10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

ýQuarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2015

☐Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ___________ to __________

Commission File No. 0-18958

Grote Molen, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Nevada	20-1282850
(State or other jurisdiction of  incorporation or organization)	(I.R.S. Employer Identification No.)
322 West Griffith Road
Pocatello, Idaho 83201
(Address of principal executive offices, including zip code)
(208) 234-9352
(Registrant's telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ý  No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes ý    No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☐	Smaller reporting company ý

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes ☐  No ý

As of November 16, 2015, there were 22,200,000 shares of the Registrant's common stock, $0.001 par value per share, outstanding.

GROTE MOLEN, INC. AND SUBSIDIARY
FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2015
PART I - Financial Information
Item 1.  Financial Statements
	Condensed Consolidated Balance Sheets as of September 30, 2015 and December 31, 2014 (unaudited)	2
	Condensed Consolidated Statements of Operations for the Three Months and Nine Months Ended September 30, 2015 and 2014 (unaudited)	3
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2015 and 2014 (unaudited)	4
	Notes to Condensed Consolidated Financial Statements (unaudited)	5
Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations		11
Item 3.  Quantitative and Qualitative Disclosures About Market Risk		17
Item 4.  Controls and Procedures		17
PART II - Other Information
Item 1.  Legal Proceedings		18
Item 1A.  Risk Factors		18
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds		18
Item 3.  Defaults upon Senior Securities		18
Item 4.  Mine Safety Disclosures		18
Item 5.  Other Information		18
Item 6.  Exhibits		19
Signatures		20

1

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

GROTE MOLEN, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
	September 30, 2015		December 31, 2014
ASSETS
Current assets:
Cash	$	14,413	$	60,808
Accounts receivable		57,218		58,358
Inventories		468,272		328,160
Deposits		272,430		382,295
Prepaid expenses		448		6,935
Total current assets		812,781		836,556
Property and equipment, net		143,896		156,652
Intangible assets, net		63,331		64,120
Total assets	$	1,020,008	$	1,057,328
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses	$	61,437	$	51,021
Accrued interest payable – related parties		51,580		44,936
Accrued interest payable		21,605		14,195
Current portion of long-term debt – related party		18,646		45,774
Notes payable – related parties		136,127		154,627
Notes payable		133,100		91,600
Total current liabilities		422,495		402,153
Long-term debt:
Note payable		148,079		136,753
Long-term debt – related party		-		6,903
Total long-term debt		148,079		143,656
Total liabilities		570,574		545,809
Stockholders' equity:
Preferred stock, $.001 par value, 5,000,000 shares authorized,  no shares issued and outstanding		-		-
Common stock, $.001 par value, 100,000,000 shares authorized, 22,200,000 shares issued and outstanding		22,200		22,200
Additional paid-in capital		147,800		147,800
Retained earnings		279,434		341,519
Total stockholders' equity		449,434		511,519
Total liabilities and stockholders' equity	$	1,020,008	$	1,057,328

See notes to condensed consolidated financial statements

2

GROTE MOLEN, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Revenues:
Sales	$	382,021		$	306,381		$	964,214		$	777,811
Sales to related parties		34,615			15,537			60,661			31,072
Total revenues		416,636			321,918			1,024,875			808,883
Cost of revenues:
Cost of sales		292,887			227,065			706,097			599,329
Cost of related party sales		26,539			10,682			44,422			22,948
Total cost of revenues		319,426			237,747			750,519			622,277
Gross profit		97,210			84,171			274,356			186,606
Operating costs and expenses:
Selling, general and administrative		108,579			95,527			331,009			290,220
Depreciation and amortization		4,471			749			13,545			2,224
Total operating costs and expenses		113,050			96,276			344,554			292,444
Loss from operations		(15,840	)		(12,105	)		(70,198	)		(105,838	)
Other expense:
Interest expense – related parties		4,776			3,904			8,456			11,142
Interest expense		2,819			3,252			12,816			8,923
Total other expense		7,595			7,156			21,272			20,065
Loss before income taxes		(23,435	)		(19,261	)		(91,470	)		(125,903	)
Income tax benefit		29,419			3,648			29,385			25,322
Net income (loss)	$	5,984		$	(15,613	)	$	(62,085	)	$	(100,581	)
Net income (loss) per common share -
Basic and diluted	$	0.00		$	(0.00	)	$	(0.00	)	$	(0.00	)
Weighted average shares outstanding -
Basic and diluted		22,200,000			22,200,000			22,200,000			21,761,173

See notes to condensed consolidated financial statements

3

GROTE MOLEN, INC. AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Nine Months Ended September 30,
	2015			2014
Cash flows from operating activities:
Net loss	$	(62,085	)	$	(100,581	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		13,545			2,224
Interest added to note payable principal		-			2,531
(Increase) decrease in:
Accounts receivable		1,140			(1,638	)
Inventories		(140,112	)		(102,010	)
Deposits		109,865			(28,396	)
Prepaid expenses		6,487			(25,405	)
Increase (decrease) in:
Accounts payable and accrued expenses		10,416			48,482
Accrued interest payable – related parties		6,644			6,889
Accrued interest payable		7,410			4,680
Net cash used in operating activities		(46,690	)		(193,224	)
Cash flows from investing activities:
Purchase of property and equipment		-			(1,423	)
Net cash used in investing activities		-			(1,423	)
Cash flows from financing activities:
Proceeds from long-term note payable		28,700			151,930
Proceeds from notes payable – related parties		-			50,000
Proceeds from notes payable		41,500			9,600
Proceeds from issuance of common stock		-			60,000
Repayment of notes payable – related parties		(18,500	)		(4,000	)
Repayment of long-term debt – related party		(34,031	)		(31,746	)
Repayment of long-term note payable		(17,374	)		(6,288	)
Net cash provided by financing activities		295			229,496
Net increase (decrease) in cash		(46,395	)		34,849
Cash, beginning of the period		60,808			79,069
Cash, end of the period	$	14,413		$	113,918

See notes to condensed consolidated financial statements

4

GROTE MOLEN, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS PRESENTED AS OF SEPTEMBER 30, 2015 AND FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2015 AND 2014 ARE UNAUDITED)

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNICANT ACCOUNTING POLICIES

Organization

Grote Molen, Inc. ("Grote Molen") was incorporated under the laws of the State of Nevada on March 15, 2004.  BrownWick, LLC ("BrownWick"), a wholly owned subsidiary, was formed in the State of Idaho on June 5, 2005.  The principal business of Grote Molen and BrownWick (collectively the "Company") is to distribute grain mills, kitchen mixers and related accessories for home use.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Grote Molen and BrownWick.  All significant inter-company balances and transactions have been eliminated.

Basis of Presentation

The accompanying condensed consolidated financial statements as of September 30, 2015 and for the three months and nine months ended September 30, 2015 and 2014 are unaudited.  In the opinion of management, all adjustments have been made, consisting of normal recurring items, that are necessary to present fairly the consolidated financial position as of September 30, 2015 as well as the consolidated results of operations for the three months and nine months ended September 30, 2015 and cash flows for the nine months ended September 30, 2015 and 2014 in accordance with U.S. generally accepted accounting principles.  The results of operations for any interim period are not necessarily indicative of the results expected for the full year.  The interim condensed consolidated financial statements and related notes thereto should be read in conjunction with the audited consolidated financial statements and related notes thereto for the year ended December 31, 2014.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with U.S. 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.

Earnings Per Share

The computation of basic earnings per common share is based on the weighted average number of shares outstanding during the period.

The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the period plus the common stock equivalents which would arise from the exercise of stock options and warrants outstanding using the treasury stock method and the average market price per share during the period.  Common stock equivalents are not included in the diluted earnings per share calculation when their effect is anti-dilutive.  We have not granted any stock options or warrants since inception of the Company.  Therefore, our basic earnings per share is the same as diluted earnings per share for the three months and nine months ended September 30, 2015 and 2014.

Comprehensive Income (Loss)

Comprehensive income (loss) is the same as net income (loss).

