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NOTE 1 <br />SUNSHINE LAND DESIGN, INC. <br />NOTES TO FINANCIAL STATEMENTS <br />DECEMBER 31, 2014 and 2013 As Restated <br />(Read Accountant's Independent Review Report) <br />SUMMARY OF SIGNIFICANT POLICIES AND OTHER INFORMATION <br />Organization and Business <br />The company was incorporated on July 1, 1985. The company provides services in <br />landscape and irrigation, design and maintenance. <br />Property and Enuipment <br />Property and equipment are recorded at cost. For Financial Statement presentation. <br />property and equipment are depreciated using the straight-line method over the estimated <br />life of the related asset. For Income Tax reporting, the company utilizes the straight line <br />method and accelerated depreciation methods as allowed by the Internal Revenue Code. <br />Federal Income Taxes. <br />The company prepares income tax reports on the accrual basis of accounting. See deferred <br />income taxes note below. <br />Deferred income taxes <br />The accompanying financial statements reflect the temporary differences in reporting <br />results of operations for income tax purposes and financial accounting purposes .Deterred <br />tax liability is the long term deferred taxes estimated due to the depreciation methods used <br />for financial statement presentation versus tax reporting. Those balances are $83,843 for <br />2013 and $ 57,837 for 2014.Deferred tax asset is the estimate tax benefit to he realized <br />from the net operating loss of the corporation. The Deferred tax account for 2014 is <br />$211,612 and $ -0- for 2013. <br />Bad Debt Allowance <br />The company utilizes specific identification to write off uncollectible receivables. <br />NOTE 2 BASIS OF ACCOUNTING <br />The accompanying financial statement has been prepared on the accrual basis of accounting! <br />thereby recognizing revenues when earned and cost when incurred. The company <br />recognizes revenue and costs from long term contracts using the percentage of completion <br />method as determined by the ratio of costs incurred to estimated total costs. <br />NOTE 3 LONG TERM DEBT <br />Debt consists of notes payable secured by equipment and vehicles, with total monthly <br />payments of $ 58,383 and $ 51,385, including interest and principle for 2014 and 2013 <br />respectively. Due to the nature of the business, management expects that Tong term debt <br />maturing will be replaced. The utility of equipment, due to usage, does not generally <br />exceed maturity of the related debt. <br />7 <br />