☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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46-4288088
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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8992 Preston Rd., Suite 110-3
Frisco, Texas 75034
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(Address of principal executive offices)
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(214) 505-3839
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(Registrant’s telephone number, including area code)
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Large Accelerated Filer
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☐
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Accelerated Filer
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☐
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Non-accelerated Filer
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☐
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Smaller Reporting Company
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☒
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Class
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Outstanding at August 26, 2016
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Common stock, $0.0001 par value per share
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190,064,778
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Page
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Part I
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Item 1.
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1
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1
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2
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3
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4
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5
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Item 2.
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12
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Item 3.
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17
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Item 4.
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17
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Part II
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Other Information
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Item 1.
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18
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Item 2.
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18
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Item 3.
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19
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Item 4.
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19
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Item 5.
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19
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Item 6.
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20
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21
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June 30,
2016
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December 31,
2015
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|||||||
(Unaudited)
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||||||||
ASSETS
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||||||||
Current Assets:
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||||||||
Cash and cash equivalents (Note 2)
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$
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18,830
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$
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3,971
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Inventory (Note 2)
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45,630
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-
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Prepaid Rent (Note 4)
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3,250
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-
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Total Current Assets
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67,710
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3,971
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Property, plant and equipment, net (Notes 2 and 5)
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42,135
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–
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TOTAL ASSETS
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$
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109,845
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$
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3,971
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LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
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||||||||
Current Liabilities:
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||||||||
Accrued Expenses
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$
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3,500
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$
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9,309
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Related party loan
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–
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449
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Total Current Liabilities
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3,500
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9,758
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STOCKHOLDERS’ EQUITY (DEFICIT)
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||||||||
Preferred stock par value $0.0001 per share; 20,000,000 shares authorized; none issued at
June 30, 2016 and December 31, 2015.
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–
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–
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Common stock, par value $0.0001 per share; 500,000,000 shares authorized;190,104,000
and 185,740,000 shares issued and outstanding, at June 30, 2016 and December 31, 2015, respectively.
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19,010
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18,574
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Additional Paid In Capital
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186,564
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–
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Accumulated Deficit
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(99,229
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)
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(24,361
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)
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Total Stockholders’ Equity (Deficit)
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106,345
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(5,787
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)
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Total Liabilities and Stockholders’ Equity (Deficit)
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$
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109,845
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$
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3,971
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Three Months Ended June 30,
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Six Months Ended June 30,
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|||||||||||||||
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2016
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2015
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2016
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2015
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Revenues (Note 2):
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Revenues
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$
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10,000
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$
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-
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$
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18,000
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$
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-
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Less: cost of goods sold
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(5,750
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)
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-
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(10,750
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)
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-
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Gross Profit
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4,250
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-
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7,250
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-
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Expenses
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General and administrative
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19,029
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(521
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)
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26,627
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11
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Taxes-property
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16,856
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-
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23,856
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-
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Legal, organization and related expenses
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-
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1,566
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-
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1,566
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Professional fees
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9,500
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-
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31,635
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-
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Total Expenses
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45,385
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1,045
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82,118
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1,577
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Net (loss)
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$
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(41,135
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)
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$
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(1,045
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)
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$
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(74,868
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)
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$
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(1,577
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)
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(Loss) per common share, basic and diluted (Note 2)
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$
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(0.00
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)
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$
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(0.00
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$
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(0.00
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$
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(0.00
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)
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Weighted average shares outstanding, basic and diluted
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190,064,778
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185,740,000
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189,156,911
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185,740,000
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Common
Stock
Shares
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Common
Stock
Amount
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Additional
Paid-in
Capital
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Accumulated
Deficit
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Total
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|||||||||||||||
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Balance December 31, 2015
