Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Mar. 31, 2019 | May 14, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | CHASE GENERAL CORP | |
Entity Central Index Key | 0000015357 | |
Trading Symbol | csgn | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 969,834 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
CURRENT ASSETS | ||
Cash and Cash Equivalents | $ 98,777 | $ 2,129 |
Trade Receivables, Net of Allowance for Doubtful Accounts of $14,289 and $13,389, Respectively | 165,586 | 135,331 |
Inventories | ||
Finished Goods | 12,675 | 208,254 |
Goods in Process | 12,959 | 10,937 |
Raw Materials | 79,015 | 74,267 |
Packaging Materials | 106,395 | 152,184 |
Prepaid Expenses | 22,335 | 12,225 |
Total Current Assets | 497,742 | 595,327 |
PROPERTY AND EQUIPMENT | ||
Land | 35,000 | 35,000 |
Buildings | 77,348 | 77,348 |
Machinery and Equipment | 851,791 | 851,791 |
Trucks and Autos | 163,039 | 163,039 |
Office Equipment | 33,025 | 33,025 |
Leasehold Improvements | 72,068 | 72,068 |
Total | 1,232,271 | 1,232,271 |
Less Accumulated Depreciation | 1,039,428 | 997,091 |
Total Property and Equipment, Net | 192,843 | 235,180 |
Total Assets | 690,585 | 830,507 |
CURRENT LIABILITIES | ||
Accounts Payable | 47,658 | 176,871 |
Current Maturities of Notes Payable | 7,473 | 11,224 |
Accrued Expenses | 24,831 | 30,852 |
Refund Liability Owed to Customers | 11,020 | |
Deferred Income | 1,299 | 1,299 |
Total Current Liabilities | 92,281 | 220,246 |
LONG-TERM LIABILITIES | ||
Deferred Income | 6,492 | 7,466 |
Notes Payable, Less Current Maturities | 12,761 | 24,787 |
Total Long-Term Liabilities | 19,253 | 32,253 |
Total Liabilities | 111,534 | 252,499 |
COMMITMENTS AND CONTINGENCIES | ||
Capital Stock Issued and Outstanding: | ||
Common Stock, $1 Par Value | 969,834 | 969,834 |
Paid-In Capital in Excess of Par | 3,134,722 | 3,134,722 |
Accumulated Deficit | (5,886,945) | (5,887,988) |
Total Stockholders' Equity | 579,051 | 578,008 |
Total Liabilities and Stockholders' Equity | 690,585 | 830,507 |
Prior Cumulative Preferred Stock, $5 Par Value: | Series A | ||
Capital Stock Issued and Outstanding: | ||
Preferred stock, value | 500,000 | 500,000 |
Prior Cumulative Preferred Stock, $5 Par Value: | Series B | ||
Capital Stock Issued and Outstanding: | ||
Preferred stock, value | 500,000 | 500,000 |
Cumulative Preferred Stock, $20 Par Value: | Series A | ||
Capital Stock Issued and Outstanding: | ||
Preferred stock, value | 1,170,660 | 1,170,660 |
Cumulative Preferred Stock, $20 Par Value: | Series B | ||
Capital Stock Issued and Outstanding: | ||
Preferred stock, value | $ 190,780 | $ 190,780 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Allowance for doubtful accounts on trade receivables (in dollars) | $ 14,289 | $ 13,389 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Prior Cumulative Preferred Stock, $5 Par Value: | ||
Preferred stock, par value (in dollars per share) | $ 5 | $ 5 |
Prior Cumulative Preferred Stock, $5 Par Value: | Series A | ||
Preferred stock, liquidation preference (in dollars) | $ 2,332,500 | $ 2,310,000 |
Prior Cumulative Preferred Stock, $5 Par Value: | Series B | ||
Preferred stock, liquidation preference (in dollars) | $ 2,287,500 | $ 2,265,000 |
Cumulative Preferred Stock, $20 Par Value: | ||
Preferred stock, par value (in dollars per share) | $ 20 | $ 20 |
Cumulative Preferred Stock, $20 Par Value: | Series A | ||
Preferred stock, liquidation preference (in dollars) | $ 5,238,696 | $ 5,194,796 |
Cumulative Preferred Stock, $20 Par Value: | Series B | ||
Preferred stock, liquidation preference (in dollars) | $ 853,748 | $ 846,594 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
SALES | $ 327,044 | $ 378,326 | $ 2,199,193 | $ 2,358,991 |
COST OF SALES | 355,195 | 344,016 | 1,633,970 | 1,791,498 |
Gross Profit (Loss) on Sales | (28,151) | 34,310 | 565,223 | 567,493 |
OPERATING EXPENSES | ||||
Selling | 61,398 | 82,324 | 229,815 | 312,872 |
General and Administrative | 96,654 | 106,855 | 332,467 | 376,518 |
Total Operating Expenses | 158,052 | 189,179 | 562,282 | 689,390 |
Income/(Loss) from Operations | (186,203) | (154,869) | 2,941 | (121,897) |
OTHER INCOME (EXPENSE) | ||||
Miscellaneous Income | 586 | 842 | 4,411 | 1,604 |
Interest Expense | (368) | (556) | (6,309) | (4,856) |
Total Other Expense | 218 | 286 | (1,898) | (3,252) |
Income/(Loss) before Income Taxes | (185,985) | (154,583) | 1,043 | (125,149) |
INCOME TAX BENEFIT | (3,400) | (34,126) | (20,235) | |
NET INCOME/(LOSS) | $ (182,585) | $ (120,457) | $ 1,043 | $ (104,914) |
LOSS PER SHARE | ||||
Basic (in dollars per share) | $ (0.22) | $ (0.16) | $ (0.10) | $ (0.21) |
Diluted (in dollars per share) | $ (0.22) | $ (0.16) | $ (0.10) | $ (0.21) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) | 9 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net Income (Loss) | $ 1,043 | $ (104,914) |
