Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | Apr. 20, 2015 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 31-Mar-15 | |
Entity Registrant Name | HASCO Medical, Inc. | |
Entity Central Index Key | 1131675 | |
Current Fiscal Year End Date | -19 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Common Stock, Shares Outstanding | 1,006,762,163 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Current assets | ||
Cash | $210,791 | $509,924 |
Accounts receivable, net of allowance for doubtful accounts of $379,453 and $752,624, respectively | 6,402,944 | 9,006,558 |
Inventory, net of inventory reserve of $106,449 and $109,993 respectively | 15,668,718 | 16,641,806 |
Deferred tax asset, short term | 448,877 | 448,877 |
Current portion of note receivable | 25,525 | 25,515 |
Prepaid expenses and other current assets | 776,109 | 603,699 |
Total current assets | 23,532,964 | 27,236,379 |
Property & equipment, net of accumulated depreciation of $2,002,267 and $1,940,549, respectively | 1,933,196 | 2,041,141 |
Intangible assets, net of accumulated depreciation of $37,774 and $31,108, respectively | 6,146,452 | 6,153,118 |
Deferred tax asset, long term | 194,669 | 194,669 |
Note receivable, net of current portion | 80,086 | 88,631 |
Other non-current assets | 599,625 | 591,609 |
Total Assets | 32,486,992 | 36,305,547 |
Current liabilities | ||
Accounts payable and accrued expenses | 2,092,768 | 2,842,626 |
Cash overdraft | 187,089 | |
Customer deposits and deferred revenue | 865,331 | 465,167 |
Line of credit | 3,918,885 | 2,738,878 |
Note payable - floor plan | 11,704,519 | 15,584,949 |
Obligation under capital leases | 574,800 | 434,142 |
Current portion of notes payable | 389,989 | 402,546 |
Current portion note payable, related party | 364,659 | 359,579 |
Other current liabilities | 1,761,460 | 2,456,637 |
Total current liabilities | 21,859,500 | 25,284,524 |
Obligation under capital leases, net of current portion | 604,081 | 870,176 |
Notes payable, net of current portion | 3,550,136 | 3,667,125 |
Notes payable to related party, net of current portion | 1,471,823 | 1,576,076 |
Total liabilities | 27,485,540 | 31,397,901 |
Stockholders' equity | ||
Preferred stock, $0.001 par value, 3,000,000 shares authorized, none issued and outstanding | ||
Common stock, $0.001 par value, 2,000,000,000 shares authorized; and 1,009,619,306 and 1,004,210,973 shares issued and outstanding, respectively | 1,009,619 | 1,004,210 |
Additional paid-in capital | 6,959,216 | 6,875,350 |
Accumulated deficit | -2,967,383 | -2,971,914 |
Total stockholders' equity | 5,001,452 | 4,907,646 |
Total Liabilities and Stockholders' Equity | $32,486,992 | $36,305,547 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
Consolidated Balance Sheets [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $379,453 | $752,624 |
Inventory, inventory reserve | 106,449 | 109,993 |
Property and equipment, accumulated depreciation | 2,002,267 | 1,940,549 |
Intangible assets, accumulated amortization | $37,774 | $31,108 |
Preferred stock, par value per share | $0.00 | $0.00 |
Preferred stock, shares authorized | 3,000,000 | 3,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value per share | $0.00 | $0.00 |
Common stock, shares authorized | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued | 1,009,619,306 | 1,004,210,973 |
Common stock, shares outstanding | 1,009,619,306 | 1,004,210,973 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Consolidated Statements of Operations [Abstract] | ||
Product sales | $15,786,396 | $16,588,280 |
Rental revenue | 399,325 | 245,005 |
Service and other | 3,276,024 | 3,852,318 |
Total net revenues | 19,461,745 | 20,685,603 |
Cost of sales | 14,846,915 | 15,425,817 |
Gross profit | 4,614,830 | 5,259,786 |
Operating expenses: | ||
Selling and marketing | 868,478 | 953,798 |
General and administrative | 3,421,383 | 3,415,207 |
Amortization and depreciation | 224,086 | 234,327 |
Total operating expenses | 4,513,947 | 4,603,332 |
Income from operations | 100,883 | 656,454 |
Other income (expense) | 176,649 | 20,989 |
Interest expense | -332,822 | -302,838 |
Total other income (expense) | -156,173 | -281,849 |
Income (loss) from continuing operations before income taxes | -55,290 | 374,605 |
Provision (benefit) for income taxes | -59,821 | 170,218 |
Income from continuing operations | 4,531 | 204,387 |
Loss from discontinued operations, net of income tax | -10,040 | |
Net income | $4,531 | $194,347 |
Earnings per share: | ||
Basic and dilutive-continuing operations | ||
Basic and dilutive-discontinued operations | ||
Weighted average shares outstanding: | ||
Basic and dilutive | 1,009,024,984 | 994,619,535 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Cash Flows from operating activities: | ||
Net income | $4,531 | $194,347 |
Adjustment to reconcile net income to net cash provided by operations: | ||
Depreciation and amortization | 224,086 | 234,327 |
Stock based compensation | 89,275 | 34,607 |
Loss on disposal of property and equipment | 13,812 | |
Changes in assets and liabilities: | ||
Accounts receivable | 2,603,614 | 364,811 |
Inventory | 973,088 | 590,726 |
Prepaid expenses | -172,410 | -149,592 |
Other assets | -8,016 | 18,035 |
Accounts payable and accrued expenses | -749,858 | 512,254 |
Customer deposits and deferred revenue | 400,164 | 872 |
Other liabilities | -695,177 | 381,162 |
Net cash provided by operating activities | 2,683,109 | 2,181,549 |
Cash Flows from investing activities: | ||
Purchase of property and equipment | -123,287 | -44,875 |
Proceeds from note receivable | 8,535 | |
Net cash used in investing activities | -114,752 | -44,875 |
Cash Flows from financing activities: | ||
Proceeds from floor plan financing | 8,751,989 | 10,751,664 |
Repayments of floor plan financing | -12,632,419 | -10,271,136 |
Proceeds from line of credit | 8,322,572 | |
Repayments of line of credit | -7,142,565 | -1,374,333 |
Repayments of note and loan payables | -129,546 | -121,665 |
Repayments of loans payables - related party | -99,173 | -83,557 |
Principal payments under capital lease obligations | -125,437 | -103,384 |
Cash overdraft | 187,089 | -175,572 |
Net cash used in financing activities | -2,867,490 | -1,377,983 |
Net change in cash | -299,133 | 758,691 |
Cash at beginning of period | 509,924 | 150,313 |
Cash at end of period | 210,791 | 909,004 |
Supplemental disclosures of cash flow information Cash paid for: | ||
Interest | 332,822 | 281,914 |
Income Taxes | 170,218 | |
Non-Cash transactions: | ||
Loan payments made through issuance of common stock | 42,426 | |
Vehicles purchased through capital lease | $201,426 |
BASIS_OF_PRESENTATION_AND_SUMM
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ||||||||
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||
NATURE OF OPERATIONS | ||||||||
