FINANCIAL RESULTS
Albanese Cormier Holdings, LLC and Subsidiaries NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Years ended December 31, 2025 and 2024 Summary of Significant Accounting Policies, continued Sales of Real Estate
1.
Sales of real estate generally are accounted for under the full accrual method. Under that method, the gain is not recognized until the collectability of the sales price is reasonably assured and the earnings process is virtually complete. When a sale does not meet the requirements for income recognition, gain is deferred until those requirements are met. Inventory The Company maintains an inventory of completed lots of residential real estate located in in Groves, TX. The value is based upon actual cost incurred. The property is purchased, developed and subsequently sold in the normal course of business. Real estate inventory consists of land and construction and development costs all of which are associated with the preparation of lots for residential real estate in Groves, TX. Land acquisition costs, development costs, and indirect costs associated with development are capitalized and allocated to each individual lot. Such capitalized costs are charged to cost of real estate sold when the related revenue is recognized. The Company carries real estate inventory at the lower of cost or net realizable value. Property and Equipment Real estate assets are stated at cost less accumulated depreciation. The buildings and improvements are depreciated using the straight-line method over the estimated useful lives ranging from 5 to 39 years. The tenant improvements are depreciated using the straight- line method over the life of the related lease. The furniture, fixtures and equipment are depreciated using the straight-line method over their estimated useful lives ranging from 5 to 10 years. For tax reporting purposes, depreciation is calculated using accelerated depreciation methods. Expenditures that extend the useful lives of the real estate are capitalized and those that do not extend the useful lives are expenses as incurred. Depreciation expense for the years ended December 31, 2025 and 2024 was $18,780,769 and $19,288,121. Disposals are removed at cost less accumulated depreciation, and any gain or loss from disposition is reflected in income. All of the properties are held in single purpose entities. A single purpose entity is a legal entity typically established solely for the purpose of owning a property or group of properties subject to a mortgage. There may be restrictions limiting the entity’s ability to engage in an activity other than owning or operating the property, assuming or guaranteeing the debt of any other entity, or dissolving itself or declaring bankruptcy before the debt has been repaid. The single purpose entities are 100% owned by the Company except for Edison Plaza Partners, LLC (see Note 2) and are consolidated in the financial statements.
9
77 AlbaneseCormier® | 2025 Annual Report
Made with FlippingBook - Share PDF online