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities: | ||
Depreciation and Amortization | 42,337 | 50,995 |
Allowance for Bad Debts | 900 | 900 |
Deferred Income Amortization | (974) | (974) |
Deferred Income Taxes | 32,950 | |
Effects of Changes in Operating Assets and Liabilities: | ||
Trade Receivables | (31,155) | (88,432) |
Inventories | 234,598 | 209,085 |
Prepaid Expenses | (10,110) | (1,435) |
Income Taxes Receivable | 11,160 | |
Accounts Payable | (129,213) | 49,554 |
Refund Liability Owed to Customers | 11,020 | |
Accrued Expenses | (6,021) | (1,269) |
Net Cash Provided by Operating Activities | 112,425 | 157,620 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchases of Property and Equipment | (2,276) | |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from Line-of-Credit | 340,000 | 330,000 |
Principal Payments on Line-of-Credit | (340,000) | (330,000) |
Principal Payments on Notes Payable | (15,777) | (16,666) |
Net Cash Used by Financing Activities | (15,777) | (16,666) |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 96,648 | 138,678 |
Cash and Cash Equivalents - Beginning of Period | 2,129 | 46,182 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | $ 98,777 | $ 184,860 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Mar. 31, 2019 | |
Nature Of Business And Significant Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 SIGNIFICANT ACCOUNTING POLICIES General The condensed consolidated balance sheet of Chase General Corporation (hereinafter referred to as Chase, we, our, and us) at June 30, 2018 has been taken from audited consolidated financial statements at that date and condensed. The condensed consolidated financial statements as of and for the three and nine months ended March 31, 2019 and for the three and nine months ended March 31, 2018 are unaudited and reflect all normal and recurring accruals and adjustments which are, in the opinion of management, necessary for a fair presentation of the financial position, operating results and cash flows for the interim periods presented in this quarterly report. The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto, together with management’s discussion and analysis of financial condition and results of operations, contained in our Annual Report on Form 10-K for the year ended June 30, 2018. The results of operations for the three and nine months ended March 31, 2019 and cash flows for the nine months ended March 31, 2019 are not necessarily indicative of the results for the entire fiscal year ending June 30, 2019. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary to fairly present financial position, results of operations, and cash flows for the periods have been included. No events have occurred subsequent to March 31, 2019, through the date of filing this form, that would require disclosure in this Form 10-Q or would be required to be recognized in the condensed consolidated financial statements as of or for the nine month period ended March 31, 2019. Revenue Recognition The majority of our revenue is derived by fulfilling customer orders for the purchase of our products, including 1) a candy bar marketed under the trade name “Cherry Mash” and 2) coconut, peanut, chocolate, and fudge confectioneries. The Company recognizes revenue at the point in time that control of the ordered product(s) is transferred to the customer, which is typically upon shipment to the customer. Shipping and handling costs incurred to ship product to the customer are recorded within cost of sales. Amounts billed and due from our customers are classified as accounts receivables on the balance sheet and require payment on a short-term basis. Generally, individual orders from customers are accounted for as a single performance obligation. Revenue is measured as the amount of consideration we expect to receive in exchange for fulfilling product orders. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. The amount of consideration the Company expects to receive and revenue the Company recognizes includes estimates of variable consideration, including costs for trade promotional programs, customer incentives, and allowances and discounts associated with aged or potentially unsaleable products. These estimates are based upon our analysis of the programs offered, historical trends, and expectations regarding customer and consumer participation, sales and payment trends and our experience with payment patterns associated with similar programs offered in the past. The Company reviews and updates these estimates regularly and the impact of any adjustments are recognized in the period the adjustments are identified. The adjustments recognized in the third quarter of the year ending June 30, 2019 resulting from updated estimates of revenue for prior year product sales were not significant. The majority of the Company’s products are