LCTC Lifeloc Technologies Inc (PK)

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

 

Form 10-Q

 

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended March 31, 2024

 

OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from                      to

 

Commission file number     000-54319

 

LIFELOC TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

 

Colorado	84-1053680
(State or other jurisdiction of	(I.R.S. Employer Identification No.)
incorporation or organization)

 

12441 West 49th Ave., Unit 4

Wheat Ridge, Colorado  80033

(Address of principal executive offices)

 

(303) 431-9500

(Registrant's telephone number)

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	LCTC	N/A

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  ☐   No  ☒*

 

* The registrant is a voluntary filer of reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934, and has filed all such reports during the preceding 12 months.

 

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit).    Yes ☒       No  ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company.  See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" or and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer      ☐	Accelerated filer      ☐
Non-accelerated filer       ☐	Smaller reporting company   ☒
(Do not check if a smaller reporting company)
Emerging growth company  ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  ☐   No   ☒

 

Indicate the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:

 

Common Stock, no par value	2,454,116 Shares
(Class)	(outstanding at March 31, 2024)

 

 

LIFELOC TECHNOLOGIES, INC.

 FORM 10-Q

 For the Three Months Ended March 31, 2024

 INDEX

		Page
		Number
PART I.	FINANCIAL INFORMATION	3
ITEM 1	FINANCIAL STATEMENTS (UNAUDITED)
	Condensed Balance Sheets as of March 31, 2024 (Unaudited) and December 31, 2023	3
	Condensed Statements of Income (Unaudited) for the three months ended March 31, 2024 and 2023	4
	Condensed Statements of Stockholders' Equity (Unaudited) for the three months ended March 31, 2024 and 2023	5
	Condensed Statements of Cash Flows (Unaudited) for the three months ended March 31, 2024 and 2023	6
	Notes to Condensed Financial Statements (Unaudited)	7
ITEM 2	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	12
ITEM 3	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	16
ITEM 4	CONTROLS AND PROCEDURES	16
PART II.	OTHER INFORMATION	21
ITEM 1	LEGAL PROCEEDINGS	17
ITEM 1A	RISK FACTORS	17
ITEM 2	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	17
ITEM 3	DEFAULTS UPON SENIOR SECURITIES	17
ITEM 4	MINE SAFETY DISCLOSURES	17
ITEM 5	OTHER INFORMATION	17
ITEM 6	EXHIBITS	17
SIGNATURES		18

 

 

 

PART I      FINANCIAL INFORMATION

ITEM 1 – FINANCIAL STATEMENTS

LIFELOC TECHNOLOGIES, INC.

Balance Sheets

 

ASSETS
		March 31, 2024   (Unaudited)				December 31, 2023
CURRENT ASSETS:
Cash		$	1,031,540			$	1,766,621
Accounts receivable, net			756,907				812,126
Inventories, net			3,017,505				3,024,834
Prepaid expenses and other			266,956				105,967
Total current assets			5,072,908				5,709,548
PROPERTY AND EQUIPMENT, at cost:
Land			317,932				317,932
Building			1,928,795				1,928,795
Real-time Alcohol Detection And Recognition equipment and software			569,448				569,448
Production equipment, software and space modifications			1,154,803				1,154,803
Training courses			432,375				432,375
Office equipment, software and space modifications			233,190				216,618
Sales and marketing equipment and space modifications			226,356				226,356
Research and development equipment, software and space modifications			522,542				480,684
Less accumulated depreciation			(3,375,026	)			(3,326,837	)
Total property and equipment, net			2,010,415				2,000,174
OTHER ASSETS:
Patents, net			84,327				64,439
Deposits and other			265,169				111,157
Deferred taxes			895,551				806,652
Total other assets			1,245,047				982,248
Total assets		$	8,328,370			$	8,691,970
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable		$	556,160			$	402,231
Term loan payable, current portion			51,985				51,588
Income taxes payable			—				44,952
Customer deposits			178,052				195,719
Accrued expenses			175,916				329,311
Deferred revenue, current portion			76,247				79,036
Reserve for warranty expense			46,500				46,500
Total current liabilities			1,084,860				1,149,337
TERM LOAN PAYABLE, net of current portion and debt issuance costs			1,157,635				1,170,243
DEFERRED REVENUE, net of current portion			8,856				11,565
Total liabilities			2,251,351				2,331,145
COMMITMENTS AND CONTINGENCIES			—				—
STOCKHOLDERS' EQUITY:
Common stock, no par value; 50,000,000 shares   authorized, 2,454,116 shares outstanding			4,668,014				4,668,014
Retained earnings			1,409,005				1,692,811
Total stockholders' equity			6,077,019				6,360,825
Total liabilities and stockholders' equity		$	8,328,370			$	8,691,970

  

See attached notes.

LIFELOC TECHNOLOGIES, INC

Condensed Statements of Income (Unaudited)

		Three Months Ended March 31,
REVENUES:		2024				2023
Product sales		$	2,134,434			$	2,133,359
Royalties			10,936				8,206
Rental income			8,073				22,989
Total			2,153,443				2,164,554
COST OF SALES			1,318,136				1,229,127
GROSS PROFIT			835,307				935,427
OPERATING EXPENSES:
Research and development			555,599				396,766
Sales and marketing			345,009				287,883
General and administrative			314,926				319,015
Total			1,215,534				1,003,664
OPERATING INCOME (LOSS)			(380,227	)			(68,237	)
OTHER INCOME (EXPENSE):
Interest income			17,672				9,800
Interest expense			(10,150	)			(10,535	)
Total			7,522				(735	)
NET (LOSS) BEFORE PROVISION FOR TAXES			(372,705	)			(68,972	)
BENEFIT FROM FEDERAL AND STATE INCOME TAXES			88,899				15,184
NET INCOME (LOSS)		$	(283,806	)		$	(53,788	)
NET INCOME (LOSS) PER SHARE, BASIC		$	(0.12	)		$	(0.02	)
NET INCOME (LOSS) PER SHARE, DILUTED		$	(0.12	)		$	(0.02	)
WEIGHTED AVERAGE SHARES, BASIC			2,454,116				2,454,116
WEIGHTED AVERAGE SHARES, DILUTED			2,454,116				2,454,116

  

See attached notes

 

 Lifeloc Technologies, Inc.

Condensed Statements of Stockholders' Equity (Unaudited)

		Three Months Ended March 31,
		2024				2023
Beginning balances		4,668,014				4,668,014
Beginning balances		1,692,811				1,487,954
Total stockholders' equity, beginning balances		$	6,360,825			$	6,115,211
Common stock (no shares issued during periods):
Beginning balances			4,668,014				4,668,014
Net income (loss)			—				—
Ending balances			4,668,014				4,668,014
Retained earnings:
Beginning balances			1,692,811				1,487,954
Net income (loss)			(283,806	)			(53,788	)
Ending balances			1,409,005				1,433,409
Beginning balances			6,360,825				6,115,211
Net income (loss)			(283,806)				(53,788)
Total stockholders' equity, ending balances		$	6,077,019			$	6,101,423

 

See attached notes

 LIFELOC TECHNOLOGIES, INC.

Condensed Statements of Cash Flows (Unaudited)

		Three Months Ended March 31,
CASH FLOWS FROM OPERATING ACTIVITIES:		2024				2023
Net (loss)			(283,806	)			(53,788	)
Adjustments to reconcile net income to net cash  provided from (used in) operating activities-
Depreciation and amortization			51,085				72,490
Provision for inventory obsolescence, net change			17,500				—
Deferred taxes, net change			(88,899	)			(15,184	)
Changes in operating assets and liabilities-
Accounts receivable			55,219				84,089
Inventories			(10,171	)			(130,416	)
Prepaid expenses and other			(160,989	)			(155,863	)
Deposits and other			(154,012	)			—
Accounts payable			153,929				88,806
Income taxes payable			(44,952	)			—
Customer deposits			(17,667	)			(11,884	)
Accrued expenses			(153,395	)			(157,567	)
Deferred revenue			(5,498	)			(6,689	)
Net cash provided from (used in)             operating activities			(641,656	)			(286,006	)
CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES:
Purchases of property and equipment			(58,430	)			—
Patent filing expense			(21,708	)			(1,404	)
Net cash (used in) investing activities			(80,138	)			(1,404	)
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES:
Principal payments made on term loan			(13,287	)			(12,900	)
Net cash provided from (used in) financing             activities			(13,287	)			(12,900	)
NET INCREASE (DECREASE) IN CASH			(735,081	)			(300,310	)
CASH, BEGINNING OF PERIOD			1,766,621				2,352,754
CASH, END OF PERIOD		$	1,031,540			$	2,052,444
SUPPLEMENTAL INFORMATION:
Cash paid for interest		$	9,073			$	9,459
Cash paid for income tax		$	6,440			$	—

 

See attached notes

 LIFEELOC TECHNOLOGIES, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

 

1.  ORGANIZATION AND NATURE OF BUSINESS

Lifeloc Technologies, Inc. ("Lifeloc" or the "Company") is a Colorado-based developer, manufacturer and marketer of portable hand-held and fixed station breathalyzers and related accessories, supplies and education.  We design, produce and sell fuel-cell based breath alcohol testing equipment.  We compete in all major segments of the breath alcohol testing instrument market, including law enforcement, workplace, corrections, original equipment manufacturing ("OEM") and consumer markets. In addition, we offer a line of supplies, accessories, services, and training to support customers' alcohol testing programs. We sell globally through distributors as well as directly to users.

