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5. REVENUE RECOGNITION AND CONCENTRATIONS
9 Months Ended
Nov. 30, 2019
Revenue Recognition [Abstract]  
REVENUE RECOGNITION AND CONCENTRATIONS

NOTE 5:    REVENUE RECOGNITION AND CONCENTRATIONS

 

We derive our revenue primarily from product sales.  We determine revenue recognition through the following steps: (1) identification of the contract with a customer; (2) identification of the performance obligations in the contract; (3) determination of the transaction price; (4) allocation of the transaction price to the performance obligations in the contract; (5) recognition of revenue when, or as, we satisfy a performance obligation.

 

The Company's performance obligations consist solely of product shipped to customers.  Revenue from product sales is recognized upon transfer of control of promised products to customers in an amount that reflects the consideration we expect to receive in exchange for these products.  Revenue is recognized net of returns and any taxes collected from customers.  We offer standard contractual terms in our purchase orders. In addition, we use the practical expedient related to commissions paid since they would be amortized in less than one year.

 

Sales to three customers accounted for 66.25% and 70.61% of sales for the three and nine month periods ended November 30, 2019, respectively.  Accounts receivable from these customers amounted to $324,000 or approximately 82% of accounts receivable as of November 30, 2019.

 

Sales to two customers accounted for 56% of sales for the three and nine month periods ended November 30, 2018. Accounts receivable from these customers amounted to $290,215 or approximately 66% of accounts receivable as of November 30, 2018.