Hasco Medical, Inc., formerly BBC Graphics of Palm Beach Inc., was incorporated in May 1999 under the laws of the State of Florida. Through a series of transactions, BBC Graphics of Palm Beach, Inc. (at the time an inactive corporation) became Hasco Medical, Inc. (Hasco). Concurrently, Hasco Medical, Inc. acquired Southern Medical & Mobility. In May, 2011, Hasco acquired Mobility Freedom, Inc. and Wheelchair Vans of America. In November, 2011, Hasco acquired Certified Medical Systems II (Certified Medical). A more detailed description of these transactions is contained in our 10-K filing with the Securities and Exchange Commission for the period ended December 31, 2013. On September 1, 2012, Hasco Medical, Inc. completed the acquisition of Ride-Away Handicap Equipment Corp., a closely-held New Hampshire corporation (Ride-Away). On September 4, 2013, Hasco Medical, Inc. completed the acquisition of Auto Mobility Sales, Inc. (Auto Mobility). | ||||||||
Services and Products | ||||||||
Historically, our operations were focused on the provision of a diversified range of home health care services and products. Following our May 2011 acquisition of Mobility Freedom, our March 2012 acquisition of Ride-Away and our September 2013 acquisition of Auto Mobility Sales, our operations are conducted within one major business unit: | ||||||||
• | Modified Mobility Vehicles – conducts sales of handicap accessible vans, parts and services as well as the rental of such vehicles. This segment consists of Ride-Away Handicap Equipment Corp. which has thirteen (13) locations from Maine to Florida, Mobility Freedom Inc. which has five (5) locations in Florida and includes “Wheelchair Vans of America” operating our van rental operations, and Auto Mobility Sales, Inc., which has two (2) locations in Florida. | |||||||
With our acquisitions of Mobility Freedom, Ride-Away, and Auto Mobility Sales as well as the sale of Certified Medical, our Modified Mobility Vehicles segment comprises 100% of our consolidated revenues. As a consequence and for purposes of consolidated financial statement presentation, our Home Health Care segment is no longer materially relevant when considering the consolidated financial statements as a whole. | ||||||||
Our corporate headquarters and principal corporate operations are conducted in Addison, Texas, a northern suburb of Dallas, Texas. We also house a portion of our corporate operations in Londonderry, New Hampshire. Hasco Medical Inc. is a Florida corporation. | ||||||||
Modified Mobility Vehicles | ||||||||
Ride-Away, Mobility Freedom and Auto Mobility serve individuals with physical limitations that need specialty equipment in order to safely operate their vehicle. We also provide products for families and care-givers with transport requirements for those under care. In certain circumstances both the van itself and its specialty equipment is paid for directly by a federal or state agency. For the periods ended March 31, 2015 and 2014, approximately 18% and 24%, respectively, of the Modified Mobility Vehicles segments revenue was derived from veterans receiving benefits from the United States Department of Veterans Affairs (the “VA”). Mobility Freedom and Ride-Away are both a VA and Vocational Rehabilitation (VR) certified vendors in all the states in which we operate. Ride-Away has thirteen corporate owned stores which are located in Beltsville, MD, East Hartford, CT, Essex Junction, VT, Gray, ME, Londonderry, NH, Norfolk, VA, Norristown, PA, North Attleboro, MA, Norwood, MA, Richmond VA, Tampa, FL Brooklyn, NY and Parkville, MD. Mobility Freedom has five corporate owned stores located in Orlando, Largo, Clermont, Bunnell and Ocala, Florida. Auto Mobility Sales has locations in Fort Lauderdale and Lake Worth, Florida. | ||||||||
Wheelchair Vans of America specializes in renting conversion vans to disabled individuals, and is located in Orlando, Florida. Our rental operations compliment the retail products we provide through our Mobility Freedom, Auto Mobility Sales and Ride-Away subsidiaries. | ||||||||
Discontinued Operations | ||||||||
During the second quarter of 2014, the Company initiated a plan to sell the division of Certified Medical Systems II, Inc. These operations were originally reported in the home health care segment. The Company assessed the fair value of the operations at the time of the disposition and sale of the entity. Management has also determined that the amount of assets continued to be realized is immaterial and therefore not separately disclosed. | ||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||||||
Basis of Presentation | ||||||||
In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal and recurring accruals) necessary to present fairly the consolidated financial position as of March 31, 2015 and the consolidated statements of operations, and cash flows for the three month periods ended March 31, 2015 and 2014 of Hasco Medical Inc. (“Hasco” or the “Company”). | ||||||||
The significant accounting policies followed by the Company are set forth in Note 1 to the Company's consolidated financial statements in the December 31, 2014, Hasco Medical Inc. Annual Report on Form 10-K, which should be read in conjunction with these financial statements. The results of operations for the periods ended March 31, 2015 are not necessarily indicative of the result to be expected for the full year. | ||||||||
The consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”) and present the financial statements of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. The consolidated entities are: | ||||||||
• | Hasco Medical, Inc.; | |||||||
• | Mobility Freedom, Inc.; | |||||||
• | Ride Away Handicapped Equipment, Inc.; | |||||||
• | Auto Mobility Sales, Inc.; | |||||||
• | Certified Medical Systems II, Inc.; (discontinued operations) | |||||||
Use of Estimates | ||||||||
Management's Discussion and Analysis or Plan of Operations is based upon our consolidated financial statements that have been prepared in accordance with accounting principles generally accepted in the United States of America. Management bases its use of estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ significantly from these estimates under different assumptions or conditions. | ||||||||
Revenue Recognition | ||||||||
The Company recognizes revenue in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 605, “Revenue Recognition”, and with the guidelines of the Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin (“SAB”) No. 104, “Revenue Recognition”. Under SAB 104, four conditions must be met before revenue can be recognized: (i) there is persuasive evidence that an arrangement exists, (ii) delivery has occurred or service has been rendered, (iii) the price is fixed or determinable, and (iv) collection is reasonably assured. Revenues consist of the sales of new and used vehicles, sales of parts and automotive services, commissions from finance and insurance products, and vehicle rentals. The Company recognizes revenue in the period in which products are sold or the services are rendered and only if there is reasonable expectation of collection. For vehicles, a sale is recorded only when title has transferred and the vehicle has been delivered. Rebates received from manufacturers are recorded as a reduction of the costs of each vehicle and recognized upon the sale of the vehicle or when earned under a specific manufacturer program. | ||||||||
