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Product Warranty
 3 Months Ended
Mar. 31, 2018
Product Warranty  
Product Warranty

Note 8.  Product Warranty

 

The Company generally offers a one year warranty for all of its systems, the terms and conditions of which vary depending upon the product sold. For all systems sold, the Company accrues a liability for the estimated cost of standard warranty at the time of system shipment and defers the portion of systems revenue attributable to the fair value of non-standard warranty. Costs for non-standard warranty are expensed as incurred. Factors that affect the Company’s warranty liability include the number of installed units, historical and anticipated product failure rates, material usage and service labor costs. The Company periodically assesses the adequacy of its recorded liability and adjusts the amount as necessary.

 

The changes in the Company’s standard product warranty liability are as follows:

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

 

 

March 31,

 

 

    

2018

    

2017

    

 

 

(in thousands)

 

Balance at January 1 (beginning of year)

 

$

4,502

 

$

2,666

 

Warranties issued during the period

 

 

1,540

 

 

1,166

 

Settlements made during the period

 

 

(1,334)

 

 

(454)

 

Changes in estimate of liability for pre-existing warranties during the period

 

 

260

 

 

(254)

 

Balance at March 31 (end of period)

 

$

4,968

 

$

3,124

 

 

 

 

 

 

 

 

 

Amount classified as current

 

$

4,583

 

$

2,748

 

Amount classified as long-term

 

 

385

 

 

376

 

Total warranty liability

 

$

4,968

 

$

3,124