We define our business as providing "near and remote sensing and monitoring" products and solutions. Today, the majority of our revenues are derived from products and services for alcohol detection and measurement. We remain committed to growing our breath alcohol testing business. In the future, we anticipate the commercialization of new sensing and measurement products that may allow Lifeloc to successfully expand our business into new growth areas where we do not presently compete or where no satisfactory product solutions exist today.

Lifeloc incorporated in Colorado in December 1983.  We filed a registration statement on Form 10 with the Securities and Exchange Commission, which became effective on May 31, 2011.  Our fiscal year end is December 31.  Our principal executive offices are located at 12441 West 49th Avenue, Unit 4, Wheat Ridge, Colorado 80033-3338.  Our telephone number is (303) 431-9500.  Our websites are www.lifeloc.com and www.stsfirst.com.  Information contained on our websites does not constitute part of this Form 10-Q.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation.  These statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") and accounting principles generally accepted in the United States ("GAAP") for interim financial information.  They do not include all information and notes required by GAAP for complete financial statements.  However, except as disclosed herein, there has been no material change in the information disclosed in the notes to financial statements included in Lifeloc's Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the SEC.  In the opinion of management, the accompanying unaudited financial statements contain all adjustments, consisting of normal recurring accruals necessary for a fair presentation of the financial position as of March 31, 2024 and December 31, 2023, and the results of operations and cash flows for the quarters ended March 31, 2024 and March 31, 2023. Operating results for the interim periods presented are not necessarily indicative of the results that may be expected for a full year.  The Company's 2023 Annual Report on Form 10-K includes certain definitions and a summary of significant accounting policies and should be read in conjunction with this Form 10-Q.

Use of Estimates in the Preparation of Financial Statements.   The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions. Such estimates and assumptions affect the reported amounts of assets and liabilities as well as disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expense during the reporting period.  Actual results could differ from those estimates.

Fair Value Measurement.  Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("ASC 820"), provides a comprehensive framework for measuring fair value and expands disclosures which are required about fair value measurements. Specifically, ASC 820 sets forth a definition of fair value and establishes a hierarchy prioritizing the inputs to valuation techniques, giving the highest priority to quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable value inputs. ASC 820 defines the hierarchy as follows:

Level 1 - Quoted prices are available in active markets for identical assets or liabilities as of the reported date. The types of assets and liabilities included in Level 1 are highly liquid and actively traded instruments with quoted prices, such as equity securities listed on the New York Stock Exchange.

Level 2 - Pricing inputs are other than quoted prices in active markets, but are either directly or indirectly observable as of the reported date. The types of assets and liabilities in Level 2 are typically either comparable to actively traded securities or contracts or priced with models using highly observable inputs. 

 

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Level 3 - Significant inputs to pricing that are unobservable as of the reporting date. The types of assets and liabilities included in Level 3 are those with inputs requiring significant management judgment or estimation, such as complex and subjective models and forecasts used to determine the fair value of financial transmission rights.

Inventories.   Inventories are stated at the lower of cost (first-in, first-out basis) or net realizable value. We reduce inventory for estimated obsolete or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions. If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.  At March 31, 2024 and December 31, 2023, inventory consisted of the following:

Schedule of inventories
		2024				2023
Raw materials & deposits		$	2,774,784			$	2,696,659
Work-in-process			17,331				26,269
Finished goods			612,046				671,062
Total gross inventories			3,404,161				3,393,990
Less reserve for obsolescence			(386,656	)			(369,156	)
Total net inventories		$	3,017,505			$	3,024,834

Income Taxes.  We account for income taxes under the provisions of ASC Topic 740, Accounting for Income Taxes ("ASC 740"). We have determined an estimated annual effective tax rate.  The rate will be revised, if necessary, as of the end of each successive interim period during our fiscal year to our best current estimate.

The estimated annual effective tax rate is applied to the year-to-date ordinary income (loss) at the end of the interim period. 

ASC 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.  This pronouncement also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition.

Revenue Recognition.  In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services.  We adopted this ASU on January 1, 2018 retrospectively, with the cumulative effect of initial application (which was zero) recognized in retained earnings on that date.

Revenue from product sales and supplies is generally recorded when we ship the product and title has passed to the customer, or when agreed milestones are met in the case of product developments, provided that we have evidence of a customer arrangement and can conclude that collection is probable.  The prices at which we sell our products are fixed and determinable at the time we accept a customer's order. We recognize revenue from sales to stocking distributors when there is no right of return, other than for normal warranty claims, and generally have no ongoing obligations related to product sales, except for normal warranty.

The sales of licenses to our training courses are recognized as revenue at the time of sale. Training and certification revenues are recognized at the time the training and certification occurs.  Data recording revenue is recognized based on each day’s usage of enrolled devices.

Revenues arising from extended warranty contracts are booked as sales over their life on a straight-line basis. We have discontinued arranging for customer financing and leasing through unrelated third parties and instead are providing for customer financing and leasing ourselves, which we recognize as revenue over the applicable lease term.  Occasionally, we rent used equipment to customers, and in those cases, we recognize the revenues as they are earned over the life of the contract. 

Royalty income is recognized in accordance with agreed upon terms, when performance obligations are satisfied, the amount is fixed or determinable and collectability is reasonably assured.

Rental income from space leased to our tenants is recognized in the month in which it is due, which approximates if it were recognized on a straight-line basis over the term of the related lease.

On occasion we receive customer deposits for future product orders and product developments.  Customer deposits are initially recorded as a liability and recognized as revenue when the product is shipped and title has passed to the customer, or when agreed milestones are met in the case of product developments.

8

Topic 606 requires the disaggregation of revenue into broad categories, which we have defined as shown below for the three months ended March 31, 2024 and March 31, 2023.

Schedule of disaggregation of revenue
Product sales:		2024				2023
Product sales and supplies		$	1,911,824			$	1,900,828
Training, certification and data recording			204,059				211,249
Service plans and equipment rental			18,551				21,282
Product sales subtotal			2,134,434				2,133,359
Royalties			10,936				8,206
Rental income			8,073				22,989
Total revenues		$	2,153,443			$	2,164,554

Deferred Revenue.  Deferred revenues arise from service contracts and from development contracts.  Revenues from service contracts are recognized on a straight-line basis over the life of the contract, generally one year, and are included in product revenue in our statements of income.  However, there are occasions when they are written for longer terms up to four years.  The revenues from that portion of the contract that extend beyond one year are shown in our balance sheets as long term.  Deferred revenues also result from progress payments received on development contracts; those revenues are recognized when the contract is complete, and are included in product revenue in our statements of income.  All development contracts are for less than one year and all deferred revenues from this source are shown in our balance sheets as short term.

Recent Accounting Pronouncements.  We have reviewed all recently issued, but not yet effective, accounting pronouncements and do not expect them to have a material effect on our financial statements. 

Stock-Based Compensation.  Stock-based compensation is presented in accordance with the guidance of ASC Topic 718, Compensation – Stock Compensation ("ASC 718").  Under the provisions of ASC 718, companies are required to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model.  The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in our statement of income.

ASC 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the accompanying statement of income.

Stock-based compensation expense recognized during the period is based on the value of the portion of share-based payment awards that is ultimately expected to vest during the period.  We used the Black-Scholes option-pricing model to determine fair value. Our determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by our stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to our expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. Although the fair value of employee stock options is determined in accordance with ASC 718 using an option-pricing model, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction.

Stock-based compensation expense recognized under ASC 718 for the three months ended March 31, 2024 and 2023 was 0 and $17,202 respectively. These amounts consist of stock-based compensation expenses from grants of employee stock options which are allocated to General and Administrative Expense when incurred.

Segment Reporting.   We have concluded that we have two operating segments, including our primary business which is as a developer, manufacturer and marketer of portable hand-held breathalyzers and related accessories, supplies and education.  As a result of purchasing our building on October 31, 2014, we have a second business segment consisting of renting portions of our building to one tenant, whose lease expires on June 30, 2025.

