Opening Request for Qualifications - SB Pinhook WTP Guaranteed Savings Contract - Reynolds Construction

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Reynolds Construction, LLC Notes to Financial Statements December 31, 2019 and 2018 Accounts receivable are ordinarily due 30 days after the issuance of the invoice. Accounts past due more than 120 days are considered delinquent. Delinquent receivables are written off based on individual credit evaluation and specific circumstances of the customer. Retention receivables for which the Company has an unconditional right to payment that is only subject to the passage of time are included in accounts receivable. Retention receivables subject to conditions other than the passage of time, such as fulfillment guarantees, future performance, or achievement of stated milestones are included in contract assets. Inventory Pricing Inventories consist of purchased materials. Inventories are stated at the lower of cost or net realizable value. Property and Equipment Property and equipment are depreciated over the estimated useful life of each asset. Annual depreciation is computed using the straight-line method. Leasehold improvements are amortized over the shorter of the lease term or estimated useful lives. The estimated useful lives for each major depreciable classification of property and equipment are as follows: Building and leasehold improvements15 - 39 years Construction equipment3 - 10 years Office furniture and equipment3 - 5 years Vehicles5 - 10 years Long-Lived Asset Impairment The Company evaluates the recoverability of the carrying value of long-lived assets whenever events or circumstances indicate the carrying amount may not be recoverable. If a long-lived asset is tested for recoverability and the undiscounted estimated future cash flows expected to result from the use and eventual disposition of the asset is less than the carrying amount of the asset, the asset cost is adjusted to fair value and an impairment loss is recognized as the amount by which the carrying amount of a long-lived asset exceeds its fair value. No asset impairment was recognized during the years ended December 31, 2019 and 2018. Allocation of Equipment Costs The Company charges each contract for the use of the Company-owned equipment based upon pre- established monthly rates. The actual equipment costs, including depreciation, are accumulated separately. The difference between amounts charged to contracts and the actual costs is netted within cost of revenue earned in the statements of operations. 8