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4. Revenue Recognition

9 Months Ended

Sep. 30, 2018

Our products consist of the following:

●	Antimony: includes antimony oxide, sodium antimonate, antimony trisulfide, and antimony metal

●	Zeolite: includes coarse and fine zeolite crushed in various sizes.

●	Precious Metals: includes unrefined and refined gold and silver

For our antimony and zeolite products, revenue is recognized upon the completion of the performance obligation which is met when the transaction price can be reasonably estimated and revenue is recognized generally at the time when risk is transferred. We have determined the performance obligation is met and title is transferred either upon shipment from our warehouse locations or upon receipt by the customer as specified in individual sales orders. The performance obligation is met because at that time, 1) legal title is transferred to the customer, 2) the customer has accepted the product and obtained the ability to realize all of the benefits from the product, 3) the customer has the significant risks and rewards of ownership to it, 4) it is very unlikely product will be rejected by the customer upon physical receipt, and 5) we have the right to payment for the product. Shipping costs related to the sales of antimony and zeolite products are recorded to cost of sales as incurred. For zeolite products, royalty expense due a third party by the Company is also recorded to cost of sales upon sale in accordance with terms of underlying royalty agreements.

For sales of precious metals, the performance obligation is met, the transaction price is known, and revenue is recognized at the time of transfer of control of the agreed-upon metal quantities to the customer. Refining and shipping costs related to sales of precious metals are recorded to cost of sales as incurred.

Sales of products for the three and nine month periods ended September 30, 2018 and 2017 were as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018		2017
Antimony	$	1,366,540	$	1,796,776	$	4,540,873	$	5,860,584
Zeolite		653,365		494,694		2,026,605		1,723,120
Precious metals		71,820		78,244		213,523		243,821
	$	2,091,725	$	2,369,714	$	6,781,001	$	7,827,525

The following is sales information by geographic area based on the location of customers for the three and nine month periods ended September 30, 2018 and 2017:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2018		2017		2018		2017
United States	$	1,876,218	$	2,208,417	$	6,151,068	$	7,284,803
Canada		215,507		161,297		629,933		542,722
	$	2,091,725	$	2,369,714	$	6,781,001	$	7,827,525

Sales of products to significant customers were as follows for the three and nine month periods ended September 30, 2018 and 2017:

	For the Three Months Ended						For the Nine Months Ended
Sales to Three	September 30,			September 30,			September 30,			September 30,
Largest Customers	2018			2017			2018			2017
Ampacet Corporation	$	142,414		$	150,234		$	472,674		$	-
Mexichem Specialty Compounds Inc.		587,568			909,965			1,985,249			2,466,388
Kohler Corporation		471,358			512,451			1,122,908			1,458,949
East Penn Corporation		-			-			-			512,641
	$	1,201,340		$	1,572,650		$	3,580,831		$	4,437,978
% of Total Revenues		57	%		66	%		53	%		57	%

Accounts receivable from largest customers were as follows for September 30, 2018 and December 31, 2017:

Three Largest
Accounts Receivable	September 30, 2018			December 31, 2017
Kohler Corporation	$	154,903		$	169,991
Earth Innovations Inc.		36,107			31,522
Axens North America, Inc.		38,403			31,237
	$	229,413		$	232,750
% of Total Receivables		40	%		47	%

Our trade accounts receivable balance related to contracts with customers was $574,216 at September 30, 2018 and $362,579 at December 31, 2017. Our products do not involve any warranty agreements and product returns are not typical.

We have determined our contracts do not include a significant financing component. For antimony and zeolite sales contracts, we may factor certain receivables and receive final payment within 30 days of the performance obligation being met. For antimony and zeolite receivables not factored, we typically receive payment within 10 days. For precious metals sales, a provisional payment of 75% is typically received within 45 days of the date the product is delivered to the customer. After an exchange of assays, a final payment is normally received within 90 days of product delivery.