Note J - Revenue from Contracts with Customers

9 Months Ended

Oct. 02, 2021

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

Note J – Revenue from Contracts with Customers

Revenue Recognition – Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; generally this occurs with the transfer of control of our goods at a point in time based on shipping terms and transfer of title. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. Shipping and handling fees charged to customers are reported within revenue.

Gross-to-net sales adjustments – We recognize revenue net of various sales adjustments to arrive at net sales as reported on the statement of operations. These adjustments are referred to as gross-to-net sales adjustments and primarily fall into one of three categories: returns, warranties and customer allowances.

Returns – The Company records an accrued liability and reduction in sales for estimated product returns based upon historical experience. An accrued liability and reduction in sales is also recorded for approved return authorizations that have been communicated by the customer.

Warranties – Limited warranties are provided on certain products for varying periods. We record an accrued liability and reduction in sales for estimated future warranty claims based upon historical experience and management’s estimate of the level of future claims. Changes in the estimated amounts recognized in prior years are recorded as an adjustment to the accrued liability and sales in the current year.

Customer Allowances – Customer allowances are common practice in the industries in which the Company operates. These agreements are typically in the form of advertising subsidies, volume rebates and catalog allowances and are accounted for as a reduction to gross sales. The Company reviews such allowances on an ongoing basis and accruals are adjusted, if necessary, as additional information becomes available.

Disaggregation of Revenue – We generate revenue from the sale of widely recognized sporting goods brands in basketball goals, archery, indoor and outdoor game recreation and fitness products. These products are sold through multiple sales channels that include: mass merchants, specialty dealers, key on-line retailers (“E-commerce”) and international. The following table depicts the disaggregation of revenue according to sales channel:

	Three Months Ended				Nine Months Ended
All Amounts in Thousands	October 2, 2021		October 3, 2020		October 2, 2021		October 3, 2020
Gross Sales by Channel:
Mass Merchants	$	41,792	$	36,234	$	93,298	$	77,418
Specialty Dealers		19,170		21,741		73,347		57,666
E-commerce		25,116		25,172		86,053		78,242
International		2,259		2,637		9,182		6,129
Other		883		598		2,469		1,669
Total Gross Sales		89,220		86,382		264,349		221,124
Less: Gross-to-Net Sales Adjustments
Returns		1,283		2,117		5,531		5,538
Warranties		590		376		1,703		1,152
Customer Allowances		6,049		5,820		16,947		15,552
Total Gross-to-Net Sales Adjustments		7,922		8,313		24,181		22,242
Total Net Sales	$	81,298	$	78,069	$	240,168	$	198,882