Page 56 - PC Tax RFP

NOTE 2:
THE PERRYCOMPANY OF 7TH AVENUE, INC. NOTES TO REVIEWED FINANCIAL STATEMENTS DECEMBER 31, 2014
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Use of Estimates
THE PERRY COMPANY
NOTE 3:
NOTE 4:
The preparation of financial statements 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 liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Management periodically evaluates estimates used in the preparation of the financial statements for continued reasonableness. Appropriate adjustments, if any, to the estimates used are made prospectively based upon such periodic evaluation. It is reasonably possible that changes may occur in the near term that would affect management’s estimates with respect to the percentage of completion method, allowance for doubtful accounts and accrued expenses.
CONTRACTS RECEIVABLE
Contracts receivable from construction, operation and maintenance are based on amounts billed to customers. The Company provides an allowance for doubtful collections which is based upon a review of outstanding receivables, historical collection information, and existing economic conditions. Delinquent contracts receivable are written off based on individual credit evaluation and specific circumstances of the customer. There were none in 2014.
PROPERTY AND EQUIPMENT
The following is a summary of property and equipment at December 31, 2014:
Office Equipment Furniture and Fixtures Computer Equipment
Less: Accumulated Depreciation Property and Equipment, Net
2014
$ 3,926 6,249 13,477 23,652 9,022 $ 14,630
Depreciation expense for financial statement purposes was $858 in fiscal year ended December 31, 2014. For income tax purposes the Company depreciation expense deducted was $13,873. Deferred tax asset or liability is not recognized as explained in Note 2 – Income Taxes.
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