Warranty Reserve

6 Months Ended

Jun. 30, 2011

Warranty Reserve

Warranty Reserve

6. Warranty Reserve. We generally do not independently warrant the products that we distribute. Instead, in almost all cases, the manufacturers of the products that we distribute warrant the products and allow us to return defective products, including those that have been returned to us by our customers. However, we sell a line of portable generators under a product supply arrangement which obligates us to provide warranty services for these products and to share the costs of providing those services with the manufacturer. The duration of the warranty for these products is a period of 24 months following the sale of the product to a retail customer. The warranty provision is recorded as a component of costs of sales in the condensed consolidated statements of operations.