In certain instances, customers place deposits on vehicles or special order parts for service and conversions. Deposits are not recognized as revenue until the related vehicle or part is sold. | ||||||||
The Company arranges financing for customers through various institutions and receives financing fees based on the difference between the loan rates charged to customers and wholesale financing rates set by the financing institution. The Company also receives fees from the sale of extended service contracts, warranties and vehicle security systems. | ||||||||
Cash and Cash Equivalents | ||||||||
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. The Company places its cash with high credit quality financial institutions. The Company's accounts at these institutions are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. From time to time and for the three month periods ended March 31, 2015 and December 31, 2014, the Company reached bank balances exceeding the FDIC insurance limit. To reduce its risk associated with the failure of such financial institution, the Company evaluates, at least annually, the rating of the financial institution in which it holds deposits. | ||||||||
Related Parties | ||||||||
Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management, and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions shall be recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as a distribution to related party. | ||||||||
Earnings per Share | ||||||||
Earnings per common share are calculated under the provisions of ASC 260. The accounting standard requires the Company to report both basic earnings per share, which is based on the weighted-average number of common shares outstanding, and diluted earnings per share, which is based on the weighted-average number of common shares outstanding plus all potential dilutive common shares outstanding. The computation of diluted net loss per share does not include dilutive common stock equivalents in the weighted average shares outstanding if they would be anti-dilutive. There were no stock options which could potentially dilute earnings per share for the periods ended March 31, 2015 and 2014, respectively. | ||||||||
The following table sets forth the computation of basic and diluted income per share: | ||||||||
For The Three Months ended | ||||||||
March 31, | ||||||||
2015 | 2014 | |||||||
Net income | $ | 4,531 | $ | 194,347 | ||||
Basic weighted average outstanding shares of common stock | 1,009,024,984 | 994,619,535 | ||||||
Diluted weighted average common stock | 1,009,024,984 | 994,619,535 | ||||||
Earnings per share: | ||||||||
Basic and diluted | $ | 0 | $ | 0 | ||||
The number of outstanding shares of our common stock as of March 31, 2015 was 1,009,619,306. | ||||||||
Recently Issued Accounting Pronouncements | ||||||||
From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption. | ||||||||
ACCOUNTS_RECEIVABLE
ACCOUNTS RECEIVABLE | 3 Months Ended | ||||||||||||||
Mar. 31, 2015 | |||||||||||||||
ACCOUNTS RECEIVABLE [Abstract] | |||||||||||||||
ACCOUNTS RECEIVABLE | NOTE 2 – ACCOUNTS RECEIVABLE | ||||||||||||||
Accounts receivable consisted of the following: | |||||||||||||||
March 31, 2015 | % | December 31, 2014 | % | ||||||||||||
(unaudited) | |||||||||||||||
Trade receivables | $ | 2,497,182 | 36.8 | $ | 4,457,010 | 45.7 | |||||||||
Government receivables | 4,285,215 | 63.2 | 5,302,172 | 54.3 | |||||||||||
6,782,397 | 100 | 9,759,182 | 100 | ||||||||||||
Less: allowances for doubtful accounts | (379,453 | ) | (752,624 | ) | |||||||||||
Total | $ | 6,402,944 | $ | 9,006,558 | |||||||||||
Trade receivables represent amounts due for van sales, van rentals, and medical supplies that have been delivered or sold. Government receivables represent receivables from the VA and other Government bodies related to van sales and rentals listed above. The Company does not bill Medicare or Medicaid for any vehicle-related sales or service. | |||||||||||||||
INVENTORY
INVENTORY | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
INVENTORY [Abstract] | |||||||||
INVENTORY | NOTE 3 – INVENTORY | ||||||||
Inventory consists of the following: | |||||||||
March 31, 2015 | December 31, 2014 | ||||||||
(unaudited) | |||||||||
Vehicles | $ | 14,267,837 | $ | 15,254,709 | |||||
Work in Process | 398,804 | 474,850 | |||||||
Equipment and supplies | 1,108,526 | 1,022,240 | |||||||
Inventory reserve | (106,449 | ) | (109,993 | ) | |||||
$ | 15,668,718 | $ | 16,641,806 |
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
PROPERTY AND EQUIPMENT [Abstract] | |||||||||||
PROPERTY AND EQUIPMENT | NOTE 4 – PROPERTY AND EQUIPMENT | ||||||||||
Property and equipment consisted of the following: | |||||||||||
March 31, | |||||||||||
Estimated | 2015 | December 31, | |||||||||
Life | (unaudited) | 2014 | |||||||||
Building improvements | Varies | $ | 955,602 | $ | 949,478 | ||||||
Office furniture and equipment | 5 years | 265,207 | 306,331 | ||||||||
Rental equipment | 13-36 months | 623,833 | 581,245 | ||||||||
Vehicles | 5 years | 231,060 | 161,786 | ||||||||
Capitalized leases | Varies | 1,859,761 | 1,982,850 | ||||||||
Total | 3,935,463 | 3,981,690 | |||||||||
Accumulated depreciation | (2,002,267 | ) | (1,940,549 | ) | |||||||
Net | $ | 1,933,196 | $ | 2,041,141 | |||||||
For the three months ended March 31, 2015 and 2014 depreciation expense amounted to $217,420 and $223,296 respectively. | |||||||||||
INTANGIBLE_ASSETS
INTANGIBLE ASSETS | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
INTANGIBLE ASSETS [Abstract] | |||||||||||
INTANGIBLE ASSETS | NOTE 5 – INTANGIBLE ASSETS | ||||||||||
Intangible assets consist of the following: | |||||||||||
March 31, | |||||||||||
Estimated | 2015 | December 31, | |||||||||
Life | (unaudited) | 2014 | |||||||||
Goodwill related to acquisition of Mobility Freedom | Indefinite | 1,641,303 | 1,641,303 | ||||||||
Goodwill related to acquisition of Ride-Away | Indefinite | 1,888,710 | 1,888,710 | ||||||||
Trade name related to acquisition of Mobility Freedom | Indefinite | 400,000 | 400,000 | ||||||||
Trade name related to acquisition of Ride-Away | Indefinite | 990,000 | 990,000 | ||||||||
Primary market area related to acquisition of Mobility Freedom | Indefinite | 280,000 | 280,000 | ||||||||
Primary market area related to acquisition of Ride-Away | Indefinite | 470,000 | 470,000 | ||||||||
Goodwill related to acquisition of Auto Mobility Sales | Indefinite | 284,213 | 284,213 | ||||||||
Primary market area related to acquisition of Auto Mobility Sales | Indefinite | 150,000 | 150,000 | ||||||||
Non-compete agreements area related to acquisition of Auto Mobility Sales | 3 years | 80,000 | 80,000 | ||||||||
Subtotal | 6,184,226 | 6,184,226 | |||||||||
Accumulated amortization | (37,774 | ) | (31,108 | ) | |||||||
Total | $ | 6,146,452 | $ | 6,153,118 | |||||||
For the three months ended March 31, 2015 and 2014 amortization expense was $6,666 and $11,031 respectively. | |||||||||||
NOTES_PAYABLE_AND_DEBT
NOTES PAYABLE AND DEBT | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
