Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 17, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | Quarta-Rad, Inc. | |
Entity Central Index Key | 0001549631 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 15,659,483 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 |
Condensed and Consolidated Bala
Condensed and Consolidated Balance Sheets - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash | $ 113,422 | $ 108,126 |
Accounts receivable | 75,605 | 48,490 |
Marketable securities, trading | 421,038 | |
Inventory | 86,041 | 89,497 |
Deferred tax asset | 36,826 | 50,768 |
Due from officer | 332,553 | |
Total Current Assets | 732,932 | 629,434 |
Fixed Assets, Net | 3,770 | 3,970 |
TOTAL ASSETS | 736,702 | 633,404 |
Current Liabilities | ||
Accounts payable and accrued expenses | 104,531 | 77,241 |
Income taxes payable | 70,660 | 70,660 |
Related party payable | 190,883 | 167,324 |
Total Liabilities | 366,074 | 315,225 |
Stockholders' Equity | ||
Common Stock: authorized 50,000,000 common shares, $0.0001 par value 15,659,483 were issued and outstanding on March 31, 2021 and December 31, 2020 | 1,866 | 1,866 |
Additional paid-in capital | 337,427 | 337,427 |
Retained Earnings/(Accumulated Deficit) | 31,335 | (21,114) |
Total Stockholders' Equity | 370,628 | 318,179 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 736,702 | $ 633,404 |
Condensed and Consolidated Ba_2
Condensed and Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares issued | 15,659,483 | 15,659,483 |
Common stock, shares outstanding | 15,659,483 | 15,659,483 |
Condensed and Consolidated Stat
Condensed and Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Total sales, net | $ 334,679 | $ 180,597 |
Cost of goods sold - Quarta Rad, Inc. | 190,328 | 140,966 |
Gross profit | 144,351 | 39,631 |
Expenses: | ||
General & administrative | 5,028 | 1,694 |
Advertising | 16,060 | 6,870 |
Professional and consulting fees | 60,346 | 34,559 |
Operating expenses | 81,434 | 43,123 |
Net income (loss) from operations | 62,917 | (3,492) |
Other income - Unrealized gain/(loss) on investments | 3,474 | |
Income before for provision for income taxes | 66,391 | (3,492) |
Income tax expense | 13,942 | |
Net income/(loss) | $ 52,449 | $ (3,492) |
Income/(loss) per share - basic and diluted | ||
Weighted average shares - basic and diluted | 15,659,483 | 15,326,150 |
Sellavir, Inc., net - related party [Member] | ||
Total sales, net | $ 90,000 | |
Quarta Rad Inc [Member] | ||
Total sales, net | $ 244,679 | $ 180,597 |
Condensed and Consolidated St_2
Condensed and Consolidated Statements of Changes in Stockholders' Equity/Deficit (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings/(Accumlated Deficit) | Total |
Balance at Dec. 31, 2019 | $ 1,533 | $ 65,197 | $ (96,570) | $ (29,840) |
Balance, shares at Dec. 31, 2019 | 15,326,150 | |||
Net Income Loss | (3,492) | (3,492) | ||
Balance at Mar. 31, 2020 | $ 1,533 | 65,197 | (100,062) | (33,332) |
Balance, shares at Mar. 31, 2020 | 15,326,150 | |||
Balance at Dec. 31, 2020 | $ 1,866 | 337,427 | (21,114) | 318,179 |
Balance, shares at Dec. 31, 2020 | 15,659,483 | |||
Net Income Loss | 52,449 | 52,449 | ||
Balance at Mar. 31, 2021 | $ 1,866 | $ 337,427 | $ 31,335 | $ 370,628 |
Balance, shares at Mar. 31, 2021 | 15,659,483 |
Condensed and Consolidated St_3
Condensed and Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
OPERATING ACTIVITIES: | ||
Net income/(loss) | $ 52,449 | $ (3,492) |
Adjustments to reconcile net income/(loss) to net cash provided by operating activities: | ||
Depreciation | 200 | |
Unrealized gain/loss on investments | (3,474) | |
Deferred tax asset | 13,942 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (27,116) | 51,617 |
Inventory | 3,456 | 4,832 |
Accounts payable and accrued expenses | 27,290 | (4,909) |
Related party payable | 23,559 | (7,006) |
Net cashed provided by operating activities | 90,306 | 41,042 |
INVESTING ACTIVITIES: | ||
Purchase of marketable securities, trading | (85,010) | |
Net change in cash | 5,296 | 41,042 |
Cash, beginning of period | 108,126 | 41,962 |
Cash, end of period | 113,422 | 83,004 |
Non-cash Investing Transactions: | ||
Repayment of officer advance by transfer of marketable securities at fair value | 332,553 | |
Supplemental cash flow information: | ||
Cash paid on interest | ||
Cash paid for income taxes |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | NOTE 1 - BASIS OF PRESENTATION The condensed and consolidated balance sheet of Quarta-Rad, Inc. and Subsidiaries (the “Company”) as of March 31, 2021, and the statements of operations and changes in stockholders’ equity/deficit for the three months ended March 31, 2021 and 2020, and the cash flows for the three months ended March 31, 2021 and 2020 have not been audited. However, in the opinion of management, such information includes all adjustments (consisting of normal recurring adjustments), which are necessary to accurately reflect the financial position of the Company as of March 31, 2021, the results of operations and cash flows for the periods ended March 31, 2021 and 2020. The condensed and consolidated balance sheet as of December 31, 2020 has been derived from audited financial statements. Certain information and notes normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted, although management believes that the disclosures are adequate to make the information presented not misleading. Interim period results are not necessarily indicative of the results to be achieved for an entire year. These consolidated and condensed financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2020. During April 2020 the Company acquired Quarta-Rad USA, Inc., a Delaware corporation, as a wholly owned subsidiary. There was no consideration paid for the shares. The purpose of the acquisition is to separate the sales of certain products in separate entities. There was no activity, assets or liabilities in the subsidiary through March 31, 2021. During December 2020, the Company acquired the common controlled entity, Sellavir, Inc., a Delaware Corporation. Sellavir was owned 100% by Quarta-Rad’s majority shareholder. 