 3.  BASIC AND DILUTED INCOME (LOSS) PER COMMON SHARE

We report both basic and diluted net income (loss) per common share.  Basic net income (loss) per common share is computed by dividing net income (loss) for the period by the weighted average number of common shares outstanding for the period.  Diluted net income (loss) per common share is computed by dividing the net income (loss) for the period by the weighted average number of common and potential common shares outstanding during the period if the effect of the potential common shares is dilutive.  The shares used in the calculation of dilutive potential common shares exclude options to purchase shares where the exercise price was greater than the average market price of common shares for the period. The shares used in the calculation of dilutive potential common shares exclude options to purchase shares in loss periods since they are anti-dilutive.

9

The following table presents the calculation of basic and diluted net income (loss) per common share for three months ended March 31, 2024 and March 31, 2023:

 

Schedule of basic and diluted net income (loss) per common share
		2024				2023
Net income (loss)		$	(283,806	)		$	(53,788	)
Weighted average shares-basic			2,454,116				2,454,116
Effect of dilutive potential common shares			—				—
Weighted average shares-diluted			2,454,116				2,454,116
Net income (loss) per share-basic		$	(0.12	)		$	(0.02	)
Net income (loss) per share-diluted		$	(0.12	)		$	(0.02	)
Antidilutive employee stock options			—				—

4.  STOCKHOLDERS' EQUITY

The following table summarizes information about employee stock options outstanding and exercisable at March 31, 2024:

	Schedule of stock options outstanding and exercisable			STOCK OPTIONS OUTSTANDING										STOCK OPTIONS EXERCISABLE
	Range of Exercise Prices			Number Outstanding			Weighted Average Remaining Contractual Life (in Years)				Weighted Average Exercise Price per Share			Number Exercisable			Weighted Average Exercise Price per Share
$	3.80			123,000			1.80			$	3.80			123,000		$	3.80

 

The exercise price of all options granted through March 31, 2024 has been equal to or greater than the fair market value of the Company's common stock at the time the options were issued. As of March 31, 2024, no options for our common stock remain available for grant under the 2013 Plan as it has expired.

No options were exercised during the three months ended March 31, 2024 or during the three months ended March 31, 2023.

The total number of authorized shares of common stock continues to be 50,000,000, with no change in the par value per share.

5.  COMMITMENTS AND CONTINGENCIES

Mortgage Expense. We purchased our facilities in Wheat Ridge, Colorado on October 31, 2014 for $1,949,139 and took out a term loan secured by a first mortgage on the property in the amount of $1,581,106 with Bank of America for a portion of the purchase price. This loan was paid on September 30, 2021 with proceeds from a new term loan with Citiwide Banks, also secured by a first priority mortgage on the property, in the principal amount of $1,350,000 which matures in September, 2031.  The new note is payable in 119 equal monthly installments of $7,453, including interest, plus a final payment of $773,727 (excluding interest) on September 30, 2031.  Our minimum future principal payments on this term loan, by year, are as follows:

Schedule of minimum future lease payments
2024			$	40,452
2025				55,345
2026				57.000
2027				58,704
2028 – 2031				1,009,936
Total				1,221,437
Less financing cost				(11,817	)
Net term loan payable				1,209,620
Less current portion				(51,985	)
Long term portion			$	1,157,635

Employee Severance Benefits. Our obligation with respect to employee severance benefits is minimized by the "at will" nature of the employee relationships.  As of March 31, 2024, we had no obligation with respect to contingent severance benefit obligations other than the Company's obligations under the employment agreement with its chief executive officer, Dr. Wayne Willkomm. In the event that Dr. Willkomm's employment is terminated by the Company without Cause (including through a decision by the Company not to renew the employment agreement) or by Dr. Willkomm with Good Reason (as each are defined in the employment agreement), Dr. Willkomm will be eligible, upon satisfaction of certain conditions, for severance equal to two months of salary continuation plus 12 months of health insurance continuation.

 

10

Contractual Commitments and Purchase Orders. Contractual commitments under development agreements and outstanding purchase orders issued to vendors in the ordinary course of business totaled $2,770,163 at March 31, 2024.

Regulatory Commitments. We are subject to certain regulations of the United States Department of Transportation and by various state departments of transportation.  We believe that we are in substantial compliance with all known applicable regulations.

6.  INCOME TAXES

The items accounting for the difference between income taxes computed at the federal statutory rate and the provision for (benefit from) income taxes consist of the following.

Schedule of provision for (benefit from) income taxes
		Three Months Ended March 31,
		2024				2023
Federal statutory rate		$	78,268			$	(14,484	)
Effect of:
State taxes, net of federal tax benefit			15,400				1,149
Other			(4,769	)			(1,849	)
Total		$	88,899			$	(15,184	)

7. BUSINESS SEGMENTS

We currently have two business segments: (i) the sale of physical products, including portable hand-held breathalyzers and related accessories, supplies, education, training ("Product Sales"), and royalties from development contracts with OEM manufacturers ("Royalties" and, together with Product Sales, the "Products" segment), and (ii) rental of a portion of our building (the "Rentals" segment).  The accounting policies of the segments are the same as those described in the summary of significant accounting policies in Note 2.

Operating profits for these segments exclude unallocated corporate items.  Administrative and staff costs were commonly used by all business segments and were indistinguishable.

The following sets forth information about the operations of the business segments for the three months ended March 31, 2024 and 2023.

Schedule of operations of business segments
Revenues:		2024				2023
Product sales		$	2,134,434			$	2,133,359
Royalties			10,936				8,206
Products subtotal			2,145,370				2,141,565
Rentals			8,073				22,989
Total			2,153,443				2,164,554
Gross profit:
Product sales			819,355				909,464
Royalties			10,936				8,206
Products subtotal			830,291				917,670
Rentals			5,016				17,757
Total			835,307				935,427
Interest expense:
Product sales			8,895				7,269
Royalties			—				—
Products subtotal			8,895				7,269
Rentals			1,255				3,266
Total			10,150				10,535
Net income (loss) before taxes:
Product sales			(387,402	)			(91,669	)
Royalties			10,936				8,206
Products subtotal			(376,466	)			(83,463	)
Rentals			3,761				14,491
Total		$	(372,705	)		$	(68,972	)

There were no intersegment revenues.

At March 31, 2024, $185,549 of our assets were used in the Rentals segment, with the remainder, $8,142,821, used in the Products and unallocated segments.

9.  SUBSEQUENT EVENTS

We evaluated all of our activity and concluded that no subsequent events have occurred that would require recognition in our financial statements or disclosure in the notes to our financial statements.

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following is a discussion of our financial condition and results of operations, and should be read in conjunction with our financial statements and the related notes included elsewhere in this Form 10-Q.  Certain statements contained in this section are not historical facts, including statements about our strategies and expectations about new and existing products, market demand, acceptance of new and existing products, technologies and opportunities, market and industry segment growth, and return on investments in products and markets.  These statements are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), and we intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in these statutes.  You can identify forward-looking statements by the use of forward-looking terminology such as "believes," "expects," "may," "will," "should," "seeks," "intends," "plans" or "anticipates" or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters.  Such statements involve substantial risks and uncertainties that may cause actual results to differ materially from those indicated by the forward-looking statements.  All forward-looking statements in this section are based on information available to us on the date of this document, and we assume no obligation to update such forward looking statements.  Readers of this Form 10-Q are strongly encouraged to review the section titled "Risk Factors" in our December 31, 2023 Form 10-K.

Overview

 

Lifeloc Technologies, Inc., a Colorado corporation ("Lifeloc" or the "Company"), is a Colorado-based developer, manufacturer and marketer of portable hand-held and fixed station breathalyzers and related accessories, supplies and education.  We design, produce and sell fuel-cell based breath alcohol testing equipment.  We compete in all major segments of the portable breath alcohol testing instrument market, including law enforcement, workplace, corrections, original equipment manufacturing ("OEM") and consumer markets. In addition, we offer a line of supplies, accessories, services, and training to support customers' alcohol testing programs. We sell globally through distributors as well as directly to users.

 

We define our business as providing "near and remote sensing and monitoring" products and solutions. Today, the majority of our revenues are derived from products and services for alcohol detection and measurement. We remain committed to growing our breath alcohol testing business. In the future, we anticipate the commercialization of new sensing and measurement products that may allow Lifeloc to successfully expand our business into new growth areas where we do not presently compete or where no satisfactory product solutions exist today.

 

In addition, with the October 2014 purchase of our corporate headquarters and certain adjacent property, we added a new reporting segment focused on the ownership and rental of real property through existing commercial leases.

