2. Significant Accounting Policies: Revenue Recognition (Policies)

9 Months Ended

Sep. 30, 2015

Policies

Revenue Recognition

Revenue Recognition

            The Company’s revenue recognition activities relate almost entirely to the manufacture and sale of flexible metal hose and pipe.  Under GAAP, revenues are considered to have been earned when the Company has substantially accomplished what it must do to be entitled to the benefits represented by the revenues.  The following criteria represent preconditions to the recognition of revenue:

·         Persuasive evidence of an arrangement for the sale of product or services must exist.

·         Delivery has occurred or services rendered.

·         The sales price to the customer is fixed or determinable.

·         Collection is reasonably assured.

The Company recognizes revenue upon shipment in accordance with the above principles.

            Gross sales are reduced for all consideration paid to customers for which no identifiable benefit is received by the Company.  This includes promotional incentives, which includes various programs including year-end rebates and discounts.  The amounts of certain incentives are known with reasonable certainty at the time of sale, while others are projected based upon the most reliable information available at the reporting date.  Commissions are accounted for as a sales expense.