Discontinued Operations

12 Months Ended

Dec. 31, 2011

Discontinued Operations [Abstract]

Discontinued Operations

Note 10. Discontinued Operations

On September 16, 2011, the Company sold its entire interest in its AutoData Systems Division to Auto Data Inc. (ADI). The purchase price will be paid as an earn-out based on three percent of the software, hardware, and maintenance contracts that ADI sells over the next five years (four percent while ADI continues to occupy our building). As of December 30, 2011, ADI owed the Company approximately $3,000 under the earn-out. The amount is included in other assets on the balance sheet.

The division, a separate operating segment as described in Note 12, designed and marketed desktop software based systems that read hand printed characters, checkmarks and bar code information from scanned or faxed forms, in addition to collecting and reporting data from web forms.

The financial results of the discontinued operation are as follows:

	Years Ended December 31,
	2011			2010
Net sales	$	246,000		$	407,000
Expenses		(314,000	)		(424,000	)
Net loss before income taxes		(68,000	)		(17,000	)
Income tax benefit		18,000			4,000
Net loss of discontinued operations	$	(50,000	)	$	(13,000	)

The effect of the discontinued operation on the financial position of the Company, as of December 31, 2011, is as follows:

Property and equipment	$	2,000
Inventories		17,000
Accounts receivable		35,000
Net assets disposed	$	54,000
Accrued expenses	$	10,000
Deferred revenue		58,000
Net liabilities disposed	$	68,000
Net cash paid to ADI	$	14,000