Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Apr. 08, 2020 | Jun. 30, 2019 | |
Cover [Abstract] | |||
Entity Registrant Name | CannAssist International Corp | ||
Entity Central Index Key | 0001709542 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity File Number | 000-55740 | ||
Entity Incorporation State Country Code | DE | ||
Entity a Well-known Seasoned Issuer | No | ||
Entity a Voluntary Filer | No | ||
Entity Shell Company | false | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Public Float | $ 0 | ||
Entity Common Stock, Shares Outstanding | 18,435,000 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 |
Balance Sheets
Balance Sheets - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash | $ 80,021 | $ 67,351 |
Accounts receivable | 1,135 | 56,160 |
Prepaid expenses | 4,145 | 62,173 |
Other asset | 1,567 | |
Inventory | 50,592 | 19,764 |
Total assets | 137,460 | 205,448 |
Current liabilities: | ||
Accounts payable and accruals | 124,796 | 89,565 |
Accounts payable - related party | 9,857 | 4,373 |
Accrued liabilities | ||
Customer deposits | 54,660 | 59,671 |
Due to a related party | 9,498 | 8,666 |
Loan payable | 1,000 | 1,000 |
Accrual for income taxes | 6,748 | |
Total current liabilities | 199,811 | 170,023 |
Commitments and contingencies | ||
Stockholders' Equity (Deficit): | ||
Preferred stock, $0.0001 par value 20,000,000 shares authorized; none issued and outstanding | ||
Common Stock, $0.0001 par value, 100,000,000 shares authorized; 18,435,000 and 12,410,000 issued and outstanding, respectively | 1,844 | 1,241 |
Stock subscription receivable | (30) | |
Additional paid in capital | 358,317 | 13,920 |
(Accumulated deficit) / retained earnings | (422,512) | 20,294 |
Total Stockholders' (deficit) / equity | (62,351) | 35,425 |
Total Liabilities and Stockholders' Deficit | $ 137,460 | $ 205,448 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, authorized | 20,000,000 | 20,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 100,000,000 | 100,000,000 |
Common stock, issued | 18,435,000 | 12,410,000 |
Common stock, outstanding | 18,435,000 | 12,410,000 |
Statements of Operations
Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Total revenue | $ 686,400 | $ 745,165 |
Total cost of revenue | 461,606 | 576,066 |
Gross margin | 224,794 | 169,099 |
Operating expenses: | ||
General and administrative | 267,895 | 34,471 |
General and administrative- related party | 158,500 | 4,800 |
Commissions - related party | 25,562 | 28,655 |
Professional fees | 211,192 | 69,040 |
Total operating expenses | 663,149 | 136,966 |
(Loss) / income from operations | (438,355) | 32,133 |
Other expense: | ||
Interest expense | (4,451) | |
Total other expense | (4,451) | |
(Loss) / income before provision for income taxes | (442,806) | 32,133 |
Provision for income taxes | (6,748) | |
Net (loss) / income | $ (442,806) | $ 25,385 |
(Loss) / income per share, basic and diluted (in dollars per share) | $ (0.02) | $ 0 |
Weighted average shares outstanding, basic and diluted (in shares) | 17,773,836 | 15,101,877 |
Related Party [Member] | ||
Total revenue | $ 163,980 | |
Total cost of revenue | 129,636 | |
Revenue [Member] | ||
Total revenue | 686,400 | 581,185 |
Cost Of Revenue [Member] | ||
Total revenue | $ 461,606 | $ 446,430 |
Statement of Changes in Stockho
Statement of Changes in Stockholders' Equity - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Stock Subscription Receivable [Member] | Retained Earnings [Member] | Total |
Balance at the beginning at Dec. 31, 2017 | $ 2,000 | $ 471 | $ (5,091) | $ (2,620) | |
Balance at the beginning (in shares) at Dec. 31, 2017 | 20,000,000 | ||||
Increase Decrease In Stockholders Equity [Roll Forward] | |||||
Contributed capital | 2,400 | 2,400 | |||
Common stock cancelled | $ (2,000) | 2,000 | |||
Common stock cancelled (in shares) | (20,000,000) | ||||
Common stock issued for cash | $ 501 | 9,999 | (30) | $ 10,470 | |
Common stock issued for cash (in shares) | 5,005,000 | 5,005,000 | |||
Shares issued with merger | $ 300 | (300) | |||
Shares issued with merger (in shares) | 3,000,000 | ||||
Common stock issued for cash - related party | $ 440 | $ 440 | |||
Common stock issued for cash - related party (in shares) | 4,405,000 | ||||
Recapitalization of reverse merger | (650) | (650) | |||
Net loss | 25,385 | 25,385 | |||
Balance at the end at Dec. 31, 2018 | $ 1,241 | 13,920 | (30) | 20,294 | 35,425 |
Balance at the end (in shares) at Dec. 31, 2018 | 12,410,000 | ||||
Increase Decrease In Stockholders Equity [Roll Forward] | |||||
Contributed capital | 1,250 | 1,250 | |||
Common stock issued for cash | $ 85 | 149,915 | 30 | 150,030 | |
Common stock issued for cash (in shares) | 850,000 | ||||
Common stock issued for services | $ 18 | 43,732 | 43,750 | ||
Common stock issued for services (in shares) | 175,000 | ||||
Common stock issued for license agreement - related party | $ 500 | 149,500 | 150,000 | ||
Common stock issued for license agreement - related party (in shares) | 5,000,000 | ||||