 

Lifeloc incorporated in Colorado in December 1983.  We filed a registration statement on Form 10 with the Securities and Exchange Commission, which became effective on May 31, 2011.  Our fiscal year end is December 31.  Our principal executive offices are located at 12441 West 49th Avenue, Unit 4, Wheat Ridge, Colorado 80033-3338.  Our telephone number is (303) 431-9500.  Our websites are www.lifeloc.com and www.stsfirst.com.  Information contained on our websites does not constitute part of this Form 10-K.

 

Outlook

 

Installed Base of Breathalyzers.  We believe the installed base of our breathalyzers will increase as the inherent risks associated with drinking while driving or while working in safety sensitive jobs become more widely acknowledged and as our network of distributors and our direct sales force grows.  We believe that increased marketing efforts, the introduction of new products and the expansion of our sales network may provide the basis for increased sales and continuing profitable operations.  However, these measures, or any others that we may adopt or determine not to adopt, may not result in either increased sales or continuing profitable operations.

 

Possibility of Operating Losses.  Over many of the past several years we have operated profitably; however, prior to that, and in 2021 through 2023, we incurred losses.  There is no assurance that we will not incur losses in any given quarter or year in the future.

 

Sales Growth.  We expect to increase sales in the U.S. and worldwide as our network of direct customers and distributors grows and becomes more proficient and expands the number of new accounts.  Our growth efforts have focused on expanding our global reach and broadening our product offering in alcohol and drug detection. Orders for all of our products, particularly ignition interlock components, are on an intermittent purchase order basis and there is no assurance they will continue at any given rate, or that orders will repeat. 

 

Sales and Marketing Expenses.  We continue our efforts to expand our domestic and international distribution capability, and we believe that sales and marketing expenses will need to be maintained at a healthy level in order to do so.  Sales and marketing expenses are expected to increase as we increase our direct sales representatives and marketing efforts.

 

Research and Development Expenses.  We expect to increase our research and development expenses to support refinements to our products, and the development of additional new products.

 

 

SpinDx

 

In August 2016 we entered into an exclusive patent license agreement with Sandia Corporation pursuant to which we acquired the exclusive rights to develop, manufacture and market Sandia's patented SpinDx™ technology for the detection of drugs of abuse. We believe this license agreement represents the beginning of a relationship that will become material to the Company in the near future. A prototype was built by Sandia under our Cooperative Research and Development Agreement and received in 2018, after which we commenced work on commercializing the device.

 

In 2022 we purchased SpinDx related test and other equipment totaling $23,999, but made no similar expenditure in 2023. Our spending on SpinDx related test and other equipment so far in 2024 has been $41,858. We are optimistic about the results of the work to date and expect market introduction later in 2024 and commercialization in 2025. SpinDx™ uses a centrifugal disk with micro fluidic flow paths allowing multiple tests to be carried out on a single small sample.  The SpinDx™ platform has the potential to revolutionize real-time screening for a panel of high abuse drugs, with the ability to quickly and quantitatively measure very low concentrations of drugs such as cocaine, heroin, methamphetamine and others.  We intend to use this technology, sometimes referred to as "Lab on a Disk", to develop devices and tests that could be used at roadside, emergency rooms and in workplace testing to get a rapid and quantitative measure for a panel of such drugs of abuse.  We have detected delta-9-THC (the primary psychoactive component of marijuana) down to concentrations of 5 nanograms per milliliter in our laboratory.  This includes resolving the psychoactive delta-9-THC from its inactive metabolites. Resolving the psychoactive levels from metabolites is an important step in establishing impairment. We completed the upgrade of our base breathalyzer platform in 2019 (the LX9), and we remain committed to combining it with the SpinDx technology. If successful, this combination will result in a marijuana breathalyzer.

R.A.D.A.R.

On March 8, 2017, we entered into an Asset Purchase Agreement (the "Asset Purchase Agreement") with Track Group Inc., a Delaware corporation. Pursuant to the terms and conditions of the Asset Purchase Agreement, we acquired certain assets comprised of: (1) handheld hardware device technology (the "R.A.D.A.R.® Mobile Devices"), designed to measure breath alcohol content of the user; and (2) software technology called R.A.D.A.R.® (Real-time Alcohol Detection and Reporting) Reporting Center designed to allow the Device to be configured and to capture and manage the data being returned from the Device (together with the Device, the "R.A.D.A.R.® Assets"). We purchased the assets of R.A.D.A.R. 100 knowing the product needed significant upgrading, which was essentially completed and released for sale several years later as R.A.D.A.R. 200. This product met with little market acceptance as a result of the underperformance of one feature. We withdrew R.A.D.A.R. 200 from the market and have outsourced the development of R.A.D.A.R. 300 to a third party, which, if successful, will result in proof of concept showing that the above problem has been resolved. Although there is no assurance of market acceptance, widespread adoption of the R.A.D.A.R.® Mobile Devices may provide an alternative to, and thus lower, incarceration rates through better offender monitoring.

Results of Operations

 

For the three months ended March 31, 2024 compared to the three months ended March 31, 2023.

 

Supply chain problems caused by Covid-19, as well as the other market impacts of Covid-19, were mostly resolved by the end of 2023, and the perceived need to monitor for the presence of alcohol reverted back to the level experienced previously. We maintained our reduced costs at their 2023 levels where possible, although inflation took its toll, increasing the cost of raw materials, labor, and freight. We continued and intensified our new product development efforts while maintaining the high level of customer service that has led to an excellent reputation for outstanding customer service. With the introduction of new products, we believe Lifeloc will again be profitable.

 

Net sales.

 

Our product sales for the quarter ended March 31, 2024 were $2,134,434, relatively unchanged from $2,133,359 for the quarter ended March 31, 2023. When royalties of $10,936 and rental income of $8,073 are included, total revenues of $2,153,443 were also similar to the same quarter a year ago. Rental income decreased by $14,916 due to our election not to renew or replace a lease for a portion of the space formerly occupied by a tenant, and royalties increased by $2,730 due to an increase in sales by royalty-paying customers.

 

Gross profit. 

 

Gross profit for the 3 months ended March 31, 2024 of $835,307 represented a decrease of 11% from total gross profit of $935,427 for the same three months ended March 31, 2023, primarily as a result of increased cost of materials and labor resulting from inflation, offset in part by increased royalties in 2024. Cost of product sales increased from $1,223,895 in the 3 months ended March 31, 2023 to $1,315,079 in the same period in 2024, an increase of $91,184 (10%).  Gross profit margin on products decreased to 38.4% in the quarter ended March 31, 2024 from 42.6% in the same period a year ago primarily as a result of the increase in costs.

 

 

Research and development expenses. 

 

Research and development expenses were $555,599 for the quarter ended March 31, 2024 representing an increase of $158,833 (40%) over the $396,766 in the same period a year ago.  This increase resulted primarily from additional personnel, materials and outside contractors needed for our dedication of resources to SpinDx.

 

Sales and marketing expenses.

 

Sales and marketing expenses of $345,009 for the 3 months ended March 31, 2024 were up by $57,126 (or 20%) from the $287,883 spent in the same period a year ago, as a result of expanded marketing efforts, including the additional of personnel.

 

General and administrative expenses.  

 

General and administrative expenses of $314,926 for the quarter ended March 31, 2024 versus $319,015 for the quarter ended March 31, 2023 were relatively unchanged as the decrease of $4,089 represented a decrease of 1% from a year ago.

 

Other income (expense).  

 

Interest income increased from $9,800 a year ago to $17,672 in 2024, as a result of higher yield availability. Interest expense of $10,150 in the 3 months ended March 31, 2024 was down from $10,535 in the previous year as a result of the paydown on our loan on our building. The total increase as a result of the above items in the quarter ended March 31, 2024 was $8,257, or 11%.

 

Net income (loss).  

 

We realized a net loss of $283,806 for the 3 months ended March 31, 2024 compared to a net loss of $53,788 for the quarter ended March 31, 2023. This increase of $230,018 was the result of the changes in gross profit, operating expenses and other income discussed above, which resulted in a loss before taxes of $372,705, or an increase of $303,733 from the loss before taxes of $68,972 in 2023. After the benefit from taxes of $88,899 (versus a benefit from taxes of $15,184 a year ago), we realized a net loss of $283,806 compared to a net loss of $53,788 in 2023.

 

Trends and Uncertainties That May Affect Future Results

 

Revenues in the year 2024 were nearly unchanged compared to revenues in 2023. We believe that continued increased sales efforts may result in improved revenues in the rest of 2024 and beyond.  Inflationary pressures have affected our business in a number of ways, including increasing the cost of raw materials, labor, and freight. Our actions to mitigate the impact of inflation, including pre-ordering components in higher than usual quantities, sourcing new vendors and increasing prices, have been somewhat successful.

 

We expect our quarter-to-quarter revenue fluctuations to continue, due to the unpredictable timing of large orders from customers and the size of those orders in relation to total revenues.  Going forward, we intend to focus our development efforts on products we believe offer the best prospects to increase our intermediate and near-term revenues, with particular emphasis on completing SpinDx™.