confectionery and confectionery-based and, therefore, exhibit similar economic characteristics, such that they are based on similar ingredients and are marketed and sold through the same channels to the same customers. The Company operates two divisions, Chase Candy Products and Seasonal Candy Products. Chase Candy Products involve production and sale of a candy bar marketed under the trade name “Cherry Mash”. The Seasonal Candy Products involve production and sale of coconut, peanut, chocolate, and fudge confectioneries. Both divisions share a common labor force and utilize the same basic equipment and raw materials. Management considers these two divisions as one reportable segment. The various divisions of revenue are as follows: For the three months ended March 31, 2019 2018 Sales - Chase Candy $ 321,390 $ 372,664 Sales - Seasonal Candy 5,654 5,662 Sales $ 327,044 $ 378,326 For the nine months ended March 31, 2019 2018 Sales - Chase Candy $ 1,044,762 $ 1,136,093 Sales - Seasonal Candy 1,154,431 1,222,898 Sales $ 2,199,193 $ 2,358,991 Recently Adopted Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (ASC 606), which replaces numerous requirements in U.S. GAAP, including industry-specific requirements, and provides companies with a single revenue recognition model for recognizing revenue from contracts with customers. On July 1, 2018, we adopted the requirements of ASC 606 and all the related amendments to contracts that have not been completed as of the initial adoption date using the modified retrospective method. Upon completing our implementation assessment of ASC 606, we concluded that no adjustment was required to the opening balance of retained earnings at the date of initial application. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The Company identified certain amounts included in accounts payable that are separately recorded as a current liability upon adoption of ASC 606. There was no impact to working capital as a result of these reclassifications. The cumulative effects of the changes made to our consolidated July 1, 2018 balance sheet for the adoption of the new revenue standard were as follows: Balance at Adjustment Balance at June 30, 2018 Upon Adoption July 1, 2018 Balance Sheet Accounts Payable $ 135,311 $ (12,900 ) $ 122,411 Refund Liability Owed to Customers - 12,900 12,900 There is no change in the timing of revenue recognition upon adoption of ASC 606. The Company has identified certain amounts paid to customers which are currently recorded as selling expense. Under ASC 606, these amounts will be recorded as a reduction to revenue as the Company does not receive a distinct good or service in exchange for the payment. The total impact of adoption on our consolidated statement of operation and balance sheet was as follows: For the three month period ended March 31, 2019 Current Previous Standard Change Standard Statement of Operations Sales $ 327,044 $ (1,313 ) $ 325,731 Selling Expenses 61,398 (1,313 ) 60,085 As of and for the nine month period ended March 31, 2019 Current Previous Standard Change Standard Balance Sheet Accounts Payable $ 41,423 $ 11,020 $ 52,443 Refund Liability Owed to Customers 11,020 (11,020 ) - Statement of Operations Sales $ 2,199,193 $ 46,577 $ 2,245,770 Selling Expenses 229,815 46,577 276,392 Recently Issued Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This ASU will require lessees to recognize most leases on their balance sheet as lease liabilities with corresponding right-of-use (ROU) assets. Recognition, measurement, and presentation of expenses will depend on classification as a finance or operating lease. We are currently in the process of evaluating our existing lease portfolio, including accumulating all of the necessary information required to properly account for the leases under the new standard. ASU 2016-02 is effective for us beginning July 1, 2019. The guidance originally required entities to apply ASU 2016-02 on a modified retrospective basis; however, the FASB has recently issued guidance that would allow adoption of this standard as of the effective date without restating prior periods. Management has begun the process of inventorying leases that this standard may apply to and the impact is not yet determined. There have been no other newly issued or newly applicable accounting pronouncements that have, or are expected to have, a significant impact on the Company’s consolidated financial statements. |
LOSS PER SHARE
LOSS PER SHARE | 9 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