333,333 shares of common stock in Quarta-Rad were exchanged for 100% of the outstanding shares of Sellavir. Under an acquisition of common control, the purchase is recorded at historical cost. The fair value of the common stock issued was approximately $170,000. The excess carry-over basis of the net assets acquired was treated as a capital contribution and included in additional paid-in capital. |
Nature of Business
Nature of Business | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business | NOTE 2 - NATURE OF BUSINESS The Company distributes detection devices, including but not limited to Geiger counters, to homeowners and interested customers in North America and, Europe. The Company targets homebuilders and home renovation contractors. Sellavir is a video analytics company whose platform empowers organizations to decode videos to develop creative marketing strategies and analysis through advanced and proprietary technologies. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Advertising The Company expenses advertising costs, consisting primarily of placement in multiple publications, along with design and printing costs of sales materials, when incurred. Advertising expense for the three months ended March 31, 2021 and 2020, amounted to $16,060, and $6,870 respectively. Inventory Inventories are stated at the lower of cost or market (net realizable value). The Company periodically reviews the value of items in inventory and provides write-downs or write-offs of inventory based on its assessment of market conditions. Write-downs and write-offs are charged to cost of goods sold. The Company’s inventory consists of finished goods available for sale. There were no write-offs for the three months ended March 31, 2021 or 2020. Marketable Securities Our investment securities consist of available-for-sale instruments which include $421,038 of tradable equities. Substantially all of our available-for-sale securities are Level 1. Realized gains and losses on these securities are included in other income in the consolidated statements of operations. Unrealized gains and losses, net of tax, on available-for-sale securities are recorded in other income. Unrealized losses that are considered other than temporary are recorded in other income with the corresponding reduction to the carrying basis of the investment. Principles of Consolidation The consolidated financial statements include the accounts Quarta-Rad, Inc. and its wholly-owned subsidiaries Quarta-Rad USA, Inc. and Sellavir, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. Property and Equipment Property and equipment are stated at cost. Depreciation is provided on the straight-line method over the estimated useful lives of the related assets, which is five years. Leasehold improvements are amortized over the shorter of their estimated useful lives or their related lease terms. Repairs and maintenance costs are charged to expense when incurred. Long-Lived Assets The Company reviews the carrying values of its long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the expected future cash flow from the use of the asset and its eventual disposition is less than the carrying amount of the asset, an impairment loss is recognized and measured using the fair value of the related asset. No impairment charges were incurred during the three months ended March 31, 2021 and 2020. There can be no assurance, however, that market conditions will not change or demand for the Company’s services will continue, which could result in impairment of long-lived assets in the future. Income Taxes The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740-10, “Accounting for Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year; and, (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if, based on the weight of available positive and negative evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition of a tax position taken or expected to be taken on a tax return. Under ASC 740-10, a tax benefit from an uncertain tax position taken or expected to be taken may be recognized only if it is “more likely than not” that the position is sustainable upon examination, based on its technical merits. The tax benefit of a qualifying position under ASC 740-10 would equal the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with a taxing authority having full knowledge of all the relevant information. A liability (including interest and penalties, if applicable) is established to the extent a current benefit has been recognized on a tax return for matters that are considered contingent upon the outcome of an uncertain tax position. Related interest and penalties, if any, are included as components of income tax expense and income taxes payable. As of March 31, 2021, we have