Annual report pursuant to Section 13 and 15(d)

Product warranty

Product warranty

12 Months Ended

Dec. 31, 2012

The Company reserves an estimate of its exposure to warranty claims based on both current and historical product sales data and warranty costs incurred. The majority of the Company’s products carry a one-year warranty. The Company assesses the adequacy of its recorded warranty liability annually and adjusts the amount as necessary. The warranty liability is included in accrued expenses on the accompanying consolidated balance sheets.

Changes in the Company’s warranty reserve were as follows:



Warranty reserve, December 31, 2010	$	53,000
Warranty provision for units sold	76,637
Costs of warranty incurred	(72,637		)
Warranty reserve, December 31, 2011	57,000
Warranty provision for units sold	160,684
Costs of warranty incurred	(127,484		)
Warranty reserve, December 31, 2012	$	90,200