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<br />BUDGET CONSTRUCTION CO., INC. AND BUDGET HOLDINGS, LLC
<br />NOTES TO THE COMBINED FINANCIAL STATEMENTS
<br />Years Ended December 31, 2007 and 2006
<br />
<br />NOTE 4 - Property, equipment and capital leases, net:
<br />
<br />Property, equipment and capital leases of The Company and The Affiliate consist of the following:
<br />
<br />Heavy construction equipment
<br />Land
<br />Transportation equipment
<br />Capital leases
<br />Property
<br />Building improvements
<br />Office and computer equipment
<br />
<br /> Years Ended December 31,
<br /> 2007 2006
<br />$ 2,658,832 $ 2,523,737
<br /> 1,180,204 1,180,204
<br /> 1,079,046 774,056
<br /> 742,493 573,087
<br /> 250,551 227,500
<br /> 168,498 168,498
<br /> 84,757 56,116
<br /> 6,164,381 5,503,198
<br /> (1,885,721) (1,444,423)
<br />$ 4,278,660 $ 4,058,775
<br />
<br />Less: accumulated depreciation and amortization
<br />
<br />Total property, equipment and capital leases, net
<br />
<br />Depreciation of property and equipment is provided utilizing the straight-line method over the
<br />estimated useful lives of the respective assets as follows:
<br />
<br />Office and computer equipment
<br />Capital leases and Transportation equipment
<br />Heavy construction equipment
<br />Property and Building improvements
<br />
<br />Years
<br />3 - 5
<br />5
<br />10
<br />40
<br />
<br />NOTE 5 - Prepaid expenses:
<br />
<br />Prepaid expenses consist of$55,384 of prepaid insurance paid in advance of its due date in accordance
<br />with the payment schedule established by the insurance company, and $6,000 of refundable restoration
<br />bonds issued to the City of Miami.
<br />
<br />NOTE 6 - Credit line facility:
<br />
<br />The credit line facility consists of the amount of money borrowed by The Company under a secured line
<br />of credit agreement of $700,000. Set line is collateralized by The Company's assets, the stockholders'
<br />individual guarantees and a second mortgage on The Company's operating facility, currently owned
<br />by The Affiliate. It is subject to revolving terms and annual reviews, and it is bearing a variable interest
<br />rate of no less than 8.25%. The line is due on demand on June 14, 2008 unless renewed or extended by
<br />the financial institution.
<br />
<br />10
<br />
<br />Benitez & Company. CPA',
<br />
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