Motorola 2012 Annual Report Download - page 102

Download and view the complete annual report

Please find page 102 of the 2012 Motorola annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 120

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120

94
perform a hypothetical purchase price allocation to the fair value of the assets and liabilities of the reporting unit. The
difference between the fair value of the reporting unit calculated in Step One and the fair value of the underlying assets and
liabilities of the reporting unit is the implied fair value of the reporting unit's goodwill. A charge is recorded in the financial
statements if the carrying value of the reporting unit's goodwill is greater than its implied fair value.
The Company weighted the valuation of its reporting units at 75% based on the income approach and 25% based on the
market-based approach consistent with prior periods. The Company believes that this weighting is appropriate because it is
often difficult to find other appropriate market participants that are similar to its reporting units, and it is the Company's view
that future discounted cash flows are more reflective of the value of the reporting units.
Based on the results of the 2010 annual assessment of the recoverability of goodwill, the fair values of both reporting
units exceeded their book values, indicating that there was no impairment of goodwill.
15. Valuation and Qualifying Accounts
The following table presents the valuation and qualifying account activity for the years ended December 31, 2012, 2011
and 2010:
Balance at
January 1
Charged to
Earnings Used Adjustments*
Balance at
December 31
2012
Allowance for Doubtful Accounts** $ 45$ 8$ (4)$ 2 $ 51
Allowance for Losses on Long-term
Receivables** 10——
(10)—
Inventory Reserves 170 67 (73)(1) 163
Customer Reserves 125 456 (416)(21) 144
2011
Allowance for Doubtful Accounts 49 7 (4)(7)45
Allowance for Losses on Long-term
Receivables 110 (1)— 10
Inventory Reserves 157 37 (30) 6 170
Customer Reserves 117 580 (565)(7) 125
2010
Allowance for Doubtful Accounts 16 41 (2)(6)49
Allowance for Losses on Long-term
Receivables 7— (6)— 1
Inventory Reserves 140 67 (34)(16) 157
Customer Reserves 97 427 (374)(33) 117
*Adjustments include translation adjustments
** During 2012, the adjustment of $10 million within Allowance for Losses on Long-term Receivables relates to a reclass from non-current to current.