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185,740,000
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$
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18,574
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$
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–
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$
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(24,361
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)
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$
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(5,787
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)
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Shares issued for cash
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4,364,000
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436
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186,564
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–
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187,000
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Net (loss)
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(74,868
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)
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(74,868
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)
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Balance June 30, 2016 (unaudited)
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190,104,000
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$
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19,010
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$
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186,564
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$
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(99,229
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)
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$
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106,345
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Six Months Ended
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June 30,
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2016
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2015
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Cash flows from operating activities:
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Net (loss)
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$
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(74,868
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)
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$
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(1,577
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)
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Adjustments to reconcile net (loss) to net cash
provided by (used in) operating activities:
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Depreciation
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543
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–
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Changes in operating assets and liabilities:
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(Increase) in inventory
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(45,630
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)
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(Increase) in prepaid rent
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(3,250
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)
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(Decrease) in accrued expenses
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(5,809
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)
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Net cash (used in) operating activities
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(129,014
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)
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(1,577
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)
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Cash flows from investing activities:
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Purchase of building
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(42,678
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)
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–
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Net cash (used in) investing activities
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(42,678
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)
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–
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Cash flows from Financing activities:
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Proceeds from issuance of common stock
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187,000
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–
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(Repayment of) proceeds from related party loan
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(449
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50
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Net cash provided by financing activities
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186,551
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50
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Net change in cash and cash equivalents
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14,859
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(1,527
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)
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Cash and cash equivalents, beginning of period
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3,971
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7,358
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Cash and cash equivalents, end of period
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$
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18,830
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$
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5,831
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Supplemental disclosures of cash flow information:
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Cash paid during the period for interest
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$
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–
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$
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–
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Cash paid during the period for taxes
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$
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–
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$
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–
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Building
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40 years
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Furniture
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7 years
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Level 1 Inputs – | Unadjusted quoted market prices for identical assets and liabilities in an active market that the Company has the ability to access. |
Level 2 Inputs – | Inputs other than the quoted prices in active markets that are observable either directly or indirectly. |
Level 3 Inputs – | Inputs based on prices or valuation techniques that are both unobservable and significant to the overall fair value measurements. |
2016
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2015
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(Unaudited)
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Building
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$
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40,399
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$
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-
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Furniture and fixtures
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2,279
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-
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42,678
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-
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Less: accumulated depreciation
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(543
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)
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-
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Property, plant and equipment, net
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$
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42,135
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$
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-
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Expenditures
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Purchase of facility/warehouse
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$
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40,399
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Professional Fees
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31,635
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Property taxes
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23,856
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Inventory
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51,380
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Furniture and fixtures
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2,279
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Incorporated by reference
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Exhibit
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Exhibit Description
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Filed herewith
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Form
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Period ending
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Exhibit
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Filing date
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3.1
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Certificate of Incorporation
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10-12G
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3.1
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9/25/2012
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3.2
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By-Laws
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10-12G
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3.2
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9/25/2012
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31
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X
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32
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X
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MJ PHARMACEUTICALS, INC.
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Dated: August 29, 2016
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By:
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/s/ James Liebo
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James Liebo, Chief Executive Officer,
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President and Secretary
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By:
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/s/ Steven Lebo
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Steven Lebo, Chief Financial Officer
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1.
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I have reviewed this Form 10-Q of MJ Pharmaceuticals, Inc.
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report;
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4.
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The small business issuer’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the small business issuer's internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and
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5.
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The small business owner’s other certifying officer and I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small issuer's board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.
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1.
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I have reviewed this Form 10-Q of MJ Pharmaceuticals, Inc.
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report;
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4.
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The small business issuer’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the small business issuer's internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and
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5.
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The small business owner’s other certifying officer and I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small issuer's board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.