 

Our 2024 operating plan is focused on growing sales, increasing gross profits, and increasing research and development efforts on new products, including SpinDx™, for long-term growth. We cannot predict with certainty the expected sales, gross profit, net income or loss, or usage of cash and cash equivalents for 2024. However, we believe that cash resources will be sufficient to fund our operations for the next twelve months under our current operating plan. If we are unable to manage the business operations in line with our budget expectations, it could have a material adverse effect on business viability, financial position, results of operations and cash flows. Further, if we are not successful in sustaining profitability and remaining at least cash flow break-even, additional capital may be required to maintain ongoing operations.

 

Interest expense.

 

In connection with the financing of our building purchase on October 31, 2014 we obtained a 10-year term loan from Bank of America in an initial principal amount of $1,581,106 bearing interest at 4.45% per annum (which was decreased to 4% in 2016) and secured by a first-priority mortgage in the acquired property, as well as a one-year $250,000 line of credit, which was later increased to $750,000 with a maturity date of September 28, 2021. The Bank of America loan was paid on September 30, 2021 with proceeds from a new term loan from Citywide Banks, also secured by a first-priority mortgage on the property, in the principal amount of $1,350,000. The new loan is payable in monthly installments of $7,453, with interest at 2.95% and a maturity date of September 30, 2031. The revolving line of credit facility expired in accordance with its terms and has not been renewed. 

 

 

Liquidity and Capital Resources

 

We compete in a highly technical, very competitive and, in most cases, price driven alcohol testing marketplace, where products can take years to develop and introduce to distributors and end users.  Furthermore, manufacturing, marketing and distribution activities are regulated by the DOT and other regulatory bodies that, while intended to enhance the ultimate quality and functionality of products produced, can contribute to the cost and time needed to maintain existing products and develop and introduce new products.

 

Except for normal operating contractual commitments and purchase orders, we do not have any material contractual commitments requiring settlement in the future. See "Note 5 – Commitments and Contingencies" to our Financial Statements in Part II - Item 8.

 

We have traditionally funded working capital needs through product sales and close management of working capital components of our business.  Historically, we have also received cash from private offerings of our common stock, warrants to purchase shares of our common stock, and notes.  In our earlier years, we incurred quarter to quarter operating losses to develop current product applications, utilizing a number of proprietary and patent-pending technologies.  Although we have been profitable in recent years except 2020 and 2022, we can provide no assurances that operating losses will not occur in the future.  Should that situation arise, we may not be able to obtain working capital funds necessary in the time frame needed and at satisfactory terms, if at all.

 

As of March 31, 2024, cash and cash equivalents was $1,031,540, trade accounts receivable were $756,907 and current liabilities were $1,084,860 resulting in net liquid assets of $703,587. We believe that the resolution of supply chain issues and the Covid-19 pandemic, and the introduction of several new products during the last several years, along with new and on-going customer relationships will allow Lifeloc to operate profitably. If the revenue levels during the last several years do not continue to recover in a timely manner, if inflationary pressures are not contained, or if the development of SpinDx takes longer than expected, we may be required to seek additional sources of capital and/or to implement further cost reduction measures, as necessary.

 

Equipment expenditures, consisting of updated office equipment and SpinDx related equipment, during Q1 of 2024 were $58,430 compared to $0 in Q1 of 2023, an increase of $58,430. We incurred patent application costs in preparation for filing of $21,708 in 2024 versus $1,404 in 2023. As development of SpinDx progresses, and as normal wear and tear of equipment occurs, we expect to continue to incur outlays for equipment and patent filings in 2024 and beyond.

 

We generally provide a standard one-year limited warranty on materials and workmanship to our customers.  We provide for estimated warranty costs at the time product revenue is recognized.  Warranty costs are included as a component of cost of goods sold in the accompanying statements of operations.  For the quarter ended March 31, 2024 and for the quarter ended March 31, 2023, warranty costs were not deemed significant.

 

Critical Accounting Policies and Estimates

 

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

 

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements.  In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.

 

Our discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.  The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, sales and expenses, and related disclosure of contingent assets and liabilities.  On an on-going basis, we evaluate our estimates, including those related to bad debts, inventories, sales returns, warranty, contingencies and litigation.  We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.  Actual results may differ from these estimates under different assumptions or conditions.  We believe the following critical accounting policies affect the more significant judgments and estimates used in the preparation of our financial statements.

 

We have concluded that we have two operating segments, including our primary business which is as a developer, manufacturer and marketer of portable hand-held breathalyzers and related accessories, supplies and education, and a second segment consisting of renting portions of our building to existing tenants.  

 

We maintain allowances for doubtful accounts for estimated losses resulting from the inability of our customers to make required payments.  If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances would be required, which would increase our expenses during the periods in which any such allowances were made.  The amount recorded as a provision for bad debts in each period is based upon our assessment of the likelihood that we will be paid on our outstanding receivables, based on customer-specific as well as general considerations.  To the extent that our estimates prove to be too high, and we ultimately collect a receivable previously determined to be impaired, we may record a reversal of the provision in the period of such determination.

 

We reduce inventory for estimated obsolete or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions.  If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.  Any write-downs of inventory would reduce our reported net income during the period in which such write-downs were applied.

 

 

 

Property and equipment are stated at cost, with depreciation computed over the estimated useful lives of the assets, generally five years (three years for software and technology licenses).  We use the declining method of depreciation for property, including space modifications, and the straight line method for software and technology licenses. We purchased all of the assets of STS, an online education company, in 2014, which consisted of training courses that are amortized over 15 years using the straight line method.  In October 2014, we purchased our building. A majority of the cost of the building is depreciated over 39 years using the straight line method. In addition, based on the results of a third party analysis, a portion of the cost was allocated to components integral to the building.  Such components are depreciated over 5 and 15 years, using the declining method.  The R.A.D.A.R.® software and patents that were purchased in March 2017 were originally set to amortize over 15 years using the straight line method, but in 2022 we accelerated the amortization of the remaining cost to fully amortize the assets by December 31, 2022. Maintenance and repairs are expensed as incurred and major additions, replacements and improvements are capitalized.

 

Revenue from product sales and supplies is generally recorded when we ship the product and title has passed to the customer, or when agreed milestones are met in the case of product developments, provided that we have evidence of a customer arrangement and can conclude that collection is probable.  The prices at which we sell our products are fixed and determinable at the time we accept a customer's order. We recognize revenue from sales to stocking distributors when there is no right of return, other than for normal warranty claims, and generally have no ongoing obligations related to product sales, except for normal warranty.

 

The sales of licenses to our training courses are recognized as revenue at the time of sale. Direct training performed by us is recognized when training is completed by the trainer, with the unearned portion classified as deferred revenue. Training and certification revenues are recognized at the time the training and certification occurs.  Data recording revenue is recognized based on each day’s usage of enrolled devices.

 

Revenues arising from extended warranty contracts are booked as sales over their life on a straight-line basis. We provide customer financing and leasing ourselves, which we recognize as revenue over the applicable lease term.  Occasionally, we rent used equipment to customers, and in those cases, we recognize the revenues as they are earned over the life of the contract. 

 

Royalty income is recognized in accordance with agreed upon terms, when performance obligations are satisfied, the amount is fixed or determinable and collectability is reasonably assured.

 

Rental income from space leased to our tenants is recognized in the month in which it is due.

 

On occasion we receive customer deposits for future product orders and for product development.  Customer deposits are initially recorded as a liability and recognized as revenue when the product is shipped and title has passed to the customer, or in the case of product development, when agreed milestones are met.

 

Stock-based compensation is presented in accordance with the guidance of Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 718, Compensation — Stock Compensation ("ASC 718").  Under the provisions of ASC 718, companies are required to estimate the fair value of share-based payment awards made to employees and directors including employee stock options based on estimated fair values on the date of grant using an option-pricing model.  The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in our statement of operations.

ITEM 3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4 – CONTROLS AND PROCEDURES

(a)       Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q, our management has evaluated, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934).  Disclosure controls and procedures are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.  Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of March 31, 2024.

(b)       Changes in Internal Control over Financial Reporting

There were no significant changes in our internal controls over financial reporting during the period ended March 31, 2024 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Controls

A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system's objectives will be met.  Our management, including our Chief Executive Officer and our Chief Financial Officer, do not expect that the Company's disclosure controls will prevent or detect all errors and all fraud.  Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs.  Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected.  These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of simple error or mistake.  Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls.  The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.  Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with associated policies or procedures.  Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

PART II. OTHER INFORMATION

ITEM 1 – LEGAL PROCEEDINGS

We may be involved from time to time in litigation, negotiation and settlement matters that may have a material effect on our operations or finances. We are not aware of any pending or threatened litigation against us or our officers or directors in their capacity as such that could have a material impact on our operations or finances.