NOTES PAYABLE AND DEBT [Abstract] | |||||||||
NOTES PAYABLE AND DEBT | NOTE 6 – NOTES PAYABLE AND DEBT | ||||||||
Revolving Line of Credit | |||||||||
On October 31, 2013, the Company renewed its Commercial Note agreement with a bank for advances of funds for working capital purposes under a line of credit arrangement for $8,000,000 with an interest calculation of the prime rate plus 0.25% which reflected an interest rate of 3.50% as of March 31, 2015. The agreement is secured against all property of the borrowers assets, on demand with an annual review as of December 31, 2014 and expires on October 31, 2016. Payments due are interest only and the interest rate varies based on the Company's leverage ratio. The balance of the line of credit was $3,918,885 at March 31, 2015 and $2,738,878 at December 31, 2014. | |||||||||
Acquisitions Term Loan Draw Facility | |||||||||
On February 27, 2015, the Company contracted with a bank for a term loan draw facility to be used solely as an acquisitions line of credit. Borrowing on this agreement is up to $1,000,000 for up to 50% of the acquisition amount of any US company in the Modified Mobility Vehicle industry. These draws will be charged 6% interest per annum, at the one (1) year anniversary date of each given draw amount, a 48 month term loan is then granted at the same 6% interest amount and the facility is renewed to the full $1,000,000 availability. This agreement expires on March 27, 2020. | |||||||||
Note Payable – Floor Plan | |||||||||
The Company has a floor plan line of credit with General Electric Credit Corporation with a maximum borrowing capacity of $11,250,000 for Ride-Away, $3,850,000 for Mobility Freedom, and $1,750,000 for Auto Mobility Sales at March 31, 2015. The borrowing capacity was increased by $5 million on May 20, 2014. Amounts borrowed for vehicles under this line bear no interest for 60 days and then bear interest at the 90 day LIBOR plus 6.0% for Ride-Away and at the 90 day LIBOR plus 5.5% for Mobility Freedom and Auto Mobility Sales. The loan balance on the vehicle is due when the vehicle is fully funded or paid by the customer. If the vehicle is not fully funded or paid within nine months of being purchased by the Company and funded by the floor plan, a graduated percentage of the balance is due with the entire balance due at twelve months. The note is secured by the vehicles financed. At March 31, 2015 and December 31, 2014, the Company had $11,704,519 and $15,584,949 respectively, outstanding under these lines. | |||||||||
With the discretionary nature of this loan agreement, the Lender or the Company can terminate this agreement with a sixty (60) day written notice at any time. | |||||||||
Installment Debt | |||||||||
Installment debts consist of the following: | |||||||||
March 31, | December 31, | ||||||||
2015 | 2014 | ||||||||
(unaudited) | |||||||||
Vehicle Note Payable, dated August 18, 2011, vehicle financing arrangement for tow truck, original amount of $47,124, 5 years (60 months), 0% interest rate, commenced October 1, 2011, matures on October 1, 2016, monthly installment payments of $785 | 12,566 | 14,923 | |||||||
Note Payable, dated May 13, 2011, issued for the acquisition of Mobility Freedom, original amount of $2 million, fifteen years (180 months), 6% interest rate, commenced August 1, 2011, matures on July 1, 2026, monthly installment payments of $16,877 secured by grantee from the majority shareholder of Mobility Freedom | 1,653,914 | 1,679,480 | |||||||
Note Payable to related party, dated May 13, 2011, associated with the acquisition of Mobility Freedom, original amount of $2 million, ten years (120 months), 5% interest rate, commenced August 1, 2011, matures on July 1, 2021, monthly installment payments of $22,204 | 1,363,965 | 1,415,737 | |||||||
Note Payable, dated November 16, 2011, issued for the acquisition of Certified Auto, original amount of $50,000, four years (16 quarters), 0% interest rate, commenced January 16, 2012, matures on November 16, 2015, quarterly installment payments of $3,125 | — | 18,660 | |||||||
Note Payable, dated March 1, 2012, issued for the acquisition of Ride-Away, original amount of $3,000,000, ten years (120 months), 5% interest rate, commences September 1, 2012, matures on May 2, 2022, monthly installment payments of $31,820. Note is with the former owner of Ride-Away | 2,273,645 | 2,356,573 | |||||||
Note payable to related party, dated March 1, 2012, issued for the acquisition of Ride-Away, original amount of $500,000 , five years (60 months), 6% interest rate, commenced April 1, 2012, matures March 1, 2017, monthly installment payments of $9,685 | 218,532 | 244,010 | |||||||
Promissory Note payable to a related party, dated September 4, 2014, issued for the acquisition of Auto Mobility Sales, original amount of $210,000 , five years (60 months), 5% interest rate, commenced November 1, 2014, matures October 1, 2018, monthly installment payments of $3,963 | 152,391 | 165,565 | |||||||
Promissory Note payable to a related party, dated September 4, 2014, issued for the acquisition of Auto Mobility Sales, original amount of $140,000 , five years (60 months), 5% interest rate, commenced November 1, 2014, matures October 1, 2018, monthly installment payments of $2,642 | 101,594 | 110,378 | |||||||
Total debt | 5,776,607 | 6,005,326 | |||||||
Current portion of long-term debt, notes payable | 754,648 | 762,125 | |||||||
Long-term portion | $ | 5,021,959 | $ | 5,243,201 |
STOCKHOLDERS_EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Mar. 31, 2015 | |
STOCKHOLDERS' EQUITY [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 7 – STOCKHOLDERS' EQUITY |
During the three months ended March 31, 2015, 5,408,333 shares of common stock valued at $89,275 were issued to key employees as employee compensation. | |
CONTINGENCIES
CONTINGENCIES | 3 Months Ended |
Mar. 31, 2015 | |
CONTINGENCIES [Abstract] | |
CONTINGENCIES | NOTE 8 – CONTINGENCIES |
Company operations involve the handling and disposal of waste and hazardous material within a highly regulated oversight structure. The Company is subjected to inspections by OSHA and other regulatory bodies. Management believes that there are no current regulatory claims that would have a material effect on the Company's financial position or results of operations. | |
INCOME_TAXES
INCOME TAXES | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
INCOME TAXES [Abstract] | |||||||||
INCOME TAXES | NOTE 9 – INCOME TAXES | ||||||||
Prior to its acquisition in September 2008 by HASCO Holdings, LLC, the Company was an S Corporation. Beginning in September 2008 the Company's tax status changed to a C Corporation. The Company accounts for income taxes under ASC Topic 740: Income Taxes requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry forwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. | |||||||||
As of March 31, 2015 and 2014, the Company had no loss carry forwards available to reduce its future federal taxable income. | |||||||||
The table below summarizes the differences between the Company's effective tax rate and the statutory federal rate as follows for income for continuing operations for the three months ended March 31, 2015 and 2014: | |||||||||
