Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 10, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | Reliant Holdings, Inc. | |
Entity Central Index Key | 0001682265 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | true | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Sep. 30, 2020 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 | |
Entity Ex Transition Period | false | |
Entity Common Stock Shares Outstanding | 14,585,000 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Current Assets | ||
Cash | $ 205,082 | $ 280,680 |
Federal income tax receivable | 416 | 416 |
House and real estate inventory | 33,448 | 17,424 |
Total current assets | 238,946 | 298,520 |
Equipment, net of accumulated depreciation of $39,223 and $27,587 as of September 30, 2020 and December 31, 2019, respectively | 42,505 | 7,339 |
Total Assets | 281,451 | 305,859 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 166,458 | 54,974 |
Contract liabilities | 275,017 | 96,490 |
Current portion of note payable | 6,807 | 0 |
Total current liabilities | 448,282 | 151,464 |
Long-term note payable, net of current portion | 75,053 | 0 |
Total Liabilities | 523,335 | 151,464 |
Stockholders' Equity (Deficit) | ||
Preferred stock, 5,000,000 shares authorized, $0.001 par value, 0 issued and outstanding as of September 30, 2020 and December 31, 2019 | 0 | 0 |
Common stock, 70,000,000 shares authorized, $0.001 par value, 14,585,000 issued and outstanding as of September 30, 2020 and December 31, 2019 | 14,585 | 14,585 |
Additional paid-in capital | 43,365 | 43,365 |
Retained earnings (accumulated deficit) | (299,834) | 96,445 |
Total Stockholders' Equity (Deficit) | (241,884) | 154,395 |
Total Liabilities and Stockholders' Equity (Deficit) | $ 281,451 | $ 305,859 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Current Assets | ||
Equipment, accumulated depreciation | $ 39,223 | $ 27,587 |
Stockholders' Equity | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 70,000,000 | 70,000,000 |
Common stock, shares issued | 14,585,000 | 14,585,000 |
Common stock, shares outstanding | 14,585,000 | 14,585,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations (unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Consolidated Statements of Operations (unaudited) | ||||
Revenue | $ 555,073 | $ 591,891 | $ 1,381,051 | $ 1,310,232 |
Cost of goods sold | (407,229) | (401,284) | (974,228) | (869,962) |
Gross margin | 147,844 | 190,607 | 406,823 | 440,270 |
Operating Expenses | ||||
General and administrative | 164,913 | 110,378 | 802,262 | 355,036 |
Total Operating Expenses | (164,913) | (110,378) | (802,262) | (355,036) |
Income (loss) From Operations | (17,069) | 80,229 | (395,439) | 85,234 |
Other income / (expense) | ||||
Interest income | 0 | 32 | 22 | 73 |
Interest expense | (320) | (127) | (862) | (388) |
Total other expense | (320) | (95) | (840) | (315) |
Income (loss) before income taxes | (17,389) | 80,134 | (396,279) | 84,919 |
Provision for Income Tax | 0 | 0 | 0 | 0 |
Net Income (loss) | $ (17,389) | $ 80,134 | $ (396,279) | $ 84,919 |
Net Income (loss) Per Share - Basic and Diluted | $ 0 | $ 0.01 | $ (0.03) | $ 0.01 |
Weighted Average Common Shares Outstanding | 14,585,000 | 14,585,000 | 14,585,000 | 14,585,000 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) (unaudited) - USD ($) | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) |
Balance, shares at Dec. 31, 2018 | 14,585,000 | ||||
Balance, amount at Dec. 31, 2018 | $ 51,385 | $ 0 | $ 14,585 | $ 43,365 | $ (6,565) |
Net income | 6,340 | $ 0 | $ 0 | 0 | 6,340 |
Balance, shares at Mar. 31, 2019 | 14,585,000 | ||||
Balance, amount at Mar. 31, 2019 | 57,725 | $ 0 | $ 14,585 | 43,365 | (225) |
Balance, shares at Dec. 31, 2018 | 14,585,000 | ||||
Balance, amount at Dec. 31, 2018 | 51,385 | $ 0 | $ 14,585 | 43,365 | (6,565) |
Net loss | 84,919 | ||||
Balance, shares at Sep. 30, 2019 | 14,585,000 | ||||
Balance, amount at Sep. 30, 2019 | 136,304 | $ 0 | $ 14,585 | 43,365 | 78,354 |
Balance, shares at Mar. 31, 2019 | 14,585,000 | ||||
Balance, amount at Mar. 31, 2019 | 57,725 | $ 0 | $ 14,585 | 43,365 | (225) |
Net loss | (1,555) | $ 0 | $ 0 | 0 | (1,555) |
Balance, shares at Jun. 30, 2019 | 14,585,000 | ||||
Balance, amount at Jun. 30, 2019 | 56,170 | $ 0 | $ 14,585 | 43,365 | (1,780) |
