RESERVE FOR SALES RETURNS

6 Months Ended

Sep. 30, 2021

Reserve For Sales Returns

RESERVE FOR SALES RETURNS

NOTE 13 – RESERVE FOR SALES RETURNS

A return program for defective goods is negotiated with each of our wholesale customers on a year-to-year basis. Customers are allowed to return defective goods within a specified period of time after shipment (between 6 and 9 months). The Company does make occasional exceptions to this return policy and accordingly records a sales return reserve based on historic return amounts, specific exceptions as identified and management estimates.

The Company records a sales reserve for its return goods programs at the time of sale for estimated sales returns that may occur. The liability for defective goods is included in the reserve for sales returns on the condensed consolidated balance sheets.

Changes in the Company’s reserve for sales returns are presented in the following table:

	Six Months Ended
	September 30,			September 30,
	2021			2020
Reserve for sales returns at beginning of the year	$	960,000		$	1,224,000
Provision for estimated sales returns		2,110,222			2,306,668
Sales returns received		(1,206,491	)		(1,807,613	)
Reserve for sales returns at end of the period	$	1,863,731		$	1,723,055

THE SINGING MACHINE COMPANY, INC AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021 and 2020

(Unaudited)