For The Three months Ended | |||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Expected federal income tax expense (benefit) (34 %) | $ | 1,540 | $ | 127,184 | |||||
State tax expense, net of federal tax effect | — | 23,427 | |||||||
Other | (61,361 | ) | 19,607 | ||||||
(59,821 | ) | 170,218 | |||||||
Change in valuation allowance | — | — | |||||||
Net income tax expense (benefit) | $ | (59,821 | ) | $ | 170,218 |
SEGMENT_REPORTING
SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2015 | |
SEGMENT REPORTING [Abstract] | |
SEGMENT REPORTING | NOTE 10 – SEGMENT REPORTING |
Accounting standards for the Disclosure about Segments of an Enterprise and Related Information establishes standards for the reporting by business enterprises of information about operating segments, products and services, geographic areas, and major customers. The method for determining what information to report is based on the way that management organizes the operations of the Company for making operational decisions and assessments of financial performance. | |
According to such standards, management determined that, as a consequence of our Home Healthcare Segment now comprising less than 1% of our gross revenue, the reporting of segment operating results is no longer relevant when considering the financial statement as a whole. | |
DIVESTITURE_OF_CERTIFIED_MEDIC
DIVESTITURE OF CERTIFIED MEDICAL | 3 Months Ended |
Mar. 31, 2015 | |
DIVESTITURE OF CERTIFIED MEDICAL [Abstract] | |
DIVESTITURE OF CERTIFIED MEDICAL | NOTE 11 – DIVESTITURE OF CERTIFIED MEDICAL |
On June 30, 2014 the Company entered into an agreement with a related party and completed the sale of its Certified Medical business in exchange for a note receivable in the amount of $124,618. In connection with the sale, the Company recognized a gain of $92,653. In accordance with ASC 205-20, the results of operations for the Home Healthcare business segment through March 31, 2015, and for all applicable prior periods, are reported as discontinued operations. For the three months ended March 31, 2015, income or loss from discontinued operations from Certified Medical was $0. | |
Concurrent with the sale of its Certified Medical business, the Company and the buyer entered into a transition services agreement pursuant to which each of the parties will provide certain transitional, administrative, and support services to the other party for a period up to nine months, which may be extended upon mutual agreement. Such services provided to the buyer by the Company will be recorded as contra-expense since the Company will be reimbursed for the service cost incurred. Activity associated with transitional service is not considered significant relative to the condensed consolidated financial statements of the Company. | |
BASIS_OF_PRESENTATION_AND_SUMM1
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ||||||||
Basis of Presentation | Basis of Presentation | |||||||
In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal and recurring accruals) necessary to present fairly the consolidated financial position as of March 31, 2015 and the consolidated statements of operations, and cash flows for the three month periods ended March 31, 2015 and 2014 of Hasco Medical Inc. (“Hasco” or the “Company”). | ||||||||
The significant accounting policies followed by the Company are set forth in Note 1 to the Company's consolidated financial statements in the December 31, 2014, Hasco Medical Inc. Annual Report on Form 10-K, which should be read in conjunction with these financial statements. The results of operations for the periods ended March 31, 2015 are not necessarily indicative of the result to be expected for the full year. | ||||||||
The consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”) and present the financial statements of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. The consolidated entities are: | ||||||||
• | Hasco Medical, Inc.; | |||||||
• | Mobility Freedom, Inc.; | |||||||
• | Ride Away Handicapped Equipment, Inc.; | |||||||
• | Auto Mobility Sales, Inc.; | |||||||
• | Certified Medical Systems II, Inc.; (discontinued operations) | |||||||
Use of Estimates | Use of Estimates | |||||||
Management's Discussion and Analysis or Plan of Operations is based upon our consolidated financial statements that have been prepared in accordance with accounting principles generally accepted in the United States of America. Management bases its use of estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ significantly from these estimates under different assumptions or conditions. | ||||||||
Revenue Recognition | Revenue Recognition | |||||||
The Company recognizes revenue in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 605, “Revenue Recognition”, and with the guidelines of the Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin (“SAB”) No. 104, “Revenue Recognition”. Under SAB 104, four conditions must be met before revenue can be recognized: (i) there is persuasive evidence that an arrangement exists, (ii) delivery has occurred or service has been rendered, (iii) the price is fixed or determinable, and (iv) collection is reasonably assured. Revenues consist of the sales of new and used vehicles, sales of parts and automotive services, commissions from finance and insurance products, and vehicle rentals. The Company recognizes revenue in the period in which products are sold or the services are rendered and only if there is reasonable expectation of collection. For vehicles, a sale is recorded only when title has transferred and the vehicle has been delivered. Rebates received from manufacturers are recorded as a reduction of the costs of each vehicle and recognized upon the sale of the vehicle or when earned under a specific manufacturer program. | ||||||||
In certain instances, customers place deposits on vehicles or special order parts for service and conversions. Deposits are not recognized as revenue until the related vehicle or part is sold. | ||||||||
The Company arranges financing for customers through various institutions and receives financing fees based on the difference between the loan rates charged to customers and wholesale financing rates set by the financing institution. The Company also receives fees from the sale of extended service contracts, warranties and vehicle security systems. | ||||||||
Cash and Cash Equivalents | Cash and Cash Equivalents | |||||||
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. The Company places its cash with high credit quality financial institutions. The Company's accounts at these institutions are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. From time to time and for the three month periods ended March 31, 2015 and December 31, 2014, the Company reached bank balances exceeding the FDIC insurance limit. To reduce its risk associated with the failure of such financial institution, the Company evaluates, at least annually, the rating of the financial institution in which it holds deposits. | ||||||||