5

NOTE 2 – DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS

Accounts receivable consist of the following:

	September 30, 2015		December 31, 2014
Trade accounts receivable – related parties	$	21,218	$	8,141
Trade accounts receivable		31,000		45,217
Employee advances		5,000		5,000
	$	57,218	$	58,358

Property and equipment consist of the following:

	September 30, 2015			December 31, 2014
Office equipment	$	4,335		$	4,335
Warehouse equipment		16,927			16,927
Website development		2,000			2,000
Molds		150,615			150,615
		173,877			173,877
Accumulated depreciation		(29,981	)		(17,225	)
	$	143,896		$	156,652

Intangible assets consist of the following:

	September 30, 2015			December 31, 2014
License – definite lived	$	10,500		$	10,500
License – indefinite lived		62,720			62,720
Patent		100			100
		73,320			73,320
Accumulated amortization		(9,989	)		(9,200	)
	$	63,331		$	64,120

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NOTE 3 – RELATED PARTY DEBT

Notes payable – related parties are unsecured and are comprised of the following:

	September 30, 2015		December 31, 2014
Note payable to a stockholder, due on demand, with interest at 6% per annum	$	30,000	$	30,000
Note payable to a stockholder, due on demand, with interest at 6% per annum		3,500		3,500
Note payable to a stockholder, due on demand, with interest at 6% per annum		38,000		38,000
Note payable to a stockholder, due on demand, with interest at 6% per annum		10,000		10,000
Note payable to a stockholder, due on demand, with interest at 6% per annum		5,000		5,000
Note payable to a stockholder, due on demand, with interest at 8% per annum		9,000		9,000
Note payable to a stockholder, due on demand, with interest at 8% per annum		15,000		15,000
Note payable to a stockholder, due on demand, with interest at 8% per annum		16,500		35,000
Non-interest bearing advances from stockholders, with no formal repayment terms		9,127		9,127
Total	$	136,127	$	154,627

Long-term debt – related party is comprised of the following:

	September 30, 2015			December 31, 2014
Note payable to a stockholder, due in monthly installments of $4,000 through February 2016, with interest at 6.97 % per annum	$	18,646		$	52,677
Less current portion		(18,646	)		(45,774	)
Long-term portion	$	-		$	6,903

Interest expense on related party debt was $4,776 and $3,904 for the three months ended September 30, 2015 and 2014, respectively, and $8,456, and $11,142 for the nine months ended September 30, 2015 and 2014, respectively.  Accrued interest payable to related parties was $51,580 and $44,936 at September 30, 2015 and December 31, 2014, respectively.

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NOTE 4 – NOTES PAYABLE

Short-term notes payable to non-related parties are unsecured and are comprised of the following:

	September 30, 2015		December 31, 2014
Note payable, due on demand, with interest at 8% per annum	$	15,000	$	15,000
Note payable, due on demand, with interest at 8% per annum		20,000		20,000
Note payable, due on demand, with interest at 8% per annum		5,000		5,000
Note payable, due on demand, with interest at 8% per annum		7,000		7,000
Note payable, due on demand, with interest at 6% per annum		15,000		15,000
Note payable, due on demand, with interest at 6% per annum		10,000		10,000
Note payable, due on demand, with interest at 6% per annum		4,000		4,000
Note payable, due on demand, with interest at 6% per annum		5,600		5,600
Note payable, due on demand, with interest at 6% per annum		10,000		10,000
Note payable, due on demand, with interest at 6% per annum		10,000		-
Note payable, due on demand, with interest at 6% per annum		10,000		-
Note payable, due on demand, with interest at 6% per annum		10,000		-
Note payable, due on demand, with interest at 6% per annum		2,500		-
Note payable, due on demand, with interest at 6% per annum		9,000		-
Total	$	133,100	$	91,600

At September 30, 2015 and December 31, 2014 we had a long-term note payable to a bank with a principal balance of $148,079 and $136,753, respectively.  The long-term note payable is a line of credit promissory note bearing interest at an indexed rate plus 2% (5.25% at September 30, 2015), requiring monthly interest payments only, and maturing on May 16, 2021.  The note payable has an available line of credit of $150,000, and is secured by a deed of trust on certain real estate owned by one of the principal stockholders of the Company and by the Company's inventories, property and equipment, and intangible assets.

Accrued interest payable on the notes payable was $21,605 and $14,195 at September 30, 2015 and December 31, 2014, respectively.

8

NOTE 5 – RELATED PARTY TRANSACTIONS

Pursuant to an agreement effective in February 2011, we pay a monthly management fee to a company owned by one of the major stockholders of the Company to manage our day-to-day business activities and to provide business space.  Historically we have paid monthly management fees in varying amounts to this related party pursuant to prior agreements.  The agreement is on a month-to-month basis and can be cancelled at any time by the vote of management.  The agreement was amended and restated on October 31, 2014 to increase the fee to $12,500 effective November 1, 2014.  Also included in management fees are monthly payments of $150 to another major stockholder of the Company for expense reimbursement.  Included in selling, general and administrative expenses were management fees totaling $37,950 and $32,100 for the three months ended September 30, 2015 and 2014, respectively, and $113,850 and $97,950 for the nine months ended September 30, 2015 and 2014, respectively.

Each of the two principal stockholders of the Company owns a company that is our customer.  Sales to these related parties totaled $34,615 and $15,537 for the three months ended September 30, 2015 and 2014, respectively, or approximately 8% and 5%, respectively.  Sales to these related parties totaled $60,661 and $31,072 for the nine months ended September 30, 2015 and 2014, respectively, or approximately 6% and 4%, respectively.  Accounts receivable from these related parties totaled $21,218 and $8,141 at September 30, 2015 and December 31, 2014, respectively.

See Note 3 for discussion of related party debt and interest expense.

NOTE 6 – CAPITAL STOCK

The Company's preferred stock may have such rights, preferences and designations and may be issued in such series as determined by our Board of Directors.  No shares of preferred stock were issued and outstanding at September 30, 2015 and December 31, 2014.

NOTE 7 – INCOME TAXES

The income tax benefit for the three months and nine months ended September 30, 2015 resulted primarily from federal income tax refunds received and approximated 126% of the net loss for the three months ended September 30, 2015.  The refunds and resultant tax benefit were recorded in the current period though they arose from prior tax filings due to changes in estimates and computations accounted for in the current period.  There were no other material permanent differences affecting the effective tax rate.

NOTE 8 – SUPPLEMENTAL STATEMENT OF CASH FLOWS INFORMATION

During the nine months ended September 30, 2015 and 2014, we had no non-cash financing and investing activities.

We paid cash for income taxes of $34 and $30 for the nine months ended September 30, 2015 and 2014, respectively.  We paid cash for interest of $4,707 and $8,496 for the nine months ended September 30, 2015 and 2014, respectively.

NOTE 9 – SIGNIFICANT CUSTOMERS

In addition to the sales to related parties discussed in Note 5, we had sales to one customer that accounted for approximately 9% and 8% of total sales for the nine months ended September 30, 2015 and 2014, respectively.

9

NOTE 10 – RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In July 2015, the Financial Accounting Standards Board issued Accounting Standards Update No. 2015-11, "Inventory (Topic 330), Simplifying the Measurement of Inventory."  An entity is required to measure inventory within the scope of this Update at the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation.  Other than the change in the subsequent measurement guidance from the lower of cost or market to the lower of cost and net realizable value for inventory within the scope of this Update, there are no other substantive changes to the guidance on measurement of inventory.  For public companies, the amendments in this Update are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years.  The amendments in this Update are to be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period.  We are currently unable to determine the impact on our consolidated financial statements of the adoption of this new accounting pronouncement.

NOTE 11 – SUBSEQUENT EVENTS

We have evaluated events occurring after the date of our accompanying consolidated balance sheets through the date the financial statements were issued.  We have not identified any subsequent events that we believe require disclosure.