Net income | 80,134 | $ 0 | $ 0 | 0 | 80,134 |
Net loss | 80,134 | ||||
Balance, shares at Sep. 30, 2019 | 14,585,000 | ||||
Balance, amount at Sep. 30, 2019 | 136,304 | $ 0 | $ 14,585 | 43,365 | 78,354 |
Balance, shares at Dec. 31, 2019 | 14,585,000 | ||||
Balance, amount at Dec. 31, 2019 | 154,395 | $ 0 | $ 14,585 | 43,365 | 96,445 |
Net loss | (331,838) | $ 0 | $ 0 | 0 | (331,838) |
Balance, shares at Mar. 31, 2020 | 14,585,000 | ||||
Balance, amount at Mar. 31, 2020 | (177,443) | $ 0 | $ 14,585 | 43,365 | (235,393) |
Balance, shares at Dec. 31, 2019 | 14,585,000 | ||||
Balance, amount at Dec. 31, 2019 | 154,395 | $ 0 | $ 14,585 | 43,365 | 96,445 |
Net loss | (396,279) | ||||
Balance, shares at Sep. 30, 2020 | 14,585,000 | ||||
Balance, amount at Sep. 30, 2020 | (241,884) | $ 0 | $ 14,585 | 43,365 | (299,834) |
Balance, shares at Mar. 31, 2020 | 14,585,000 | ||||
Balance, amount at Mar. 31, 2020 | (177,443) | $ 0 | $ 14,585 | 43,365 | (235,393) |
Net loss | (47,052) | $ 0 | $ 0 | 0 | (47,052) |
Balance, shares at Jun. 30, 2020 | 14,585,000 | ||||
Balance, amount at Jun. 30, 2020 | (224,495) | $ 0 | $ 14,585 | 43,365 | (282,445) |
Net loss | (17,389) | $ 0 | $ 0 | 0 | (17,389) |
Balance, shares at Sep. 30, 2020 | 14,585,000 | ||||
Balance, amount at Sep. 30, 2020 | $ (241,884) | $ 0 | $ 14,585 | $ 43,365 | $ (299,834) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Operating Activities | ||
Net income (loss) | $ (396,279) | $ 84,919 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Depreciation | 11,636 | 5,081 |
Changes in operating assets and liabilities: | ||
Contract assets | 0 | (19,300) |
House and real estate inventory | (16,024) | (17,424) |
Prepaid and other current assets | 0 | 1,500 |
Increase (decrease) in contract liabilities | 178,527 | (11,627) |
Accounts payable and accrued liabilities | 111,484 | 40,760 |
Net Cash Provided By (Used In) Operating Activities | (110,656) | 83,909 |
Investing Activities | ||
Purchase of property and equipment | (11,000) | 0 |
Net Cash Used In Investing Activities | (11,000) | 0 |
Financing Activities | ||
Payments on related party advances | 0 | (5,000) |
Proceeds from notes payable | 51,113 | 0 |
Payments on note payable | (5,055) | (13,248) |
Net Cash Provided By (Used In) Financing Activities | 46,058 | (18,248) |
Net change in Cash | (75,598) | 65,661 |
Cash - Beginning of Period | 280,680 | 181,093 |
Cash - End of Period | 205,082 | 246,754 |
Supplemental Disclosures | ||
Interest paid | 783 | 368 |
Income taxes paid | 0 | 0 |
Non-cash Disclosures | ||
Purchase of equipment with note payable | $ 35,802 | $ 0 |
The Company and Summary of Sign
The Company and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
The Company and Summary of Significant Accounting Policies | |
Note 1. The Company and Summary of Significant Accounting Policies | The Compan y Reliant Holdings, Inc. (the “ Company Reliant Pools Basis of Presentation The financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“ US GAAP The consolidated financial statements and related disclosures as of September 30, 2020 are unaudited, pursuant to the rules and regulations of the United States Securities and Exchange Commission (“ SEC Revenue Recognition – Home and Land Home sale revenues - Home sale revenues and related profit are generally recognized when title to and possession of the home are transferred to the buyer at the home closing date. Our performance obligation to deliver the agreed-upon home is generally satisfied at the home closing date. Home sale contract assets consist of cash from home closings held in escrow for our benefit, typically for less than five days, which are considered deposits in-transit and classified as cash. Contract liabilities, include customer deposit liabilities related to homes sold but not yet delivered to buyers, totaled $0 at September 30, 2020 and December 31, 2019, related to Home and Land revenue. Substantially all of our home sales are scheduled to close and be recorded to revenue within one year from the date of receiving a customer deposit. Land sale revenues Home and Real Estate Inventory Inventory is stated at cost unless the carrying value is determined to not be recoverable, in which case the affected inventory is written down to fair