Related Parties | Related Parties | |||||||
Parties are considered to be related to the Company if the parties, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management, and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. The Company discloses all related party transactions. All transactions shall be recorded at fair value of the goods or services exchanged. Property purchased from a related party is recorded at the cost to the related party and any payment to or on behalf of the related party in excess of the cost is reflected as a distribution to related party. | ||||||||
Earnings per Share | Earnings per Share | |||||||
Earnings per common share are calculated under the provisions of ASC 260. The accounting standard requires the Company to report both basic earnings per share, which is based on the weighted-average number of common shares outstanding, and diluted earnings per share, which is based on the weighted-average number of common shares outstanding plus all potential dilutive common shares outstanding. The computation of diluted net loss per share does not include dilutive common stock equivalents in the weighted average shares outstanding if they would be anti-dilutive. There were no stock options which could potentially dilute earnings per share for the periods ended March 31, 2015 and 2014, respectively. | ||||||||
The following table sets forth the computation of basic and diluted income per share: | ||||||||
For The Three Months ended | ||||||||
March 31, | ||||||||
2015 | 2014 | |||||||
Net income | $ | 4,531 | $ | 194,347 | ||||
Basic weighted average outstanding shares of common stock | 1,009,024,984 | 994,619,535 | ||||||
Diluted weighted average common stock | 1,009,024,984 | 994,619,535 | ||||||
Earnings per share: | ||||||||
Basic and diluted | $ | 0 | $ | 0 | ||||
The number of outstanding shares of our common stock as of March 31, 2015 was 1,009,619,306. | ||||||||
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements | |||||||
From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently issued standards that are not yet effective will not have a material impact on our financial position or results of operations upon adoption. | ||||||||
BASIS_OF_PRESENTATION_AND_SUMM2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ||||||||
Schedule of Computation of Basic and Diluted Income Per Share | For The Three Months ended | |||||||
March 31, | ||||||||
2015 | 2014 | |||||||
Net income | $ | 4,531 | $ | 194,347 | ||||
Basic weighted average outstanding shares of common stock | 1,009,024,984 | 994,619,535 | ||||||
Diluted weighted average common stock | 1,009,024,984 | 994,619,535 | ||||||
Earnings per share: | ||||||||
Basic and diluted | $ | 0 | $ | 0 |
ACCOUNTS_RECEIVABLE_Tables
ACCOUNTS RECEIVABLE (Tables) | 3 Months Ended | ||||||||||||||
Mar. 31, 2015 | |||||||||||||||
ACCOUNTS RECEIVABLE [Abstract] | |||||||||||||||
Schedule of Accounts Receivable | March 31, 2015 | % | December 31, 2014 | % | |||||||||||
(unaudited) | |||||||||||||||
Trade receivables | $ | 2,497,182 | 36.8 | $ | 4,457,010 | 45.7 | |||||||||
Government receivables | 4,285,215 | 63.2 | 5,302,172 | 54.3 | |||||||||||
6,782,397 | 100 | 9,759,182 | 100 | ||||||||||||
Less: allowances for doubtful accounts | (379,453 | ) | (752,624 | ) | |||||||||||
Total | $ | 6,402,944 | $ | 9,006,558 |
INVENTORY_Tables
INVENTORY (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
INVENTORY [Abstract] | |||||||||
Schedule of Inventory | March 31, 2015 | December 31, 2014 | |||||||
(unaudited) | |||||||||
Vehicles | $ | 14,267,837 | $ | 15,254,709 | |||||
Work in Process | 398,804 | 474,850 | |||||||
Equipment and supplies | 1,108,526 | 1,022,240 | |||||||
Inventory reserve | (106,449 | ) | (109,993 | ) | |||||
$ | 15,668,718 | $ | 16,641,806 |
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
PROPERTY AND EQUIPMENT [Abstract] | |||||||||||
Schedule of Property and Equipment | March 31, | ||||||||||
Estimated | 2015 | December 31, | |||||||||
Life | (unaudited) | 2014 | |||||||||
Building improvements | Varies | $ | 955,602 | $ | 949,478 | ||||||
Office furniture and equipment | 5 years | 265,207 | 306,331 | ||||||||
Rental equipment | 13-36 months | 623,833 | 581,245 | ||||||||
Vehicles | 5 years | 231,060 | 161,786 | ||||||||
Capitalized leases | Varies | 1,859,761 | 1,982,850 | ||||||||
Total | 3,935,463 | 3,981,690 | |||||||||
Accumulated depreciation | (2,002,267 | ) | (1,940,549 | ) | |||||||
Net | $ | 1,933,196 | $ | 2,041,141 |
INTANGIBLE_ASSETS_Tables
INTANGIBLE ASSETS (Tables) | 3 Months Ended | ||||||||||
Mar. 31, 2015 | |||||||||||
INTANGIBLE ASSETS [Abstract] | |||||||||||
Schedule of Intangibles Assets | March 31, | ||||||||||
Estimated | 2015 | December 31, | |||||||||
Life | (unaudited) | 2014 | |||||||||
Goodwill related to acquisition of Mobility Freedom | Indefinite | 1,641,303 | 1,641,303 | ||||||||
Goodwill related to acquisition of Ride-Away | Indefinite | 1,888,710 | 1,888,710 | ||||||||
Trade name related to acquisition of Mobility Freedom | Indefinite | 400,000 | 400,000 | ||||||||
Trade name related to acquisition of Ride-Away | Indefinite | 990,000 | 990,000 | ||||||||
Primary market area related to acquisition of Mobility Freedom | Indefinite | 280,000 | 280,000 | ||||||||
Primary market area related to acquisition of Ride-Away | Indefinite | 470,000 | 470,000 | ||||||||
Goodwill related to acquisition of Auto Mobility Sales | Indefinite | 284,213 | 284,213 | ||||||||
Primary market area related to acquisition of Auto Mobility Sales | Indefinite | 150,000 | 150,000 | ||||||||
Non-compete agreements area related to acquisition of Auto Mobility Sales | 3 years | 80,000 | 80,000 | ||||||||
Subtotal | 6,184,226 | 6,184,226 | |||||||||
Accumulated amortization | (37,774 | ) | (31,108 | ) | |||||||
Total | $ | 6,146,452 | $ | 6,153,118 |
NOTES_PAYABLE_AND_DEBT_Tables
NOTES PAYABLE AND DEBT (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
NOTES PAYABLE AND DEBT [Abstract] | |||||||||
Schedule of Installement Debt | March 31, | December 31, | |||||||
2015 | 2014 | ||||||||
(unaudited) | |||||||||
Vehicle Note Payable, dated August 18, 2011, vehicle financing arrangement for tow truck, original amount of $47,124, 5 years (60 months), 0% interest rate, commenced October 1, 2011, matures on October 1, 2016, monthly installment payments of $785 | 12,566 | 14,923 | |||||||
Note Payable, dated May 13, 2011, issued for the acquisition of Mobility Freedom, original amount of $2 million, fifteen years (180 months), 6% interest rate, commenced August 1, 2011, matures on July 1, 2026, monthly installment payments of $16,877 secured by grantee from the majority shareholder of Mobility Freedom | 1,653,914 | 1,679,480 | |||||||
Note Payable to related party, dated May 13, 2011, associated with the acquisition of Mobility Freedom, original amount of $2 million, ten years (120 months), 5% interest rate, commenced August 1, 2011, matures on July 1, 2021, monthly installment payments of $22,204 | 1,363,965 | 1,415,737 | |||||||