ITEM 1A – RISK FACTORS

In addition to the other information set forth in this report, you should carefully consider the factors discussed in ''Risk Factors'' in our Annual Report on Form 10-K for the year ended December 31, 2023, which could materially affect our business, financial condition and/or future results.  The risks described in our Annual Report on Form 10-K are not the only risks facing us.  Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

ITEM 2 – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

No options were exercised during the three months ended March 31, 2024 or during the three months ended March 31, 2023.  There were no sales of equity securities during the three months ended March 31, 2024 or during the three months ended March 31, 2023.

ITEM 3 – DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4 – MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5 – OTHER INFORMATION

During the quarter ended March 31, 2024, no director or officer of the Company adopted, modified or terminated any contract, instruction or written plan for the purchase or sale of the Company’s securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement” as defined in Item 408(a) of Regulation S-K.

ITEM 6 – EXHIBITS

The following exhibits are filed with this report on Form 10-Q or are incorporated by reference:

Exhibit No.		Description of Exhibit
31.1		Certification of Principal Executive Officer Pursuant To Section 302 Of The Sarbanes—Oxley Act Of 2002
31.2		Certification of Principal Financial Officer Pursuant To Section 302 Of The Sarbanes—Oxley Act Of 2002
32.1		Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

  

SIGNATURES

 

Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

		LIFELOC TECHNOLOGIES, INC.
May 15, 2024	By:	/s/ Wayne R. Willkomm
Date		Wayne R. Willkomm, Ph.D.
		President and Chief Executive Officer (Principal Executive Officer)
May 15, 2024	By:	/s/ Michelle Heim
Date		Michelle Heim
		Controller (Principal Accounting Officer)

 

 

 Exhibit Index

Exhibit No.		Description of Exhibit
31.1		Certification of Principal Executive Officer Pursuant To Section 302 Of The Sarbanes—Oxley Act Of 2002
31.2		Certification of Principal Financial Officer Pursuant To Section 302 Of The Sarbanes—Oxley Act Of 2002
32.1		Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
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 Exhibit 31.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Wayne R. Willkomm, certify that:

 

1. I have reviewed this report on Form 10-Q of Lifeloc Technologies, Inc.;

2. 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;

3. 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 registrant as of, and for, the periods presented in this report;

 4. The registrant'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 registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, 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; 

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our 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;

c)  evaluated the effectiveness of the registrant'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

 d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

 a) 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 registrant's ability to record, process, summarize and report financial information; and

 

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 

Dated: May 15, 2024

 

		/s/ Wayne R. Willkomm
		Wayne R. Willkomm, Ph.D.
		Chief Executive Officer (Principal Executive Officer)

Exhibit 31.2

 

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Vern D. Kornelsen, certify that:

1. I have reviewed this report on Form 10-Q of Lifeloc Technologies, Inc.;

2. 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;

3. 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 registrant as of, and for, the periods presented in this report;

4. The registrant'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 registrant and have:

 a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, 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; 

 b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our 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;

 c)  evaluated the effectiveness of the registrant'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

 d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

 a) 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 registrant's ability to record, process, summarize and report financial information; and

 b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 Dated: May 15, 2024

		/s/ Vern D. Kornelsen
		Vern D. Kornelsen
		Chief Financial Officer (Principal Financial Officer)

 Exhibit 32.1

 

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

 I, Wayne R. Willkomm, Chief Executive Officer of Lifeloc Technologies, Inc. (the "Company"), hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

●	the Quarterly Report on Form 10-Q of the Company for the period ended March 31, 2024 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
●	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the period covered by the Report.

Dated: May 15, 2024

		/s/ Wayne R. Willkomm
		Wayne R. Willkomm, Ph.D.
		Chief Executive Officer (Principal Executive Officer)

 

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 I, Vern D. Kornelsen, Chief Financial Officer of Lifeloc Technologies, Inc. (the "Company"), hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

●	the Quarterly Report on Form 10-Q of the Company for the period ended March 31, 2024 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
●	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the period covered by the Report.

Dated: May 15, 2024

		/s/ Vern D. Kornelsen
		Vern D. Kornelsen
		Chief Financial Officer (Principal Financial Officer)

v3.24.1.1.u2

Cover	3 Months Ended
	Mar. 31, 2024 shares
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2024
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-31
Entity File Number	000-54319
Entity Registrant Name	LIFELOC TECHNOLOGIES, INC.
Entity Central Index Key	0001493137
Entity Tax Identification Number	84-1053680
Entity Incorporation, State or Country Code	CO
Entity Address, Address Line One	12441 West 49th Ave.
Entity Address, Address Line Two	Unit 4
Entity Address, City or Town	Wheat Ridge
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80033
City Area Code	303
Local Phone Number	431-9500
Title of 12(b) Security	Common Stock
Trading Symbol	LCTC
Entity Current Reporting Status	No
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	2,454,116

v3.24.1.1.u2

Balance Sheets - USD ($)	Mar. 31, 2024	Dec. 31, 2023
CURRENT ASSETS:
Cash	$ 1,031,540	$ 1,766,621
Accounts receivable, net	756,907	812,126
Inventories, net	3,017,505	3,024,834
Prepaid expenses and other	266,956	105,967
Total current assets	5,072,908	5,709,548
PROPERTY AND EQUIPMENT, at cost:
Land	317,932	317,932
Building	1,928,795	1,928,795
Real-time Alcohol Detection And Recognition equipment and software	569,448	569,448
Production equipment, software and space modifications	1,154,803	1,154,803
Training courses	432,375	432,375
Office equipment, software and space modifications	233,190	216,618
Sales and marketing equipment and space modifications	226,356	226,356
Research and development equipment, software and space modifications	522,542	480,684
Less accumulated depreciation	(3,375,026)	(3,326,837)
Total property and equipment, net	2,010,415	2,000,174
OTHER ASSETS:
Patents, net	84,327	64,439
Deposits and other	265,169	111,157
Deferred taxes	895,551	806,652
Total other assets	1,245,047	982,248
Total assets	8,328,370	8,691,970
CURRENT LIABILITIES:
Accounts payable	556,160	402,231
Term loan payable, current portion	51,985	51,588
Income taxes payable	0	44,952
Customer deposits	178,052	195,719
Accrued expenses	175,916	329,311
Deferred revenue, current portion	76,247	79,036
Reserve for warranty expense	46,500	46,500
Total current liabilities	1,084,860	1,149,337
TERM LOAN PAYABLE, net of current portion and debt issuance costs	1,157,635	1,170,243
DEFERRED REVENUE, net of current portion	8,856	11,565
Total liabilities	2,251,351	2,331,145
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, no par value; 50,000,000 shares   authorized, 2,454,116 shares outstanding	4,668,014	4,668,014
Retained earnings	1,409,005	1,692,811
Total stockholders' equity	6,077,019	6,360,825
Total liabilities and stockholders' equity	$ 8,328,370	$ 8,691,970

v3.24.1.1.u2

Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Common stock, par value	$ 0	$ 0
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares outstanding	2,454,116	2,454,116

v3.24.1.1.u2

Condensed Statements of Income (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
REVENUES:
Product sales	$ 2,134,434	$ 2,133,359
Royalties	10,936	8,206
Rental income	8,073	22,989
Total	2,153,443	2,164,554
COST OF SALES	1,318,136	1,229,127
GROSS PROFIT	835,307	935,427
OPERATING EXPENSES:
Research and development	555,599	396,766
Sales and marketing	345,009	287,883
General and administrative	314,926	319,015
Total	1,215,534	1,003,664
OPERATING INCOME (LOSS)	(380,227)	(68,237)
OTHER INCOME (EXPENSE):
Interest income	17,672	9,800
Interest expense	(10,150)	(10,535)
Total	7,522	(735)
NET (LOSS) BEFORE PROVISION FOR TAXES	(372,705)	(68,972)
BENEFIT FROM FEDERAL AND STATE INCOME TAXES	88,899	15,184
NET INCOME (LOSS)	$ (283,806)	$ (53,788)
NET INCOME (LOSS) PER SHARE, BASIC	$ (0.12)	$ (0.02)
NET INCOME (LOSS) PER SHARE, DILUTED	$ (0.12)	$ (0.02)
WEIGHTED AVERAGE SHARES, BASIC	2,454,116	2,454,116
WEIGHTED AVERAGE SHARES, DILUTED	2,454,116	2,454,116

