NOTE 3. DISCONTINUED OPERATIONS

Security Segment

On December 26, 2019, our board of directors and management made the strategic decision to investigate a possible buyer for the Security Segment and if no buyer could be found, cease operations of the security segment. We transferred all our Colorado security contracts and employees to a company on January 16, 2020, in exchange for which we will receive $1.00 per man hour worked on existing contracts for a period of one year. On February 6, 2020 we cancelled all our security contracts in California. The assets and liabilities classified as held for sale for the security segment are presented separately in the balance sheet as of June 30, 2020 and December 31, 2019 and as discontinued operations as of June 30, 2020 and the operating results for the six months ended June 30, 2020 and 2019, respectively, are presented as discontinued operations.

Assets and liabilities of discontinued operations for the security segment included the following:


	June 30,		December 31,
	2020		2019
Cash and cash equivalents	$	27,581	$	77,380
Accounts receivable, net		20,440		280,058
Prepaid expenses and other current assets		—		17,780
Current assets discontinued operations	$	48,021	$	375,218

Property and equipment, net	$	—	$	15,584
Noncurrent assets discontinued operations	$	—	$	15,584

Accounts payable and accrued expenses	$	958	$	88,309
Customer deposits		—		60,940
Current liabilities discontinued operations	$	958	$	149,249

A breakdown of the discontinued operations is presented as follows:


	Three months ended				Six months ended
	June 30,				June 30,
	2020		2019		2020		2019
Service revenues	$	—	$	507,556	$	119,891	$	1,072,148

Cost of service revenues		—		379,900		88,599		829,837
Selling, general and administrative		(1,654)		189,704		146,107		396,671
Depreciation and amortization				21,944		2,174		43,576
Professional fees		—		1,804		—		1,804
Total costs and expenses		(1,654)		593,352		236,880		1,271,888

OPERATING INCOME (LOSS)		1,654		(85,796)		(116,989)		(199,740)

Interest expense, net		—		984		984		1,454

NET INCOME (LOSS) FROM DISCONTINUED OPERATIONS	$	1,654	$	(86,780)	$	(117,973)	$	(201,194)

The cash flows related to discontinued operations have not been segregated and are included in the consolidated statements of cash flows. The following table provides selected information on cash flows related to discontinued operations for the three and six months ended June 30, 2020 and 2019, respectively.


	Six months ended
	June 30,
	2020		2019
Receivables	$	259,618	$	104,691
Prepaids and other		17,780		(3,101)
Depreciation and amortization		2,174		4,413
Capital expenditures		—		(1,331)
Accounts payable and accrued expenses		(87,351)		(53,036)
Customer deposits		(60,940)		(43,036)

Consumer Goods Segment

On December 26, 2019, our board of directors and management made the strategic move to cease operations of Chiefton. On December 26, 2019, our board of directors committed to a plan to cease operations of STOA Wellness. We transferred all assets of STOA Wellness to an individual on January 10, 2020, in exchange for the release on the outstanding lease of the STOA retail front. The assets and liabilities classified as discontinued operations for the consumer goods segment are presented separately in the balance sheet as of June 30, 2020 and December 31, 2019 and the operating results for the three and six months ended June 30, 2020 and 2019, respectively, are presented as discontinued operations.

Assets and liabilities of discontinued operations included the following:


	June 30,		December 31,
	2020		2019
Cash and cash equivalents	$	—	$	25,223
Accounts receivable, net		—		7,836
Prepaid expenses and other current assets		—		14,394
Current assets discontinued operations	$	—	$	47,453

Right to use asset	$	—	$	83,525
Noncurrent assets discontinued operations	$	—	$	83,525

Accounts payable and accrued expenses	$	100,230	$	124,468
Operating lease liability – current portion		—		83,525
Current liabilities discontinued operations	$	100,230	$	207,993

A breakdown of the discontinued operations is presented as follows:


	Three months ended				Six months ended
	June 30,				June 30,
	2020		2019		2020		2019
Product Revenues	$	—	$	28,892	$	33	$	58,667

Cost of service revenues		—		35,717		—		59,739
Cost of goods sold		—		35,387		—		59,296
Selling, general and administrative		(3,579)		262,765		29,685		438,883
Professional fees		—		49,554		—		84,660
Depreciation and amortization		—		5,265		—		7,164
Total costs and expenses		(3,579)		388,688		29,685		649,742

OPERATING INCOME (LOSS)		(3,579)		359,796		29,652		591,075

NET INCOME (LOSS) FROM DISCONTINUED OPERATIONS	$	(3,579)	$	359,796	$	29,652	$	591,075


	Six months ended
	June 30,
	2020		2019
Receivables	$	7,836	$	24,638
Prepaids and other		14,394		(45,478)
Inventory		—		(28,501)
Depreciation and amortization		—		7,164
Capital expenditures		—		(66,937)
Accounts payable and accrued expenses		(24,238)		(51,933)
Customer deposits		—		(23,807)