Garmin 2009 Annual Report Download - page 90

72
Inventories
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Inventoriesarestatedatthelowerofcostormarket.Costisdeterminedusingtheweighted‐average
method(whichapproximatesthefirst‐in,first‐out(FIFO)method)byGCandtheFIFOmethodbyGII,GATandGEL.
Inventoriesconsistedofthefollowing:
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December 26, December 27,
2009 2008
Raw materials $80,963 $151,132
Work-in-process 32,587 28,759
Finished goods 235,286 268,625
Inventory reserves (38,898) (23,204)
$309,938 $425,312
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PropertyandEquipment
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Propertyandequipmentarerecordedatcostanddepreciatedusingthestraight‐linemethodoverthe
followingestimatedusefullives:
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Buildingsandimprovements 39
Officefurnitureandequipment 5
Manufacturingandengineeringequipment 5
Vehicles 5
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Long‐LivedAssets
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AsrequiredbytheProperty,PlantandEquipmenttopicoftheFASBASC,theCompanyreviewslong‐lived
assetsforimpairmentwhenevereventsorchangesincircumstancesindicatethecarryingamountofanassetmay
notbefullyrecoverable.Thecarryingamountofalong‐livedassetisnotrecoverableifitexceedsthesumofthe
undiscountedcashflowsexpectedtoresultfromtheuseandeventualdispositionoftheasset.Thatassessmentis
basedonthecarryingamountoftheassetatthedateitistestedforrecoverability.Animpairmentlossis
measuredastheamountbywhichthecarryingamountofalong‐livedassetexceedsitsfairvalue.
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TheIntangibles–GoodwillandOthertopicoftheFASBASCrequiresthatgoodwillandintangibleassets
withindefiniteusefullivesshouldnotbeamortizedbutratherbetestedforimpairmentatleastannuallyorsooner
whenevereventsorchangesincircumstancesindicatethattheymaybeimpaired.TheCompanydidnotrecognize
anygoodwillorintangibleassetimpairmentchargesin2009,2008,or2007.TheCompanyestablishedreporting
unitsbasedonitscurrentreportingstructure.Forpurposesoftestinggoodwillforimpairment,goodwillhasbeen
allocatedtothesereportingunitstotheextentitrelatestoeachreportingunit. Theaccountingguidancealso
requiresthatintangibleassetswithdefinitelivesbeamortizedovertheirestimatedusefullivesandreviewedfor
impairment.TheCompanyiscurrentlyamortizingitsacquiredintangibleassetswithdefinitelivesoverperiods
rangingfrom3to10years.
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Dividends
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OnJuly30,2009theBoardofDirectorsdeclaredadividendof$0.75persharetobepaidonDecember
15,2009toshareholdersofrecordonDecember1,2009.TheCompanypaidoutadividendintheamountof
$149,846.Thedividendhasbeenreportedasareductionofretainedearnings.
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