Audiovox 2004 Annual Report Download - page 81

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AUDIOVOX CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements, Continued
November 30, 2002, 2003 and 2004
(Dollars in thousands, except share and per share data)
(b) Gain on Sale of Cellular Business
As a result of the sale of the Cellular business, the Company recorded
a gain of $67,000 for the year ended November 30, 2004 which was
calculated as follows:
Purchase Price $165,170
Working capital adjustment 8,472
Less: payment to former Cellular employees 25,019
Less: professional fees incurred in conjunction with
divestiture 4,603
Less: net assets sold 49,598
Less: non−cash charge for stock options 98
Non−cash cumulative translation gains 914
Gain on purchase of Toshiba minority interest 8,073
Less: estimated taxes 36,311
−−−−−−−−
Gain on sale of Cellular business, included in discontinued
operations $ 67,000
========
(c) Financial Presentation of Discontinued Operations
In accordance with SFAS No. 144, the Company has assessed the
measurement date in accounting for the sale transaction on June 11,
2004 in connection with the date of board approval and signing of the
Agreement. Accordingly, the Company reclassified all associated assets
and liabilities as discontinued operations and recorded the results of
Cellular as a discontinued operation for all periods presented. The
following sets forth the carrying amounts of the major classes of
assets and liabilities of ACC, which are classified as assets and
liabilities of discontinued operations in the accompanying
consolidated balance sheets.
November 30,
−−−−−−−−−−−−−−−−−−−−−−−−−−
2003 2004
−−−−−−−− −−−−−−−−
Assets
Accounts receivable, net $124,560 $ 16,958
Inventory 66,902 −−
Receivables from vendors 3,367 −−
Prepaid expenses and other current assets 2,727 −−
−−−−−−−− −−−−−−−−
Current assets of discontinued operations $197,556 $ 16,958
======== ========
Property, plant and equipment, net $ 1,644 −−
Other assets 66 −−
−−−−−−−− −−−−−−−−
Non−current assets of discontinued operations $ 1,710 −−
======== ========
78