Audiovox 2005 Annual Report Download - page 72

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NOVEMBER 30, 2005
−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−−
GROSS ACCUMULATED TOTAL NET
CARRYING
VALUE AMORTIZATION BOOK VALUE
−−−−−−−−−−−−− −−−−−−−−−−−−−−−−−− −−−−−−−−−−−−−−−
Patents subject to amortization $ 150 $ 15 $ 35
Trademarks/Tradenames not subject to
amortization 10,042 − 10,042
Contract subject to amortization 1,104 221 883
−−−−−−− −−−−− −−−−−−−
Total $11,296 $ 236 $11,060
======= ===== =======
During the year ended November 30, 2005, the Company purchased
$150 of patents, which expire in February 2015. In addition, the
Company acquired a $1,999 indefinite life tradename and a $1,104
customer contract, which expires in December 2009 in connection
with the Terk acquisition (Note 4).
The estimated aggregate amortization expense for all amortizable
intangibles for each of the succeeding years ending November 30,
2010 is as follows:
2006 $236
2007 236
2008 236
2009 235
2010 15
−−−−−
$958
(m) Advertising
Excluding co−operative advertising, the Company expenses the
cost of advertising, as incurred, of $6,371, $8,821 and $8,214
for the years ended November 30, 2003, 2004 and 2005,
respectively.
(n) Product Warranties and Product Repair Costs
The Company generally warrants its products against certain
manufacturing and other defects. The Company provides warranties
for all of its products ranging from 90 days to the lifetime of
the product. Warranty expenses are accrued at the time of sale
based on the Company's estimated cost to repair expected returns
of products for warranty matters. This liability is based
primarily on historical experiences of actual warranty claims as
well as current information on repair costs. The warranty
liability of $7,947 and $6,142 is recorded in accrued expenses
in the accompanying consolidated balance sheets as of November
30, 2004 and 2005, respectively. In addition, the Company
records a reserve for product repair costs which is based upon
the quantities of defective inventory on hand and an estimate of
the cost to repair such defective inventory. The reserve for
product repair costs of $3,847 and $4,187 is recorded as a
reduction to inventory in the accompanying consolidated balance
sheets as of
F−18