Quarterly report pursuant to Section 13 or 15(d)

REVENUE

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REVENUE
 9 Months Ended
Sep. 30, 2021
Revenue from Contract with Customer [Abstract]  
REVENUE

NOTE C – REVENUE

 

The following table presents the Company’s product and recurring revenues disaggregated by industry for the three months ended September 30, 2021. 

                                   
    Hospitality     Education     Multiple
Dwelling
Units		     Government     Healthcare     Total  
Product   $ 1,195,394     $ 39,577     $ 33,728     $ 21,690     $ –     $ 1,290,389  
Recurring     96,211       67,468       –       –       –       163,679  
    $ 1,291,605     $ 107,045     $ 33,728     $ 21,690     $ –     $ 1,454,068  

 

The following table presents the Company’s product and recurring revenues disaggregated by industry for the nine months ended September 30, 2021.

 

    Hospitality     Education     Multiple
Dwelling
Units		     Government     Healthcare     Total  
Product   $ 3,463,056     $ 123,975     $ 290,936     $ 144,997     $ 48,195     $ 4,071,159  
Recurring     408,604       97,542       26,461       –       –       532,607  
    $ 3,871,660     $ 221,517     $ 317,397     $ 144,997     $ 48,195     $ 4,603,766  

 

The following table presents the Company’s product and recurring revenues disaggregated by industry for the three months ended September 30, 2020. 

 

    Hospitality     Education     Multiple
Dwelling
Units		     Government     Healthcare     Total  
Product   $ 1,890,086     $ 61,779     $ 2,083     $ 96,222     $ –     $ 2,050,170  
Recurring     116,292       72,059       1,450       –       –       189,801  
    $ 2,006,378     $ 133,838     $ 3,533     $ 96,222     $ –     $ 2,239,971  

 

The following table presents the Company’s product and recurring revenues disaggregated by industry for the nine months ended September 30, 2020.

 

    Hospitality     Education     Multiple
Dwelling
Units		     Government     Healthcare     Total  
Product   $ 4,072,147     $ 383,944     $ 132,353     $ 174,358     $ –     $ 4,762,802  
Recurring     432,214       112,422       17,638       –       –       562,274  
    $ 4,504,361     $ 496,366     $ 149,991     $ 174,358     $ –     $ 5,325,076  

 

Sales taxes and other usage-based taxes are excluded from revenues.

 

Remaining performance obligations

 

As of September 30, 2021, the aggregate amount of the transaction price allocated to remaining performance obligations was approximately $0.8 million. Except for support services, the Company expects to recognize 100% of the remaining performance obligations over the next six months.

 

Contract assets and liabilities 

           
    September 30,
2021		     December 31,
2020		  
Contract assets   $ 181,761     $ 104,989  
Contract liabilities     1,285,192       1,052,367  
Net contract liabilities   $ 1,103,431     $ 947,378  

 

Contracts are billed in accordance with the terms and conditions, either at periodic intervals or upon substantial completion. This can result in billings occurring subsequent to revenue recognition, resulting in contract assets. Contract assets are presented as current assets in the Condensed Consolidated Balance Sheet.

 

Often, the Company will require customers to pay a deposit upon contract signing that will be applied against work performed or products shipped. In addition, the Company will often invoice the full term of support at the start of the support period. Billings that occur prior to revenue recognition result in contract liabilities. The change in the contract liability balance during the three-month period ended September 30, 2021 is the result of cash payments received and billing in advance of satisfying performance obligations.

 

Contract costs

 

Costs to complete a turnkey contract primarily relate to the materials cost and direct labor and are recognized proportionately as the performance obligation is satisfied. The Company will defer costs to complete a contract when materials have shipped (and control over the materials has transferred to the customer), but an insignificant amount of rooms have been installed. The Company will recognize any deferred costs in proportion to revenues recognized from the related turnkey contract. The Company does not expect deferred contract costs to be long-lived since a typical turnkey project takes sixty days to complete. Deferred contract costs are generally presented as other current assets in the Condensed Consolidated Balance Sheet.

 

The Company incurs incremental costs to obtain a contract in the form of sales commissions. These costs, whether related to performance obligations that extend beyond twelve months or not, are immaterial and will continue to be recognized in the period incurred within selling, general and administrative expenses.