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Date: August 29, 2016
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By:
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/s/ James Liebo
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James Liebo
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Chief Executive Officer, President and Secretary
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Date: August 29, 2016
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By:
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/s/ Steven Lebo
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Steven Lebo
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Chief Financial Officer
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Document And Entity Information - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2016 |
Aug. 26, 2016 |
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Document and Entity Information [Abstract] | ||
Entity Registrant Name | MJ Pharmaceuticals Inc. | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 190,064,778 | |
Amendment Flag | false | |
Entity Central Index Key | 0001502629 | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Filer Category | Smaller Reporting Company | |
Entity Well-known Seasoned Issuer | No | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2016 | |
Document Fiscal Period Focus | Q2 |
BALANCE SHEETS - USD ($) |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Current Assets: | ||
Cash and cash equivalents (Note 2) | $ 18,830 | $ 3,971 |
Inventory (Note 2) | 45,630 | 0 |
Prepaid Rent (Note 4) | 3,250 | 0 |
Total Current Assets | 67,710 | 3,971 |
Property, plant and equipment, net (Notes 2 and 5) | 42,135 | 0 |
TOTAL ASSETS | 109,845 | 3,971 |
Current Liabilities: | ||
Accrued Expenses | 3,500 | 9,309 |
Related party loan | 0 | 449 |
Total Current Liabilities | 3,500 | 9,758 |
STOCKHOLDERS’ EQUITY (DEFICIT) | ||
Preferred stock par value $0.0001 per share; 20,000,000 shares authorized; none issued at June 30, 2016 and December 31, 2015. | 0 | 0 |
Common stock, par value $0.0001 per share; 500,000,000 shares authorized;190,104,000 and 185,740,000 shares issued and outstanding, at June 30, 2016 and December 31, 2015, respectively. | 19,010 | 18,574 |
Additional Paid In Capital | 186,564 | 0 |
Accumulated Deficit | (99,229) | (24,361) |
Total Stockholders’ Equity (Deficit) | 106,345 | (5,787) |
Total Liabilities and Stockholders’ Equity (Deficit) | $ 109,845 | $ 3,971 |
BALANCE SHEETS (Parentheticals) - $ / shares |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Preferred Stock, Par Value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 20,000,000 | 20,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Common stock, par value (in Dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 190,104,000 | 185,740,000 |
Common stock, shares outstanding | 190,104,000 | 185,740,000 |
STATEMENT OF OPERATIONS (UNAUDITED) - USD ($) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
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Revenues (Note 2): | ||||
Revenues | $ 10,000 | $ 0 | $ 18,000 | $ 0 |
Less: cost of goods sold | (5,750) | 0 | (10,750) | 0 |
Gross Profit | 4,250 | 0 | 7,250 | 0 |
Expenses | ||||
General and administrative | 19,029 | (521) | 26,627 | 11 |
Taxes-property | 16,856 | 0 | 23,856 | 0 |
Legal, organization and related expenses | 0 | 1,566 | 0 | 1,566 |
Professional fees | 9,500 | 0 | 31,635 | 0 |
Total Expenses | 45,385 | 1,045 | 82,118 | 1,577 |
Net (loss) | $ (41,135) | $ (1,045) | $ (74,868) | $ (1,577) |
(Loss) per common share, basic and diluted (Note 2) (in Dollars per share) | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
Weighted average shares outstanding, basic and diluted (in Shares) | 190,064,778 | 185,740,000 | 189,156,911 | 185,740,000 |
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) (UNAUDITED) - 6 months ended Jun. 30, 2016 - USD ($) |
Common Stock [Member] |
Additional Paid-in Capital [Member] |
Retained Earnings [Member] |
Total |
---|---|---|---|---|
Balance at Dec. 31, 2015 | $ 18,574 | $ (24,361) | $ (5,787) | |
Balance (in Shares) at Dec. 31, 2015 | 185,740,000 | 185,740,000 | ||
Shares issued for cash | $ 436 | $ 186,564 | $ 187,000 | |
Shares issued for cash (in Shares) | 4,364,000 | 4,364,000 | ||
Net (loss) | (74,868) | $ (74,868) | ||
Balance at Jun. 30, 2016 | $ 19,010 | $ 186,564 | $ (99,229) | $ 106,345 |
Balance (in Shares) at Jun. 30, 2016 | 190,104,000 | 190,104,000 |
1. GENERAL |
6 Months Ended |
---|---|
Jun. 30, 2016 | |
Disclosure Text Block [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | 1. GENERAL Organization and Business Nature MJ Pharmaceuticals, Inc. (the "Company") was incorporated under the laws of the State of Delaware on February 21, 2012 as Melanthios Acquisition, Inc. The Company initially intended to serve as a vehicle to effect an asset acquisition, merger, and exchange of capital stock or other business combination with a domestic or foreign business. On October 31, 2013, the original owner of the Company transferred 100% of his shares to Uren Enterprises, LLC which is solely owned by Mr. Mark Uren. The Company under the new ownership intended to serve as an investor in and provider of e-commerce operations to the property management and property rental industries, as well as investor in and provider of e-commerce operations and other services to the marijuana pharmaceutical industry. On April 11, 2014, Melanthios Acquisition, Inc. amended its certificate of incorporation changing the name of the Company to Price My Rent Group, Inc. On December 17, 2014, Price My Rent Group, Inc. amended its certificate of incorporation changing the name of the Company to MJ Pharmaceuticals, Inc. The Company commenced limited initial e-commerce operations on September 1, 2014. In November 2014, the Company suspended these operations, subject to further development of the e-commerce portal. |
