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DICKERSON FLORIDA, INC. <br />(A Wholly-owned Subsidiary of The Dickerson Group, Inc.) <br />NOTES TO FINANCIAL STATEMENTS <br />DECEMBER 31, 2019 and 2018 <br />(1) Summary of Significant Accounting Policies <br />(a) Nature of Operations <br />Dickerson Florida, Inc. (the Company), a Florida <br />corporation, is a wholly-owned subsidiary of The Dickerson <br />Group, Inc. and is engaged in the highway construction <br />business for various governmental and private entities in <br />the southeastern United :States. The work is performed <br />primarily under unit price contracts. <br />(b) Use of Estimates <br />The preparation of the accompanying financial statements in <br />conformity with GAAP requires management to make estimates <br />and assumptions that affect the reported amounts of assets <br />and liabilities, the disclosure of contingent assets and <br />liabilities at the date of the financial statements and the <br />reported amounts of revenues and expenses during the <br />reporting period. Certain of the Company's accounting <br />policies require higher degrees. of judgment than others in <br />their application. These include the recognition of <br />revenue and earnings from installation contracts over time, <br />the valuation of long-term assets, income taxes, and <br />purchase accounting, including intangibles and goodwill. <br />Management continually evaluates all of its estimates and <br />judgments based on available information and experience; <br />however, actual results could differ from these estimates. <br />(c) Revenue Recognition <br />Performance Obligation Satisfied Over Time <br />The Company engages in highway construction. Revenues are <br />recognized as performance obligations are satisfied over time <br />(formerly known as percentage -of completion method), using <br />the ratio of costs .incurred to estimated total costs for each <br />contract This cost to cost measure is used because <br />management considers it to be the best available measure of <br />progress on these contracts. Contract costs include all <br />direct material, labor, subcontract and other costs and <br />those indirect costs determined to relate to contract <br />performance, such as indirect salaries and wages equipment <br />(8) (continued) <br />