v3.24.1.1.u2

Condensed Statements of Stockholders' Equity (Unaudited) - USD ($)	Common Stock [Member]	Retained Earnings [Member]	Total
Beginning balance, amount at Dec. 31, 2022	$ 4,668,014	$ 1,487,954	$ 6,115,211
Net income (loss)		(53,788)	(53,788)
Ending balance, amount at Mar. 31, 2023	4,668,014	1,433,409	6,101,423
Beginning balance, amount at Dec. 31, 2023	4,668,014	1,692,811	6,360,825
Net income (loss)		(283,806)	(283,806)
Ending balance, amount at Mar. 31, 2024	$ 4,668,014	$ 1,409,005	$ 6,077,019

v3.24.1.1.u2

Condensed Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss)	$ (283,806)	$ (53,788)
Adjustments to reconcile net income to net cash  provided from (used in) operating activities-
Depreciation and amortization	51,085	72,490
Provision for inventory obsolescence, net change	17,500	0
Deferred taxes, net change	(88,899)	(15,184)
Changes in operating assets and liabilities-
Accounts receivable	55,219	84,089
Inventories	(10,171)	(130,416)
Prepaid expenses and other	(160,989)	(155,863)
Deposits and other	(154,012)	0
Accounts payable	153,929	88,806
Income taxes payable	(44,952)	0
Customer deposits	(17,667)	(11,884)
Accrued expenses	(153,395)	(157,567)
Deferred revenue	(5,498)	(6,689)
Net cash provided from (used in)             operating activities	(641,656)	(286,006)
CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES:
Purchases of property and equipment	(58,430)	0
Patent filing expense	(21,708)	(1,404)
Net cash (used in) investing activities	(80,138)	(1,404)
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES:
Principal payments made on term loan	(13,287)	(12,900)
Net cash provided from (used in) financing             activities	(13,287)	(12,900)
NET INCREASE (DECREASE) IN CASH	(735,081)	(300,310)
CASH, BEGINNING OF PERIOD	1,766,621	2,352,754
CASH, END OF PERIOD	1,031,540	2,052,444
SUPPLEMENTAL INFORMATION:
Cash paid for interest	9,073	9,459
Cash paid for income tax	$ 6,440	$ 0

v3.24.1.1.u2

Pay vs Performance Disclosure - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Pay vs Performance Disclosure [Table]
Net Income (Loss) Attributable to Parent	$ (283,806)	$ (53,788)

v3.24.1.1.u2

Insider Trading Arrangements	3 Months Ended
	Mar. 31, 2024
Insider Trading Arrangements [Line Items]
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

v3.24.1.1.u2

ORGANIZATION AND NATURE OF BUSINESS	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
ORGANIZATION AND NATURE OF BUSINESS	1.  ORGANIZATION AND NATURE OF BUSINESS Lifeloc Technologies, Inc. ("Lifeloc" or the "Company") is a Colorado-based developer, manufacturer and marketer of portable hand-held and fixed station breathalyzers and related accessories, supplies and education.  We design, produce and sell fuel-cell based breath alcohol testing equipment.  We compete in all major segments of the breath alcohol testing instrument market, including law enforcement, workplace, corrections, original equipment manufacturing ("OEM") and consumer markets. In addition, we offer a line of supplies, accessories, services, and training to support customers' alcohol testing programs. We sell globally through distributors as well as directly to users. We define our business as providing "near and remote sensing and monitoring" products and solutions. Today, the majority of our revenues are derived from products and services for alcohol detection and measurement. We remain committed to growing our breath alcohol testing business. In the future, we anticipate the commercialization of new sensing and measurement products that may allow Lifeloc to successfully expand our business into new growth areas where we do not presently compete or where no satisfactory product solutions exist today. Lifeloc incorporated in Colorado in December 1983.  We filed a registration statement on Form 10 with the Securities and Exchange Commission, which became effective on May 31, 2011.  Our fiscal year end is December 31.  Our principal executive offices are located at 12441 West 49th Avenue, Unit 4, Wheat Ridge, Colorado 80033-3338.  Our telephone number is (303) 431-9500.  Our websites are www.lifeloc.com and www.stsfirst.com.  Information contained on our websites does not constitute part of this Form 10-Q.

v3.24.1.1.u2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation.  These statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") and accounting principles generally accepted in the United States ("GAAP") for interim financial information.  They do not include all information and notes required by GAAP for complete financial statements.  However, except as disclosed herein, there has been no material change in the information disclosed in the notes to financial statements included in Lifeloc's Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the SEC.  In the opinion of management, the accompanying unaudited financial statements contain all adjustments, consisting of normal recurring accruals necessary for a fair presentation of the financial position as of March 31, 2024 and December 31, 2023, and the results of operations and cash flows for the quarters ended March 31, 2024 and March 31, 2023. Operating results for the interim periods presented are not necessarily indicative of the results that may be expected for a full year.  The Company's 2023 Annual Report on Form 10-K includes certain definitions and a summary of significant accounting policies and should be read in conjunction with this Form 10-Q. Use of Estimates in the Preparation of Financial Statements.   The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions. Such estimates and assumptions affect the reported amounts of assets and liabilities as well as disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expense during the reporting period.  Actual results could differ from those estimates. Fair Value Measurement.  Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("ASC 820"), provides a comprehensive framework for measuring fair value and expands disclosures which are required about fair value measurements. Specifically, ASC 820 sets forth a definition of fair value and establishes a hierarchy prioritizing the inputs to valuation techniques, giving the highest priority to quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable value inputs. ASC 820 defines the hierarchy as follows: Level 1 - Quoted prices are available in active markets for identical assets or liabilities as of the reported date. The types of assets and liabilities included in Level 1 are highly liquid and actively traded instruments with quoted prices, such as equity securities listed on the New York Stock Exchange. Level 2 - Pricing inputs are other than quoted prices in active markets, but are either directly or indirectly observable as of the reported date. The types of assets and liabilities in Level 2 are typically either comparable to actively traded securities or contracts or priced with models using highly observable inputs.  Level 3 - Significant inputs to pricing that are unobservable as of the reporting date. The types of assets and liabilities included in Level 3 are those with inputs requiring significant management judgment or estimation, such as complex and subjective models and forecasts used to determine the fair value of financial transmission rights. Inventories.   Inventories are stated at the lower of cost (first-in, first-out basis) or net realizable value. We reduce inventory for estimated obsolete or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions. If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.  At March 31, 2024 and December 31, 2023, inventory consisted of the following: Schedule of inventories                     2024     2023   Raw materials & deposits   $ 2,774,784     $ 2,696,659   Work-in-process     17,331       26,269   Finished goods     612,046       671,062   Total gross inventories     3,404,161       3,393,990   Less reserve for obsolescence     (386,656 )     (369,156 ) Total net inventories   $ 3,017,505     $ 3,024,834   Income Taxes.  We account for income taxes under the provisions of ASC Topic 740, Accounting for Income Taxes ("ASC 740"). We have determined an estimated annual effective tax rate.  The rate will be revised, if necessary, as of the end of each successive interim period during our fiscal year to our best current estimate. The estimated annual effective tax rate is applied to the year-to-date ordinary income (loss) at the end of the interim period.  ASC 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.  This pronouncement also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. Revenue Recognition.  In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services.  We adopted this ASU on January 1, 2018 retrospectively, with the cumulative effect of initial application (which was zero) recognized in retained earnings on that date. Revenue from product sales and supplies is generally recorded when we ship the product and title has passed to the customer, or when agreed milestones are met in the case of product developments, provided that we have evidence of a customer arrangement and can conclude that collection is probable.  The prices at which we sell our products are fixed and determinable at the time we accept a customer's order. We recognize revenue from sales to stocking distributors when there is no right of return, other than for normal warranty claims, and generally have no ongoing obligations related to product sales, except for normal warranty. The sales of licenses to our training courses are recognized as revenue at the time of sale. Training and certification revenues are recognized at the time the training and certification occurs.  Data recording revenue is recognized based on each day’s usage of enrolled devices. Revenues arising from extended warranty contracts are booked as sales over their life on a straight-line basis. We have discontinued arranging for customer financing and leasing through unrelated third parties and instead are providing for customer financing and leasing ourselves, which we recognize as revenue over the applicable lease term.  Occasionally, we rent used equipment to customers, and in those cases, we recognize the revenues as they are earned over the life of the contract.  Royalty income is recognized in accordance with agreed upon terms, when performance obligations are satisfied, the amount is fixed or determinable and collectability is reasonably assured. Rental income from space leased to our tenants is recognized in the month in which it is due, which approximates if it were recognized on a straight-line basis over the term of the related lease. On occasion we receive customer deposits for future product orders and product developments.  Customer deposits are initially recorded as a liability and recognized as revenue when the product is shipped and title has passed to the customer, or when agreed milestones are met in the case of product developments. Topic 606 requires the disaggregation of revenue into broad categories, which we have defined as shown below for the three months ended March 31, 2024 and March 31, 2023. Schedule of disaggregation of revenue                 Product sales:   2024     2023     Product sales and supplies   $ 1,911,824     $ 1,900,828     Training, certification and data recording     204,059       211,249     Service plans and equipment rental     18,551       21,282     Product sales subtotal     2,134,434       2,133,359   Royalties     10,936       8,206   Rental income     8,073       22,989   Total revenues   $ 2,153,443     $ 2,164,554   Deferred Revenue.  Deferred revenues arise from service contracts and from development contracts.  Revenues from service contracts are recognized on a straight-line basis over the life of the contract, generally one year, and are included in product revenue in our statements of income.  However, there are occasions when they are written for longer terms up to four years.  The revenues from that portion of the contract that extend beyond one year are shown in our balance sheets as long term.  Deferred revenues also result from progress payments received on development contracts; those revenues are recognized when the contract is complete, and are included in product revenue in our statements of income.  All development contracts are for less than one year and all deferred revenues from this source are shown in our balance sheets as short term. Recent Accounting Pronouncements.  We have reviewed all recently issued, but not yet effective, accounting pronouncements and do not expect them to have a material effect on our financial statements.  Stock-Based Compensation.  Stock-based compensation is presented in accordance with the guidance of ASC Topic 718, Compensation – Stock Compensation ("ASC 718").  Under the provisions of ASC 718, companies are required to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model.  The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in our statement of income. ASC 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the accompanying statement of income. Stock-based compensation expense recognized during the period is based on the value of the portion of share-based payment awards that is ultimately expected to vest during the period.  We used the Black-Scholes option-pricing model to determine fair value. Our determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by our stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to our expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. Although the fair value of employee stock options is determined in accordance with ASC 718 using an option-pricing model, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction. Stock-based compensation expense recognized under ASC 718 for the three months ended March 31, 2024 and 2023 was 0 and $17,202 respectively. These amounts consist of stock-based compensation expenses from grants of employee stock options which are allocated to General and Administrative Expense when incurred. Segment Reporting.   We have concluded that we have two operating segments, including our primary business which is as a developer, manufacturer and marketer of portable hand-held breathalyzers and related accessories, supplies and education.  As a result of purchasing our building on October 31, 2014, we have a second business segment consisting of renting portions of our building to one tenant, whose lease expires on June 30, 2025.

