2005-12-30_REPORT - M1976009HR - Laserfiche WebLink

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Schmidt Construction Notes to Divisional Balance Sheet December 31, 2004 Note 1 -Nature of Business and SlgnMicartt Accounting Policies (Continued) Revenue Recognition -Revenue from sales of asphalt products is recognized when the product is shipped to the customer. Revenue on long-term contracts is recognaed under the percentage-of-completion method of accounting and is measured prindpaliy on a unk-of-delivery basis. Revisions in cost and profit estimates during the course of the contract are reflected in the acwurrcing period in which the facts requiring the revision became known. At the time a loss on a contract becomes known, the entire amount of the estimated ukimate loss is accrued. Due to uncertainties inherent in the estimating process, k is reasonably possible that estimates will change in the near term. Billings for long-term consuvction contracts are rendered monthly, induding the amount of retainage wkhheld by the wstomer until contract completion. As a general contractor, the Division wkhholds similar netainages from each subcontractor. Accounts receivable includes approximately $ 139,000 of unbilled receivables. Use of Estimates.- The preparation of a balance sheet in conformity with accounting principles generally accepted In the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and Ifabilkies and disclosure of contingent assets and IiabilRies at the date of the balance sheet. Actual results could differ from those estimates. Note 2 -Property, Piant, and Equipment Major classes of property, plats, and equipment are as follows: Depreciable Amount Life -Years Land $ 4,448,388 Land improvements 682,227 10-IS Buildings 8,827,836 7-40 Machinery and equipment 771,856 5-10 Transportation equipment I I ,645,462 5 Total cost 26,375,771 Accumulated depredation (17,663,657) Net property, plant, and equipment $ 8,712, 114