FairPoint Communications 2003 Annual Report Download - page 121

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2003 $32,612 $154,200
2004 30,103 145,200
2005 30,104 130,400
2006 30,104 113,180
2007 20,069 65,750
Thereafter — —
Total minimum lease payments $142,992 $608,730
Less amount representing interest 25,085
Present value of minimum lease payments including current maturities of $21,287 $117,907
The cell site leases are renewable for four additional five-year periods under similar terms at the end of the initial term. Lease terms
provide for certain adjustments of the payments in the renewal periods.
The Partnership has an office building lease with an affiliate of MC for an initial term of five years. The Partnership's portion of the
annual base rental, included in the future minimum rental payments above, is $68,400. A contingent rental provision allows for increases in
base rent for real estate taxes and operating costs in excess of base operating costs. The agreement includes an option to extend the lease for
an additional five years.
Rental expense for all cancelable and non-cancelable operating leases totaled $199,503, $139,150, and $114,856 in 2002, 2001, and
2000, respectively.
NOTE 10. ALLOWANCE FOR UNCOLLECTIBLES
The Company uses the reserve method to recognize uncollectible customer accounts. The following activity has been recognized under
this method.
2002
2001
2000
Balance, December 31 $110,000 $134,000 $142,000
Provision for uncollectibles 67,489 33,902 107,037
Accounts written off, net of recoveries 60,989 57,902 115,037
Balance, December 31 $116,500 $110,000 $134,000
12
NOTE 11. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
The following table presents summarized quarterly results.
Quarter
1st
2nd
3rd
4th
2002
Operating revenues $2,665,525 $2,732,486 $2,784,279 $2,713,388
Operating income $300,775 $181,779 $69,549 $(189,682)
Net income $310,158 $175,016 $64,205 $(208,098)
2001
Operating revenues $2,457,057 $2,897,386 $2,994,715 $2,882,714
Operating income $238,467 $378,592 $402,836 $443,462
Net income $222,770 $357,551 $387,483 $445,511
Quarterly operating results are not necessarily representative of operations for a full year for various reasons, including seasonal
variations in customer calling patterns and timing of promotional activities.
NOTE 12. RECENT ACCOUNTING DEVELOPMENTS
In June 2001, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standard (SFAS) No. 143,
"Accounting for Asset Retirement Obligations." SFAS No. 143 requires entities to record the fair value of the liability for legal obligations
associated with an asset retirement in the period in which the obligation is incurred. When the liability is initially recorded, the entity
capitalizes the cost of the asset retirement obligation by increasing the carrying amount of the related long-lived asset. Over time, the liability