2. ACCOUNTING POLICIES |
6 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2016 | ||||||||||||||
Accounting Policies [Abstract] | ||||||||||||||
Significant Accounting Policies [Text Block] | 2. ACCOUNTING POLICIES Basis of Accounting and Presentation The unaudited interim financial statements of the Company as of June 30, 2016 and for the three and six months ended June 30, 2016 and 2015 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”) which apply to interim financial statements. Accordingly, they do not include all of the information and footnotes normally required by accounting principles generally accepted in the United States of America for annual financial statements. In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for the periods presented. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for future quarters or for the year ending December 31, 2016. Use of Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all liquid investments with an original maturity of three months or less to be cash equivalents. Inventory Inventory, comprised of marijuana oil cartridges, is valued at the lower of cost or market. The value of inventory is determined using the first-in, first-out method. Property and Furniture Property, plant and equipment are recorded at cost, less accumulated depreciation. Cost includes the price paid to acquire the asset, and any expenditures that substantially increase an asset’s value or extends the useful life of an existing asset. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Major repairs and betterments that significantly extend original useful lives or improve productivity are capitalized and depreciated over the periods benefited. Maintenance and repairs are generally expensed as incurred. The estimated useful lives for property, plant and equipment categories are as follows:
Revenue Recognition Revenue is recorded pursuant to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 605, Revenue Recognition, when persuasive evidence of an arrangement exists, delivery of the product or services has occurred, the fee is fixed and determinable and collectability is reasonably assured. Beginning in 2016 the Company generated revenue from the sale of packaged products and marijuana oil cartridges. Income Taxes The Company accounts for income taxes in accordance with FASB ASC 740, Income Taxes (“ASC 740”), which requires the recognition of deferred income taxes for differences between the basis of assets and liabilities for financial statement and income tax purposes. Deferred tax assets and liabilities represent the future tax consequences for those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses that are available to offset future taxable income. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized. ASC 740 also addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is “more likely than not” that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position would be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on de-recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, and accounting for interest and penalties associated with tax positions. As of June 30, 2016 and December 31, 2015, the Company does not have a liability for any unrecognized tax benefits. Earnings (Loss) Per Share Net earnings (loss) per share is calculated in accordance with FASB ASC 260, Earnings Per Share. Basic net earnings (loss) per share is based upon the weighted average number of common shares outstanding during the period. Diluted net income per share is based on the assumption that all dilutive convertible shares, stock options and warrants were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Basic and diluted loss per share are the same for the three and six months ended June 30, 2016 and 2015, because the Company had losses and has no common stock equivalents. Fair Value of Financial Instruments FASB ASC 820, Fair Value Measurement, specifies a hierarchy of valuation techniques based upon whether the inputs to those valuation techniques reflect assumptions other market participants would use based upon market data obtained from independent sources (observable inputs). In accordance with ASC 820, the following summarizes the fair value hierarchy:
FASB ASC 820 requires the use of observable market data, when available, in making fair value measurements. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurements. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. The Company did not identify any assets or liabilities that are required to be presented at fair value on a recurring basis. Non-derivative financial instruments include cash and cash equivalents, accrued expenses and the related party loan. As of June 30, 2016 and December 31, 2015, the carrying values of these financial instruments approximated their fair values due to their short term nature. |