Note Payable, dated November 16, 2011, issued for the acquisition of Certified Auto, original amount of $50,000, four years (16 quarters), 0% interest rate, commenced January 16, 2012, matures on November 16, 2015, quarterly installment payments of $3,125 | — | 18,660 | |||||||
Note Payable, dated March 1, 2012, issued for the acquisition of Ride-Away, original amount of $3,000,000, ten years (120 months), 5% interest rate, commences September 1, 2012, matures on May 2, 2022, monthly installment payments of $31,820. Note is with the former owner of Ride-Away | 2,273,645 | 2,356,573 | |||||||
Note payable to related party, dated March 1, 2012, issued for the acquisition of Ride-Away, original amount of $500,000 , five years (60 months), 6% interest rate, commenced April 1, 2012, matures March 1, 2017, monthly installment payments of $9,685 | 218,532 | 244,010 | |||||||
Promissory Note payable to a related party, dated September 4, 2014, issued for the acquisition of Auto Mobility Sales, original amount of $210,000 , five years (60 months), 5% interest rate, commenced November 1, 2014, matures October 1, 2018, monthly installment payments of $3,963 | 152,391 | 165,565 | |||||||
Promissory Note payable to a related party, dated September 4, 2014, issued for the acquisition of Auto Mobility Sales, original amount of $140,000 , five years (60 months), 5% interest rate, commenced November 1, 2014, matures October 1, 2018, monthly installment payments of $2,642 | 101,594 | 110,378 | |||||||
Total debt | 5,776,607 | 6,005,326 | |||||||
Current portion of long-term debt, notes payable | 754,648 | 762,125 | |||||||
Long-term portion | $ | 5,021,959 | $ | 5,243,201 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
INCOME TAXES [Abstract] | |||||||||
Schedule of Net Income Tax Expense (Benefit) | For The Three months Ended | ||||||||
March 31, | |||||||||
2015 | 2014 | ||||||||
Expected federal income tax expense (benefit) (34 %) | $ | 1,540 | $ | 127,184 | |||||
State tax expense, net of federal tax effect | — | 23,427 | |||||||
Other | (61,361 | ) | 19,607 | ||||||
(59,821 | ) | 170,218 | |||||||
Change in valuation allowance | — | — | |||||||
Net income tax expense (benefit) | $ | (59,821 | ) | $ | 170,218 |
BASIS_OF_PRESENTATION_AND_SUMM3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Cash balance insured by FDIC | 250,000 | ||
Common stock, shares outstanding | 1,009,619,306 | 1,004,210,973 | |
Revenue, Segment [Member] | United States Department of Veterans Affairs (the "VA") [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Concentration percentage | 18.00% | 24.00% | |
Modified Mobility Vehicles [Member] | Consolidated revenues [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Concentration percentage | 100.00% |
BASIS_OF_PRESENTATION_AND_SUMM4
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Earnings per Share) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ||
Net income (loss) | $4,531 | $194,347 |
Denominator for basic income per share (weighted-average shares) | 1,009,024,984 | 994,619,535 |
Denominator for dilutive income per share (adjusted weighted-average) | 1,009,024,984 | 994,619,535 |
Basic and diluted income per share from continuing operations |
ACCOUNTS_RECEIVABLE_Details
ACCOUNTS RECEIVABLE (Details) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2015 | Dec. 31, 2014 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, gross | 6,782,397 | 9,759,182 |
Less: allowance for doubtful accounts | -379,453 | -752,624 |
Total | 6,402,944 | 9,006,558 |
Trade receivables [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, gross | 2,497,182 | 4,457,010 |
Trade receivables [Member] | Accounts receivable [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Concentration percentage | 36.80% | 45.70% |
Government receivables [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, gross | 4,285,215 | 5,302,172 |
Government receivables [Member] | Accounts receivable [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Concentration percentage | 63.20% | 54.30% |
INVENTORY_Details
INVENTORY (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
INVENTORY [Abstract] | ||
Vehicles | $14,267,837 | $15,254,709 |
Work in Process | 398,804 | 474,850 |
Equipment and supplies | 1,108,526 | 1,022,240 |
Inventory reserve | -106,449 | -109,993 |
Total inventory | $15,668,718 | $16,641,806 |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $3,935,463 | $3,981,690 | |
Accumulated depreciation | -2,002,267 | -1,940,549 | |
Property and equipment, net | 1,933,196 | 2,041,141 | |
Depreciation | 217,420 | 223,296 | |
Building improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life | Varies | ||
Property and equipment, gross | 955,602 | 949,478 | |
Office furniture and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life | 5 years | ||
Property and equipment, gross | 265,207 | 306,331 | |
Rental equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 623,833 | 581,245 | |
Rental equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life | 13 months | ||
Rental equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life | 36 months | ||
Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life | 5 years | ||
Property and equipment, gross | 231,060 | 161,786 | |
Capitalized leases [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated Life | Varies | ||
Property and equipment, gross | $1,859,761 | $1,982,850 |
INTANGIBLE_ASSETS_Details
INTANGIBLE ASSETS (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Total Intangibles, subtotal | $6,184,226 | $6,184,226 | |
Accumulated amortization | -37,774 | -31,108 | |
Total Intangibles, total | 6,146,452 | 6,153,118 | |
Amortization expense | 6,666 | 11,031 | |
Goodwill related to acquisition of Mobility Freedom [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated Life | Indefinite | ||
Goodwill | 1,641,303 | 1,641,303 | |
Goodwill related to acquisition of Ride-Away [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated Life | Indefinite | ||
Goodwill | 1,888,710 | 1,888,710 | |
Trade name related to acquisition of Mobility Freedom [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated Life | Indefinite | ||
Indefinite-Lived Intangible Assets | 400,000 | 400,000 | |
Trade name related to acquisition of Ride-Away [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated Life | Indefinite | ||
Indefinite-Lived Intangible Assets | 990,000 | 990,000 | |
Primary market area related to acquisition of Mobility Freedom [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated Life | Indefinite | ||
Indefinite-Lived Intangible Assets | 280,000 | 280,000 | |
Primary market area related to acquisition of Ride-Away [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated Life | Indefinite | ||
Indefinite-Lived Intangible Assets | 470,000 | 470,000 | |
Goodwill related to acquisition of Auto Mobility Sales [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated Life | Indefinite | ||
Goodwill | 284,213 | 284,213 | |
Primary market area related to acquisition of Auto Mobility Sales [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated Life | Indefinite | ||
Indefinite-Lived Intangible Assets | 150,000 | 150,000 | |
