Question-and-Answer Session
Operator
(Operator Instructions). Your first question from the line of Eric Stine with Northland Securities. Please proceed.
Eric Stine - Northland Securities
First I was wondering could you just talk about the warranty expense in the quarter maybe how that compares quarter-over-quarter and how long you anticipate that will persist?
Ed Reich
All of our product carries a per unit warranty expense which we calculate using a viable statistical analysis. So with the early introduction of the C2100 and 1000 there weren't enough units in the field to have a valid statistical population to make a forward-looking forecast on. So what we did is we started with the forecast for our C65, which was a reasonable place to start, we thought given we had a lot of experience with it in the field and it's similar to C200 and C200 is just a larger unit.
So given that, now at the end of the second quarter, we had enough units in the population to begin using the LIBOR and have it get back reasonably [after]. So the per unit warranty increased and we took that adjustment in this quarter.
Darren Jamison
Eric, it's Darren. I think what you are going to see here, I mean it's hard to give a quarterly guidance on this, but typically with the new product you will see somewhat of a bell-shaped curve. You'll have very little warranty exposure when the units are just originally being shipped and commissioned, as you get more units in the field like we have today, you will start to see some level of warranty issues which obviously we quickly get on and fix and then as the population grows, you will have units start to roll off the warranty backlog or the warranty books and suppose the product matures, you will see, you come back down the backside of that Bell curve.
So not surprising to see the warranty ticker spike with the new products. We'd like to see it though level out and come down over the next couple of quarter as the product matures and eventually we'll start to get unit's rolling off the warranty backlog.
Eric Stine - Northland Securities
I might have missed it in the prepared statements but did you indicate kind of what percentage of the gross loss that was?
Ed Reich
Yes, it was 800,000 of the gross loss.
Eric Stine - Northland Securities
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