AutoNation 2001 Annual Report Download - page 56

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A summary of the Company's revenue by major products and services for the
years ended December 31 is as follows:
2001 2000 1999
--------- --------- ---------
New vehicles.......................................... $12,000.0 $12,489.3 $11,481.0
Used vehicles......................................... 3,883.2 3,860.2 4,429.7
Parts and service..................................... 2,404.9 2,334.9 2,222.0
Finance and insurance, net............................ 489.6 431.8 423.4
Other................................................. 1,211.6 1,482.8 1,542.9
--------- --------- ---------
$19,989.3 $20,599.0 $20,099.0
========= ========= =========
51
AUTONATION, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
FLOORPLAN INTEREST EXPENSE AND FLOORPLAN ASSISTANCE
Floorplan interest expense and floorplan assistance are included as a
component of Cost of Operations in the accompanying Consolidated Financial
Statements. Floorplan interest expense is recognized as incurred. Floorplan
assistance is recognized when earned in accordance with the respective
manufacturers' programs. A summary of the Company's floorplan interest expense
and floorplan assistance related to new vehicles at December 31 is as follows:
2001 2000 1999
------- ------- -------
Floorplan interest expense................................ $(126.7) $(198.6) $(123.4)
Floorplan assistance...................................... $ 140.8 $ 194.0 $ 156.3
INCOME TAXES
The Company and its subsidiaries file consolidated federal tax returns. The
Company accounts for income taxes in accordance with Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes" ("SFAS 109").
Accordingly, deferred income taxes have been provided to show the effect of
temporary differences between the recognition of revenue and expenses for
financial and income tax reporting purposes and between the tax basis of assets
and liabilities and their reported amounts in the financial statements.
EARNINGS (LOSS) PER SHARE
Basic earnings (loss) per share is computed by dividing net income (loss)
by the weighted average number of common shares outstanding during the year.
Diluted earnings (loss) per share is based on the combined weighted average
number of common shares and common share equivalents outstanding which include,
where appropriate, the assumed exercise or conversion of options and warrants.
In computing diluted earnings (loss) per share, the Company has utilized the
treasury stock method.
ADVERTISING
The Company expenses the cost of advertising as incurred or when such
advertising initially takes place, net of earned manufacturer credits and other
discounts. At December 31, 2001, the Company had approximately $9.9 million of
prepaid advertising costs associated with the sale of the Company's former
outdoor media business as discussed in Note 18, Acquisitions and Divestitures.
Advertising expense, net was $183.2 million, $186.5 million and $212.2 million