Net loss | (442,806) | (442,806) | |||
Balance at the end at Dec. 31, 2019 | $ 1,844 | $ 358,317 | $ (422,512) | $ (62,351) | |
Balance at the end (in shares) at Dec. 31, 2019 | 18,435,000 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (442,806) | $ 25,385 |
Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||
Recapitalization of reverse merger | (650) | |
Common stock issued to licensing expense - related party | 150,000 | |
Common stock issued for services | 43,750 | |
Changes in Operating Assets and Liabilities: | ||
Accounts receivable | 55,024 | (56,160) |
Inventory | (30,828) | (19,764) |
Prepaid expenses and other assets | 56,462 | (62,173) |
Accounts payable and accrued liabilities | 33,966 | 98,686 |
Customer deposits | (5,011) | 59,671 |
Net cash provided by operating activities | (139,443) | 44,995 |
Cash flows from Investing activities: | ||
Cash flows from Financing activities: | ||
Proceeds from loans - related party | 12,450 | 8,666 |
Repayment of related party loans | (11,617) | |
Contributed capital | 1,250 | 2,400 |
Proceeds from sale of common stock | 150,030 | 10,910 |
Net cash provided by financing activities | 152,113 | 21,976 |
Net increase in cash | 12,670 | 66,971 |
Cash, beginning of year | 67,351 | 380 |
Cash, end of year | 80,021 | 67,351 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash paid for interest | ||
Cash paid for taxes |
DESCRIPTION OF BUSINESS AND HIS
DESCRIPTION OF BUSINESS AND HISTORY | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS AND HISTORY | NOTE 1 - DESCRIPTION OF BUSINESS AND HISTORY Description of business CannAssist International Corp. (the “Company” or “CannAssist”) was incorporated on May 17, 2017 under the laws of the state of Delaware under the name Iris Grove Acquisition Corporation to engage in any lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. On May 23, 2018 the Company changed its name to CannAssist International Corporation. On June 18, 2018, the Company cancelled all 20,000,000 shares of its issued and outstanding stock and issued 3,000,000 shares of common stock pursuant to Section 4(a)(2) of the Securities Act of 1933 at par representing 100% of the total outstanding common stock at the time. With the issuance of the stock and the redemption of the 20,000,000 shares of stock, the Company effected a change in its control and the new majority shareholder was elected as the new management of the Company. On July 12, 2018, the “Company, entered into a share exchange acquisition agreement with Xceptor LLC, a private company organized under the laws of Wyoming (“Xceptor”). The Acquisition was effected by the Company through the exchange of all the outstanding membership interests of Xceptor for 3,000,000 shares of common stock of the Company, valued at $0.0001 per share. At the time of the Acquisition, there was one shareholder of the Company who was also a shareholder and manager of Xceptor. Xceptor has become a wholly owned subsidiary of the Company and the Company has taken over its operations and business plan. Prior to the Acquisition, the Company had no ongoing business or operations. Since the Company and Xceptor were entities under common control prior to the Acquisition, the transaction is accounted for as a restructuring transaction. The Company has recast prior period financial statements to reflect the conveyance of Xceptor’s common shares as if the restructuring transaction had occurred as of the earliest date of the financial statements. CannAssist produces and sells products formulated using its cannabidiol ("CBD") product, “Cibidinol,” which is formulated based on a process developed by its founder Mark Palumbo. CBD is a non-psychoactive compound found in hemp. CannAssist’s initial research and development work, aimed at enhancing the bioavailability of desired molecular structures, resulted in the creation of a line of CBD products, most notably its CBD product, Cibidinol. Cibidinol will be available in a line of consumable and topical products that the Company believes will make enhanced CBD products more available and accessible to consumers. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles 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 the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Concentrations of Credit Risk We maintain our cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. We continually monitor our banking relationships and consequently have not experienced any losses in our accounts. We believe we are not exposed to any significant credit risk on cash. Cash equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents for the year ended December 31, 2019 or 2018. Accounts Receivable Revenues that have been recognized but not yet received are recorded as accounts receivable. Losses on receivables will be recognized when it is more likely than not that a receivable will not be collected. An allowance for estimated uncollectible amounts will be recognized