Note 6 - Product Warranty

6 Months Ended

May 31, 2013

Product Warranty Disclosure [Text Block]

Product Warranty Disclosure [Text Block]

6)    Product Warranty

The Company offers warranties of various lengths to its customers depending on the specific product and terms of the customer purchase agreement. The average length of the warranty period is one year from the date of purchase. The Company’s warranties require it to repair or replace defective products during the warranty period at no cost to the customer. The Company records a liability for estimated costs that may be incurred under its warranties. The costs are estimated based on historical experience and any specific warranty issues that have been identified. Although historical warranty costs have been within expectations, there can be no assurance that future warranty costs will not exceed historical amounts. The Company periodically assesses the adequacy of its recorded warranty liability and adjusts the balance as necessary. The accrued warranty balance is included in accrued expenses as shown in Note 5.

Changes in the Company’s product warranty liability for the three and six months ended May 31, 2013 and May 31, 2012 are as follows:

	For the three months ended
	May 31, 2013			May 31, 2012
Balance, beginning	$	575,330		$	184,137
Settlements made in cash or in-kind		(212,374	)		(33,695	)
Warranties issued		164,025			127,523
Balance, ending	$	526,981		$	277,965

	For the six months ended
	May 31, 2013			May 31, 2012
Balance, beginning	$	578,864		$	201,630
Settlements made in cash or in-kind		(381,063	)		(176,719	)
Warranties issued		329,180			253,054
Balance, ending	$	526,981		$	277,965