Jamba Juice 2008 Annual Report Download - page 117

Table of Contents
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 
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The Company’s fiscal year ends on the second Tuesday in December. The 2007 and 2006 fiscal years ended December 11, 2007 and December 12,
2006, respectively, include 52 weeks.
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The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those
estimates.
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Cash primarily consists of demand deposits in interest and non-interest bearing accounts. The carrying amount of these deposits approximates their fair
value. The bank balances maintained may, at times, exceed available depository insurance limits. At December 11, 2007 and December 12, 2006, the
Company held bank balances in excess of federally insured limits of approximately $85,000 and $1,351,000, respectively. The Company believes no
significant concentration of risk exists with respect to these cash balances.
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Inventories consist primarily of produce, dairy products, juice concentrates, and retail merchandise and are stated at the lower of cost or market. Cost is
determined using the first-in, first-out method (FIFO).
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Property and equipment are recorded at cost. Depreciation and amortization are calculated using the straight-line method over three to seven years for
furniture, fixtures and equipment and the shorter of the related lease term or estimated useful life for leasehold improvements, commencing the month after the
asset is placed in service. Maintenance and repair expenditures are charged to expense as incurred.
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The carrying values of long-lived assets are reviewed when events or changes in circumstances indicate that the carrying amount of an asset may not be
recoverable or at least annually. In accordance with Statement of Financial Accounting Standard (SFAS) No. 144, Accounting for the Impairment or
Disposal of Long-Lived Assets, losses related to the impairment of long-lived assets are recognized when expected future cash flows are less than the asset’s
carrying value. When facts and circumstances indicate that the carrying values of long-lived assets may be impaired, management of the Company evaluates
recoverability by comparing the carrying values of the assets to projected future cash flows, in addition to other quantitative and qualitative analyses. Upon
indication that the carrying values of such assets may not be recoverable, the Company recognizes an impairment loss as a charge against current operations
for an amount equal to the difference between the carrying value and the assets fair value. The Company did not incur any impairment charges during 2007
and 2006.
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