to reduce the amount of receivables to its net realizable value when needed. The allowance for uncollectible amounts is evaluated quarterly. Fair value of financial instruments The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below: Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3: Pricing inputs that are generally unobservable inputs and not corroborated by market data. The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments. The Company’s notes payable approximates the fair value of such instruments based upon management’s best estimate of interest rates that would be available to the Company for similar financial arrangements at December 31, 2019. Revenue Recognition Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company's performance obligations are transferred to customers at a point in time, typically upon delivery. The Company recognizes revenue when product is shipped. The Company will often receive payment and/or pay for the cost of goods prior to shipping. When this occurs, the result is both a prepaid for the supplies to be used in their product and a customer deposit. As of December 31, 2019, the Company has a prepaid expense of $4,145 and customer deposits of $54,660, for orders to be shipped in Q1, 2020. As of December 31, 2018, the Company has a prepaid expense of $62,173 and customer deposits of $59.671, for orders to be shipped in Q1, 2019. Cost of Sales Cost of sales is determined on the basis of the cost of production or the purchase of goods, adjusted for the variation of inventory Cost of sale is recognized as the direct cost of products or services sold during the period. Income taxes The Company follows Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal 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 Statements of Income in the period that includes the enactment date. The Company adopted section 740-10-25 of the FASB Accounting Standards Codification (“Section 740-10-25”) with regards to uncertainty income taxes. Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of Section 740-10-25. Stock-based Compensation We account for equity-based transactions with nonemployees under the provisions of ASC Topic No. 505-50, Equity-Based Payments to Non-Employees We account for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation—Stock Compensation, Net income (loss) per common share Net income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period. The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented. The Company has no dilutive shares as of December 31, 2019 and 2018. Recently issued accounting pronouncements Topic 606, Revenue from Contracts with Customers Revenue from Contracts with Customers (Topic 606) On June 20, 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting In January 2017, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805) Clarifying the Definition of a Business In August 2015, the FASB issued ASU 2015-14, Deferral of the Effective Date, which amended the effective date for nonpublic entities to annual reporting periods beginning after December 15, 2018. In March 2016, the FASB issued an update (ASU 2016-08) to ASC 606, Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which clarifies the guidance on principal versus agent considerations. In April 2016, the FASB issued an update (ASU 2016-10) to ASC 606, Identifying Performance Obligations and Licensing, which provides clarification related to identifying performance obligations and licensing implementation guidance under ASU 2014-09. In May 2016, the FASB issued an update (ASU 2016-12) to ASC 606, Narrow-Scope Improvements and Practical Expedients, which amends guidance on transition, collectability, noncash consideration and the presentation of sales and other similar taxes. In December 2016, the FASB issued an update (ASU 2016-20) to ASC 606, Technical Corrections and Improvements, which outlines technical corrections to certain aspects of the new revenue recognition standard such as provisions for losses on construction type contracts and disclosure of remaining performance obligations, among other aspects. The effective date and transition requirements are the same as those in ASU 2014-09 for all subsequent clarifying guidance discussed herein. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (modified retrospective method). As an Emerging Growth Company, the standard is effective for the Company’s 2019 annual reporting period and for interim periods after 2019. The Company is in the process of analyzing the potential impact this standard will have on its consolidated financial position and results of operations. The Company expects to apply the modified retrospective method upon adoption. |
GOING CONCERN