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Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations

FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements.  These statements reflect the Company's views with respect to future events based upon information available to it at this time.  These forward-looking statements are subject to certain uncertainties and other factors that could cause actual results to differ materially from these statements.  These uncertainties and other factors include, but are not limited to the risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2014 in Part I, Item 1A under the caption "Risk Factors."  The words "anticipates," "believes," "estimates," "expects," "plans," "projects," "targets" and similar expressions identify forward-looking statements.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made.  The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, changes in assumptions, future events or otherwise.

You should read the following discussion in conjunction with our condensed consolidated financial statements, which are included elsewhere in this report.  The following information contains forward-looking statements. (See "Forward-Looking Statements" and "Risk Factors.")

General

Grote Molen, Inc. ("Grote Molen") was incorporated under the laws of the State of Nevada on March 15, 2004. BrownWick, LLC ("BrownWick"), a wholly owned subsidiary, was formed in the State of Idaho on June 5, 2005. The principal business of Grote Molen and BrownWick (collectively the "Company") is to distribute electrical and hand operated grain mills, kitchen mixers and related accessories for home use.

Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires our management to make assumptions, estimates and judgments that affect the amounts reported in the financial statements, including the notes thereto, and related disclosures of commitments and contingencies, if any. We consider our critical accounting policies to be those that require the more significant judgments and estimates in the preparation of financial statements, including the following:

Accounts Receivable

Trade accounts receivable are carried at original invoice amount less an estimate made for doubtful accounts. We determine the allowance for doubtful accounts by identifying potential troubled accounts and by using historical experience and future expectations applied to an aging of accounts. Trade accounts receivable are written off when deemed uncollectible. Recoveries of trade accounts receivable previously written off are recorded as income when received. We determined that no allowance for doubtful accounts was required at September 30, 2015 and December 31, 2014.

Inventories

Inventories, consisting primarily of grain mills, kitchen mixers, parts and accessories, are stated at the lower of cost or market, with cost determined using primarily the first-in-first-out (FIFO) method. We purchase substantially all inventories from two foreign suppliers, and have been dependent on those suppliers for substantially all inventory purchases since we commenced operations.

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Deposits

At times, we are required to pay advance deposits toward the purchase of inventories from our principal suppliers. Such advance payments are recorded as deposits, a current asset in the accompanying consolidated financial statements.

Property and Equipment

Property and equipment are carried at cost, less accumulated depreciation. Depreciation is computed using the straight-line method based on the estimated useful lives of the assets, which range from 3 to 10 years. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed and any resulting gain or loss is recognized in operations for the period. The cost of maintenance and repairs is charged to operations as incurred. Significant renewals and betterments are capitalized.

Intangible Assets

Intangible assets are recorded at cost, less accumulated amortization. Amortization of definitive lived intangible assets is computed using the straight-line method based on the estimated useful lives or contractual lives of the assets, which range from 10 to 30 years.

Impairment of Long-Lived Assets

We periodically review our long-lived assets, including intangible assets, for impairment when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. No events or changes in circumstances have occurred to indicate that the carrying amount of our long-lived assets may not be recoverable. Therefore, no impairment loss was recognized during the three months and nine months ended September 30, 2015 and 2014.

Revenue Recognition

We record revenue from the sales of grain mills, kitchen mixers and accessories in accordance with the underlying sales agreements when the products are shipped, the selling price is fixed and determinable, and collection is reasonably assured.

Warranties

We provide limited warranties to our customers for certain of our products sold.  We perform warranty work at our service center in Pocatello, Idaho or at other authorized service locations.  Warranty expenses have not been material to our consolidated financial statements.

Research and Development Costs

Research and development costs are expensed as incurred in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification™ ("ASC") Topic 730, Research and Development. The costs of materials and other costs acquired for research and development activities are charged to expense as incurred. Salaries, wages, and other related costs of personnel, as well as other facility operating costs are allocated to research and development expense through management's estimate of the percentage of time spent by personnel in research and development activities. We had no material research and development costs for the three months and nine months ended September 30, 2015 and 2014.

12

Income Taxes

We account for income taxes in accordance with FASB ASC Topic 740, Income Taxes, using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of assets and liabilities and their respective 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. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

FASB ASC Topic 740, Income Taxes, requires us 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, we must measure the tax position to determine the amount to recognize in our consolidated financial statements. We performed a review of our material tax positions in accordance with recognition and measurement standards established by ASC Topic 740 and concluded we had no unrecognized tax benefit that would affect the effective tax rate if recognized for the three months and nine months ended September 30, 2015 and 2014.

We include interest and penalties arising from the underpayment of income taxes, if any, in our consolidated statements of operations in general and administrative expenses. As of September 30, 2015 and December 31, 2014, we had no accrued interest or penalties related to uncertain tax positions.

Fair Value of Financial Instruments

Our financial instruments consist of cash, accounts receivable, accounts payable and notes payable. The carrying amount of cash, accounts receivable and accounts payable approximates fair value because of the short-term nature of these items.  We believe the carrying amount of the notes payable approximates fair value because the interest rates on the notes approximate market rates of interest.

Results of Operations

Sales

Our business is not seasonal; however, our quarterly sales, including sales to related parties, may fluctuate materially from period to period.  At times, we derive a significant portion of our revenues from sales to related parties.  Each of our two principal stockholders owns a company that may be a significant customer.  Our sales were comprised of the following:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Sales	$	382,021	$	306,381	$	964,214	$	777,811
Sales – related parties		34,615		15,537		60,661		31,072
Total sales	$	416,636	$	321,918	$	1,024,875	$	808,883

Sales to related parties totaled approximately 8% and 5% of total sales for the three months ended September 30, 2015 and 2014, respectively, and approximately 6% and 4% of total sales for the nine months ended September 30, 2015 and 2014, respectively.

Our total sales increased $94,718, or approximately 29%, during the three months ended September 30, 2015 compared to the three months ended September 30, 2014, and increased $215,992, or approximately 27%, during the nine months ended September 30, 2015 compared to the nine months ended September 30, 2014.  During 2012, we purchased from a German manufacturer a license to the design and manufacture of its kitchen mixer.  We completed the development of the molds and the design process during the fourth quarter of 2014, and received our first shipments of the new kitchen mixers. The introduction of our new home kitchen mixer, the Wondermix, in 2015 resulted in the increase in our sales.  We believe sales of the Wondermix will continue to increase during the remainder of 2015; however, there can be no assurance that we will be successful in these endeavors.

13

Cost of Sales

Total cost of sales for the three months ended September 30, 2015 was $319,426, compared to $237,747 for the three months ended September 30, 2014, an increase of $81,679, or approximately 34%.  Total cost of sales for the nine months ended September 30, 2015 was $750,519, compared to $622,277 for the nine months ended September 30, 2014, an increase of $128,242, or approximately 21%.  Our cost of sales consists of the purchase price of our products incurred to our suppliers plus inbound shipping costs.  We do not manufacture our own products.  Our costs to purchase products for resale remained relatively constant during the first nine months of 2015.  Therefore, the increase in our cost of sales during the three months and nine months ended September 30, 2015 compared to the same periods in 2014 was primarily attributed to the increase in sales volume.   Included in cost of sales were costs of related party sales of $26,539 and $10,682 for the three months ended September 30, 2015 and 2014, respectively, and $44,422 and $22,948 for the nine months ended September 30, 2015 and 2014, respectively.  Total cost of sales as a percentage of total sales was approximately 77% and 74% for the three months ended September 30, 2015 and 2014, respectively, and approximately 73% and 77% for the nine months ended September 30, 2015 and 2014, respectively.

Cost of sales as a percentage of sales may fluctuate from period to period, based on the mix of products sold during a particular period and pricing arrangements with our suppliers.  In addition, we purchase substantially all inventories from two foreign suppliers, and have been dependent on those suppliers for substantially all inventory purchases since we commenced operations.  International manufacturing is subject to factors that can have a material impact on our costs of sales, including: availability of labor at costs consistent with historical levels; changes in labor or other laws; instability of social, political and economic factors; freight costs, including domestic and international customs and tariffs; unexpected changes in regulatory environments; costs and availability of manufacturing materials; and other factors.