value. Cost includes land acquisition, land development, and home construction costs, including interest, real estate taxes, and certain direct and indirect overhead costs related to development and construction. The specific identification method is used to accumulate home construction costs. We capitalize interest cost into homebuilding inventories. Interest expense is allocated over the period based on the timing of home closings. Cost of revenues includes the construction cost, average lot cost, estimated warranty costs, and closing costs applicable to the home. Sales commissions are classified within selling, general, and administrative expenses. The construction cost of the home includes amounts paid through the closing date of the home, plus an accrual for costs incurred but not yet paid. We assess the recoverability of our land inventory in accordance with the provisions of Accounting Standards Codification (“ASC”) Topic 360, “Property, Plant, and Equipment.” We review our home and real estate inventory for indicators of impairment by property during each reporting period. If indicators of impairment are present for a property, generally, an undiscounted cash flow analysis is prepared in order to determine if the carrying value of the assets in that community exceeds the undiscounted cash flows. Generally, if the carrying value of the assets exceeds their estimated undiscounted cash flows, the assets are potentially impaired, requiring a fair value analysis. Our determination of fair value is primarily based on a discounted cash flow model which includes projections and estimates relating to sales prices, construction costs, sales pace, and other factors. However, fair value can be determined through other methods, such as appraisals, contractual purchase offers, and other third-party opinions of value. Changes in these expectations may lead to a change in the outcome of our impairment analysis, and actual results may also differ from our assumptions. For the nine months ended September 30, 2020 and 2019, we recorded $0 of impairment charges. COVID-19 A novel strain of coronavirus (“COVID-19”) was first identified in December 2019, and subsequently declared a global pandemic by the World Health Organization on March 11, 2020. As a result of the outbreak, many companies have experienced disruptions in their operations, workforce and markets served. While the Company has to date, not suffered any negative effects of COVID-19, the governmental response thereto, or any declines in demand for the Company’s services, the full extent of the COVID-19 outbreak and the ultimate impact on the Company’s operations is uncertain. A prolonged disruption could have a material adverse impact on financial results and business operations of the Company. |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Sep. 30, 2020 | |
Accounts Receivable | |
Note 2. Accounts Receivable | Accounts receivable consisted of the following: September 30, December 31, 2020 2019 Contract receivables $ 3,000 $ 3,000 Less: Allowance for doubtful accounts (3,000 ) (3,000 ) $ - $ - The Company recognized no bad debt expense during the nine months ended September 30, 2020 and 2019. |
Contracts in Process
Contracts in Process | 9 Months Ended |
Sep. 30, 2020 | |
Contracts in Process | |
Note 3. Contracts in Process | The net asset (liability) position for contracts in process consisted of the following: September 30, December 31, 2020 2019 Costs on uncompleted contracts $ 203,021 $ 244,557 Estimated earnings 94,764 120,453 297,785 365,010 Less: Progress billings 572,802 461,500 $ (275,017 ) $ (96,490 ) The net asset (liability) position for contracts in process is included in the accompanying consolidated balance sheets as follows: September 30, 2020 December 31, 2019 Costs and estimated earnings in excess of billings on uncompleted contracts $ — $ — Billings in excess of costs and estimated earnings on uncompleted contracts (275,017 ) (96,490 ) $ (275,017 ) $ (96,490 ) |
Concentration of Risk
Concentration of Risk | 9 Months Ended |
Sep. 30, 2020 | |
Concentration of Risk | |