GOING CONCERN | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GOING CONCERN | NOTE 3 - GOING CONCERN The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has generated revenues of $686,400 during the year ended December 31, 2019 and had a net loss of $442,806 (which included $193,750 on non-cash stock compensation expense) for the year ended December 31, 2019. The Company has an accumulated deficit of $422,512 as of December 31, 201. The Company requires capital for its contemplated operational and marketing activities. The obtainment of additional financing, through an initial capital raise , |
LOAN PAYABLE
LOAN PAYABLE | 12 Months Ended |
Dec. 31, 2019 | |
Loan Payable | |
LOAN PAYABLE | NOTE 4 – LOAN PAYABLE On October 11, 2017, the Company received a $1,000 loan from a third party. The loan is unsecured, due on demand and non-interest bearing. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 5 – RELATED PARTY TRANSACTIONS Marla Palumbo has advanced the Company a limited amount of funds to cover some general operating expenses and travel costs. These advances are unsecured, due on demand and non-interest bearing. As of December 31, 2019 and 2018, the balance due to Ms. Palumbo for cash advances is $9,498 and $300, respectively. Ms. Palumbo is the President of the Company and wife of the CEO, Mark Palumbo. On June 29, 2018, Ms. Palumbo advanced the Company $6,000 for general operating expenses. The advance is unsecured, due on demand and non-interest bearing. During the year ended December 31, 2019, the $6,000 was repaid. During the year ended December 31, 2018, EME, Ltd. advanced the Company $2,366 to pay for certain operating expenses. EME, Ltd. is owned by Mark Palumbo, CEO. The advance was repaid during the year ended December 31, 2019. The advance was unsecured, non-interest bearing and due on demand. In addition, there is $9,857 and $4,373 of accounts payable due to EME, Ltd as of December 31, 2019 and 2018. During the years ended December 31, 2019 and 2018, the Company paid sales commissions of $25,562 and $28,655, respectively, to EME Ltd. During the years ended December 31, 2019 and 2018, respectively, the Company incurred $6,400 and $4,800 of expense for Matthew Palumbo for product design services. Matthew Palumbo is the son of Mark Palumbo, CEO. On April 29, 2019, the Company entered into a Technology License Agreement with Mark Palumbo (“Licensor”) whereby the Licensor granted to the Company an exclusive worldwide license (the “License”) to use, market, promote and distribute certain technology related to a provisional patent application for a “Process for creating Carbohydrate Complexes with Cannabinoids and other Hydrophobic Molecules in large scale,” related patent applications, related trade-secrets and associated knowhow, including methods, techniques, specifications, procedures, information, systems, knowledge and business processes required to practice and carry on business in the field of data collection, security and management (the “Technology”). The initial term of the License is 5-years (the “Initial Term”) and shall automatically be renewed for successive 1-year terms (each, a “Renewal Term”) unless the Company elects to terminate the License by giving 30 days’ written notice prior to commencement of a Renewal Term. In exchange for the License of the Technology, the Company shall issue to the Licensor 5,000,000 restricted shares of its common stock, valued at par value per share, at the effective date of the agreement, and shall issue to the Licensor an additional 1,000,000 restricted shares of its common stock, valued at par value per share, at the commencement of each Renewal Term. |
COMMON STOCK
COMMON STOCK | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
COMMON STOCK | NOTE 6 – COMMON STOCK During the year ended December 31, 2018, the Company sold 5,005,000 shares of common stock to third parties for total cash proceeds of $10,500. As of December 31, 2018, $30 had not been collected and has been debited to stock subscription receivable. The $30 was collected during the year ended December 31, 2019. Pursuant to the terms of the licensing agreement with Mark Palumbo (Note 5) the Company issued 5,000,000 shares of common stock. The shares were valued at $0.03, the average price that common stock has recently been sold for, for total non-cash expense of $150,000. During year ended December 31, 2019, the Company granted 175,000 shares of common stock for services. The shares were valued at $0.25 for total non-cash expense of $43,750. During the year ended December 31, 2019, the Company sold 850,000 shares of common stock for total cash proceeds of $150,000. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 7 – INCOME TAXES Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company has evaluated Staff Accounting Bulletin No. 118 regarding the impact of the decreased tax rates of the Tax Cuts & Jobs Act. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The U.S. federal income tax rate of 21% is being used due to the new tax law recently enacted. Net deferred tax assets consist of the following components as of December 31: 2019 2018 Federal income tax benefit attributable to: Current operations $ 93,000 $ (6,748 ) Less: valuation allowance (93,000 ) 6,748 Net provision for Federal income taxes $ - $ - The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income from continuing operations for the period ended December 31, due to the following: 2019 2018 Deferred Tax Assets: NOL Carryover $ 88,700 $ 1,070 Less valuation allowance (88,700 ) (1,070 ) Net deferred tax assets $ - $ - Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to use in future years. ASC Topic 740 provides guidance on the accounting for uncertainty in income taxes recognized in a company’s financial statements. Topic 740 requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements. The Company includes interest and penalties arising from the underpayment of income taxes in the statements of operations in the provision for income taxes. As of December 31, 2019, the Company had no accrued interest or penalties related to uncertain tax positions. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 8 – SUBSEQUENT EVENTS On March 30, 2020, the Company issued 1,000 shares of its Series A Preferred Stock to Mark Palumbo, an officer and director of the Company, for $0.0001 per share in reliance on the exemption from registration under Section 4(a)(2). Series A Preferred Stock, voting together as a class, have the right to vote 60% of the Company’s voting shares on any and all shareholder matters (the “Majority Voting Rights”). Additionally, the Company shall not adopt any amendments to the Company’s Bylaws, Articles of Incorporation, as amended, make any changes to the Certificate of Designations establishing the Series A Preferred Stock, or effect any reclassification of the Series A Preferred Stock, without the affirmative vote of at least a majority of the outstanding shares of Series A Preferred Stock. However, the Company may, by any means authorized by law and without any vote of the holders of shares of Series A Preferred Stock, make technical, corrective, administrative or similar changes to such Certificate of Designations that do not, individually or in the aggregate, adversely affect the rights or preferences of the holders of shares of Series A Preferred Stock. Other than the Majority Voting Rights, the Series A Preferred Stock does not have any other dividend, liquidation, conversion, or redemption rights, whatsoever. On April 1, 2020, the Company entered into an agreement with an independent consultant pursuant to which the consultant shall be paid a cash monthly retainer of $5,000 a month and shall be issued 110,000 warrants to purchase shares of the common stock of the Company at an exercise price equal to $0.0001 per share, subject to certain conditions regarding vesting. This agreement has a term of 12 months and shall be automatically renewed on a month to month basis unless terminated upon 30 days’ written notice. In accordance with SFAS 165 (ASC 855-10) management has performed an evaluation of subsequent events through the date that the financial statements were available to be issued and has determined that it does not have any material subsequent events to disclose in these financial statements other than the foregoing. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles 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 the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Concentrations of Credit Risk | Concentrations of Credit Risk We maintain our cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. We continually monitor our banking relationships and consequently have not experienced any losses in our accounts. We believe we are not exposed to any significant credit risk on cash. |
Cash equivalents | Cash equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents for the year ended December 31, 2019 or 2018. |
Accounts Receivable | Accounts Receivable Revenues that have been recognized but not yet received are recorded as accounts receivable. Losses on receivables will be recognized when it is more likely than not that a receivable will not be collected. An allowance for estimated uncollectible amounts will be recognized to reduce the amount of receivables to its net realizable value when needed. The allowance for uncollectible amounts is evaluated quarterly. |
Fair value of financial instruments | Fair value of financial instruments The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below: Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3: Pricing inputs that are generally unobservable inputs and not corroborated by market data. The carrying amount of the Company’s financial assets and liabilities, such as cash, prepaid expenses and accrued expenses approximate their fair value because of the short maturity of those instruments. The Company’s notes payable approximates the fair value of such instruments based upon management’s best estimate of interest rates that would be available to the Company for similar financial arrangements at December 31, 2019. |