analyzed filing positions in each of the federal and state jurisdictions where we are required to file income tax returns, as well as all open tax years in these jurisdictions. We have identified the U.S. federal and Delaware as our “major” tax jurisdictions. Generally, we remain subject to Internal Revenue Service examination of our 2017 through 2020 tax returns. However, we have certain tax attribute carry forwards, which will remain subject to review and adjustment by the relevant tax authorities until the statute of limitations closes with respect to the year in which such attributes are utilized. We believe that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial position. Therefore, no reserves for uncertain income tax position have been recorded pursuant to ASC 740. In addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740. Related interest and penalties, if any, are included as components of income tax expense and income taxes payable. Earnings per Share The Company’s basic earnings per share are calculated by dividing its net income available to common stockholders by the weighted average number of common shares outstanding for the period. The Company’s dilutive earnings per share is calculated by dividing its net income available to common shareholders by the diluted weighted average number of shares outstanding during the period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There were no potentially dilutive instruments outstanding at March 31, 2021. Fair Value of Financial Instruments The Company’s financial instruments as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 825, “Financial Instruments” FASB ASC 820 “Fair Value Measurements and Disclosures” ● Level 1. Observable inputs such as quoted prices in active markets; ● Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and ● Level 3. Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions. Use of Estimates in Preparation of Financial Statements The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include reserves for accounts receivable and inventory, and the European VAT exposure accrual (Note 6). Revenue Recognition The Company follows guidance from FASB Accounting Standards Codification ASC Topic 606, Revenue from Contracts with Customers . Our principal activities from which we generate our revenue are product sales and consulting services. Revenue is measured based on consideration specified in a contract with a customer. A contract with a customer exists when we enter into an enforceable contract with a customer. The contract is based on either the acceptance of standard terms and conditions on the websites for e-commerce customers and via telephone with our third-party call center for our print media and direct mail customers, or the execution of terms and conditions contracts with retailers and wholesalers. These contracts define each party’s rights, payment terms and other contractual terms and conditions of the sale. Consideration is typically paid prior to shipment via credit card or check when our products are sold direct to consumers or approximately 30 days from the time control is transferred when sold to wholesalers, distributors and retailers. We apply judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience and, in some circumstances, published credit and financial information pertaining to the customer. A performance obligation is a promise in a contract to transfer a distinct product to the customer, which for us is transfer of devices to our customers. Performance obligations promised in a contract are identified based on the goods that will be transferred to the customer that are both capable of being distinct and are distinct in the context of the contract, whereby the transfer of the goods is separately identifiable from other promises in the contract. We have concluded the sale of goods and related shipping and handling are accounted for as the single performance obligation. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance obligation. The transaction price is determined based on the consideration to which we will be entitled to receive in exchange for transferring goods to the customer. We issue refunds to e-commerce and print media customers, upon request, within 30 days of delivery. We estimate the amount of potential refunds at each reporting period using a portfolio approach of historical data, adjusted for changes in expected customer experience, including seasonality and changes in economic factors. For retailers, distributors and wholesalers, we do not offer a right of return or refund and revenue is recognized at the time products are shipped to customers. In all cases, judgment is required in estimating these reserves. Actual claims for returns could be materially different from the estimates. There was no reserve for sales returns and allowances, at March 31, 2021 and December 31, 2020, respectively. We recognize revenue when we satisfy a performance obligation in a contract by transferring control over a product to a customer when product is shipped. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by us from a customer, are excluded from revenue. Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfilment cost and are included in cost of product sales. We recognize consulting revenue over times as services are performed. Recent Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2019-12 Simplifying the Accounting for Income Taxes |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | NOTE 4–PROPERTY AND EQUIPMENT Property and Equipment at March 31, 2021 & December 31, 2020 consisted of: March 31, December 31, 2021 2020 Computer Equipment $ 4,005 $ 4,005 Accumulated Depreciation (235 ) (35 ) Net Property & Equipment $ 3,770 $ 3,970 The Company recognized $200 in depreciation expense for the three months ended March 31, 2021. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 5–RELATED PARTY TRANSACTIONS The Company sells radiation monitors and to date has purchased all of its inventory from a company in Russia, which is owned by a minority shareholder of the Company. Total inventory purchased was $156,975 and $114,665 for the three months ended March 31, 2021 and 2020, respectively. During July 2017, the Company entered into an agreement with the Russian Affiliate to develop and update software for a new device for $180,000. The development contract ended December 31, 2019. The amount due in connection with this agreement as of March 31, 2021 and December 31, 2020 is $126,390. In addition, the Company owes an additional $17,000 at March 31, 2021 for purchased inventory during the three months ended March 31, 2021. No additional amounts are included at December 31, 2020. Since inception, the Company has not compensated its CEO, who is the majority shareholder, and, as of March 31, 2021 and December 31, 2020, is due $47,494 and $40,935, respectively, for expenses paid by the shareholder on behalf of the Company, included in related party payables. The Company intends to initiate a salary to its CEO in the second quarter of 2021. Sellavir had advanced its Officer and sole Shareholder $332,553 during 2019 and 2020 and was included in the December 2020 Sellavir acquisition. The full amount was paid to the Company in March 2021 through transfer of marketable securities at fair value. Sellavir had $90,000 of revenue for the three months ended March 31, 2021 from a related entity wholly owned by the majority shareholder of the Company. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 6– COMMITMENTS AND CONTINGENCIES Contingencies The Company is currently undergoing a multi-year VAT tax examination by certain European tax authorities. As of March 31, 2021, the outcome of these examinations is uncertain, and the Company is disputing any amounts due. The estimated liabilities on the VAT tax exposure could anywhere from $0 to $125,000 based on estimates and information provided to management. The Company believes its exposure is limited to $100,000, which was accrued in 2019. The Company paid $41,822 during 2020 towards the estimated liability, a remainder of $58,178 is included in accounts payable and accrued expenses as of March 31, 2021 and December 31, 2020. Actual results from this matter could differ from this estimate. In April 2021, we paid $35,679 towards this balance. Legal In the normal course of business, the Company may become involved in various legal proceedings. The Company knows of no pending or threatened legal proceeding to which the Company is or will be a party that, if successful, might result in material adverse change in the Company’s business, properties or financial condition. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 7–SUBSEQUENT EVENTS The Company has performed an evaluation of events occurring subsequent to March 31, 2021 through May 17, 2021. Based on its evaluation, other than the note below, there is nothing to be disclosed herein. |
COVID-19
COVID-19 | 3 Months Ended |
Mar. 31, 2021 | |
Document And Entity Information | |
COVID-19 | NOTE 8 - COVID-19 On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of a new strain of coronavirus (the “COVID-19 outbreak”) and the risks to the international community as the virus spreads globally beyond its point of origin. In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally. The full impact of the COVID-19 outbreak continues to evolve as of the date of this report. Management is actively monitoring the global situation on its financial condition, liquidity, operations, suppliers, industry, and workforce. Given the daily evolution of the COVID-19 outbreak and the global responses to curb its spread, the Company is not able to estimate the effects of the COVID-19 outbreak on its results of operations, financial condition, or liquidity. However, if the pandemic continues, it may have an adverse effect on the Company’s results of future operations, financial position, and liquidity. The uncertainty as to the future impact on the Company of the recent COVID-19 outbreak has been considered as part of the Company’s adoption of the going concern basis. Thus far, we have not observed a material impact on our sales in the first four months of the year against the same period in the previous year. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Advertising | Advertising The Company expenses advertising costs, consisting primarily of placement in multiple publications, along with design and printing costs of sales materials, when incurred. Advertising expense for the three months ended March 31, 2021 and 2020, amounted to $16,060, and $6,870 respectively. |
Inventory | Inventory Inventories are stated at the lower of cost or market (net realizable value). The Company periodically reviews the value of items in inventory and provides write-downs or write-offs of inventory based on its assessment of market conditions. Write-downs and write-offs are charged to cost of goods sold. The Company’s inventory consists of finished goods available for sale. There were no write-offs for the three months ended March 31, 2021 or 2020. |