Note 4. Concentration of Risk | The Company had gross revenue of $1,381,051 and $1,310,232 for the nine months ended September 30, 2020 and 2019, respectively. The Company had five customers representing more than 10% of gross revenue, and a combined 56% of revenue for the nine months ended September 30, 2020. The Company had four customers representing more than 10% of gross revenue, and a combined 48% of revenue for the nine months ended September 30, 2019. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2020 | |
Equity | |
Note 5. Equity | From January 2016 to September 2016, the Company sold 885,000 shares of restricted common stock for $44,250, or $0.05 per share in a private offering pursuant to a private placement memorandum. Purchasers in the offering included Lilia Chavez, the mother of Michael Chavez, the Company’s then President and then sole director (10,000 shares for $500), Alexander Spohn, the adult son of Becky Spohn, the Company’s then Controller (5,000 shares for $250), and Phyllis Laws, the mother of Becky Spohn, the Company’s then Controller (5,000 shares for $250). In September 2016, the Company discovered that the investors in the January 2016 to September 2016 offering may not have been provided all of the information and materials (including current audited financial statements), as is required under the Securities Act of 1933, as amended (the “ Securities Act Nevertheless, based on the above, the Company offered the January 2016 to September 2016 purchasers of the Company’s common stock the right to rescind their previous common stock acquisitions and receive, in exchange for any shares relinquished to the Company, a payment equal to their original purchase price plus interest at the applicable statutory rate in the state in which they reside. The rescission offer expired at 5:00 pm (CST) on October 26, 2016. None of the prior purchasers opted to rescind their prior purchases in connection with the rescission offer. During the first quarter of fiscal 2017, the Company learned that in 2009, Michael Chavez, the former President and former sole director, was barred from association with any FINRA member in any capability. Mr. Chavez similarly became aware of the FINRA bar at the same time. Pursuant to Rule 506(d), Rule 506 of the Securities Act, is not available for a sale of securities if among other persons, any director or executive officer of an issuer has been subject to certain disqualifying events after September 23, 2013, including suspension or expulsion from membership in a self-regulatory organization (SRO), such as FINRA. However, in the event the disqualifying event occurred prior to September 23, 2013, the issuer is not prohibited from relying on Rule 506, provided that pursuant to Rule 506(e) of the Securities Act, an issuer is required to furnish to each purchaser, a reasonable time prior to sale, a description in writing of any matters that would have triggered disqualification under Rule 506(d)(1), but occurred before September 23, 2013. As Mr. Chavez’s FINRA bar constituted a disqualifying event under Rule 506(d), the Company was required to furnish to each purchaser of shares of the Company, a reasonable time prior to sale, a description in writing of such event. The Company did not do that, because as described above, the Company and Mr. Chavez only became aware of the FINRA bar after the close of the offering. Notwithstanding the fact that the Company was not aware of Mr. Chavez’s FINRA bar, the Company determined that the failure to provide such information may prohibit the Company from relying on a Rule 506 exemption for the prior issuances and sales of shares. The Company believes that all such transactions still complied with, and were exempt from registration under Section 4(a)(2) of the Securities Act, because the recipients acquired the securities for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof; the securities were offered without any general solicitation by us or the Company’s representatives; no underwriters or agents were involved in the foregoing issuances and the Company paid no underwriting discounts or commissions, the securities sold/issued were subject to transfer restrictions, and the certificates evidencing the securities (or book entry issuances) contain an appropriate legend stating that such securities have not been registered under the Securities Act and may not be offered or sold absent registration or pursuant to an exemption therefrom; and