LOSS PER SHARE | NOTE 2 LOSS PER SHARE The loss per share was computed on the weighted average of outstanding common shares during the period. Diluted earnings per share are calculated by including contingently issuable shares with the weighted average shares outstanding. Three Months Ended Nine Months Ended March 31 March 31 2019 2018 2019 2018 Net Income (Loss) $ (182,585 ) $ (120,457 ) $ 1,043 $ (104,914 ) Preferred Dividend Requirements: 6% Prior Cumulative Preferred, $5 Par Value 15,000 15,000 45,000 45,000 5% Convertible Cumulative Preferred, $20 Par Value 17,018 17,018 51,054 51,054 Total Dividend Requirements 32,018 32,018 96,054 96,054 Net Loss - Common Stockholders $ (214,603 ) $ (152,475 ) $ (95,011 ) $ (200,968 ) Weighted Average Shares - Basic 969,834 969,834 969,834 969,834 Dilutive Effect of Contingently Issuable Shares 1,033,334 1,033,334 1,033,334 1,033,334 Weighted Average Shares – Diluted 2,003,168 2,003,168 2,003,168 2,003,168 Basic Loss per Share $ (0.22 ) $ (0.16 ) $ (0.10 ) $ (0.21 ) Diluted Loss per Share $ (0.22 ) $ (0.16 ) $ (0.10 ) $ (0.21 ) The contingently issuable shares, for the three months and nine months ended March 31, 2019 and 2018, were not included in diluted earnings per common share as they would have an antidilutive effect upon earnings per share. Cumulative Preferred Stock dividends in arrears at March 31, 2019 and 2018 totaled $8,301,004 and $8,172,932, respectively. Total dividends in arrears, on a per share basis, consist of the following: Nine Months Ended March 31 2019 2018 6% Convertible Series A $ 18 $ 18 Series B 18 17 5% Convertible Series A $ 70 $ 69 Series B 70 69 The 6% convertible prior cumulative preferred stock may, upon 30 days prior notice, be redeemed by the Corporation at $5.25 a share plus unpaid accrued dividends to date of redemption. In the event of voluntary liquidation, holders of this stock are entitled to receive $5.25 per share plus accrued dividends. It may be exchanged for common stock at the option of the shareholders in the ratio of four common shares for one share of Series A and 3.75 common shares for one share of Series B. The Company has the privilege of redemption of 5% convertible cumulative preferred stock at $21.00 a share plus unpaid accrued dividends. In the event of voluntary or involuntary liquidation, holders of this stock are entitled to receive $20.00 a share plus unpaid accrued dividends. It may be exchanged for common stock at the option of the shareholders, in the ratio of 3.795 common shares for one of preferred. |
NOTES PAYABLE
NOTES PAYABLE | 9 Months Ended |
Mar. 31, 2019 | |
Notes Payable [Abstract] | |
NOTES PAYABLE | NOTE 3 NOTES PAYABLE The Company’s notes payable consists of: March 31, June 30, Payee Terms 2019 2018 Nodaway Valley Bank $350,000 line-of-credit agreement expiring on January 4, 2020, with a variable interest rate at prime but not less than 5%. The line-of-credit is collateralized by substantially all assets of the Company. $ - $ - Ford Credit $705 monthly payments, interest of 5.8%; final payment due October 2021, secured by a vehicle. 20,234 25,560 Toyota Credit $364 monthly payments, interest of 3.5%. The loan was paid off in March of 2019. - 10,451 Total 20,234 36,011 Less Current Portion 7,473 11,224 Long-Term Portion $ 12,761 $ 24,787 Future minimum payments for the twelve months ending March 31 are: March 31: Amount 2020 $ 7,473 2021 7,922 2022 4,839 Total $ 20,234 |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 4 INCOME TAXES The Company follows the provisions for uncertain tax positions as addressed in Financial Accounting Standards Board Accounting Standards Codification |
SUPPLEMENTAL DISCLOSURES OF CAS
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | 9 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | NOTE 5 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Nine Months Ended March 31 2019 2018 Cash Paid for: Interest $ 6,309 $ 4,856 |
DISCLOSURES ABOUT FAIR VALUE OF
DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS | 9 Months Ended |
Mar. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS | NOTE 6 DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS The Company’s financial instruments consist principally of cash and cash equivalents, trade receivables and payables, and notes payable. There are no significant differences between the carrying value and fair value of any of these consolidated financial instruments. As of March 31, 2019, the amount of the Company’s long-term debt approximates fair value based on the present value of estimated future cash flows using a discount rate commensurate with a borrowing rate available to the Company. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Mar. 31, 2019 | |
Nature Of Business And Significant Accounting Policies [Abstract] | |