Selling, General and Administrative Expenses

Our selling, general and administrative expenses were $108,579 for the three months ended September 30, 2015, compared to $95,527 for the three months ended September 30, 2014, an increase of $13,052, or approximately 14%.  On a year-to-date basis, our selling, general and administrative expenses were $331,009 for the nine months ended September 30, 2015, compared to $290,220 for the nine months ended September 30, 2014, an increase of $40,789, or approximately 14%.  In addition to the increase in management fees discussed below, we incurred higher levels of professional fees in the current year.

Pursuant to an agreement effective in February 2011, we pay a monthly management fee to a company owned by one of the major stockholders of the Company to manage our day-to-day business activities and to provide business space.  Historically we have paid monthly management fees in varying amounts to this related party pursuant to prior agreements.  The agreement is on a month-to-month basis and can be cancelled at any time by the vote of management.  The agreement was amended and restated on October 31, 2014 to increase the fee to $12,500 effective November 1, 2014.  Also included in management fees are monthly payments of $150 to another major stockholder of the Company for expense reimbursement.  Included in selling, general and administrative expenses were management fees to related parties totaling $37,950 and $32,100 for the three months ended September 30, 2015 and 2014, respectively, and $113,850 and $97,950 for the nine months ended September 30, 2015 and 2014, respectively.

Depreciation and Amortization Expense

Depreciation and amortization expense was $4,471 and $749 for the three months ended September 30, 2015 and 2014, and $13,545 and $2,224 for the nine months ended September 30, 2015 and 2014, respectively.  The increase in the current year resulted from the depreciation of the molds for our new kitchen mixer.

14

Other Expense: Interest Expense

Other expense includes interest expense on our indebtedness, a significant portion of which is indebtedness to related parties.  Total interest expense – related parties was $4,776 and $3,904 for the three months ended September 30, 2015 and 2014, and $8,456 and $11,142 for the nine months ended September 30, 2015 and 2014, respectively.  The decrease in interest expense to related parties on a year-to-date basis in the current year is due to the reduction in the long-term debt to related parties.

Other expense also includes interest expense to non-related parties of $2,819 and $3,252 for the three months ended September 30, 2015 and 2014, and $12,816 and $8,923 for the nine months ended September 30, 2015 and 2014, respectively.  The increase in interest expense to non-related parties in the current year is due to additional borrowings in the current year, and due to the line of credit financing.

Liquidity and Capital Resources

As of September 30, 2015, we had total current assets of $812,781, including cash of $14,413, and current liabilities of $422,495, resulting in working capital of $390,286.  Our current assets and working capital included inventories of $468,272 and deposits of $272,430.  Generally, we are required to pay significant advance deposits toward the purchase of inventories from our principal suppliers.

In addition, as of September 30, 2015, we had total stockholders' equity of $449,434.  We have financed our operations, the acquisition of inventories, and the payment of vendor deposits from our operations, short-term loans from our principal stockholders and non-related parties, a long-term note payable from a bank, and from the issuance of our common stock.

For the nine months ended September 30, 2015, net cash used in operating activities was $46,690, as a result of our net loss of $62,085 and increases in inventories of $140,112, partially offset by non-cash expenses of $13,545, decreases in accounts receivable of $1,140, deposits of $109,865 and prepaid expenses of $6,487, and increases in accounts payable and accrued expenses of $10,416, accrued interest payable – related parties of $6,644 and accrued interest payable of $7,410.

By comparison, for the nine months ended September 30, 2014, net cash used in operating activities was $193,224, as a result of our net loss of $100,581 and increases in accounts receivable of $1,638, inventories of $102,010, deposits of $28,396 and prepaid expenses of $25,405, partially offset by non-cash expenses of $4,755, and increases in accounts payable and accrued expenses of $48,482, accrued interest payable – related parties of $6,889 and accrued interest payable of $4,680.

15

For the nine months ended September 30, 2014, we had net cash used in investing activities of $1,423, comprised of the purchase of property and equipment.  We had no net cash provided by or used in investing activities for the nine months ended September 30, 2015.

For the nine months ended September 30, 2015, net cash provided by financing activities was $295, comprised of proceeds from long-term note payable of $28,700 and proceeds from notes payable of $41,500, partially offset by repayment of notes payable – related parties of $18,500, repayment of long-term debt – related party of $34,031 and repayment of long-term note payable of $17,374.

For the nine months ended September 30, 2014, net cash provided by financing activities was $229,496, comprised of proceeds long-term note payable of $151,930, proceeds from notes payable – related parties of $50,000, proceeds from notes payable of $9,600 and proceeds from issuance of common stock of $60,000, partially offset by repayment of notes payable – related parties of $4,000, repayment of long-term debt – related party of $31,746 and repayment of long-term note payable of $6,288.

At September 30, 2015, we had short-term notes payable – related parties totaling $136,127, which are payable to our principal stockholders, are unsecured, bear interest at rates ranging from 6% to 8% per annum and are generally due on demand.  In addition, at September 30, 2015, we had short-term notes payable to non-related parties totaling $133,100, which are unsecured, bear interest at rates ranging from 6% to 8% per annum and are due on demand.

At September 30, 2015, our long-term debt – related party was comprised only of the current portion of $18,646 of a note payable to a principal stockholder.  The note bears interest at 6.97% per annum and is due in monthly installments of $4,000 through February 2016.

At September 30, 2015, we had a long-term note payable to a bank of $148,079.  The long-term note payable is a line of credit promissory note bearing interest at an indexed rate plus 2% (5.25% at September 30, 2015), requiring monthly interest payments only and maturing on May 16, 2021.  The note payable has an available line of credit of $150,000 and is secured by a deed of trust on certain real estate owned by one of the principal stockholders of the Company and by the Company's inventories, property and equipment, and intangible assets.

Accrued interest payable – related parties was $51,580 and $44,936 at September 30, 2015 and December 31, 2014, respectively.  Accrued interest payable to non-related parties was $21,605 and $14,195 at September 30, 2015 and December 31, 2014, respectively.

In the event sales during the remainder of 2015 and during 2016 do not meet our expectations, we may require additional funding from the sale of our common stock or debt in order to meet our obligations.  Depending on the requirement to pay advance deposits on orders from our suppliers, we estimate we may require $150,000 to $200,000 of additional funding in 2016.  No assurances can be given that, if required, such funding will be available to us on acceptable terms or at all.

Recent Accounting Pronouncements

In July 2015, the Financial Accounting Standards Board issued Accounting Standards Update No. 2015-11, "Inventory (Topic 330), Simplifying the Measurement of Inventory."  An entity is required to measure inventory within the scope of this Update at the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation.  Other than the change in the subsequent measurement guidance from the lower of cost or market to the lower of cost and net realizable value for inventory within the scope of this Update, there are no other substantive changes to the guidance on measurement of inventory.  For public companies, the amendments in this Update are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years.  The amendments in this Update are to be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period.  We are currently unable to determine the impact on our consolidated financial statements of the adoption of this new accounting pronouncement.

16

Off-Balance Sheet Arrangements

Pursuant to an agreement effective in February 2011, we pay a monthly management fee to a company owned by one of the major stockholders of the Company to manage our day-to-day business activities and to provide business space.  Historically we have paid monthly management fees in varying amounts to this related party pursuant to prior agreements.  The agreement is on a month-to-month basis and can be cancelled at any time by the vote of management.  The agreement was amended and restated on October 31, 2014 to increase the fee to $12,500 effective November 1, 2014.  

Also included in management fees are monthly payments of $150 to another major stockholder of the Company for expense reimbursement.  

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

Not Applicable.  The Company is a "smaller reporting company."

Item 4.   Controls and Procedures

Evaluation of disclosure controls and procedures.