Marketable Securities | Marketable Securities Our investment securities consist of available-for-sale instruments which include $421,038 of tradable equities. Substantially all of our available-for-sale securities are Level 1. Realized gains and losses on these securities are included in other income in the consolidated statements of operations. Unrealized gains and losses, net of tax, on available-for-sale securities are recorded in other income. Unrealized losses that are considered other than temporary are recorded in other income with the corresponding reduction to the carrying basis of the investment. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts Quarta-Rad, Inc. and its wholly-owned subsidiaries Quarta-Rad USA, Inc. and Sellavir, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost. Depreciation is provided on the straight-line method over the estimated useful lives of the related assets, which is five years. Leasehold improvements are amortized over the shorter of their estimated useful lives or their related lease terms. Repairs and maintenance costs are charged to expense when incurred. |
Long-lived Assets | Long-Lived Assets The Company reviews the carrying values of its long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the expected future cash flow from the use of the asset and its eventual disposition is less than the carrying amount of the asset, an impairment loss is recognized and measured using the fair value of the related asset. No impairment charges were incurred during the three months ended March 31, 2021 and 2020. There can be no assurance, however, that market conditions will not change or demand for the Company’s services will continue, which could result in impairment of long-lived assets in the future. |
Income Taxes | Income Taxes The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740-10, “Accounting for Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year; and, (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if, based on the weight of available positive and negative evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition of a tax position taken or expected to be taken on a tax return. Under ASC 740-10, a tax benefit from an uncertain tax position taken or expected to be taken may be recognized only if it is “more likely than not” that the position is sustainable upon examination, based on its technical merits. The tax benefit of a qualifying position under ASC 740-10 would equal the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with a taxing authority having full knowledge of all the relevant information. A liability (including interest and penalties, if applicable) is established to the extent a current benefit has been recognized on a tax return for matters that are considered contingent upon the outcome of an uncertain tax position. Related interest and penalties, if any, are included as components of income tax expense and income taxes payable. As of March 31, 2021, we have analyzed filing positions in each of the federal and state jurisdictions where we are required to file income tax returns, as well as all open tax years in these jurisdictions. We have identified the U.S. federal and Delaware as our “major” tax jurisdictions. Generally, we remain subject to Internal Revenue Service examination of our 2017 through 2020 tax returns. However, we have certain tax attribute carry forwards, which will remain subject to review and adjustment by the relevant tax authorities until the statute of limitations closes with respect to the year in which such attributes are utilized. We believe that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial position. Therefore, no reserves for uncertain income tax position have been recorded pursuant to ASC 740. In addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740. Related interest and penalties, if any, are included as components of income tax expense and income taxes payable. |
Earnings Per Share | Earnings per Share The Company’s basic earnings per share are calculated by dividing its net income available to common stockholders by the weighted average number of common shares outstanding for the period. The Company’s dilutive earnings per share is calculated by dividing its net income available to common shareholders by the diluted weighted average number of shares outstanding during the period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There were no potentially dilutive instruments outstanding at March 31, 2021. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 825, “Financial Instruments” FASB ASC 820 “Fair Value Measurements and Disclosures” ● Level 1. Observable inputs such as quoted prices in active markets; ● Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and ● Level 3. Unobservable inputs in which there is little or no market data, which requires the reporting entity to develop its own assumptions. |
Use of Estimates in Preparation of Financial Statements | Use of Estimates in Preparation of Financial Statements The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include reserves for accounts receivable and inventory, and the European VAT exposure accrual (Note 6). |
