Note 3 - Revenue

12 Months Ended

Dec. 31, 2020

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

Note

3

–

Revenue

The following table represents a disaggregation of revenue from contracts for the years ended

December 31, 2020

and

December 31, 2019:

	Year Ending December 31, 2020
	Over time		Point in time		Total
Aerospace	$	1,607	$	6,013	$	7,620
Industrial	$	1,849	$	3,565	$	5,414
Research	$	3,208	$	678	$	3,886
Total	$	6,664	$	10,256	$	16,920

	Year ending December 31, 2019
	Over time		Point in time		Total
Aerospace	$	3,224	$	5,948	$	9,172
Industrial	$	3,199	$	3,994	$	7,193
Research	$	2,609	$	673	$	3,282
Total	$	9,032	$	10,615	$	19,647

The Company has unrecognized contract revenue of approximately

$2.1

million at

December 31, 2020,

which it expects to recognize as revenue within the next

twelve

months.

Judgment is required to evaluate assumptions including the amount of net contract revenues and the total estimated costs to determine our progress towards contract completion and to calculate the corresponding amount of revenue to recognize.

Changes in estimates for sales of systems occur for a variety of reasons, including but

not

limited to (i) build accelerations or delays, (ii) product cost forecast changes, (iii) cost related change orders or add-ons, or (iv) changes in other information used to estimate costs. Changes in estimates

may

have a material effect on the Company's consolidated statements of operations.

Contract Assets and Liabilities

Contract assets consist of (i) retainage which represent the earned, but unbilled, portion for which payment is deferred by the customer until certain contractual milestones are met; and (ii) unbilled receivables which represent revenue that has been recognized in advance of billing the customer, which is common for long-term contracts. Contract liabilities consist of customer advances and billings in excess of revenue recognized.

As of

December 31, 2020,

2019

and

January 1 2019,

contract assets were

$.5

million,

$.5

million and

$1.4

million, respectively. At

December 31, 2020,

2019

and

January 1, 2019,

contract liabilities were

$.2

million,

$.8

million and

$.5

million, respectively, and the ending balance of the contract liabilities are generally recognized as income in the following year.

Contract assets and contract liabilities on input method type contracts in progress are summarized as follows:

	2020			2019
Costs incurred on contracts in progress	$	4,464,471		$	6,943,066
Estimated earnings		2,087,396			3,370,032
		6,551,867			10,313,098
Billings to date		(6,212,229	)		(10,645,800	)
	$	339,638		$	(332,702	)
Deferred revenue related to non-systems contracts		(632,014	)		(1,429,582	)
		(292,376	)	$	(1,762,284	)
Included in accompanying balance sheets
Under the following captions:
Contract assets	$	494,281		$	512,952
Contract liabilities	$	(786,657	)	$	(2,275,236	)