Revenue Recognition | Revenue Recognition Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company's performance obligations are transferred to customers at a point in time, typically upon delivery. The Company recognizes revenue when product is shipped. The Company will often receive payment and/or pay for the cost of goods prior to shipping. When this occurs, the result is both a prepaid for the supplies to be used in their product and a customer deposit. As of December 31, 2019, the Company has a prepaid expense of $4,145 and customer deposits of $54,660, for orders to be shipped in Q1, 2020. As of December 31, 2018, the Company has a prepaid expense of $62,173 and customer deposits of $59.671, for orders to be shipped in Q1, 2019. |
Cost of Sales | Cost of Sales Cost of sales is determined on the basis of the cost of production or the purchase of goods, adjusted for the variation of inventory Cost of sale is recognized as the direct cost of products or services sold during the period. |
Income taxes | Income taxes The Company follows Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal 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 Statements of Income in the period that includes the enactment date. The Company adopted section 740-10-25 of the FASB Accounting Standards Codification (“Section 740-10-25”) with regards to uncertainty income taxes. Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of Section 740-10-25. |
Stock-based Compensation | Stock-based Compensation We account for equity-based transactions with nonemployees under the provisions of ASC Topic No. 505-50, Equity-Based Payments to Non-Employees We account for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation—Stock Compensation, |
Net income (loss) per common share | Net income (loss) per common share Net income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period. The weighted average number of common shares outstanding and potentially outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented. The Company has no dilutive shares as of December 31, 2019 and 2018. |
Recently issued accounting pronouncements | Recently issued accounting pronouncements Topic 606, Revenue from Contracts with Customers Revenue from Contracts with Customers (Topic 606) On June 20, 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting In January 2017, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805) Clarifying the Definition of a Business In August 2015, the FASB issued ASU 2015-14, Deferral of the Effective Date, which amended the effective date for nonpublic entities to annual reporting periods beginning after December 15, 2018. In March 2016, the FASB issued an update (ASU 2016-08) to ASC 606, Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which clarifies the guidance on principal versus agent considerations. In April 2016, the FASB issued an update (ASU 2016-10) to ASC 606, Identifying Performance Obligations and Licensing, which provides clarification related to identifying performance obligations and licensing implementation guidance under ASU 2014-09. In May 2016, the FASB issued an update (ASU 2016-12) to ASC 606, Narrow-Scope Improvements and Practical Expedients, which amends guidance on transition, collectability, noncash consideration and the presentation of sales and other similar taxes. In December 2016, the FASB issued an update (ASU 2016-20) to ASC 606, Technical Corrections and Improvements, which outlines technical corrections to certain aspects of the new revenue recognition standard such as provisions for losses on construction type contracts and disclosure of remaining performance obligations, among other aspects. The effective date and transition requirements are the same as those in ASU 2014-09 for all subsequent clarifying guidance discussed herein. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (modified retrospective method). As an Emerging Growth Company, the standard is effective for the Company’s 2019 annual reporting period and for interim periods after 2019. The Company is in the process of analyzing the potential impact this standard will have on its consolidated financial position and results of operations. The Company expects to apply the modified retrospective method upon adoption. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of net deferred tax assets | Net deferred tax assets consist of the following components as of December 31: 2019 2018 Federal income tax benefit attributable to: Current operations $ 93,000 $ (6,748 ) Less: valuation allowance (93,000 ) 6,748 Net provision for Federal income taxes $ - $ - |
Schedule of deferred income tax assets | The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income from continuing operations for the period ended December 31, due to the following: 2019 2018 Deferred Tax Assets: NOL Carryover $ 88,700 $ 1,070 Less valuation allowance (88,700 ) (1,070 ) Net deferred tax assets $ - $ - |
DESCRIPTION OF BUSINESS AND H_2
DESCRIPTION OF BUSINESS AND HISTORY (Details Narrative) - $ / shares | Jul. 12, 2018 | Jun. 18, 2018 | Dec. 31, 2018 |
