Company: KMX
Filing Date: 2025-04-11
Form Type: 10-K
Source: 0001170010-25-000024
Chunk: 105

Company: CARMAX INC
Filing Date: 2025-04-11
Form: 10-K
Item: Item 8
Chunk 105
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8 422.3 Third-party finance (fees)/income, net(1.5)(5.8)7.0 Advertising & subscription revenues (1)139.3 135.8 133.3 Service revenues83.4 85.1 82.3 Other13.4 21.1 15.9 Total other sales and revenues686.3 638.0 660.8 Total net sales and operating revenues$26,353.4 $26,536.0 $29,684.9 (1)    Excludes intercompany sales and operating revenues that have been eliminated in consolidation.Used Vehicle Sales.  Revenue from the sale of used vehicles is recognized upon transfer of control of the vehicle to the customer.  As part of our customer service strategy, we guarantee the retail vehicles we sell with a 10-day money-back guarantee.  We record a reserve for estimated returns based on historical experience and trends.  The reserve for estimated returns is presented gross on the consolidated balance sheets, with a return asset recorded in other current assets and a refund liability recorded in accrued expenses and other current liabilities.  We also guarantee the used vehicles we sell with a 90-day/4,000-mile limited warranty.  These warranties are deemed assurance-type warranties and are accounted for as warranty obligations.  See Note 18 for additional information on this warranty and its related obligation.Wholesale Vehicle Sales.  Wholesale vehicles are sold at our auctions, and revenue from the sale of these vehicles is recognized upon transfer of control of the vehicle to the customer.  Dealers also pay a fee to us based on the sale price of the vehicles they purchase.  This fee is recognized as revenue at the time of sale.  While we provide condition disclosures on each wholesale vehicle sold, the vehicles are subject to a limited right of return.  We record a reserve for estimated returns based on historical experience and trends.  The reserve for estimated returns is presented gross on the consolidated balance sheets, with a return asset recorded in other current assets and a refund liability recorded in accrued expenses and other current liabilities.EPP Revenues.  We also sell ESP and GAP products on behalf of unrelated third parties, who are primarily responsible for fulfilling the contract, to customers who purchase a retail vehicle.  The ESPs we currently offer on all used vehicles provide coverage up to 60 months (subject to mileage limitations), while GAP covers the customer for the term of their finance contract.