Laserfiche WebLink
r <br /> • L. H. TANNER CONSTRUCTION CORPORATION <br /> NOTES TO FINANCIAL STATEMENTS <br /> • For the five month period ended May 31 , 2006 <br /> Property and Equipment <br /> Vehicles and equipment are stated at cost less accumulated depreciation. Depreciation is computed <br /> using the straight-line and declining balance methods based upon the estimated useful lives of the <br /> • depreciable assets. <br /> Use of Estimates <br /> Management uses estimates and assumptions in preparing these financial statements in accordance with <br /> _ generally accepted accounting principles . Those estimates and assumptions affect the reported amounts <br /> of assets and liabilities and the reported revenues and expenses . Actual results could vary from the <br /> estimates that were used. <br /> • <br /> Income Taxes <br /> The Company qualifies for the small contractor exemption under the Internal Revenue Code Section <br /> 460(e)( 1 )(B) and as such, reports its revenue and expenses for federal income tax purposes on the <br /> completed contract method for long-term construction contracts. The Company has elected by consent of it: <br /> • stockholder to be taxed under the provisions of Subchapter S of the Internal Revenue Code effective <br /> October 20 , 1997. Under those provisions, the Company does not pay Federal corporate income taxes on <br /> • <br /> its taxable income . Instead, the stockholder is liable for individual Federal income taxes on the Company's <br /> taxable income. <br /> NOTE B - PROPERTY AND EQUIPMENT <br /> Property and equipment are summarized by major classification as follows : <br /> r <br /> Office equipment $ 11 , 026 <br /> Vehicles and equipment 154, 625 <br /> r Land 95 .423 <br /> 261 , 074 <br /> r <br /> Accumulated depreciation ( 108, 361 ) <br /> • $ 1523713 <br /> Depreciation expense for the five month period ended May 31 , 2006 was $9,263 . <br /> r <br /> r <br />