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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 />NOTE 6 LONG TERM LEASED EQUIPMENT AND VEHICLES <br />The company maintains a fleet operating lease for vehicles leased for a term of forty eight <br />months. The monthly lease payments for 2013 averaged $11,043 and 2014 averaged <br />$13,535. The company has the option to continue leasing vehicles at expiration of the <br />initial lease term. At December 31, 2014, the fleet was twenty seven vehicles, comprising <br />five vehicles within the first lease tern and twenty two vehicles with extended leases. <br />RESTATEMENT -CORRECTION OF ERROR FOR YEAR ENDED DECEMBER 2013 <br />The financial statements for the year ended December 31, 2013 have been restated in these <br />Financial Statements. insurance expense (workmen's compensation insurance) in 2013 was <br />recorded as a monthly incurred expense. On November I, 2013 the corporation chanes <br />insurers. The insurer required an annual payment for the insurance coverage. On November <br />I, 2013 the premium payment of $149,038 was made. This payment was recorded as an <br />expense for the period ending December 31, 2013.The correct expense for November and <br />December 2013 was $26,773. The premiuin amount of $149,058 Tess the actual expense of <br />$26,773 .provided for a prepaid insurance asset of $122,264 at December 31, 2013. The <br />correction of the error reclassifies the amount reducing worker compensation insurance <br />expense by the amount of $ 122,264 and recording as a current asset the amount of <br />$122,264 as a prepaid expense for the year ended December 31, 2013. The decrease in <br />insurance expense increases the restated income before income taxes to the amount of <br />$442,973 from $ 320,709. The provision for income taxes as restated increase the expense <br />$ 17,744. Net income from operations restated increase to $ 340,974 from $236,454, an <br />increase of $104,520 net 'income from operations. This correction provides an increase in <br />Retained Earnings to $1,704,965 at December 31, 2013 as restated. <br />NOTE 7 <br />9 <br />