Warranty Reserves

6 Months Ended

Jun. 30, 2011

6. Warranty Reserves

Reserves are provided for the estimated warranty costs when revenue is recognized. The costs of warranty obligations are estimated based on warranty policy or applicable contractual warranty, historical experience of known product failure rates and use of materials and service delivery charges incurred in correcting product failures. Specific warranty accruals may be made if unforeseen technical problems arise. If actual experience, relative to these factors, significantly differs from these estimates, additional warranty expense may be required.

The following table below shows the changes in accrued warranty expense for the three and six months ended June 30, 2010 and 2011:


	For the three months ended						For the six months ended
	June 30,						June 30,
	2010			2011			2010			2011
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Beginning balance	$	180,592		$	229,633		$	155,850		$	155,918
Additions		38,026			47,028			63,568			134,113
Usage		(4,495	)		(104,078	)		(5,295	)		(117,448	)

Ending balance	$	214,123		$	172,583		$	214,123		$	172,583