Pep Boys 2013 Annual Report Download - page 132

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THE PEP BOYS—MANNY, MOE & JACK AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Years ended February 1, 2014, February 2, 2013 and January 28, 2012
NOTE 11—STORE CLOSURES AND ASSET IMPAIRMENTS (Continued)
A store is classified as held for disposal when (i) the Company has committed to a plan to sell,
(ii) the building is vacant and the property is available for sale, (iii) the Company is actively marketing
the property for sale, (iv) the sale price is reasonable in relation to its current fair value and (v) the
Company expects to complete the sale within one year. Assets held for disposal have been valued at
the lower of their carrying amount or their estimated fair value, net of disposal costs. The fair value of
these assets is estimated using readily available market data for comparable properties and is classified
as a Level 2 (as described in Note 16, ‘‘Fair Value Measurements’’) measure within the fair value
hierarchy. No depreciation expense is recognized during the period the asset is held for disposal.
During fiscal 2013, the Company had four stores classified as assets held for disposal, which are as
follows:
Year Ended
February 1,
(dollar amounts in thousands) 2014
Land.................................................. $1,348
Building and improvements .................................. 3,946
Accumulated depreciation ................................... (3,281)
Property and equipment—net ................................ $2,013
Number of properties ...................................... 4
The Company classifies the four properties as held for disposal as the Company continues to
actively market the properties at prices the Company believes reasonable given current market
conditions and expects to sell these properties within the next twelve months. In addition, during fiscal
2013, the Company recorded $0.9 million of impairment charges related to four stores classified as held
for disposal of which $0.7 million was charged to merchandise cost of sales and $0.2 was charged to
service cost of sales. There were no stores classified as held for disposal in fiscal 2012.
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