the securities were not registered under the Securities Act and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act and any applicable state securities laws. Nevertheless, management determined that the Company would offer rescission to all of its stockholders in April 2017. In connection therewith, in April 2017, the Company offered every stockholder of the Company’s common stock the right to rescind their previous purchases and acquisitions and to receive, in exchange for any shares relinquished to us, a payment equal to their original purchase price or consideration provided, plus interest at the applicable statutory rate in the state in which they reside. The rescission offer expired at 5:00 pm (CST) on April 29, 2017. None of the Company’s stockholders opted to rescind their prior purchase/acquisitions in connection with the rescission offer. The federal securities laws and certain state securities laws do not expressly provide that a rescission offer will terminate a purchaser’s right to rescind a sale of securities that was not registered under the relevant securities laws as required. Accordingly, the Company may continue to be potentially liable under certain securities laws for the offer and sale of the shares sold and issued between May 2014 and September 2016, totaling $57,950 of securities in aggregate, along with statutory interest on such shares, even after the Company completed the rescission offers. This amount is recorded in equity in the accompanying September 30, 2020 and December 31, 2019 balance sheets. This will be evaluated at each reporting period for reclassification to a liability if a rescission request is made. Effective on November 3, 2017, Michael Chavez, the Company’s former sole director, Chief Executive Officer and President of the Company, entered into a Voting Agreement with Elijah May, the Company’s then Chief Operating Officer (COO), and current sole director, Chief Executive Officer and President as well as the Company’s COO (the “ Voting Agreement Pursuant to the Voting Agreement, Mr. Chavez provided complete authority to Mr. May to vote the 4,000,000 shares of common stock which Mr. Chavez then held (and any other securities of the Company obtained by Mr. Chavez in the future) at any and all meetings of stockholders of the Company and via any written consents. Those 4,000,000 shares represented 27.4% of the Company’s common stock as of the parties’ entry into the Voting Agreement and together with the 4,500,000 shares held by Mr. May prior to the parties’ entry into the Voting Agreement, constituted 58.3% of the Company’s total outstanding shares of common stock. The Voting Agreement has a term of ten years, through November 3, 2027, but can be terminated at any time by Mr. May and terminates automatically upon the death of Mr. May. In connection with his entry into the Voting Agreement, Mr. Chavez provided Mr. May an irrevocable voting proxy to vote the shares covered by the Voting Agreement. Additionally, during the term of such agreement, Mr. Chavez agreed not to transfer the shares covered by the Voting Agreement except pursuant to certain limited exceptions. Due to the Voting Agreement, Mr. May holds voting control over the Company due to his ability to vote 58.3% of the Company’s total outstanding shares of voting stock. Effective on November 3, 2017, the Board of Directors of the Company and the Board of Directors of Reliant Pools Inc., the Company’s wholly-owned subsidiary, each then consisting solely of Mr. Chavez, increased the number of members of the Board of Directors of each company from one to two and appointed Mr. May as a member of the Board of Directors of each company to fill the vacancy created by such vacancy. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies | |
Note 6. Commitments and Contingencies | The Company leases approximately 1,000 square feet of office space in Austin, Texas. The Company extended the office space lease from October 1, 2020 through September 30, 2021 for a rental rate of $1,850 per month. Lease expense was $17,415 and $17,145 for the nine months ended September 30, 2020 and 2019, respectively. On October 19, 2018, a former client, Paul T. Denucci filed an Original Petition naming the Company, Elijah May, our sole officer and director and Michael Chavez, our prior Chief Executive Officer and former sole director, as defendants. The Original Petition was originally filed in Williamson County, Texas, provided the proceeding was subsequently moved to the County Court of Travis County, Texas (County Court 2 – Cause No. C-1-CV-18-011465). The Original Petition alleged breach of contract and alleged defects in the pool which the Company built on Mr. Denucci’s behalf. The Original Petition sought damages in an amount sufficient to allow Mr. Denucci to repair the alleged defects in the pool. We denied all of Mr. Denucci’s claims and filed various responses and proceedings with the court in connection therewith. A bench trial in the matter was held in January 2020. On May 7, 2020, the trial judge ruled in favor of Mr. Denucci, the former client. The final judgment entered by the trial judge awarded Mr. Denucci actual damages in the amount of $177,053; prejudgment interest actual damages at the rate of 5% per annum from April 28, 2019 to May 7, 2020 (approximately $8,900); reasonable and necessary attorney’s fees in the amount of $85,291; court costs; and post-judgment interest at the rate of 5% per annum until all amounts are paid in full. In June 2020, Mr. Denucci filed a petition with the court to include both individuals personally (i.e., Mr. Chavez and Mr. May) and Reliant Holdings Inc. and other subsidiaries in the lawsuit. On December 21, 2018, a former client, Brian Moats filed an Original Petition naming Reliant Pools as a defendant in a suit filed in the County Court at Law No. 2 for Travis County, Texas (Cause No. C-1-CV-18-012062). The suit alleged that the Company failed to install a French drain under the pool as required by the terms of the contract, alleged causes of action of breach of express warranty and breach of contract and sought damages of between $100,000 and $200,000. We denied Mr. Moats’ claims. During the nine months ended September 30, 2020, the Company accrued $145,000 related to the above pending lawsuit with Mr. Moats. The associated expense is included in general and administrative expense. In September and October 2020, we entered into separate agreements with each of the parties above (including a settlement in principle with Mr. Moats) to settle the lawsuits in consideration for an aggregate of $420,000. |
Note Payable
Note Payable | 9 Months Ended |
Sep. 30, 2020 | |
Note Payable | |
Note 7. Note Payable | September 30, 2020 December 31, 2019 Term note with a bank secured by car, payable in monthly installments of $660, including interest at 3.99% through February 27, 2025 $ 30,747 $ — Paycheck Protection Program 51,113 — Total long-term debt 81,860 — Less: current portion (6,807 ) — Long-term debt net of current portion $ 75,053 $ — On April 28, 2020, the Company secured a construction loan to be used to develop the land purchased in the third quarter of 2019. The loan is for $221,000, bears interest at the rate of 6.25% and is repayable one year after issuance. As of September 30, 2020, no proceeds have been drawn on this instrument. On May 7, 2020, the Company received $51,113 of proceeds from the Small Business Administration’s Paycheck Protection Program. The funds will be subject to repayment and a 1% interest rate if not forgiven in accordance with the program. |
The Company and Summary of Si_2
The Company and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
The Company and Summary of Significant Accounting Policies (Policies) | |
Basis of Presentation | The financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“ US GAAP The consolidated financial statements and related disclosures as of September 30, 2020 are unaudited, pursuant to the rules and regulations of the United States Securities and Exchange Commission (“ SEC |
Revenue Recognition - Home and Land | Home sale revenues Land sale revenues |
