Travelzoo 2010 Annual Report Download - page 74

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Property and equipment consisted of the following (in thousands):
2010 2009
December 31,
Computer hardware and software ................................... $2,687 $ 2,374
Office equipment and office furniture ................................ 2,834 2,229
Capitalized internal-use software and website development ................ 1,319 1,319
Leasehold improvements ......................................... 1,182 781
8,022 6,703
Less accumulated depreciation and amortization ........................ (4,597) (2,614)
Total ........................................................ $3,425 $ 4,089
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 website
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 $2.0 million, $1.5 million, and $601,000 for the years ended December 31, 2010,
2009 and 2008, respectively.
As of December 31, 2010, 2009 and 2008, our capitalized internal-use software and website development costs,
net of accumulated amortization, were $465,000, $905,000 and $1.3 million, respectively. For the years ended
December 31, 2010, 2009 and 2008, we recorded amortization of capitalized internal-use software and website
development costs of $440,000, $409,000 and $6,000, respectively.
(f) Intangible Assets
Intangible assets consist of the following (in thousands):
2010 2009
December 31,
Acquired amortized intangible assets:
Internet domain names ............................................ $2,117 $2,117
Less accumulated amortization ...................................... 1,059 706
Total . . ....................................................... $1,058 $1,411
Intangible assets have a useful life of 5 years. Amortization expense was $354,000, $357,000 and $13,000 for
the years ended December 31, 2010, 2009 and 2008, respectively.
In January 2009, the Company purchased the fly.com domain name for $1.8 million.
Future amortization expense related to intangible assets at December 31, 2010 is as follows (in thousands):
Year ended December 31,
2011 ................................................................. $ 354
2012 ................................................................. 352
2013 ................................................................. 352
$1,058
47
TRAVELZOO INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)