Revenue Recognition In May 2014, the FASB issued Accounting Standards Update (ASU) 2014-09 (ASC 606) and related amendments, which superseded all prior revenue recognition methods and industry-specific guidance. The core principle of ASC 606 is that an entity should recognize revenue to depict the transfer of control for promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying the revenue principles, an entity is required to identify the contract(s) with a customer, identify the performance obligations, determine the transaction price, allocate the transaction price to the performance obligations and recognize revenue when the performance obligation is satisfied (i.e., either over time or point in time). ASC 606 further requires that companies disclose sufficient information to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. ASC 606 provides companies an option of two transition methods, the full retrospective method, in which case the standard would be applied to each prior reporting period presented and the cumulative effect of applying the standard would be recognized at the earliest period shown, or the modified retrospective method, in which case the cumulative effect of applying the standard would be recognized at the date of initial application. The ASU is effective for annual reporting periods beginning after December 15, 2017. Effective January 1, 2018 (beginning of fiscal year 2018), the Company adopted the requirements of ASC 606 using the modified retrospective method. The guidance was not applied to contracts that were complete at December 31, 2017, and the comparative information for the prior fiscal year has not been retrospectively adjusted. The adoption of ASC 606 did not have any impact on the Companys consolidated financial statements. The adoption of ASC 606 did not have a significant impact on the Companys revenue recognition policy as revenues on the substantial majority of the Companys contracts continue to be recognized over time. In adopting ASC 606, the Company elected to use certain practical expedients permitted by the standard including electing to adopt the right-to-invoice practical expedient on certain time and material contracts where the Company recognizes revenues as it is contractually able to invoice the customer based on the control transferred to the customer. The following policies reflect specific criteria for the various revenue streams of the Company: Revenue is recognized upon transfer of control of conferencing services. The Company generally does not charge up-front fees and bills its customers based on usage. The Company has elected the practical expedient to recognized revenue as-billed. Revenue for video equipment sales and security surveillance equipment sales is recognized upon delivery and installation which the Company has determined is the point in time that control is transferred to the customer. Due to the nature of the Companys business it is not practicable to return products therefore the Company has determined that it is not necessary to estimate for sales returns and allowances. The Companys manufacturers provide the highest quality products available. If there is a defect in a product related to materials or workmanship the Company extends the manufacturers warranty to its customers. To date this process has never occurred. Therefore no warranty liability is recorded. Revenue from periodic maintenance agreements is generally recognized ratably over the respective maintenance periods provided no significant obligations remain and collectability of the related receivable is probable. Maintenance agreements are considered stand ready arrangements for which control is transferred to the customer ratably over time. Disaggregation of Revenue The Company operates in two different geographic locations and both locations have two sources of revenue; sales of product and sales of service. Service sales mainly include installation of products related to security systems. The sales of products are generally contract based and short term in nature. The following table illustrates our revenue by type related to the years ended December 31, 2018 and 2017: Years Ended December 31, 2018 2017 Sales of Product New York $ 250,623 $ 163,102 Texas 3,061,893 2,216,088 Total Sales of Product 3,312,516 2,379,190 Services New York 160,946 206,909 Texas 632,114 318,888 Total Services 793,060 525,797 Total Net Sales $ 4,105,576 $ 2,904,987 Contract Balances The following table provides information about receivables, contract assets and contract liabilities from contracts with customers. As of December 31, 2018 2017 Contract Assets $ 97,140 $ 141,267 Contract Liability $ 5,735 $ 479,426 Contract receivables are recognized when the receipt of consideration is unconditional. During the year ended December 31, 2018, the Company recognized revenue equal to the balance of the contract liability at December 31, 2017. As a practical expedient, the Company expenses the costs of sales commissions that are paid to its sales force associated with obtaining contracts less than one year in length in the period incurred.