6. CONCENTRATIONS

3 Months Ended

May 31, 2016

Notes to Financial Statements

CONCENTRATIONS

NOTE 6:    CONCENTRATIONS

Sales to one customer accounted for 42% of sales for the three month period ended May 31, 2016. Accounts receivable from this customer accounted to $147,373 or 49% of accounts receivable as of May 31, 2016. Another customer, who did not account for a sales concentration, had accounts receivable of $35,154 or 12% as of May 31, 2016.

Sales to two customers accounted for 72% of sales for the three month period ended May 31, 2015. Accounts receivable from these two customers amounted to $575,045 or 83% of accounts receivable as of May 31, 2015.

The Company utilizes the services of an individual, who is a related party, to source materials and provide the manufacturing of component parts with third-party vendors in China. For the three months ended May 31, 2016 and 2015, purchases facilitated through the related party accounted for approximately 38% and 26%, respectively, of total raw material purchases. The Company had two other non-related vendors that accounted for 37% of raw material purchases during the three month period ended May 31, 2016. The Company had three other non-related vendors that accounted for 55% of raw material purchases during the three month period ended May 31, 2015.