Under the supervision and with the participation of our management, including our President and Treasurer who serves as our principal executive and principal financial officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("the Exchange Act") as of September 30, 2015, the end of the period covered by this report.  Based upon that evaluation, our President and Treasurer concluded that our disclosure controls and procedures as of September 30, 2015 were effective such that the information required to be disclosed by us in reports filed under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and (ii) accumulated and communicated to our management, including our President and Treasurer, as appropriate to allow timely decisions regarding disclosure.  A controls system cannot provide absolute assurance that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Changes in internal controls over financial reporting.

There was no change in our internal control over financial reporting during the quarter ended September 30, 2015 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

17

PART II – OTHER INFORMATION

Item 1.  Legal Proceedings

We are not a party to any material pending legal proceedings.

Item 1A.  Risk Factors

See the risk factors described in Item 1A of the Company's 2014 annual report on Form 10-K filed with the SEC on March 31, 2015.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

During the three months ended September 30, 2015 we had no unregistered sales of equity securities.

Item 3.  Defaults upon Senior Securities

Not Applicable.

Item 4.  Mine Safety Disclosures

Not Applicable.

Item 5.  Other Information

Not Applicable.

18

Item 6:  Exhibits

The following exhibits are filed as part of this report:

Exhibit No.	Description of Exhibit
3.1	Articles of Incorporation (1)
3.2	Bylaws (1)
10.1	Promissory Note dated August 6, 2015*
10.2	Promissory Note dated August 13, 2015*
31.1	Section 302 Certification of Chief Executive and Chief Financial Officer*
32.1	Section 1350 Certification of Chief Executive Officer and Chief Financial Officer*
101 INS	XBRL Instance Document*
101SCH	XBRL Taxonomy Extension Schema*
101 CAL	XBRL Taxonomy Extension Calculation Linkbase*
101 DEF	XBRL Taxonomy Extension Definition Linkbase*
101 LAB	XBRL Taxonomy Extension Label Linkbase*
101 PRE	XBRL Taxonomy Extension Presentation Linkbase*

(1) Incorporated by reference from Exhibit Numbers 3.1 and 3.2 of the Company's registration statement on Form 10 filed with the SEC on May 14, 2010.

* Exhibits filed with this report.

19

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Grote Molen, Inc.
Dated:  November 16, 2015	By /s/ John B. Hofman
	John B. Hofman
	President, Secretary and Treasurer
	(Principal Executive and Accounting Officer)

20

EX-10.1

Exhibit 10.1

EX-10.2

Exhibit 10.2

EX-31.1

Exhibit 31.1

I, John B. Hofman, certify that:

1. I have reviewed this report on Form 10-Q of Grote Molen, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 16, 2015	/s/ John B. Hofman
	John B. Hofman
	President, Secretary and Treasurer
	(Principal Executive Officer and
	Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Grote Molen, Inc. (the "Company") on Form 10-Q for the quarter ended September 30, 2015 as filed with the Securities and Exchange Commission on or about the date hereof (the "Report"), I, John B. Hofman, President, Secretary and Treasurer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

November 16, 2015	/s/ John B. Hofman
	John B. Hofman
	President, Secretary and Treasurer

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act has been furnished to Grote Molen, Inc. and will be retained by Grote Molen, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

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Note 8 - Supplemental Statement of Cash Flows Information (Details) - USD ($)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Details
Income Taxes Paid	$ 34	$ 30
InterestPaid	$ 4,707	$ 8,496

XML

Note 3 - Debt: Schedule Of Notes Payable To Related Parties (Details) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Notes payable - related parties	$ 136,127	$ 154,627
Note 1
Notes payable - related parties	30,000	30,000
Note 2
Notes payable - related parties	3,500	3,500
Note 3
Notes payable - related parties	38,000	38,000
Note 4
Notes payable - related parties	10,000	10,000
Note 5
Notes payable - related parties	5,000	5,000
Note 6
Notes payable - related parties	9,000	9,000
Note 7
Notes payable - related parties	15,000	15,000
Note 8
Notes payable - related parties	16,500	35,000
Note 9
Notes payable - related parties	$ 9,127	$ 9,127

XML

Note 2 - Detail of Certain Balance Sheet Accounts: Schedule of Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2015

Tables/Schedules

Schedule of Intangible Assets

	September 30, 2015	December 31, 2014
License – definite lived	$              10,500	$            10,500
License – indefinite lived	62,720	62,720
Patent	100	100
	73,320	73,320
Accumulated amortization	(9,989)	(9,200)
	$              63,331	$            64,120

XML

Note 4 - Notes Payable (Details) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Details
Notes Payable	$ 148,079	$ 136,753
Accrued interest payable	$ 21,605	$ 14,195

XML

Note 4 - Notes Payable

9 Months Ended

Sep. 30, 2015

Notes

Note 4 - Notes Payable

NOTE 4 – NOTES PAYABLE

Short-term notes payable to non-related parties are unsecured and are comprised of the following:

	September 30, 2015	December 31, 2014
Note payable, due on demand, with interest at 8% per annum	$           15,000	$           15,000
Note payable, due on demand, with interest at 8% per annum	20,000	20,000
Note payable, due on demand, with interest at 8% per annum	5,000	5,000
Note payable, due on demand, with interest at 8% per annum	7,000	7,000
Note payable, due on demand, with interest at 6% per annum	15,000	15,000
Note payable, due on demand, with interest at 6% per annum	10,000	10,000
Note payable, due on demand, with interest at 6% per annum	4,000	4,000
Note payable, due on demand, with interest at 6% per annum	5,600	5,600
Note payable, due on demand, with interest at 6% per annum	10,000	10,000
Note payable, due on demand, with interest at 6% per annum	10,000	-
Note payable, due on demand, with interest at 6% per annum	10,000	-
Note payable, due on demand, with interest at 6% per annum	10,000	-
Note payable, due on demand, with interest at 6% per annum	2,500	-
Note payable, due on demand, with interest at 6% per annum	9,000	-
Total	$         133,100	$           91,600

At September 30, 2015 and December 31, 2014 we had a long-term note payable to a bank with a principal balance of $148,079 and $136,753, respectively.  The long-term note payable is a line of credit promissory note bearing interest at an indexed rate plus 2% (5.25% at September 30, 2015), requiring monthly interest payments only, and maturing on May 16, 2021.  The note payable has an available line of credit of $150,000, and is secured by a deed of trust on certain real estate owned by one of the principal stockholders of the Company and by the Company’s inventories, property and equipment, and intangible assets.

Accrued interest payable on the notes payable was $21,605 and $14,195 at September 30, 2015 and December 31, 2014, respectively.

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Note 1 - Organization and Summary of Signicant Accounting Policies (Details)	9 Months Ended
	Sep. 30, 2015
Details
Entity Incorporation, State Country Name	Nevada
Entity Incorporation, Date of Incorporation	Mar. 15, 2004

XML

Note 4 - Notes Payable: Schedule of Short-term Debt (Tables)

9 Months Ended

Sep. 30, 2015

Tables/Schedules

Schedule of Short-term Debt

	September 30, 2015	December 31, 2014
Note payable, due on demand, with interest at 8% per annum	$           15,000	$           15,000
Note payable, due on demand, with interest at 8% per annum	20,000	20,000
Note payable, due on demand, with interest at 8% per annum	5,000	5,000
Note payable, due on demand, with interest at 8% per annum	7,000	7,000
Note payable, due on demand, with interest at 6% per annum	15,000	15,000
Note payable, due on demand, with interest at 6% per annum	10,000	10,000
Note payable, due on demand, with interest at 6% per annum	4,000	4,000
Note payable, due on demand, with interest at 6% per annum	5,600	5,600
Note payable, due on demand, with interest at 6% per annum	10,000	10,000
Note payable, due on demand, with interest at 6% per annum	10,000	-
Note payable, due on demand, with interest at 6% per annum	10,000	-
Note payable, due on demand, with interest at 6% per annum	10,000	-
Note payable, due on demand, with interest at 6% per annum	2,500	-
Note payable, due on demand, with interest at 6% per annum	9,000	-
Total	$         133,100	$           91,600