Home and Real Estate Inventory | Inventory is stated at cost unless the carrying value is determined to not be recoverable, in which case the affected inventory is written down to fair value. Cost includes land acquisition, land development, and home construction costs, including interest, real estate taxes, and certain direct and indirect overhead costs related to development and construction. The specific identification method is used to accumulate home construction costs. We capitalize interest cost into homebuilding inventories. Interest expense is allocated over the period based on the timing of home closings. Cost of revenues includes the construction cost, average lot cost, estimated warranty costs, and closing costs applicable to the home. Sales commissions are classified within selling, general, and administrative expenses. The construction cost of the home includes amounts paid through the closing date of the home, plus an accrual for costs incurred but not yet paid. We assess the recoverability of our land inventory in accordance with the provisions of Accounting Standards Codification (“ASC”) Topic 360, “Property, Plant, and Equipment.” We review our home and real estate inventory for indicators of impairment by property during each reporting period. If indicators of impairment are present for a property, generally, an undiscounted cash flow analysis is prepared in order to determine if the carrying value of the assets in that community exceeds the undiscounted cash flows. Generally, if the carrying value of the assets exceeds their estimated undiscounted cash flows, the assets are potentially impaired, requiring a fair value analysis. Our determination of fair value is primarily based on a discounted cash flow model which includes projections and estimates relating to sales prices, construction costs, sales pace, and other factors. However, fair value can be determined through other methods, such as appraisals, contractual purchase offers, and other third-party opinions of value. Changes in these expectations may lead to a change in the outcome of our impairment analysis, and actual results may also differ from our assumptions. For the nine months ended September 30, 2020 and 2019, we recorded $0 of impairment charges. |
COVID-19 | A novel strain of coronavirus (“COVID-19”) was first identified in December 2019, and subsequently declared a global pandemic by the World Health Organization on March 11, 2020. As a result of the outbreak, many companies have experienced disruptions in their operations, workforce and markets served. While the Company has to date, not suffered any negative effects of COVID-19, the governmental response thereto, or any declines in demand for the Company’s services, the full extent of the COVID-19 outbreak and the ultimate impact on the Company’s operations is uncertain. A prolonged disruption could have a material adverse impact on financial results and business operations of the Company. |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Accounts Receivable | |
Schedule of accounts receivable | September 30, December 31, 2020 2019 Contract receivables $ 3,000 $ 3,000 Less: Allowance for doubtful accounts (3,000 ) (3,000 ) |
Contracts in Process (Tables)
Contracts in Process (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Contracts in Process | |
Schedule of net asset (liability) position for contracts in process | September 30, December 31, 2020 2019 Costs on uncompleted contracts $ 203,021 $ 244,557 Estimated earnings 94,764 120,453 297,785 365,010 Less: Progress billings 572,802 461,500 $ (275,017 ) $ (96,490 ) |
Schedule for contracts in process | September 30, 2020 December 31, 2019 Costs and estimated earnings in excess of billings on uncompleted contracts $ — $ — Billings in excess of costs and estimated earnings on uncompleted contracts (275,017 ) (96,490 ) $ (275,017 ) $ (96,490 ) |
Note Payable (Tables)
Note Payable (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Note Payable | |
Schedule of long term debt | September 30, 2020 December 31, 2019 Term note with a bank secured by car, payable in monthly installments of $660, including interest at 3.99% through February 27, 2025 $ 30,747 $ — Paycheck Protection Program 51,113 — Total long-term debt 81,860 — Less: current portion (6,807 ) — Long-term debt net of current portion $ 75,053 $ — |
The Company and Summary of Si_3
The Company and Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
The Company and Summary of Significant Accounting Policies (Policies) | |||
Revenue recognition related to Home and Land revenue | $ 0 | $ 0 | |
Impairment charges | $ 0 | $ 0 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts Receivable | ||
