2005-12-30_REPORT - M1976009HR - Laserfiche WebLink

Home Browse Search

chmidt .Construction Notes to DFvisional Balance Sheet December 31, 2004 Note 1 -Nature of Business and Significant Ao>:ou~ing Policies The divisional balance sheet of Schmidt Construction (the 'Division'), a division of Edw. C. Levy Co. (tha'Parent"), includes the accourhs of the Division az of December 31, 2004. The corporate staff of the Parent provides the. Division wkh certain executive, administrative, financial, legal, and general services performed on a centralized basis. The costs of services provided by the Parent's staff are allocated to the Division. In addition, the Division is allocated a portion of the Parerrc's employee fringe benefrc costs and state and local income taxes. The Division extracts and processes natural aggregates, provides rocking services, manufactures azphak products, and paves roads, parking lou, and other surfaces in and around Colorado Springs, Colorado. Trade Accounts ReceNable - Accourrcs receivable are stated at net invoice amounts. The Division establishes an allowance for doubtful accounts, based on a specific assessment of all irnoices that remain unpaid following normal customer payment periods. All accounts or portions thereof deemed to be uncollectible are written off in the period that determination is made. No such allowance waz deemed necessary at December 31, 2004. Irnentories -Inventories are stated at the lower of cost or market, with cost determined on the flrst-in, first-out (FIFO) method for substantially all irrventories. Property, Plant, and Equipment -Property, plant, and equipment are recorded at cost. Depreciation is computed using the straight-line method for buildings and the double-declining balance method for other assets over the estimated useful lives of the assets. Divisional Equity - Divisional equity is the accumulated comings of the Division since Inception less the allocated portion of Parent's stockholder redemptions. Income Tauces -Pursuant to provisions of the Internal Revenue Code, the Parent haz elected to be taxed az an S Corporation. Generally, the income of an S Corporation is not subject to federal Income tax at the corporate level, but rather the stockholders are required to include a pro rata share of the corporation's taxable income or loss in their personal income tax returns, irrespective of whether dividends have been paid. Accordingly, no provision for federal income taxes haz been made in the accompanying dvisional balance sheet.