3. RECENTLY ISSUED ACCOUNTING STANDARDS |
6 Months Ended |
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Jun. 30, 2016 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | 3. RECENTLY ISSUED ACCOUNTING STANDARDS In February 2016, the FASB issued ASU 2016-02, Leases. The new standard establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. We are currently evaluating the impact of our pending adoption of the new standard on our financial statements. In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014-15 provides guidance in GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. In doing so, the amendments should reduce diversity in the timing and content of footnote disclosures. The amendments in ASU 2014-15 are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. This accounting standard update is not expected to have a material impact on the Company’s financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. The core principle of this updated guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new rule also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. This guidance, as amended, is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Companies are permitted to adopt this new rule following either a full or modified retrospective approach. Early adoption is permitted for annual periods beginning after December 15, 2016. This accounting standard update is not expected to have a material impact on the Company’s financial statements. |
4. LEASES |
6 Months Ended |
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Jun. 30, 2016 | |
Leases [Abstract] | |
Leases of Lessee Disclosure [Text Block] | 4. LEASES The Company leases its office space from an unrelated third party under a one-year operating lease, commencing on April 1, 2016 and expiring on March 31, 2017. The lease requires the Company to pay an annual rent of $3,900 with a security deposit of $325. The Company prepaid the total amount of $4,225 in advance for one year. Rent expense for the three and six months ended June 30, 2016 and 2015 was $975, $975, $0, and $0, respectively. |
5. PROPERTY, PLANT AND EQUIPMENT |
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment Disclosure [Text Block] | 5. PROPERTY, PLANT AND EQUIPMENT During the six months ended June 30, 2016, the Company purchased a 150,000 sq. ft. facility in Detroit Michigan for $40,399 for a future manufacturing/distribution center. Property, plant and equipment as of June 30, 2016 and December 31, 2015 are summarized as follows:
For the three and six months ended June 30, 2016 and 2015, depreciation expense was $359, $543, $0 and $0, respectively. |
6. ISSUANCE OF COMMON STOCK |
6 Months Ended |
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Jun. 30, 2016 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | 6. ISSUANCE OF COMMON STOCK During the six months ended June 30, 2016, the Company issued an aggregate of 4,364,000 shares of common stock at various prices with a total proceeds of $187,000. |
7. GOING CONCERN |
6 Months Ended |
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Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Substantial Doubt about Going Concern [Text Block] | 7. GOING CONCERN The Company’s financial statements have been presented on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company is a start-up entity subject to the substantial business risks and uncertainties inherent to such an entity, including the potential risk of business failure. The Company has generated operating losses since its inception. While the Company is attempting to commence operations and generate revenues, it continues to be reliant upon its stockholders to support its daily operations. This raises substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern and its ability to commence its planned principal business activities is dependent upon the continued financial support from its stockholders and its ability to obtain the necessary equity or debt financing and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. |
8. SUBSEQUENT EVENTS |
6 Months Ended |
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Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | 8. SUBSEQUENT EVENTS The Company's management has performed subsequent events procedures through August 26, 2016, which is the date the financial statements were available to be issued. Except for the issue discussed below, there were no subsequent events requiring adjustment to the financial statements or disclosure as stated herein. Mark Uren tendered his resignation letter dated August 15, 2016, to resign from the Company by reason of other than for Cause, as the Chief Executive Officer, Principal Financial Officer, Secretary, the sole Director and the Chairman of the Board of Directors and from any office he held with the Company. Mr. Uren shall pursue new opportunities outside of MJ Pharmaceuticals, Inc. but shall remain as the largest stockholder of the Company. As of August 15, 2016, James Liebo was appointed as the sole director and successor to Mark Uren and as the President, Secretary and Chief Executive Officer of the Company. Mr. Liebo is also the majority owner of Cutting Edge Sales and EBR Consulting in Dallas, Texas. His brings to the Company significant management experience, including employee management in excess of 25 years and his background and knowledge of sale and product distribution. Based upon the foregoing, it is believed that Mr. Liebo has sufficient management experience to serve as an officer and director of the Company. |
