Travelzoo 2008 Annual Report Download - page 69

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Property and equipment consisted of the following (in thousands):
2008 2007
December 31,
Computer hardware and software .................................... $1,794 $ 439
Office equipment and office furniture ................................. 1,864 913
Capitalized internal-use software and Web site development ................ 1,265 —
Leasehold improvements........................................... 701 69
5,624 1,421
Less accumulated depreciation ...................................... 1,365 799
Total . . ....................................................... $4,259 $ 622
Depreciation is provided using the straight-line method over the estimated useful lives of the assets. Estimated
useful lives are 3 to 5 years for computer hardware and software, capitalized internal-use software and Web site
development costs, and office equipment and office furniture. The Company depreciates leasehold improvements
over the term of the lease or the estimated useful life of the asset, whichever is shorter.
Depreciation expense was $655,000, $181,000, and $111,000 for the years ended December 31, 2008, 2007
and 2006, respectively.
As of December 31, 2008 and 2007, our capitalized internal-use software and Web site development costs, net of
accumulated amortization, were $1.3 million and $-0-. For the years ended December 31, 2008, 2007 and 2006, we
recorded amortization of capitalized internal-use software and Web site development costs of $6,000, $-0- and $-0-.
(f) Intangible Assets
Intangible assets consist of the following (in thousands):
2008 2007
December 31,
Acquired amortized intangible assets:
Internet domain names ............................................... $418 $418
Less accumulated amortization ......................................... 373 360
Total ............................................................ $ 45 $ 58
Intangible assets have a useful life of 5 years. Amortization expense was $13,000, $12,000 and $20,000 for the
years ended December 31, 2008, 2007 and 2006, respectively.
In January 2009, the Company purchased an internet domain name for $1.8 million.
Future amortization expense related to intangible assets at December 31, 2008 is as follows (in thousands):
Year Ended December 31,
2009 . .................................................................. $13
2010 . .................................................................. 13
2011 . .................................................................. 13
2012 . .................................................................. 6
$45
45
TRAVELZOO INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)