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Note 2 - Detail of Certain Balance Sheet Accounts: Schedule of Accounts, Notes, Loans and Financing Receivable (Details) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Accounts receivable	$ 57,218	$ 58,358
Trade Accounts Receivable - Related Parties
Accounts receivable	21,218	8,141
Trade Accounts Receivable
Accounts receivable	31,000	45,217
Employee Advances
Accounts receivable	$ 5,000	$ 5,000

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Note 2 - Detail of Certain Balance Sheet Accounts: Property, Plant and Equipment (Details) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Property, Plant and Equipment, Gross	$ 173,877	$ 173,877
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment	(29,981)	(17,225)
Property and equipment, net	143,896	156,652
Office Equipment
Property, Plant and Equipment, Gross	4,335	4,335
Equipment
Property, Plant and Equipment, Gross	16,927	16,927
Software Development
Property, Plant and Equipment, Gross	2,000	2,000
Tools, Dies and Molds
Property, Plant and Equipment, Gross	$ 150,615	$ 150,615

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Note 3 - Debt

9 Months Ended

Sep. 30, 2015

Notes

Note 3 - Debt

NOTE 3 – RELATED PARTY DEBT

Notes payable – related parties are unsecured and are comprised of the following:

	September 30, 2015	December 31, 2014
Note payable to a stockholder, due on demand, with interest at 6% per annum	$               30,000	$             30,000
Note payable to a stockholder, due on demand, with interest at 6% per annum	3,500	3,500
Note payable to a stockholder, due on demand, with interest at 6% per annum	38,000	38,000
Note payable to a stockholder, due on demand, with interest at 6% per annum	10,000	10,000
Note payable to a stockholder, due on demand, with interest at 6% per annum	5,000	5,000
Note payable to a stockholder, due on demand, with interest at 8% per annum	9,000	9,000
Note payable to a stockholder, due on demand, with interest at 8% per annum	15,000	15,000
Note payable to a stockholder, due on demand, with interest at 8% per annum	16,500	35,000
Non-interest bearing advances from stockholders, with no formal repayment terms	9,127	9,127
Total	$             136,127	$           154,627

Long-term debt – related party is comprised of the following:

	September 30, 2015	December 31, 2014
Note payable to a stockholder, due in monthly installments of $4,000 through February 2016, with interest at 6.97 % per annum	$               18,646	$             52,677
Less current portion	(18,646)	(45,774)
Long-term portion	$                        -	$               6,903

            Interest expense on related party debt was $4,776 and $3,904 for the three months ended September 30, 2015 and 2014, respectively, and $8,456, and $11,142 for the nine months ended September 30, 2015 and 2014, respectively.  Accrued interest payable to related parties was $51,580 and $44,936 at September 30, 2015 and December 31, 2014, respectively.

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Note 2 - Detail of Certain Balance Sheet Accounts: Schedule of Intangible Assets (Details) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Finite-Lived Intangible Assets, Gross	$ 73,320	$ 73,320
Finite-Lived Intangible Assets, Accumulated Amortization	(9,989)	(9,200)
Finite Lived Intangible Assets Net	63,331	64,120
License - definitive life
Finite-Lived Intangible Assets, Gross	10,500	10,500
License - indefinitive life
Finite-Lived Intangible Assets, Gross	62,720	62,720
Patents
Finite-Lived Intangible Assets, Gross	$ 100	$ 100

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Note 9 - Significant Customers (Details)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Details
Concentration Risk, Customer	9%	8%

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Current Assets:
Cash	$ 14,413	$ 60,808
Accounts receivable	57,218	58,358
Inventories	468,272	328,160
Deposits	272,430	382,295
Prepaid expenses	448	6,935
Total current assets	812,781	836,556
Property and equipment, net	143,896	156,652
Intangible assets, net	63,331	64,120
Total Assets	1,020,008	1,057,328
Current Liabilities:
Accounts payable and accrued expenses	61,437	51,021
Accrued interest payable - related parties	51,580	44,936
Accrued interest payable	21,605	14,195
Current portion of long-term debt - related party	18,646	45,774
Notes payable - related parties	136,127	154,627
Notes payable	133,100	91,600
Total current liabilities	422,495	402,153
Long-term debt:
Note payable	148,079	136,753
Long-term debt - related party		6,903
Total long-term debt	148,079	143,656
Total liabilities	$ 570,574	$ 545,809
Stockholders' equity:
Preferred stock, $.001 par value, 5,000,000 shares authorized, no shares issued and outstanding
Common stock, $.001 par value, 100,000,000 shares authorized, 22,200,000 shares issued and outstanding	$ 22,200	$ 22,200
Additional paid-in capital	147,800	147,800
Retained earnings	279,434	341,519
Total stockholders' equity	449,434	511,519
Total liabilities and stockholders' equity	$ 1,020,008	$ 1,057,328

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Note 1 - Organization and Summary of Signicant Accounting Policies

9 Months Ended

Sep. 30, 2015

Notes

Note 1 - Organization and Summary of Signicant Accounting Policies

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNICANT ACCOUNTING POLICIES

Organization

Grote Molen, Inc. (“Grote Molen”) was incorporated under the laws of the State of Nevada on March 15, 2004.  BrownWick, LLC (“BrownWick”), a wholly owned subsidiary, was formed in the State of Idaho on June 5, 2005.  The principal business of Grote Molen and BrownWick (collectively the “Company”) is to distribute grain mills, kitchen mixers and related accessories for home use. 

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Grote Molen and BrownWick.  All significant inter-company balances and transactions have been eliminated.

Basis of Presentation

The accompanying condensed consolidated financial statements as of September 30, 2015 and for the three months and nine months ended September 30, 2015 and 2014 are unaudited.  In the opinion of management, all adjustments have been made, consisting of normal recurring items, that are necessary to present fairly the consolidated financial position as of September 30, 2015 as well as the consolidated results of operations for the three months and nine months ended September 30, 2015 and cash flows for the nine months ended September 30, 2015 and 2014 in accordance with U.S. generally accepted accounting principles.  The results of operations for any interim period are not necessarily indicative of the results expected for the full year.  The interim condensed consolidated financial statements and related notes thereto should be read in conjunction with the audited consolidated financial statements and related notes thereto for the year ended December 31, 2014.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with U.S. 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.

Earnings Per Share

The computation of basic earnings per common share is based on the weighted average number of shares outstanding during the period.

The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the period plus the common stock equivalents which would arise from the exercise of stock options and warrants outstanding using the treasury stock method and the average market price per share during the period.  Common stock equivalents are not included in the diluted earnings per share calculation when their effect is anti-dilutive.  We have not granted any stock options or warrants since inception of the Company.  Therefore, our basic earnings per share is the same as diluted earnings per share for the three months and nine months ended September 30, 2015 and 2014.

Comprehensive Income (Loss)

Comprehensive income (loss) is the same as net income (loss).

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Note 3 - Debt (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Details
Interest expense - related parties	$ 4,776	$ 3,904	$ 8,456	$ 11,142
Accrued interest payable - related parties	$ 51,580		$ 51,580		$ 44,936

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Note 10 - Recently Issued Accounting Pronouncements: Recently Issued Accounting Pronouncements (Policies)

9 Months Ended

Sep. 30, 2015

Policies

Recently Issued Accounting Pronouncements

In July 2015, the Financial Accounting Standards Board issued Accounting Standards Update No. 2015-11, “Inventory (Topic 330), Simplifying the Measurement of Inventory.”  An entity is required to measure inventory within the scope of this Update at the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation.  Other than the change in the subsequent measurement guidance from the lower of cost or market to the lower of cost and net realizable value for inventory within the scope of this Update, there are no other substantive changes to the guidance on measurement of inventory.  For public companies, the amendments in this Update are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years.  The amendments in this Update are to be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period.  We are currently unable to determine the impact on our consolidated financial statements of the adoption of this new accounting pronouncement.