Accounting Policies, by Policy (Policies) |
6 Months Ended | |||||||||
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Jun. 30, 2016 | ||||||||||
Accounting Policies [Abstract] | ||||||||||
Basis of Accounting, Policy [Policy Text Block] | Basis of Accounting and Presentation The unaudited interim financial statements of the Company as of June 30, 2016 and for the three and six months ended June 30, 2016 and 2015 have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”) which apply to interim financial statements. Accordingly, they do not include all of the information and footnotes normally required by accounting principles generally accepted in the United States of America for annual financial statements. In the opinion of management, such information contains all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for the periods presented. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results to be expected for future quarters or for the year ending December 31, 2016.
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Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
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Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents The Company considers all liquid investments with an original maturity of three months or less to be cash equivalents.
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Inventory, Policy [Policy Text Block] | Inventory Inventory, comprised of marijuana oil cartridges, is valued at the lower of cost or market. The value of inventory is determined using the first-in, first-out method.
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Property, Plant and Equipment, Policy [Policy Text Block] | Property and Furniture Property, plant and equipment are recorded at cost, less accumulated depreciation. Cost includes the price paid to acquire the asset, and any expenditures that substantially increase an asset’s value or extends the useful life of an existing asset. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Major repairs and betterments that significantly extend original useful lives or improve productivity are capitalized and depreciated over the periods benefited. Maintenance and repairs are generally expensed as incurred. The estimated useful lives for property, plant and equipment categories are as follows:
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Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition Revenue is recorded pursuant to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 605, Revenue Recognition, when persuasive evidence of an arrangement exists, delivery of the product or services has occurred, the fee is fixed and determinable and collectability is reasonably assured. Beginning in 2016 the Company generated revenue from the sale of packaged products and marijuana oil cartridges.
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Income Tax, Policy [Policy Text Block] | Income Taxes The Company accounts for income taxes in accordance with FASB ASC 740, Income Taxes (“ASC 740”), which requires the recognition of deferred income taxes for differences between the basis of assets and liabilities for financial statement and income tax purposes. Deferred tax assets and liabilities represent the future tax consequences for those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred taxes are also recognized for operating losses that are available to offset future taxable income. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized. ASC 740 also addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is “more likely than not” that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position would be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on de-recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, and accounting for interest and penalties associated with tax positions. As of June 30, 2016 and December 31, 2015, the Company does not have a liability for any unrecognized tax benefits.
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Earnings Per Share, Policy [Policy Text Block] | Earnings (Loss) Per Share Net earnings (loss) per share is calculated in accordance with FASB ASC 260, Earnings Per Share. Basic net earnings (loss) per share is based upon the weighted average number of common shares outstanding during the period. Diluted net income per share is based on the assumption that all dilutive convertible shares, stock options and warrants were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Basic and diluted loss per share are the same for the three and six months ended June 30, 2016 and 2015, because the Company had losses and has no common stock equivalents.
