Travelzoo 2002 Annual Report Download - page 51

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TRAVELZOO INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
December 31, 2002, expand the disclosures required by a guarantor about its obligation under a guarantee.
The adoption of the disclosure requirements of this statement did not impact the Company's Ñnancial position,
results of operations or cash Öows.
In December 2002, the FASB issued Statement No. 148, Accounting for Stock-Based Compensation.
This statement provides alternative methods of transition for a voluntary change to the fair value based
method of accounting for stock-based employee compensation. In addition, this statement amends the
disclosure requirements of Statement 123 to require prominent disclosures in both annual and interim
Ñnancial statements about the method of accounting for stock-based employee compensation and the eÅect of
the method used on reported results. The Company has adopted the new disclosure requirements of this
statement.
In January 2003, the FASB issued Interpretation No. 46, Consolidation of Variable Interest Entities
(""FIN 46''). The interpretation provides guidance for determining when a primary beneÑciary should
consolidate a variable interest entity or equivalent structure, that functions to support the activities of the
primary beneÑciary. The interpretation is eÅective as of the beginning of Company's third quarter of 2003 for
variable interest entities created before February 1, 2003. The adoption of this statement is not expected to
impact the Company's Ñnancial position, results of operations or cash Öows.
(2) Commitments
The Company leases oÇce space in Mountain View, California, and in New York, New York, under
operating leases which expire on December 31, 2003 and June 30, 2004, respectively. The future minimum
rental payments under these operating leases as of December 31, 2002, total $556,940 and $197,940 for 2003
and 2004, respectively. Rent expense was $471,766, $302,355 and $154,498 for the years ended December 31,
2002, 2001, and 2000, respectively.
(3) Allowance for Doubtful Accounts
The details of changes to the allowance for doubtful accounts are as follows:
Balance at December 31, 1999 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 10,000
Additions Ì charged to costs and expenses ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 135,144
Balance at December 31, 2000 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 145,144
Deductions Ì credited to costs and expenses, net ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (88,507)
Deductions Ì write-oÅs ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (1,409)
Balance at December 31, 2001 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 55,228
Additions Ì charged to costs and expenses, net ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 14,572
Deductions Ì write-oÅs ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (13,875)
Balance at December 31, 2002 ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 55,925
35