Non-compete agreements area related to Acquisition of Auto Mobility Sales [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Estimated Life | 3 years | ||
Finite-Lived Intangible Assets, Gross | $80,000 | $80,000 |
NOTES_PAYABLE_AND_DEBT_Narrati
NOTES PAYABLE AND DEBT (Narrative) (Details) (USD $) | 0 Months Ended | 3 Months Ended | |||
Oct. 31, 2013 | Feb. 27, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | 20-May-14 | |
Line of Credit Facility [Line Items] | |||||
Line of credit, amount outstanding | $3,918,885 | $2,738,878 | |||
Note payable - floor plan | 11,704,519 | 15,584,949 | |||
Revolving Line of Credit Commercial Note [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit borrowing capacity | 8,000,000 | ||||
Prime interest rate spread | 0.25% | ||||
Effective interest rate | 3.50% | ||||
Maturity date | 31-Oct-16 | ||||
Line of credit, amount outstanding | 3,918,885 | 2,738,878 | |||
Term loan draw facility [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit borrowing capacity | 1,000,000 | ||||
Maturity date | 27-Mar-20 | ||||
Maximum percentage of acquisition amount which is covered | 50.00% | ||||
Interest rate (as a percent) | 6.00% | ||||
Maturity term | 48 months | ||||
General Electric Credit Corporation [Member] | Floor Plan Line of Credit [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Note payable - floor plan | 11,704,519 | 15,584,949 | |||
Increase in borrowing capacity | 5,000,000 | ||||
General Electric Credit Corporation [Member] | Floor Plan Line of Credit [Member] | Ride-Away [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit borrowing capacity | 11,250,000 | ||||
Prime interest rate spread | 6.00% | ||||
Debt Instrument, Description of Variable Rate Basis | 90 day LIBOR | ||||
General Electric Credit Corporation [Member] | Floor Plan Line of Credit [Member] | Mobility Freedom [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit borrowing capacity | 3,850,000 | ||||
Prime interest rate spread | 5.50% | ||||
Debt Instrument, Description of Variable Rate Basis | 90 day LIBOR | ||||
General Electric Credit Corporation [Member] | Floor Plan Line of Credit [Member] | Auto Mobility Sales [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit borrowing capacity | $1,750,000 | ||||
Prime interest rate spread | 5.50% | ||||
Debt Instrument, Description of Variable Rate Basis | 90 day LIBOR |
NOTES_PAYABLE_AND_DEBT_Schedul
NOTES PAYABLE AND DEBT (Schedule of Installment Debt) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2014 | |
Installment Debt | ||
Total debt | $5,776,607 | $6,005,326 |
Current portion of long-term debt, notes payable | 754,648 | 762,125 |
Long-term portion | 5,021,959 | 5,243,201 |
Vehicle Note Payable, Dated August 18, 2011 [Member] | ||
Installment Debt | ||
Issuance date | 18-Aug-11 | |
Commencement date | 1-Oct-11 | |
Maturity date | 1-Oct-16 | |
Original amount | 47,124 | |
Term of debt | 5 years | |
Interest rate | 0.00% | |
Installment payment | 785 | |
Installment payment, frequency | monthly | |
Total debt | 12,566 | 14,923 |
Note Payable, Dated May 13, 2011 [Member] | ||
Installment Debt | ||
Issuance date | 13-May-11 | |
Commencement date | 1-Aug-11 | |
Maturity date | 1-Jul-26 | |
Original amount | 2,000,000 | |
Term of debt | 15 years | |
Interest rate | 6.00% | |
Installment payment | 16,877 | |
Installment payment, frequency | monthly | |
Total debt | 1,653,914 | 1,679,480 |
Note Payable to Related Party, Dated May 13, 2011 [Member] | Related Party [Member] | ||
Installment Debt | ||
Issuance date | 13-May-11 | |
Commencement date | 1-Aug-11 | |
Maturity date | 1-Jul-21 | |
Original amount | 2,000,000 | |
Term of debt | 10 years | |
Interest rate | 5.00% | |
Installment payment | 22,204 | |
Installment payment, frequency | monthly | |
Total debt | 1,363,965 | 1,415,737 |
Note Payable, Dated November 16, 2011 [Member] | ||
Installment Debt | ||
Issuance date | 16-Nov-11 | |
Commencement date | 16-Jan-12 | |
Maturity date | 16-Nov-15 | |
Original amount | 50,000 | |
Term of debt | 4 years | |
Interest rate | 0.00% | |
Installment payment | 3,125 | |
Installment payment, frequency | quarterly | |
Total debt | 18,660 | |
Note Payable, Dated March 1, 2012 [Member] | ||
Installment Debt | ||
Issuance date | 1-Mar-12 | |
Commencement date | 1-Sep-12 | |
Maturity date | 2-May-22 | |
Original amount | 3,000,000 | |
Term of debt | 10 years | |
Interest rate | 5.00% | |
Installment payment | 31,820 | |
Installment payment, frequency | monthly | |
Total debt | 2,273,645 | 2,356,573 |
Note Payable to Related Party, Dated March 1, 2012 [Member] | Related Party [Member] | ||
Installment Debt | ||
Issuance date | 1-Mar-12 | |
Commencement date | 1-Apr-12 | |
Maturity date | 1-Mar-17 | |
Original amount | 500,000 | |
Term of debt | 5 years | |
Interest rate | 6.00% | |
Installment payment | 9,685 | |
Installment payment, frequency | monthly | |
Total debt | 218,532 | 244,010 |
Promissory Note One, Dated September 4, 2014 [Member] | Related Party [Member] | ||
Installment Debt | ||
Issuance date | 4-Sep-14 | |
Commencement date | 1-Nov-14 | |
Maturity date | 1-Oct-18 | |
Original amount | 210,000 | |
Term of debt | 5 years | |
Interest rate | 5.00% | |
Installment payment | 3,963 | |
Installment payment, frequency | monthly | |
Total debt | 152,391 | 165,565 |
Promissory Note Two, Dated September 4, 2014 [Member] | Related Party [Member] | ||
Installment Debt | ||
Issuance date | 4-Sep-14 | |
Commencement date | 1-Nov-14 | |
Maturity date | 1-Oct-18 | |
Original amount | 140,000 | |
Term of debt | 5 years | |
Interest rate | 5.00% | |
Installment payment | 2,642 | |
Installment payment, frequency | monthly | |
Total debt | $101,594 | $110,378 |
STOCKHOLDERS_EQUITY_Details
STOCKHOLDERS' EQUITY (Details) (Common Stock [Member], Key Employees [Member], USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Common Stock [Member] | Key Employees [Member] | |
Class of Stock [Line Items] | |
Issuance of common stock for compensation, shares | 5,408,333 |
Issuance of common stock for compensation | $89,275 |
INCOME_TAXES_Narrative_Details
INCOME TAXES (Narrative) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
INCOME TAXES [Abstract] | ||
Loss carry forwards | ||
Statutory federal tax rate | 34.00% |
INCOME_TAXES_Schedule_of_Net_I
INCOME TAXES (Schedule of Net Income Tax Expense (Benefit)) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
INCOME TAXES [Abstract] | ||
Expected federal income tax expense (benefit) (34%) | $1,540 | $127,184 |
State tax expense, net of federal tax effect | 23,427 | |
Other | -61,361 | 19,607 |
Income tax expense (benefit) before change in valuation allowance | -59,821 | 170,218 |
Change in valuation allowance | ||
Net income tax expense (benefit) | ($59,821) | $170,218 |
DIVESTITURE_OF_CERTIFIED_MEDIC1
DIVESTITURE OF CERTIFIED MEDICAL (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Income or loss from discontinued operations | ($10,040) | |
Certified Medical [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Related party note receivable | 124,618 | |
Gain on sale | 92,653 | |
Income or loss from discontinued operations | $0 |