General | General The condensed consolidated balance sheet of Chase General Corporation (hereinafter referred to as Chase, we, our, and us) at June 30, 2018 has been taken from audited consolidated financial statements at that date and condensed. The condensed consolidated financial statements as of and for the three and nine months ended March 31, 2019 and for the three and nine months ended March 31, 2018 are unaudited and reflect all normal and recurring accruals and adjustments which are, in the opinion of management, necessary for a fair presentation of the financial position, operating results and cash flows for the interim periods presented in this quarterly report. The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto, together with management’s discussion and analysis of financial condition and results of operations, contained in our Annual Report on Form 10-K for the year ended June 30, 2018. The results of operations for the three and nine months ended March 31, 2019 and cash flows for the nine months ended March 31, 2019 are not necessarily indicative of the results for the entire fiscal year ending June 30, 2019. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary to fairly present financial position, results of operations, and cash flows for the periods have been included. No events have occurred subsequent to March 31, 2019, through the date of filing this form, that would require disclosure in this Form 10-Q or would be required to be recognized in the condensed consolidated financial statements as of or for the nine month period ended March 31, 2019. |
Revenue Recognition | Revenue Recognition The majority of our revenue is derived by fulfilling customer orders for the purchase of our products, including 1) a candy bar marketed under the trade name “Cherry Mash” and 2) coconut, peanut, chocolate, and fudge confectioneries. The Company recognizes revenue at the point in time that control of the ordered product(s) is transferred to the customer, which is typically upon shipment to the customer. Shipping and handling costs incurred to ship product to the customer are recorded within cost of sales. Amounts billed and due from our customers are classified as accounts receivables on the balance sheet and require payment on a short-term basis. Generally, individual orders from customers are accounted for as a single performance obligation. Revenue is measured as the amount of consideration we expect to receive in exchange for fulfilling product orders. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. The amount of consideration the Company expects to receive and revenue the Company recognizes includes estimates of variable consideration, including costs for trade promotional programs, customer incentives, and allowances and discounts associated with aged or potentially unsaleable products. These estimates are based upon our analysis of the programs offered, historical trends, and expectations regarding customer and consumer participation, sales and payment trends and our experience with payment patterns associated with similar programs offered in the past. The Company reviews and updates these estimates regularly and the impact of any adjustments are recognized in the period the adjustments are identified. The adjustments recognized in the third quarter of the year ending June 30, 2019 resulting from updated estimates of revenue for prior year product sales were not significant. The majority of the Company’s products are confectionery and confectionery-based and, therefore, exhibit similar economic characteristics, such that they are based on similar ingredients and are marketed and sold through the same channels to the same customers. The Company operates two divisions, Chase Candy Products and Seasonal Candy Products. Chase Candy Products involve production and sale of a candy bar marketed under the trade name “Cherry Mash”. The Seasonal Candy Products involve production and sale of coconut, peanut, chocolate, and fudge confectioneries. Both divisions share a common labor force and utilize the same basic equipment and raw materials. Management considers these two divisions as one reportable segment. The various divisions of revenue are as follows: For the three months ended March 31, 2019 2018 Sales - Chase Candy $ 321,390 $ 372,664 Sales - Seasonal Candy 5,654 5,662 Sales $ 327,044 $ 378,326 For the nine months ended March 31, 2019 2018 Sales - Chase Candy $ 1,044,762 $ 1,136,093 Sales - Seasonal Candy 1,154,431 1,222,898 Sales $ 2,199,193 $ 2,358,991 |
Recently Adopted Pronouncements | Recently Adopted Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (ASC 606), which replaces numerous requirements in U.S. GAAP, including industry-specific requirements, and provides companies with a single revenue recognition model for recognizing revenue from contracts with customers. On July 1, 2018, we adopted the requirements of ASC 606 and all the related amendments to contracts that have not been completed as of the initial adoption date using the modified retrospective method. Upon completing our implementation assessment of ASC 606, we concluded that no adjustment was required to the opening balance of retained earnings at the date of initial application. