Contract Assets and Contract Liabilities

12 Months Ended

Dec. 31, 2021

Contract Assets and Contract Liabilities [Abstract]

Contract Assets and Contract Liabilities

5. Contract Assets and Contract Liabilities 

Costs and estimated earnings on uncompleted contracts, which represent contract assets and contract liabilities, consisted of the following at December 31, 2021 and 2020:

	2021			2020
Costs incurred on uncompleted contracts	$	4,272,425		$	4,572,581
Provision for loss on uncompleted contracts		2,238,578			—
Estimated earnings (losses) to date on uncompleted contracts		(3,156,377	)		872,302
Gross contract assets		3,354,626			5,444,883
Less: billings to date		(4,750,289	)		(5,916,487	)
Net contract liabilities on uncompleted contracts	$	(1,395,663	)	$	(471,604	)

The above amounts are included in the accompanying consolidated balance sheets under the following captions at December 31, 2021 and 2020.

	2021			2020
Contract assets	$	41,916		$	1,303,136
Contract liabilities		(1,437,579	)		(1,774,740	)
Net contract liabilities	$	(1,395,663	)	$	(471,604	)

Although management believes it has established adequate procedures for estimating costs to complete on open contracts, it is at least reasonably possible that additional significant costs could occur on contracts prior to completion. The Company periodically evaluates and revises its estimates and makes adjustments when they are considered necessary. The Company has experienced accrued losses on legacy contract commitments from the acquisition of SG ECHO due to escalations in material pricing related to COVID-19 and labor overages.