Revenue Recognition: Sales are recognized when revenue is realized or realizable and has been earned. Revenue transactions represent sales of inventory. The Company has historically adopted shipping terms that title to merchandise passes to the customer at the shipping point (FOB Shipping Point). Revenue is realized or realizable and earned when all of the following criteria are met:  Persuasive evidence of an arrangement exits  Shipment has occurred  The Companys selling price for its products are fixed and determinable  Collectability is reasonable assured The Company does not offer any discounts, credits or other sales incentives. Historically, the Company believes that it has no collection issues with its customer base. The Companys policy with respect to customer returns and allowances as well as product warranty is as follows: The Company will accept a return of defective product within one year from shipment for repair or replacement at the Companys option. If the product is repairable, the Company at its own cost, will repair and return it to the customer. If unrepairable, the Company will either offer an allowance against payment or will reimburse the customer for the total cost of product. The cost of defective products is immaterial at this time. The Company provides engineering services as part of the relationship with its customers in developing the custom product. The Company is not obligated to provide such engineering service to its customers. The Company does not invoice its customers separately for these services. In May 2014, the Financial Accounting Standards Board issued ASC 606 Revenue from Contracts with Customers that, as amended on August 12, 2015, became effective to annual report periods beginning after December 15, 2017. The core principle underlying ASC 606, is to recognize revenue to depict the transfer of 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. ASC 606-10-05-4 sets out the following steps for an entity to follow when applying the core principle to its revenue-generating transactions:  Identify the contract with a customer  Identify the performance obligations in the contract  Determine the transaction price  Allocate the transaction price to the performance obligations  Recognize revenue when (or as) each performance obligation is satisfied The Company has adopted the provisions of ASC 606. However, such adoption did not have any effect on the way in which the Company recognizes, records and reports revenues.