Contract receivables | $ 3,000 | $ 3,000 |
Less: Allowance for doubtful accounts | (3,000) | (3,000) |
Accounts receivable | $ 0 | $ 0 |
Contracts in Process (Details)
Contracts in Process (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Contracts in Process (Details) | ||
Costs on uncompleted contracts | $ 203,021 | $ 244,557 |
Estimated earnings | 94,764 | 120,453 |
Total | 297,785 | 365,010 |
Less: Progress billings | 572,802 | 461,500 |
Net asset (liability) position for contracts in process | $ (275,017) | $ (96,490) |
Contracts in Process (Details 1
Contracts in Process (Details 1) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Contracts in Process (Details 1) | ||
Costs and estimated earnings in excess of billings on uncompleted contracts | $ 0 | $ 0 |
Billings in excess of costs and estimated earnings on uncompleted contracts | (275,017) | (96,490) |
The net asset (liability) position for contracts in process | $ (275,017) | $ (96,490) |
Concentration of Risk (Details
Concentration of Risk (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue | $ 555,073 | $ 591,891 | $ 1,381,051 | $ 1,310,232 |
Gross Revenue [Member] | ||||
Concentration risk, percentage | 56.00% | 48.00% | ||
Gross revenue percent | 10.00% | 10.00% | ||
Number of customers | 5 | 4 |
Equity (Details Narrative)
Equity (Details Narrative) - USD ($) | Nov. 03, 2017 | Sep. 30, 2016 | Sep. 30, 2016 |
Sale of stock | $ 57,950 | ||
Elijah May [Member] | Voting Agreement [Member] | |||
Common stock shares held by related party | 4,500,000 | ||
Ownership percentage | 58.30% | ||
Michael Chavez [Member] | |||
Common stock shares held by related party | 4,000,000 | ||
Ownership percentage | 27.40% | ||
Restricted Stock [Member] | |||
Sale of stock | $ 44,250 | ||
Sale of stock, shares | 885,000 | ||
Share price (per share) | $ 0.05 | $ 0.05 | |
Restricted Stock [Member] | Lilia Chavez [Member] | |||
Sale of stock | $ 500 | ||
Sale of stock, shares | 10,000 | ||
Restricted Stock [Member] | Alexander Spohn [Member] | |||
Sale of stock | $ 250 | ||
Sale of stock, shares | 5,000 | ||
Restricted Stock [Member] | Phyllis Laws [Member] | |||
Sale of stock | $ 250 | ||
Sale of stock, shares | 5,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) | May 07, 2020USD ($) | Dec. 21, 2018USD ($) | Sep. 30, 2020USD ($)ft² | Sep. 30, 2019USD ($) | May 07, 2020USD ($) |
Lease expense per month | $ 1,850 | $ 1,850 | |||
Accrued lawsuit settlements | 145,000 | ||||
Reliant Pools [Member] | |||||
Name of defendant | Brian Moats | ||||
Allegations | suit alleged that the Company failed to install a French drain under the pool as required by the terms of the contract | ||||
Reliant Pools [Member] | Minimum [Member] | |||||
Damages sought, value | $ 100,000 | ||||
Reliant Pools [Member] | Maximum [Member] | |||||
Damages sought, value | $ 200,000 | ||||
Mr Moats [Member] | Formal Settlement Agreement [Member] | In September and October 2020 [Member] | |||||
Consideration aggregate value | 420,000 | ||||
Mr Denucci [Member] | |||||
Damages sought, value | $ 177,053 | ||||
Rate of Interest | 5.00% | ||||
Attorneys fees | $ 85,291 | ||||
Post judgement interest rate for payment | 5.00% | ||||
Austin Texas [Member] | |||||
Lease expense per month | $ 17,415 | $ 17,415 | |||
Area of office space leased | ft² | 1,000 |
Note Payable (Details)
Note Payable (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Note Payable | ||
Term note with a bank secured by car, payable in monthly installments of $660, including interest at 3.99% through February 27, 2025 | $ 30,747 | $ 0 |
Paycheck Protection Program | 51,113 | 0 |
Total long-term debt | 81,860 | 0 |
Less: current portion | (6,807) | 0 |
Long-term debt net of current portion | $ 75,053 | $ 0 |
Notes payable (Details Narrativ
Notes payable (Details Narrative) - USD ($) | May 07, 2020 | Apr. 28, 2020 |
Construction loan | $ 221,000 | |
Rate of interest | 6.25% | |
Description of loan payment | Repayable one year after issuance | |
Small Business Administration's Paycheck Protection Program [Member] | ||
Received amount under the program | $ 51,113 | |
Repayment term, description | The funds will be subject to repayment and a 1% interest rate if not forgiven in accordance with the program. | |
Interest rate | 1.00% |