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The Company identified certain amounts included in accounts payable that are separately recorded as a current liability upon adoption of ASC 606. There was no impact to working capital as a result of these reclassifications. The cumulative effects of the changes made to our consolidated July 1, 2018 balance sheet for the adoption of the new revenue standard were as follows: Balance at Adjustment Balance at June 30, 2018 Upon Adoption July 1, 2018 Balance Sheet Accounts Payable $ 135,311 $ (12,900 ) $ 122,411 Refund Liability Owed to Customers - 12,900 12,900 There is no change in the timing of revenue recognition upon adoption of ASC 606. The Company has identified certain amounts paid to customers which are currently recorded as selling expense. Under ASC 606, these amounts will be recorded as a reduction to revenue as the Company does not receive a distinct good or service in exchange for the payment. The total impact of adoption on our consolidated statement of operation and balance sheet was as follows: For the three month period ended March 31, 2019 Current Previous Standard Change Standard Statement of Operations Sales $ 327,044 $ (1,313 ) $ 325,731 Selling Expenses 61,398 (1,313 ) 60,085 As of and for the nine month period ended March 31, 2019 Current Previous Standard Change Standard Balance Sheet Accounts Payable $ 41,423 $ 11,020 $ 52,443 Refund Liability Owed to Customers 11,020 (11,020 ) - Statement of Operations Sales $ 2,199,193 $ 46,577 $ 2,245,770 Selling Expenses 229,815 46,577 276,392 Recently Issued Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This ASU will require lessees to recognize most leases on their balance sheet as lease liabilities with corresponding right-of-use (ROU) assets. Recognition, measurement, and presentation of expenses will depend on classification as a finance or operating lease. We are currently in the process of evaluating our existing lease portfolio, including accumulating all of the necessary information required to properly account for the leases under the new standard. ASU 2016-02 is effective for us beginning July 1, 2019. The guidance originally required entities to apply ASU 2016-02 on a modified retrospective basis; however, the FASB has recently issued guidance that would allow adoption of this standard as of the effective date without restating prior periods. Management has begun the process of inventorying leases that this standard may apply to and the impact is not yet determined. There have been no other newly issued or newly applicable accounting pronouncements that have, or are expected to have, a significant impact on the Company’s consolidated financial statements. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Nature Of Business And Significant Accounting Policies [Abstract] | |
Schedule of divisions of revenue | For the three months ended March 31, 2019 2018 Sales - Chase Candy $ 321,390 $ 372,664 Sales - Seasonal Candy 5,654 5,662 Sales $ 327,044 $ 378,326 For the nine months ended March 31, 2019 2018 Sales - Chase Candy $ 1,044,762 $ 1,136,093 Sales - Seasonal Candy 1,154,431 1,222,898 Sales $ 2,199,193 $ 2,358,991 |
Schedule of impact of recently adopted pronouncements on our consolidated statement of operation and balance sheet | Balance at Adjustment Balance at June 30, 2018 Upon Adoption July 1, 2018 Balance Sheet Accounts Payable $ 135,311 $ (12,900 ) $ 122,411 Refund Liability Owed to Customers - 12,900 12,900 For the three month period ended March 31, 2019 Current Previous Standard Standard Statement of Operations Sales $ 327,044 $ (1,313 ) $ 325,731 Selling Expenses 61,398 (1,313 ) 60,085 As of and for the nine month period ended March 31, 2019 Current Previous Standard Change Standard Balance Sheet Accounts Payable $ 41,423 $ 11,020 $ 52,443 Refund Liability Owed to Customers 11,020 (11,020 ) - Statement of Operations Sales $ 2,199,193 $ 46,577 $ 2,245,770 Selling Expenses 229,815 46,577 276,392 |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of earnings (loss) per share computed on weighted average of outstanding common shares | Three Months Ended Nine Months Ended March 31 March 31 2019 2018 2019 2018 Net Income (Loss) $ (182,585 ) $ (120,457 ) $ 1,043 $ (104,914 ) Preferred Dividend Requirements: 6% Prior Cumulative Preferred, $5 Par Value 15,000 15,000 45,000 45,000 5% Convertible Cumulative Preferred, $20 Par Value 17,018 17,018 51,054 51,054 Total Dividend Requirements 32,018 32,018 96,054 96,054 Net Loss - Common Stockholders $ (214,603 ) $ (152,475 ) $ (95,011 ) $ (200,968 ) Weighted Average Shares - Basic 969,834 969,834 969,834 969,834 Dilutive Effect of Contingently Issuable Shares 1,033,334 1,033,334 1,033,334 1,033,334 Weighted Average Shares – Diluted 2,003,168 2,003,168 2,003,168 2,003,168 Basic Loss per Share $ (0.22 ) $ (0.16 ) $ (0.10 ) $ (0.21 ) Diluted Loss per Share $ (0.22 ) $ (0.16 ) $ (0.10 ) $ (0.21 ) |