Revenue Recognition | Revenue Recognition The Company follows guidance from FASB Accounting Standards Codification ASC Topic 606, Revenue from Contracts with Customers . Our principal activities from which we generate our revenue are product sales and consulting services. Revenue is measured based on consideration specified in a contract with a customer. A contract with a customer exists when we enter into an enforceable contract with a customer. The contract is based on either the acceptance of standard terms and conditions on the websites for e-commerce customers and via telephone with our third-party call center for our print media and direct mail customers, or the execution of terms and conditions contracts with retailers and wholesalers. These contracts define each party’s rights, payment terms and other contractual terms and conditions of the sale. Consideration is typically paid prior to shipment via credit card or check when our products are sold direct to consumers or approximately 30 days from the time control is transferred when sold to wholesalers, distributors and retailers. We apply judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience and, in some circumstances, published credit and financial information pertaining to the customer. A performance obligation is a promise in a contract to transfer a distinct product to the customer, which for us is transfer of devices to our customers. Performance obligations promised in a contract are identified based on the goods that will be transferred to the customer that are both capable of being distinct and are distinct in the context of the contract, whereby the transfer of the goods is separately identifiable from other promises in the contract. We have concluded the sale of goods and related shipping and handling are accounted for as the single performance obligation. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance obligation. The transaction price is determined based on the consideration to which we will be entitled to receive in exchange for transferring goods to the customer. We issue refunds to e-commerce and print media customers, upon request, within 30 days of delivery. We estimate the amount of potential refunds at each reporting period using a portfolio approach of historical data, adjusted for changes in expected customer experience, including seasonality and changes in economic factors. For retailers, distributors and wholesalers, we do not offer a right of return or refund and revenue is recognized at the time products are shipped to customers. In all cases, judgment is required in estimating these reserves. Actual claims for returns could be materially different from the estimates. There was no reserve for sales returns and allowances, at March 31, 2021 and December 31, 2020, respectively. We recognize revenue when we satisfy a performance obligation in a contract by transferring control over a product to a customer when product is shipped. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by us from a customer, are excluded from revenue. Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfilment cost and are included in cost of product sales. We recognize consulting revenue over times as services are performed. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2019-12 Simplifying the Accounting for Income Taxes |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and Equipment at March 31, 2021 & December 31, 2020 consisted of: March 31, December 31, 2021 2020 Computer Equipment $ 4,005 $ 4,005 Accumulated Depreciation (235 ) (35 ) Net Property & Equipment $ 3,770 $ 3,970 |
Basis of Presentation (Details
Basis of Presentation (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Fair value of common stock issued | $ 170,000 | |
Majority Shareholder [Member] | Sellavir, Inc.,[Member] | ||
Common stock value of shares | 333,333 | |
Equity ownership percentage | 100.00% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Accounting Policies [Abstract] | ||
Advertising expense | $ 16,060 | $ 6,870 |
Impairment charges | ||
Tax benefit realized upon settlement description | greater than 50% | |
Available for sale of instruments, tradable equities | $ 421,038 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expenses | $ 200 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Abstract] | ||
Computer Equipment | $ 4,005 | $ 4,005 |
Accumulated Depreciation | (235) | (35) |
Net Property & Equipment | $ 3,770 | $ 3,970 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 31, 2017 | |
Inventory purchased | $ 156,975 | $ 114,665 | |||
Due to majority shareholder | 47,494 | $ 40,935 | |||
Revenue | 334,679 | $ 180,597 | |||
Sellavir, Inc.,[Member] | Officer and Sole Shareholder [Member] | |||||
Business combination, consideration transferred | 332,553 | $ 332,553 | |||
Russian Affiliate [Member] | |||||
Related party payable | 126,390 | $ 126,390 | $ 126,390 | ||
Russian Affiliate [Member] | Software Development [Member] | |||||
Related party payable | 126,390 | $ 180,000 | |||
Majority Shareholder [Member] | Sellavir, Inc.,[Member] | |||||
Revenue | $ 90,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended |
Apr. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2019 | |
Accounts payable and accrued expenses | $ 58,178 | $ 100,000 | |
Payment of estimated liability | 41,822 | ||
Subsequent Event [Member] | |||
Accounts payable and accrued expenses | $ 35,679 | ||
Minimum [Member] | |||
Estimated liabilities on VAT | 0 | ||
Maximum [Member] | |||
Estimated liabilities on VAT | $ 125,000 |