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Note 4 - Notes Payable: Schedule of Short-term Debt (Details) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Notes payable	$ 133,100	$ 91,600
Note 10
Notes payable	15,000	15,000
Note 11
Notes payable	20,000	20,000
Note 12
Notes payable	5,000	5,000
Note 13
Notes payable	7,000	7,000
Note 14
Notes payable	15,000	15,000
Note 15
Notes payable	10,000	10,000
Note 16
Notes payable	4,000	4,000
Note 17
Notes payable	5,600	5,600
Note18Member
Notes payable	10,000	$ 10,000
Note19Member
Notes payable	10,000
Note20Member
Notes payable	10,000
Note21Member
Notes payable	10,000
Note22Member
Notes payable	2,500
Note23Member
Notes payable	$ 9,000

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Note 2 - Detail of Certain Balance Sheet Accounts: Property, Plant and Equipment (Tables)

9 Months Ended

Sep. 30, 2015

Tables/Schedules

Property, Plant and Equipment

	September 30, 2015	December 31, 2014
Office equipment	$                4,335	$              4,335
Warehouse equipment	16,927	16,927
Website development	2,000	2,000
Molds	150,615	150,615
	173,877	173,877
Accumulated depreciation	(29,981)	(17,225)
	$            143,896	$          156,652

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Note 2 - Detail of Certain Balance Sheet Accounts

9 Months Ended

Sep. 30, 2015

Notes

Note 2 - Detail of Certain Balance Sheet Accounts

NOTE 2 – DETAIL OF CERTAIN BALANCE SHEET ACCOUNTS

Accounts receivable consist of the following:

	September 30, 2015	December 31, 2014
Trade accounts receivable – related parties	$              21,218	$              8,141
Trade accounts receivable	31,000	45,217
Employee advances	5,000	5,000
	$              57,218	$            58,358

Property and equipment consist of the following:

	September 30, 2015	December 31, 2014
Office equipment	$                4,335	$              4,335
Warehouse equipment	16,927	16,927
Website development	2,000	2,000
Molds	150,615	150,615
	173,877	173,877
Accumulated depreciation	(29,981)	(17,225)
	$            143,896	$          156,652

            Intangible assets consist of the following:

	September 30, 2015	December 31, 2014
License – definite lived	$              10,500	$            10,500
License – indefinite lived	62,720	62,720
Patent	100	100
	73,320	73,320
Accumulated amortization	(9,989)	(9,200)
	$              63,331	$            64,120

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CONDENSED CONSOLIDATED BALANCE SHEETS PARENTHETICAL - $ / shares	Sep. 30, 2015	Dec. 31, 2014
CONDENSED CONSOLIDATED BALANCE SHEETS PARENTHETICAL
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock shares authorized	5,000,000	5,000,000
Preferred stock shares issued
Preferred stock shares outstanding
Common stock par value	$ 0.001	$ 0.001
Common stock shares authorized	100,000,000	100,000,000
Common stock shares issued	22,200,000	22,200,000
Common stock shares outstanding	22,200,000	22,200,000

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Note 1 - Organization and Summary of Signicant Accounting Policies: Principles of Consolidation (Policies)

9 Months Ended

Sep. 30, 2015

Policies

Principles of Consolidation

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Grote Molen and BrownWick.  All significant inter-company balances and transactions have been eliminated.

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Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Nov. 16, 2015
Document and Entity Information:
Entity Registrant Name	GROTE MOLEN INC
Document Type	10-Q
Document Period End Date	Sep. 30, 2015
Trading Symbol	grote
Amendment Flag	false
Entity Central Index Key	0001456212
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		22,200,000
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q3
Entity Incorporation, State Country Name	Nevada
Entity Incorporation, Date of Incorporation	Mar. 15, 2004

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Note 1 - Organization and Summary of Signicant Accounting Policies: Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2015

Policies

Basis of Presentation

Basis of Presentation

The accompanying condensed consolidated financial statements as of September 30, 2015 and for the three months and nine months ended September 30, 2015 and 2014 are unaudited.  In the opinion of management, all adjustments have been made, consisting of normal recurring items, that are necessary to present fairly the consolidated financial position as of September 30, 2015 as well as the consolidated results of operations for the three months and nine months ended September 30, 2015 and cash flows for the nine months ended September 30, 2015 and 2014 in accordance with U.S. generally accepted accounting principles.  The results of operations for any interim period are not necessarily indicative of the results expected for the full year.  The interim condensed consolidated financial statements and related notes thereto should be read in conjunction with the audited consolidated financial statements and related notes thereto for the year ended December 31, 2014.

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Revenues:
Sales	$ 382,021	$ 306,381	$ 964,214	$ 777,811
Sales to related parties	34,615	15,537	60,661	31,072
Total revenues	416,636	321,918	1,024,875	808,883
Cost of revenues:
Cost of sales	292,887	227,065	706,097	599,329
Cost of related party sales	26,539	10,682	44,422	22,948
Total cost of revenues	319,426	237,747	750,519	622,277
Gross profit	97,210	84,171	274,356	186,606
Operating costs and expenses:
Selling, general and administrative	108,579	95,527	331,009	290,220
Depreciation and amortization	4,471	749	13,545	2,224
Total operating costs and expenses	113,050	96,276	344,554	292,444
Loss from operations	(15,840)	(12,105)	(70,198)	(105,838)
Other expense:
Interest expense - related parties	4,776	3,904	8,456	11,142
Interest expense	2,819	3,252	12,816	8,923
Total other expense	7,595	7,156	21,272	20,065
Loss before income taxes	(23,435)	(19,261)	(91,470)	(125,903)
Income tax benefit	29,419	3,648	29,385	25,322
Net income (loss)	$ 5,984	$ (15,613)	$ (62,085)	$ (100,581)
Net income (loss) per common share - Basic and diluted
Weighted average shares outstanding - Basic and diluted	22,200,000	22,200,000	22,200,000	21,761,173

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Note 7 - Income Taxes

9 Months Ended

Sep. 30, 2015

Notes

Note 7 - Income Taxes

NOTE 7 – INCOME TAXES

The income tax benefit for the three months and nine months ended September 30, 2015 resulted primarily from federal income tax refunds received and approximated 126% of the net loss for the three months ended September 30, 2015.  The refunds and resultant tax benefit were recorded in the current period though they arose from prior tax filings due to changes in estimates and computations accounted for in the current period.  There were no other material permanent differences affecting the effective tax rate.

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Note 6 - Capital Stock

9 Months Ended

Sep. 30, 2015

Notes

Note 6 - Capital Stock

NOTE 6 – CAPITAL STOCK

The Company’s preferred stock may have such rights, preferences and designations and may be issued in such series as determined by our Board of Directors.  No shares of preferred stock were issued and outstanding at September 30, 2015 and December 31, 2014.

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Note 2 - Detail of Certain Balance Sheet Accounts: Schedule of Accounts, Notes, Loans and Financing Receivable (Tables)

9 Months Ended

Sep. 30, 2015

Tables/Schedules

Schedule of Accounts, Notes, Loans and Financing Receivable

	September 30, 2015	December 31, 2014
Trade accounts receivable – related parties	$              21,218	$              8,141
Trade accounts receivable	31,000	45,217
Employee advances	5,000	5,000
	$              57,218	$            58,358

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Note 1 - Organization and Summary of Signicant Accounting Policies: Use of Estimates in The Preparation of Financial Statements (Policies)

9 Months Ended

Sep. 30, 2015

Policies

Use of Estimates in The Preparation of Financial Statements

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with U.S. 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.

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Note 10 - Recently Issued Accounting Pronouncements

9 Months Ended

Sep. 30, 2015

Notes

Note 10 - Recently Issued Accounting Pronouncements

NOTE 10 – RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In July 2015, the Financial Accounting Standards Board issued Accounting Standards Update No. 2015-11, “Inventory (Topic 330), Simplifying the Measurement of Inventory.”  An entity is required to measure inventory within the scope of this Update at the lower of cost and net realizable value.  Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation.  Other than the change in the subsequent measurement guidance from the lower of cost or market to the lower of cost and net realizable value for inventory within the scope of this Update, there are no other substantive changes to the guidance on measurement of inventory.  For public companies, the amendments in this Update are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years.  The amendments in this Update are to be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting period.  We are currently unable to determine the impact on our consolidated financial statements of the adoption of this new accounting pronouncement.

