Revenue Recognition

9 Months Ended

Apr. 30, 2019

Revenue from Contract with Customer [Abstract]

18.	Revenue Recognition

Revenue is recognized as performance obligations under the terms of contracts with customers are satisfied. The Company’s vehicle and extruded aluminum contracts have a single performance obligation of providing the promised goods (recreational vehicles and extruded aluminum components), which is satisfied when control of the goods is transferred to the customer. Revenue from the sales of extruded aluminum components is generally recognized upon delivery to the customer’s location. The Company’s European recreational vehicle reportable segment includes vehicle sales to third party dealers as well as sales of new and used vehicles to end customers through our owned and operated dealership network.

For recreational vehicle sales, the Company recognizes revenue when all performance obligations have been satisfied and control of the product is transferred to the dealer in accordance with shipping terms. Shipping terms vary depending on regional contracting practices. U.S. customers primarily contract under FOB shipping point terms. European customers generally contract on ExWorks (“EXW”) incoterms (meaning the seller fulfills its obligation to deliver when it makes goods available at its premises, or another specified location, for the buyer to collect). Under EXW incoterms, the performance obligation is satisfied and control is transferred at the point when the customer is notified that the vehicle is available for pickup.

In addition to recreational vehicle sales, the Company’s European reportable segment sells accessory items and provides repair services through our dealerships. Each ordered item represents a distinct performance obligation satisfied when control of the good is transferred to the customer. Service and repair contracts with customers are short term in nature and are recognized when the service is complete.

Dealers do not have a right of return. All warranties provided are assurance-type warranties.

Revenue is measured as the amount of consideration to which the Company expects to be entitled in exchange for the Company’s products and services. The amount of revenue recognized includes adjustments for any variable consideration, such as sales discounts, sales allowances, promotions, rebates and other sales incentives which are included in the transaction price and allocated to each performance obligation based on the standalone selling price. The Company estimates variable consideration based on the expected value of total consideration to which customers are likely to be entitled to based primarily on historical experience and current market conditions. Included in the estimate is an assessment as to whether any variable consideration is constrained. Revenue estimates are adjusted at the earlier of a change in the expected value of consideration or when the consideration becomes fixed. During the three and nine-month periods ended April 30, 2019, adjustments to revenue from performance obligations satisfied in prior periods, which relate primarily to changes in estimated variable consideration, were immaterial.

Amounts billed to customers related to shipping and handling activities are included in net sales. In adopting ASU

No. 2014-09,

the Company elected to account for shipping and handling costs as fulfillment activities, and these costs are included in cost of sales.

All revenue streams are considered point in time. The table below disaggregates revenue to the level that the Company believes best depicts how the nature, amount, timing and uncertainty of the Company’s revenue and cash flows are affected by economic factors. Other

RV-related

revenues shown below in the European segment include sales related to accessories and services, used vehicle sales at owned dealerships and RV rentals.


	Three Months Ended April 30,						Nine Months Ended April 30,
	2019			2018			2019			2018
NET SALES:
Recreational vehicles
North American Towables
Travel Trailers and Other	$	734,028		$	978,906		$	2,031,291		$	2,801,828
Fifth Wheels		503,227			629,308			1,366,626			1,798,005

Total North American Towables		1,237,255			1,608,214			3,397,917			4,599,833
North American Motorized
Class A		201,927			273,095			602,689			782,610
Class C		242,912			301,303			609,798			866,822
Class B		14,399			24,061			49,444			75,547

Total North American Motorized		459,238			598,459			1,261,931			1,724,979

Total North America		1,696,493			2,206,673			4,659,848			6,324,812
European
Motorcaravan		506,964			—			506,964			—
Campervan		94,226			—			94,226			—
Caravan		100,741			—			100,741			—
Other RV-related		65,578						65,578

Total European		767,509			—			767,509			—

Total recreational vehicles		2,464,002			2,206,673			5,427,357			6,324,812
Other, primarily aluminum extruded components		69,506			82,239			198,468			233,171
Intercompany eliminations		(26,925	)		(37,342	)		(72,690	)		(103,185	)

Total	$	2,506,583		$	2,251,570		$	5,553,135		$	6,454,798

Other Practical Expedients

We do not disclose information about the transaction price allocated to the remaining performance obligations at period end because our contracts generally have original expected durations of one year or less. In addition, we expense when incurred contract acquisition costs, primarily sales commissions, because the amortization period would be one year or less.