Discontinued Operations

12 Months Ended

Dec. 31, 2017

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Note 9 – Discontinued Operations

On June 15, 2017, the Company entered into a Purchase and Sale Agreement with Metropolitan Sound + Vision LLC, a South Carolina limited liability company. Pursuant to the Agreement, the Company agreed to sell to Metro all of the shares of common stock of S&G Holdings, Inc., a Tennessee corporation doing business as High Five Entertainment owned by the Company, which constitute 75% of the issued and outstanding shares of S&G. Pursuant to current accounting guidelines, the business component is reported as a discontinued operations.

Pursuant to the Agreement, at the closing of the Transaction, the Company was to deliver to Metro 100% of the issued and outstanding shares of common stock of S&G owned by the Company, and Metro was required to pay for such stock as follows: An initial payment of $10,000 was required to be made at the closing, and thereafter, at the end of each fiscal quarter, beginning at the end the third fiscal quarter of 2017, Metro shall pay the Company 5% of gross revenues collected during the quarter by Metro via the exploitation of S&G’s assets, up to a lifetime maximum of $590,000.

The Agreement requires Metro to use its best professional efforts to generate revenue from the exploitation of S&G’s assets, and if the Company has not received a total of at least $265,000 of the $590,000 lifetime maximum purchase price from Metro before July 1, 2022, the Company has the right to repurchase the stock and assets of the S&G from Metro for $10,000.

The Company recognized a gain on the sale of S&G of $57,000 consisting of the assumption by the buyer of the net liabilities of S&G of $236,000 offsets by the elimination of the non-controlling interest of S&G of $189,000 and the purchase price consideration of $10,000. The remainder of the purchase price will be recognized when collectability can be determined.

The following table summarizes the assets and liabilities of our former subsidiary’s discontinued operations as of December 31, 2016:

	December 31, 2016
ASSETS:
Current assets
Cash	$	24,000
Accounts receivable		1,000
Prepaid expenses and other current assets		3,000
Total assets	$	28,000
LIABILITIES :
Current liabilities
Accounts payable and accrued expenses	$	82,000
Accrued payroll - officers		36,000
Advances from related parties		10,000
Deferred revenue		24,000
Note payable		75,000
Total liabilities	$	227,000

The following table summarizes the results of operations of our former subsidiary for the years ended December 31, 2017 and 2016 and is included in the consolidated statements of operations as discontinued operations:

	For the year ended
	December 31,
	2017			2016
Revenue	$	49,000		$	184,000
Cost of goods sold		31,000			107,000
Gross Profit		18,000			77,000
Operating Expenses:
Compensation		76,000			187,000
General and administrative		7,000			90,000
Total operating expenses		83,000			277,000
Loss from operations		(65,000	)		(200,000	)
Other Income (Expense)
Interest expense		(1,000	)		(4,000	)
Other income (expense)		(2,000	)		-
Total Other Income (Expense)		(3,000	)		(4,000	)
Loss From Operations of Discontinued Business Component	$	(68,000	)	$	(204,000	)