Quarterly report pursuant to Section 13 or 15(d)

Product Warranty Costs

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Product Warranty Costs
 3 Months Ended
Nov. 30, 2012
Product Warranty Costs

Note 5. Product Warranty Costs

The Company generally offers its customers a warranty on products they purchase, although warranty periods vary by product type and application. During the three months ended November 30, 2011, the warranty reserve was reduced by $5.7 million, the result of a purchase accounting adjustment to Mastervolt’s initial estimated warranty reserve. The reserve for future warranty claims is based on historical claim rates and current warranty cost experience. The following is a rollforward of the accrued product warranty reserve (in thousands):

 

     Three Months Ended
November 30,		  
     2012     2011  

Beginning balances

    $ 12,869      $ 23,707   

Purchase accounting adjustment

      —          (5,719 ) 

Provision for warranties

      2,417        2,491   

Warranty payments and costs incurred

      (3,096 )      (2,903 ) 

Impact of changes in foreign currency rates

      271        (1,109 ) 
  

 

 

    

 

 

  

Ending balances

    $ 12,461      $ 16,467