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<br />7 <br />NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) <br /> <br />Marketable Securities <br /> The Company considers its investment in marketable securities as available for <br />sale. Accordingly, unrealized gains and losses, if any, are excluded from <br />earnings and reported as a separate component of stockholders’ equity. <br />Realized gains and losses on the sale of marketable securities are computed <br />using the specific identification method based on original cost and are included <br />in earnings. <br /> <br />Contract Receivables <br /> Contract receivables are uncollateralized customer obligations due under <br />normal trade terms. The carrying amount of contract receivables may be <br />reduced by an allowance that reflects management’s best estimate of the <br />amounts that will not be collected. Management individually reviews all contract <br />receivables balances and based on assessment of current credit worthiness, <br />estimates the portion, if any, of the balance that will not be collected. As <br />management believes that the accounts are fully collectible and are therefore <br />stated at net realizable value, management has not recorded an allowance for <br />doubtful accounts. <br /> <br />Property and Equipment <br /> Property and equipment is recorded at cost. Expenditures for major <br />improvements and additions are charged to the asset accounts, while <br />replacements, maintenance and repairs which do not improve or extend the lives <br />of the respective assets are charged to expense currently. <br /> <br /> Depreciation <br /> Depreciation is computed by using the straight-line method, using various rates <br />based generally on the estimated useful lives of the assets which range from five <br />to seven years. <br /> <br />Advertising Costs <br />Advertising costs are charged to operations as incurred and are included in <br />operating expenses. The amounts charged for the year ended December 31, <br />2022 was approximately $18,264. <br /> <br />Income Taxes <br />The Company, with the consent of its stockholders, has elected to be taxed <br />under the S Corporation provisions of the Internal Revenue Code. Under these <br />provisions, the Company’s taxable income or loss is reported on the individual <br />stockholders’ income tax returns and, as such, no provision for income taxes has <br />been made in the accompanying financial statements. <br /> <br /> <br /> <br />