13. Contract Assets and Contract Liabilities

12 Months Ended

Dec. 31, 2020

Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract]

Contract Assets and Contract Liabilities

13. Contract Assets and Contract Liabilities

Contract assets represent contract billings for sales per contracts with customers and are classified as current. Our contract assets include our accounts receivables. For the year ended December 31, 2020, the Company had contract assets balance of $1,233,000, a decrease of $333,000 from the prior year due to cash receipts exceeding new contract assets. For the year ended December 31, 2019, the Company had contract assets balance of $1,566,000.

Contract liabilities consist of cash payments in advance of the Company satisfying performance obligations and recognizing revenue. The Company currently classifies deferred revenue as a contract liability. For the year ended December 31, 2020, the Company had contract liabilities balance of $177,000. For the year ended December 31, 2019, the Company had contract liabilities balance of $516,000.