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Note 8 - Supplemental Statement of Cash Flows Information

9 Months Ended

Sep. 30, 2015

Notes

Note 8 - Supplemental Statement of Cash Flows Information

NOTE 8 – SUPPLEMENTAL STATEMENT OF CASH FLOWS INFORMATION

During the nine months ended September 30, 2015 and 2014, we had no non-cash financing and investing activities.

We paid cash for income taxes of $34 and $30 for the nine months ended September 30, 2015 and 2014, respectively.  We paid cash for interest of $4,707 and $8,496 for the nine months ended September 30, 2015 and 2014, respectively.

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Note 9 - Significant Customers

9 Months Ended

Sep. 30, 2015

Notes

Note 9 - Significant Customers

NOTE 9 – SIGNIFICANT CUSTOMERS

In addition to the sales to related parties discussed in Note 5, we had sales to one customer that accounted for approximately 9% and 8% of total sales for the nine months ended September 30, 2015 and 2014, respectively.

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Note 11 - Subsequent Events

9 Months Ended

Sep. 30, 2015

Notes

Note 11 - Subsequent Events

NOTE 11 – SUBSEQUENT EVENTS

We have evaluated events occurring after the date of our accompanying consolidated balance sheets through the date the financial statements were issued.  We have not identified any subsequent events that we believe require disclosure.

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Note 3 - Debt: Schedule of Long-term Debt - Related Party (Details) - USD ($)		Sep. 30, 2015	Dec. 31, 2014
Details
Due to Other Related Parties	[1]	$ 18,646	$ 52,677
Current Portion of Long-Term Debt - Related Party		$ (18,646)	(45,774)
Long-term debt - related party			$ 6,903

[1] Due in monthly installments of $4,000 through February 2016, with interest at 6.97 % per annum

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Note 1 - Organization and Summary of Signicant Accounting Policies: Comprehensive Income (loss) (Policies)

9 Months Ended

Sep. 30, 2015

Policies

Comprehensive Income (loss)

Comprehensive Income (Loss)

Comprehensive income (loss) is the same as net income (loss).

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Note 3 - Debt: Schedule Of Notes Payable To Related Parties (Tables)

9 Months Ended

Sep. 30, 2015

Tables/Schedules

Schedule Of Notes Payable To Related Parties

	September 30, 2015	December 31, 2014
Note payable to a stockholder, due on demand, with interest at 6% per annum	$               30,000	$             30,000
Note payable to a stockholder, due on demand, with interest at 6% per annum	3,500	3,500
Note payable to a stockholder, due on demand, with interest at 6% per annum	38,000	38,000
Note payable to a stockholder, due on demand, with interest at 6% per annum	10,000	10,000
Note payable to a stockholder, due on demand, with interest at 6% per annum	5,000	5,000
Note payable to a stockholder, due on demand, with interest at 8% per annum	9,000	9,000
Note payable to a stockholder, due on demand, with interest at 8% per annum	15,000	15,000
Note payable to a stockholder, due on demand, with interest at 8% per annum	16,500	35,000
Non-interest bearing advances from stockholders, with no formal repayment terms	9,127	9,127
Total	$             136,127	$           154,627

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Cash flows from operating activities:
Net income (loss)	$ (62,085)	$ (100,581)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	13,545	2,224
Interest Added to Note Payable Principal		2,531
(Increase) decrease in:
(Increase) Decrease in Accounts Receivable	1,140	(1,638)
(Increase) Decrease in Inventories	(140,112)	(102,010)
(Increase) Decrease in Deposits	109,865	(28,396)
(Increase) Decrease in Prepaid Expenses	6,487	(25,405)
Increase (Decrease) in Accounts Payable and Accrued Expenses	10,416	48,482
Increase (Decrease) in Accrued Interest Payable - Related Parties	6,644	6,889
Increase (Decrease) in Accrued Interest Payable	7,410	4,680
Net cash used in operating activities	$ (46,690)	(193,224)
Cash flows from investing activities:
Purchase of property and equipment		(1,423)
Net cash used in investing activities		(1,423)
Cash flows from financing activities:
Proceeds from long-term note payable	$ 28,700	151,930
Proceeds from Notes Payable - Related Parties		50,000
Proceeds from notes payable	41,500	9,600
Proceeds from issuance of common stock		60,000
Repayment of notes payable - related parties	(18,500)	(4,000)
Repayment of long-term debt - related party	(34,031)	(31,746)
Repayment of long-term note payable	(17,374)	(6,288)
Net cash provided by financing activities	295	229,496
Net increase (decrease) in cash	(46,395)	34,849
Cash, beginning of the period	60,808	79,069
Cash, end of the period	$ 14,413	$ 113,918

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Note 5 - Related Party Transactions

9 Months Ended

Sep. 30, 2015

Notes

Note 5 - Related Party Transactions

NOTE 5 – RELATED PARTY TRANSACTIONS

Pursuant to an agreement effective in February 2011, we pay a monthly management fee to a company owned by one of the major stockholders of the Company to manage our day-to-day business activities and to provide business space.  Historically we have paid monthly management fees in varying amounts to this related party pursuant to prior agreements.  The agreement is on a month-to-month basis and can be cancelled at any time by the vote of management.  The agreement was amended and restated on October 31, 2014 to increase the fee to $12,500 effective November 1, 2014.  Also included in management fees are monthly payments of $150 to another major stockholder of the Company for expense reimbursement.  Included in selling, general and administrative expenses were management fees totaling $37,950 and $32,100 for the three months ended September 30, 2015 and 2014, respectively, and $113,850 and $97,950 for the nine months ended September 30, 2015 and 2014, respectively.

Each of the two principal stockholders of the Company owns a company that is our customer.  Sales to these related parties totaled $34,615 and $15,537 for the three months ended September 30, 2015 and 2014, respectively, or approximately 8% and 5%, respectively.  Sales to these related parties totaled $60,661 and $31,072 for the nine months ended September 30, 2015 and 2014, respectively, or approximately 6% and 4%, respectively.  Accounts receivable from these related parties totaled $21,218 and $8,141 at September 30, 2015 and December 31, 2014, respectively. 

See Note 3 for discussion of related party debt and interest expense.

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Note 3 - Debt: Schedule of Long-term Debt - Related Party (Tables)

9 Months Ended

Sep. 30, 2015

Tables/Schedules

Schedule of Long-term Debt - Related Party

	September 30, 2015	December 31, 2014
Note payable to a stockholder, due in monthly installments of $4,000 through February 2016, with interest at 6.97 % per annum	$               18,646	$             52,677
Less current portion	(18,646)	(45,774)
Long-term portion	$                        -	$               6,903

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Note 5 - Related Party Transactions (Details) - USD ($)	3 Months Ended			6 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014	Feb. 01, 2011
Details
Expense reimbursement to stockholder									$ 150
Management fee paid to related party	$ 37,950	$ 32,100				$ 113,850	$ 97,950
Sales to related parties	$ 34,615	$ 15,537	$ 15,537			60,661	$ 31,072
Percent of sales to related parties	8.00%	5.00%		6.00%	4.00%
Accounts receivable, related parties	$ 21,218					$ 21,218		$ 8,141

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Note 1 - Organization and Summary of Signicant Accounting Policies: Earnings Per Share (Policies)

9 Months Ended

Sep. 30, 2015

Policies

Earnings Per Share

Earnings Per Share

The computation of basic earnings per common share is based on the weighted average number of shares outstanding during the period.

The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the period plus the common stock equivalents which would arise from the exercise of stock options and warrants outstanding using the treasury stock method and the average market price per share during the period.  Common stock equivalents are not included in the diluted earnings per share calculation when their effect is anti-dilutive.  We have not granted any stock options or warrants since inception of the Company.  Therefore, our basic earnings per share is the same as diluted earnings per share for the three months and nine months ended September 30, 2015 and 2014.