Note 2 - Summary of significant accounting policies: Finance leases receivable (Policies) |
12 Months Ended |
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Dec. 31, 2018 | |
Policies | |
Finance leases receivable |
Finance leases receivable
The Company, through its subsidiaries, is the lessor of manufacturing equipment subject to leases under master leasing agreements. The leases contain an element of dealer profit and lessee bargain purchase options at prices substantially below the subject assets estimated residual values at the exercise date for the options. Consequently, the Company classified the leases as sales-type leases (the finance leases) for financial accounting purposes. For such finance leases, the Company reports the discounted present value of (i) future minimum lease payments (including the bargain purchase option, if any) and (ii) any residual value not subject to a bargain purchase option as a finance lease receivable on its balance sheet and accrues interest on the balance of the finance lease receivable based on the interest rate inherent in the applicable lease over the term of the lease. For each finance lease, the Company recognized revenue in an amount equal to the net investment in the lease and cost of sales equal to the net book value of the equipment at the inception of the applicable lease.
A finance receivable is considered impaired, based on current information and events, if it is probable that we will be unable to collect all amounts due according to contractual terms. Impaired finance receivables include finance receivables that have been restructured and are troubled debt restructures. There were no impaired finance receivables as of December 31, 2018. There were no finance leases receivable at December 31, 2017. |
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- Definition Describes an entity's accounting policy and methodology for estimating its allowance for loan and lease losses, and its accounting policy for nonperforming loans. The description identifies the factors that influenced management of the entity in establishing the level of the allowance (for example, historical losses and existing economic conditions) and also may include discussion of the risk elements relevant to particular categories of receivables. The disclosure also may describe any liability the entity has recorded for off-balance sheet credit losses and may include the basis for determining each element of the allowance for loan and lease losses. The disclosure also could discuss the entity's policy for (1) placing loans on nonaccrual status (or discontinuing accrual of interest) and recording payments received on nonaccrual loans, and the policy for resuming accrual of interest, (2) charging-off uncollectible loans, and (3) determining past due or delinquency status (that is, whether past due status is based on how recently payments have been received or contractual terms). Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- References No definition available.
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