Schedule of total dividends in arrears, on a per share basis | Nine Months Ended March 31 2019 2018 6% Convertible Series A $ 18 $ 18 Series B 18 17 5% Convertible Series A $ 70 $ 69 Series B 70 69 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Notes Payable [Abstract] | |
Schedule of long-term debt | March 31, June 30, Payee Terms 2019 2018 Nodaway Valley Bank $350,000 line-of-credit agreement expiring on January 4, 2020, with a variable interest rate at prime but not less than 5%. The line-of-credit is collateralized by substantially all assets of the Company. $ - $ - Ford Credit $705 monthly payments, interest of 5.8%; final payment due October 2021, secured by a vehicle. 20,234 25,560 Toyota Credit $364 monthly payments, interest of 3.5%. The loan was paid off in March of 2019. - 10,451 Total 20,234 36,011 Less Current Portion 7,473 11,224 Long-Term Portion $ 12,761 $ 24,787 |
Schedule of future minimum payments of long term debt | March 31: Amount 2020 $ 7,473 2021 7,922 2022 4,839 Total $ 20,234 |
SUPPLEMENTAL DISCLOSURES OF C_2
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of supplemental disclosures of cash flow information | Nine Months Ended March 31 2019 2018 Cash Paid for: Interest $ 6,309 $ 4,856 |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Nature Of Business And Significant Accounting Policies [Line Items] | ||||
Sales | $ 327,044 | $ 378,326 | $ 2,199,193 | $ 2,358,991 |
Sales - Chase Candy | ||||
Nature Of Business And Significant Accounting Policies [Line Items] | ||||
Sales | 321,390 | 372,664 | 1,044,762 | 1,136,093 |
Sales - Seasonal Candy | ||||
Nature Of Business And Significant Accounting Policies [Line Items] | ||||
Sales | $ 5,654 | $ 5,662 | $ 1,154,431 | $ 1,222,898 |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Nature Of Business And Significant Accounting Policies [Line Items] | ||
Accounts Payable | $ 47,658 | $ 176,871 |
Refund Liability Owed to Customers | 12,900 | |
Early adoption | ||
Nature Of Business And Significant Accounting Policies [Line Items] | ||
Accounts Payable | 135,311 | |
Refund Liability Owed to Customers | 0 | |
Adjustment Upon Adoption | ||
Nature Of Business And Significant Accounting Policies [Line Items] | ||
Accounts Payable | (12,900) | |
Refund Liability Owed to Customers | $ 12,900 |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES (Details 2) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Sales | $ 327,044 | $ 378,326 | $ 2,199,193 | $ 2,358,991 |
Selling Expenses | 61,398 | $ 82,324 | 229,815 | $ 312,872 |
Change | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Sales | (1,313) | 46,577 | ||
Selling Expenses | (1,313) | 46,577 | ||
Previous Standard | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Sales | 325,731 | 2,245,770 | ||
Selling Expenses | $ 60,085 | $ 276,392 |
SIGNIFICANT ACCOUNTING POLICI_7
SIGNIFICANT ACCOUNTING POLICIES (Details 3) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Accounts Payable | $ 47,658 | $ 176,871 |
Refund Liability Owed to Customers | 11,020 | |
Change | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Accounts Payable | 11,020 | |
Refund Liability Owed to Customers | (11,020) | |
Previous Standard | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Accounts Payable | 52,443 | |
Refund Liability Owed to Customers | $ 0 |
SIGNIFICANT ACCOUNTING POLICI_8
SIGNIFICANT ACCOUNTING POLICIES (Detail Textuals) | 9 Months Ended |
Mar. 31, 2019Segment | |
Nature Of Business And Significant Accounting Policies [Abstract] | |
Number of reportable segment | 1 |
EARNINGS (LOSS) PER SHARE (Deta
EARNINGS (LOSS) PER SHARE (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Class of Stock [Line Items] | ||||
Net Income | $ (182,585) | $ (120,457) | $ 1,043 | $ (104,914) |
Preferred Dividend Requirements: | ||||
Total Dividend Requirements | 32,018 | 32,018 | 96,054 | 96,054 |
Net Income (Loss) - Common Stockholders | $ (214,603) | $ (152,475) | $ (95,011) | $ (200,968) |
Weighted Average Shares - Basic | 969,834 | 969,834 | 969,834 | 969,834 |
Dilutive Effect of Contingently Issuable Shares | 1,033,334 | 1,033,334 | 1,033,334 | 1,033,334 |
Weighted Average Shares - Diluted (in shares) | 2,003,168 | 2,003,168 | 2,003,168 | 2,003,168 |
Basic Earnings (Loss) per Share (in dollars per share) | $ (0.22) | $ (0.16) | $ (0.10) | $ (0.21) |
Diluted Earnings (Loss) per Share (in dollars per share) | $ (0.22) | $ (0.16) | $ (0.10) | $ (0.21) |
6% Prior Cumulative Preferred, $5 Par Value | ||||
Preferred Dividend Requirements: | ||||
Total Dividend Requirements | $ 15,000 | $ 15,000 | $ 45,000 | $ 45,000 |
5% Convertible Cumulative Preferred, $20 Par Value | ||||
Preferred Dividend Requirements: | ||||
Total Dividend Requirements | $ 17,018 | $ 17,018 | $ 51,054 | $ 51,054 |
EARNINGS (LOSS) PER SHARE (Pare
EARNINGS (LOSS) PER SHARE (Parentheticals) (Details) | 9 Months Ended |