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Fair Value Measurement, Policy [Policy Text Block] | Fair Value of Financial Instruments FASB ASC 820, Fair Value Measurement, specifies a hierarchy of valuation techniques based upon whether the inputs to those valuation techniques reflect assumptions other market participants would use based upon market data obtained from independent sources (observable inputs). In accordance with ASC 820, the following summarizes the fair value hierarchy:
FASB ASC 820 requires the use of observable market data, when available, in making fair value measurements. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurements. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. The Company did not identify any assets or liabilities that are required to be presented at fair value on a recurring basis. Non-derivative financial instruments include cash and cash equivalents, accrued expenses and the related party loan. As of June 30, 2016 and December 31, 2015, the carrying values of these financial instruments approximated their fair values due to their short term nature.
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2. ACCOUNTING POLICIES (Tables) |
6 Months Ended | ||||
---|---|---|---|---|---|
Jun. 30, 2016 | |||||
Estimated Useful Life [Member] | |||||
2. ACCOUNTING POLICIES (Tables) [Line Items] | |||||
Property, Plant and Equipment [Table Text Block] | The estimated useful lives for property, plant and equipment categories are as follows:
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5. PROPERTY, PLANT AND EQUIPMENT (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Table for Property, Plant and Equipment [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
5. PROPERTY, PLANT AND EQUIPMENT (Tables) [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Table Text Block] | Property, plant and equipment as of June 30, 2016 and December 31, 2015 are summarized as follows:
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1. GENERAL (Details) |
Oct. 31, 2013 |
---|---|
Percent of Ownership Transfered to Uren Enterprises from Initial Owner [Member] | |
1. GENERAL (Details) [Line Items] | |
Equity Method Investment, Ownership Percentage | 100.00% |
2. ACCOUNTING POLICIES (Details) - Property, Plant and Equipment |
6 Months Ended |
---|---|
Jun. 30, 2016 | |
Building [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Life | 40 years |
Furniture and Fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Life | 7 years |
4. LEASES (Details) - USD ($) |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Apr. 01, 2016 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Jun. 30, 2016 |
Jun. 30, 2015 |
Dec. 31, 2015 |
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Leases [Abstract] | ||||||
Operating Leases, Rent Expense, Minimum Rentals | $ 3,900 | |||||
Security Deposit | $ 325 | $ 325 | ||||
Prepaid Expense, Current | $ 4,225 | 3,250 | 3,250 | $ 0 | ||
Operating Leases, Rent Expense | $ 975 | $ 975 | $ 0 | $ 0 |
5. PROPERTY, PLANT AND EQUIPMENT (Details) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2016
USD ($)
ft²
|
Jun. 30, 2015
USD ($)
|
Jun. 30, 2016
USD ($)
ft²
|
Jun. 30, 2015
USD ($)
|
|
5. PROPERTY, PLANT AND EQUIPMENT (Details) [Line Items] | ||||
Payments to Acquire Property, Plant, and Equipment | $ 42,678 | $ 0 | ||
Depreciation | $ 359 | $ 0 | $ 543 | $ 0 |
Building [Member] | ||||
5. PROPERTY, PLANT AND EQUIPMENT (Details) [Line Items] | ||||
Area of Real Estate Property (in Square Feet) | ft² | 150,000 | 150,000 | ||
Payments to Acquire Property, Plant, and Equipment | $ 40,399 |
5. PROPERTY, PLANT AND EQUIPMENT (Details) - Property, Plant and Equipment - USD ($) |
Jun. 30, 2016 |
Dec. 31, 2015 |
---|---|---|
Property, Plant and Equipment [Abstract] | ||
Building | $ 40,399 | $ 0 |
Furniture and fixtures | 2,279 | 0 |
42,678 | 0 | |
Less: accumulated depreciation | (543) | 0 |
Property, plant and equipment, net | $ 42,135 | $ 0 |
6. ISSUANCE OF COMMON STOCK (Details) |
6 Months Ended |
---|---|
Jun. 30, 2016
USD ($)
shares
| |
Stockholders' Equity Note [Abstract] | |
Stock Issued During Period, Shares, New Issues | shares | 4,364,000 |
Stock Issued During Period, Value, New Issues | $ | $ 187,000 |
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