2005-12-30_REPORT - M1982155 - Laserfiche WebLink

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Schmidt Construction Notes to Divisional Balance Sheet December E 1, 3004 Note 1 -Nature of Business and Signiilcant 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 recognized under the percentage-of-completion method of accounting and is measured prindpally on a unk-of-delivery basis, dons in cost and profit estimates during the course of the contract are reflected in the accounting period in which the facts requiring the revision become known. At the time a loss on a contract becomes known, the entire amount of the estimated ukimate loss is acuved. Due to uncertainties inherent in the estimating process, k is reasonably possible that estimates will change in the near term. Billings for long-term construction contracts are rendered monthly, induding the amourn of retainage withheld by the customer urnil contract completion. As a general contractor, the Division withholds similar retainages from each subeontrador. Accounts receivable includes approximately $139,000 of unbilled receivables. Use of Estimates •- The preparation of a balance sheet in wnformity wkh accounting principles generally accepted In the United States of Ameria requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingem assets and liabilities at the date of the balance sheet. Actual results could differ from those estimates. Note Z -Properly, Plant, and Equipment Major dosses of property, plarrt, and equipment are as follows: Depneciabk Amount Life -Years Land $ 4,448,388 Land improvements 682,227 10.15 Buildings 8,827,838 740 Machinery and equipment 771,856 5-10 Transportation equipment 11,645,462 5 Total cost 26,375,771 Accumulated depredation (17,663,657) Net property, plant, and equipmern $ 8,712, 114 4