Mar. 31, 2019$ / shares | |
6% Prior Cumulative Preferred, $5 Par Value | |
Class of Stock [Line Items] | |
Stated percentage of preferred stock | 6.00% |
Preferred stock, par value (in dollars per share) | $ 5 |
5% Convertible Cumulative Preferred, $20 Par Value | |
Class of Stock [Line Items] | |
Stated percentage of preferred stock | 5.00% |
Preferred stock, par value (in dollars per share) | $ 20 |
EARNINGS (LOSS) PER SHARE (De_2
EARNINGS (LOSS) PER SHARE (Details 1) - $ / shares | 9 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
6% Convertible | Series A | ||
Class of Stock [Line Items] | ||
Total dividends in arrears | $ 18 | $ 18 |
6% Convertible | Series B | ||
Class of Stock [Line Items] | ||
Total dividends in arrears | 18 | 17 |
5% Convertible | Series A | ||
Class of Stock [Line Items] | ||
Total dividends in arrears | 70 | 69 |
5% Convertible | Series B | ||
Class of Stock [Line Items] | ||
Total dividends in arrears | $ 70 | $ 69 |
EARNINGS (LOSS) PER SHARE (De_3
EARNINGS (LOSS) PER SHARE (Detail Textuals) | 9 Months Ended | |
Mar. 31, 2019$ / shares | Mar. 31, 2018$ / shares | |
6% convertible prior cumulative preferred stock | ||
Class of Stock [Line Items] | ||
Redemption price per share (in dollars per share) | $ 5.25 | $ 5.25 |
Preferred stock, liquidation preference per share (in dollars per share) | $ 5.25 | $ 5.25 |
6% convertible prior cumulative preferred stock | Series A | ||
Class of Stock [Line Items] | ||
Number of common stock exchanged for each preferred stock held | 4 | 4 |
6% convertible prior cumulative preferred stock | Series B | ||
Class of Stock [Line Items] | ||
Number of common stock exchanged for each preferred stock held | 3.75 | 3.75 |
5% convertible cumulative preferred stock | ||
Class of Stock [Line Items] | ||
Redemption price per share (in dollars per share) | $ 21 | $ 21 |
Preferred stock, liquidation preference per share (in dollars per share) | $ 21 | $ 21 |
Number of common stock exchanged for each preferred stock held | 3.795 | 3.795 |
NOTES PAYABLE AND LINE OF CREDI
NOTES PAYABLE AND LINE OF CREDIT - Long-term debt (Details) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Debt Instrument [Line Items] | ||
Total | $ 20,234 | $ 36,011 |
Less Current Portion | 7,473 | 11,224 |
Long-Term Portion | 12,761 | 24,787 |
Nodaway Valley Bank: $350,000 line-of-credit agreement expiring on January 4, 2020, with a variable interest rate at prime but not less than 5%. The line-of-credit is collateralized by substantially all assets of the Company. | ||
Debt Instrument [Line Items] | ||
Total | 0 | 0 |
Ford Credit: $705 monthly payments, interest of 5.8%; final payment due October 2021, secured by a vehicle. | ||
Debt Instrument [Line Items] | ||
Total | 20,234 | 25,560 |
Toyota Credit $364 monthly payments, interest of 3.5%. The loan was paid off in March of 2019. | ||
Debt Instrument [Line Items] | ||
Total | $ 0 | $ 10,451 |
NOTES PAYABLE AND LINE OF CRE_2
NOTES PAYABLE AND LINE OF CREDIT - Long-term debt (Parentheticals) (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Jun. 30, 2018 | |
Nodaway Valley Bank: $350,000 line-of-credit agreement expiring on January 4, 2020, with a variable interest rate at prime but not less than 5%. The line-of-credit is collateralized by substantially all assets of the Company. | ||
Debt Instrument [Line Items] | ||
Line-of-credit agreement, amount | $ 350,000 | $ 350,000 |
Line of Credit Facility, Expiration date | Jan. 4, 2020 | Jan. 4, 2020 |
Interest rate, description | variable interest rate at prime | variable interest rate at prime |
Line of credit facility, Basis for measurement | prime | prime |
Basis Spread on Variable Rate | 5.00% | 5.00% |
Ford Credit: $705 monthly payments, interest of 5.8%; final payment due October 2021, secured by a vehicle. | ||
Debt Instrument [Line Items] | ||
Notes payable, periodic payment | $ 705 | $ 705 |
Notes payable, frequency | monthly | monthly |
Interest rate | 5.80% | 5.80% |
Maturity date | Oct. 31, 2021 | Oct. 31, 2021 |
Toyota Credit $364 monthly payments, interest of 3.5%. The loan was paid off in March of 2019. | ||
Debt Instrument [Line Items] | ||
Notes payable, periodic payment | $ 364 | $ 364 |
Notes payable, frequency | monthly | monthly |
Basis Spread on Variable Rate | 3.50% | |
Interest rate | 3.50% | |
Maturity date | Mar. 31, 2019 | Dec. 31, 2020 |
NOTES PAYABLE AND LINE OF CRE_3
NOTES PAYABLE AND LINE OF CREDIT - Future minimum payments (Details 1) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Notes Payable [Abstract] | ||
2020 | $ 7,473 | |
2021 | 7,922 | |
2022 | 4,839 | |
Total | $ 20,234 | $ 36,011 |
SUPPLEMENTAL DISCLOSURES OF C_3
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION (Details) - USD ($) | 9 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash Paid for: | ||
Interest | $ 6,309 | $ 4,856 |