Number of shares cancelled | 20,000,000 | ||
Number of shares issued (in shares) | 3,000,000 | 5,005,000 | |
Redemption shares of stock | 20,000,000 | ||
Percentage of total outstanding common stock | 100.00% | ||
Xceptor LLC [Member] | Exchange Acquisition Agreement [Member] | |||
Number of shares exchange in business acquisition (in shares) | 3,000,000 | ||
Business acquisition, share price (in dollars per share) | $ 0.0001 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Accounting Policies [Abstract] | ||
Prepaid expenses | $ 4,145 | $ 62,173 |
Customer deposits | $ 54,660 | $ 59,671 |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Revenues | $ 686,400 | |
Net income (loss) | (442,806) | $ 25,385 |
Non-cash stock compensation expense | 193,750 | |
Accumulated deficit | $ (422,512) | $ 20,294 |
LOAN PAYABLE (Details Narrative
LOAN PAYABLE (Details Narrative) | Oct. 11, 2017USD ($) |
Third Party [Member] | Unsecured Loan Payable [Member] | |
Proceeds from unsecured loan payable | $ 1,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Apr. 29, 2019 | Jun. 29, 2018 | Jun. 18, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
Related party transaction repaid | $ 11,617 | ||||
Accounts payable - related party | 9,857 | 4,373 | |||
Commissions - related party | 25,562 | $ 28,655 | |||
Number of shares issued (in shares) | 3,000,000 | 5,005,000 | |||
Technology License Agreement [Member] | Common Stock Issued For Cash - Related Party [Member] | |||||
License initial term | 5 years | ||||
Automatically renewed terms | 1 year | ||||
Technology License Agreement [Member] | Restricted Shares [Member] | Common Stock Issued For Cash - Related Party [Member] | |||||
Number of shares issued (in shares) | 5,000,000 | ||||
Number of shares issued at each renewal term (in shares) | 1,000,000 | ||||
Matthew Palumbo [Member] | |||||
Expenses related party transaction | 6,400 | $ 4,800 | |||
Marla Palumbo [Member] | General Operating Expenses [Member] | |||||
Due to related party | 9,498 | 300 | |||
Expenses related party transaction | $ 6,000 | ||||
Related party transaction repaid | 6,000 | ||||
Mark Palumbo [Member] | EME, Ltd. [Member] | |||||
Expenses related party transaction | 2,366 | ||||
Accounts payable - related party | 9,857 | 4,373 | |||
Commissions - related party | $ 25,562 | $ 28,655 |
COMMON STOCK (Details Narrative
COMMON STOCK (Details Narrative) - USD ($) | Apr. 29, 2019 | Jun. 18, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
Number of shares issued (in shares) | 3,000,000 | 5,005,000 | ||
Proceeds from issuance of common stock | $ 150,030 | $ 10,910 | ||
Stock subscription receivable | 30 | 30 | ||
Shares issued | 43,750 | |||
Cash proceeds | $ 150,030 | $ 10,470 | ||
Common Stock [Member] | ||||
Number of shares issued (in shares) | 850,000 | 5,005,000 | ||
Share price (in dollars per share) | $ 0.25 | |||
Non cash expense | $ 43,750 | |||
Shares issued | $ 18 | |||
Shares granted | 175,000 | |||
Cash proceeds | $ 85 | $ 501 | ||
Technology License Agreement [Member] | Restricted Shares [Member] | Common Stock Issued For Cash - Related Party [Member] | ||||
Number of shares issued (in shares) | 5,000,000 | |||
Share price (in dollars per share) | $ 0.03 | |||
Non cash expense | $ 150,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Federal income tax benefit attributable to: | ||
Current operations | $ 93,000 | $ (6,748) |
Less: valuation allowance | (93,000) | 6,748 |
Net provision for Federal income taxes |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred Tax Assets: | ||
NOL Carryover | $ 88,700 | $ 1,070 |
Less valuation allowance | (88,700) | (1,070) |
Net deferred tax assets |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Statutory corporate tax rate | 21.00% |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Apr. 01, 2020 | Mar. 30, 2020 | Jun. 18, 2018 | Dec. 31, 2018 | Dec. 31, 2019 |
Subsequent Event [Line Items] | |||||
Number of shares issued | 3,000,000 | 5,005,000 | |||
Cash paid | $ 67,351 | $ 80,021 | |||
Subsequent Event [Member] | Consultant [Member] | Agreement [Member] | |||||
Subsequent Event [Line Items] | |||||
Description of agreement term | This agreement has a term of 12 months and shall be automatically renewed on a month to month basis unless terminated upon 30 days’ written notice. | ||||
Subsequent Event [Member] | Consultant [Member] | Agreement [Member] | Warrant [Member] | |||||
Subsequent Event [Line Items] | |||||
Number of shares issued | 110,000 | ||||
Subsequent Event [Member] | Consultant [Member] | Agreement [Member] | |||||
Subsequent Event [Line Items] | |||||
Cash paid | $ 5,000 | ||||
Excercise price of warrant | $ 0.0001 | ||||
Subsequent Event [Member] | Series A Preferred Stock [Member] | Mr. Mark Palumbo[Member] | |||||
Subsequent Event [Line Items] | |||||
Number of shares issued | 1,000 | ||||
Shares issued price per share (in dollars per share) | $ 0.0001 | ||||
Percentage of voting rights | 60.00% |