehicle inventory . when 100 % absorption is achieved , then gross profit from the sale of a commercial vehicle , after sales commissions and inventory carrying costs , directly impacts operating profit . in 1999 , the company 's commercial vehicle dealerships ' absorption rate was approximately 80 % . the company has made a concerted effort to increase its absorption rate since 1999. the company 's commercial vehicle dealerships achieved a 113.9 % absorption rate for the year in 2011 and 105.5 % absorption rate for the year in 2010 . 24 critical accounting policies and estimates the company 's discussion and analysis of its financial condition and results of operations are based on the company 's consolidated financial statements , which have been prepared in accordance with u.s. generally accepted accounting principles . the preparation of these consolidated financial statements requires the company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period . there can be no assurance that actual results will not differ from those estimates . the company believes the following accounting policies , which are also described in note 2 of the notes to the consolidated financial statements , affect its more significant judgments and estimates used in the preparation of its consolidated financial statements . inventories inventories are stated at the lower of cost or market value . cost is determined by specific identification of new and used commercial vehicles inventory and by the first-in , first-out method for tires , parts and accessories . as the market value of our inventory typically declines over time , reserves are established based on historical loss experience and market trends . these reserves are charged to cost of sales and reduce the carrying value of our inventory on hand . an allowance is provided when it is anticipated that cost will exceed net realizable value plus a reasonable profit margin . goodwill goodwill and other intangible assets that have indefinite lives are not amortized but instead are tested at least annually by reporting unit for impairment , or more frequently when events or changes in circumstances indicate that the asset might be impaired . goodwill is reviewed for impairment utilizing a two-step process . the first step requires the company to compare the fair value of the reporting unit , which is the same as the segment , to the respective carrying value . the company considers its segment to be a reporting unit for purposes of this analysis . if the fair value of the reporting unit exceeds its carrying value , the goodwill is not considered impaired . if the carrying value is greater than the fair value , there is an indication that an impairment may exist and a second step is required . story_separator_special_tag 29 the company sold 4,649 used commercial vehicles in 2011 , a 34.3 % increase compared to 3,461 used commercial vehicles in 2010. the company expects to sell approximately 5,200 to 6,000 used commercial vehicles in 2012. the company expects used commercial vehicle sales to be largely dependent upon our ability to acquire quality used commercial vehicles and maintain an adequate used commercial vehicle inventory throughout 2012. truck lease and rental revenues increased $ 16.0 million , or 23.7 % , in 2011 , compared to 2010. the increase in lease and rental revenue is consistent with management 's expectations , which are based upon the increased number of units put into service in the lease and rental fleet during 2010 and 2011 and increasing rental fleet utilization . the company expects lease and rental revenue to increase 20 % to 25 % during 2012 , compared to 2011 based on the increase of units in the lease and rental fleet . finance and insurance revenues increased $ 2.9 million , or 37.2 % , in 2011 , compared to 2010. the increase in finance and insurance revenue is primarily a result of the increase in new and used commercial vehicle sales . the company expects finance and insurance revenue to fluctuate proportionately with the company 's new and used commercial vehicle sales in 2012. finance and insurance revenues have limited direct costs and , therefore , contribute a disproportionate share of the company 's operating profits . other income increased $ 2.3 million , or 34.7 % in 2011 , compared to 2010. other income consists primarily of the gain on sale realized on trucks from the lease and rental fleet , document fees related to commercial vehicle sales and mineral royalties . gross profit gross profit increased $ 138.4 million , or 48.6 % , in 2011 , compared to 2010. gross profit as a percentage of sales decreased to 16.4 % in 2011 , from 19.0 % in 2010. this decrease in gross profit as a percentage of sales is primarily a result of a change in our product sales mix . commercial vehicle sales , a lower margin revenue item , increased as a percentage of total revenue to 69.8 % in 2011 , from 61.9 % in 2010. parts and service revenue , a higher margin revenue item , decreased as a percentage of total revenue to 26.2 % in 2011 , from 32.7 % in 2010. gross margins from the company 's parts , service and body shop operations increased to 39.5 % in 2011 , from 38.5 % in 2010. gross profit for the parts , service and body shop departments increased to $ 266.7 million in 2011 , from $ 188.5 million in 2010. the company expects gross margins on parts , service and body shop operations to range 39.0 % to 41.0 % in 2012. gross margins on class 8 truck sales decreased to 7.1 % in 2011 , from 7.4 % in 2010. in 2012 , the company expects overall gross margins from class 8 truck sales of approximately 6.5 % to 7.5 % . the company recorded expense of $ 1.6 million to increase its new heavy-duty truck valuation allowance in 2011 and $ 1.9 million in 2010. gross margins on medium-duty commercial vehicle sales decreased to 4.8 % in 2011 , from 5.6 % in 2010. gross margins on medium-duty commercial vehicles are difficult to forecast accurately because gross margins vary significantly depending upon the mix of fleet and non-fleet purchasers and types of medium-duty commercial vehicles sold . for 2012 , the company expects overall gross margins from medium-duty commercial vehicle sales of approximately 4.5 % to5.5 % , but this will largely depend upon general economic conditions and the mix of purchasers and types of vehicles sold . the company recorded expense of $ 1.9 million to increase its new medium-duty commercial vehicle valuation allowance in 2011 and $ 0.6 million in 2010. gross margins on used commercial vehicle sales decreased to 9.4 % in 2011 , from 12.2 % in 2010. in 2012 , the company expects margins on used commercial vehicles to remain between 8.0 % and 10.0 % , but this will largely depend upon general economic conditions and the availability of quality used vehicles . the company recorded expense of $ 2.3 million to increase its used commercial vehicle valuation allowance in 2011 and $ 1.5 million in 2010. gross margins from truck lease and rental sales increased to 16.5 % in 2011 , from approximately 14.9 % in 2010. the increase in lease and rental gross profit is primarily attributable to increased utilization of vehicles in the company 's rental fleet and increased variable rental revenue that is based on the miles that vehicles being leased are driven . the company expects gross margins from lease and rental sales of approximately 16.0 % to 18.0 % during 2012. the company 's policy is to depreciate its lease and rental fleet using a straight line method over the customer 's contractual lease term . the lease unit is depreciated to a residual value that approximates fair value at the expiration of the lease term . this policy results in the company realizing reasonable gross margins while the unit is in service and a corresponding gain or loss on sale when the unit is sold at the end of the lease term . 30 finance and insurance revenues and other income , as described above , have limited direct costs and , therefore , contribute a disproportionate share of gross profit . selling , general and administrative expenses selling , general and administrative ( sg & a ) expenses increased $ 78.8 million , or 34.6 % , in 2011 , compared to 2010. sg & a expenses as a percentage of total revenue decreased to 11.9 % in 2011 , from 15.2 % in 2010. sg & a expenses as a percentage