v3.24.1.1.u2

BASIC AND DILUTED INCOME (LOSS) PER COMMON SHARE	3 Months Ended
	Mar. 31, 2024
Earnings Per Share [Abstract]
BASIC AND DILUTED INCOME (LOSS) PER COMMON SHARE	3.  BASIC AND DILUTED INCOME (LOSS) PER COMMON SHARE We report both basic and diluted net income (loss) per common share.  Basic net income (loss) per common share is computed by dividing net income (loss) for the period by the weighted average number of common shares outstanding for the period.  Diluted net income (loss) per common share is computed by dividing the net income (loss) for the period by the weighted average number of common and potential common shares outstanding during the period if the effect of the potential common shares is dilutive.  The shares used in the calculation of dilutive potential common shares exclude options to purchase shares where the exercise price was greater than the average market price of common shares for the period. The shares used in the calculation of dilutive potential common shares exclude options to purchase shares in loss periods since they are anti-dilutive. The following table presents the calculation of basic and diluted net income (loss) per common share for three months ended March 31, 2024 and March 31, 2023:   Schedule of basic and diluted net income (loss) per common share                     2024     2023   Net income (loss)   $ (283,806 )   $ (53,788 ) Weighted average shares-basic     2,454,116       2,454,116   Effect of dilutive potential common shares     —         —     Weighted average shares-diluted     2,454,116       2,454,116   Net income (loss) per share-basic   $ (0.12 )   $ (0.02 ) Net income (loss) per share-diluted   $ (0.12 )   $ (0.02 ) Antidilutive employee stock options     —         —

v3.24.1.1.u2

STOCKHOLDERS' EQUITY	3 Months Ended
	Mar. 31, 2024
Equity [Abstract]
STOCKHOLDERS' EQUITY	4.  STOCKHOLDERS' EQUITY The following table summarizes information about employee stock options outstanding and exercisable at March 31, 2024:                                         Schedule of stock options outstanding and exercisable      STOCK OPTIONS OUTSTANDING     STOCK OPTIONS EXERCISABLE     Range of Exercise Prices     Number Outstanding     Weighted Average Remaining Contractual Life (in Years)       Weighted Average Exercise Price per Share     Number Exercisable     Weighted Average Exercise Price per Share   $ 3.80     123,000     1.80     $ 3.80     123,000   $ 3.80     The exercise price of all options granted through March 31, 2024 has been equal to or greater than the fair market value of the Company's common stock at the time the options were issued. As of March 31, 2024, no options for our common stock remain available for grant under the 2013 Plan as it has expired.   No options were exercised during the three months ended March 31, 2024 or during the three months ended March 31, 2023. The total number of authorized shares of common stock continues to be 50,000,000, with no change in the par value per share.

v3.24.1.1.u2

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	5.  COMMITMENTS AND CONTINGENCIES Mortgage Expense. We purchased our facilities in Wheat Ridge, Colorado on October 31, 2014 for $1,949,139 and took out a term loan secured by a first mortgage on the property in the amount of $1,581,106 with Bank of America for a portion of the purchase price. This loan was paid on September 30, 2021 with proceeds from a new term loan with Citiwide Banks, also secured by a first priority mortgage on the property, in the principal amount of $1,350,000 which matures in September, 2031.  The new note is payable in 119 equal monthly installments of $7,453, including interest, plus a final payment of $773,727 (excluding interest) on September 30, 2031.  Our minimum future principal payments on this term loan, by year, are as follows: Schedule of minimum future lease payments           2024     $ 40,452   2025       55,345   2026       57.000   2027       58,704   2028 – 2031       1,009,936   Total       1,221,437   Less financing cost       (11,817 ) Net term loan payable       1,209,620   Less current portion       (51,985 ) Long term portion     $ 1,157,635   Employee Severance Benefits. Our obligation with respect to employee severance benefits is minimized by the "at will" nature of the employee relationships.  As of March 31, 2024, we had no obligation with respect to contingent severance benefit obligations other than the Company's obligations under the employment agreement with its chief executive officer, Dr. Wayne Willkomm. In the event that Dr. Willkomm's employment is terminated by the Company without Cause (including through a decision by the Company not to renew the employment agreement) or by Dr. Willkomm with Good Reason (as each are defined in the employment agreement), Dr. Willkomm will be eligible, upon satisfaction of certain conditions, for severance equal to two months of salary continuation plus 12 months of health insurance continuation. Contractual Commitments and Purchase Orders. Contractual commitments under development agreements and outstanding purchase orders issued to vendors in the ordinary course of business totaled $2,770,163 at March 31, 2024. Regulatory Commitments. We are subject to certain regulations of the United States Department of Transportation and by various state departments of transportation.  We believe that we are in substantial compliance with all known applicable regulations.

v3.24.1.1.u2

INCOME TAXES	3 Months Ended
	Mar. 31, 2024
Income Tax Disclosure [Abstract]
INCOME TAXES	6.  INCOME TAXES The items accounting for the difference between income taxes computed at the federal statutory rate and the provision for (benefit from) income taxes consist of the following. Schedule of provision for (benefit from) income taxes                     Three Months Ended March 31,       2024     2023   Federal statutory rate   $ 78,268     $ (14,484 ) Effect of:                   State taxes, net of federal tax benefit     15,400       1,149     Other     (4,769 )     (1,849 ) Total   $ 88,899     $ (15,184 )

v3.24.1.1.u2

BUSINESS SEGMENTS	3 Months Ended
	Mar. 31, 2024
Segment Reporting [Abstract]
BUSINESS SEGMENTS	7. BUSINESS SEGMENTS We currently have two business segments: (i) the sale of physical products, including portable hand-held breathalyzers and related accessories, supplies, education, training ("Product Sales"), and royalties from development contracts with OEM manufacturers ("Royalties" and, together with Product Sales, the "Products" segment), and (ii) rental of a portion of our building (the "Rentals" segment).  The accounting policies of the segments are the same as those described in the summary of significant accounting policies in Note 2. Operating profits for these segments exclude unallocated corporate items.  Administrative and staff costs were commonly used by all business segments and were indistinguishable. The following sets forth information about the operations of the business segments for the three months ended March 31, 2024 and 2023.  Schedule of operations of business segments                 Revenues:   2024     2023   Product sales   $ 2,134,434     $ 2,133,359   Royalties     10,936       8,206   Products subtotal     2,145,370       2,141,565   Rentals     8,073       22,989   Total     2,153,443       2,164,554                     Gross profit:                 Product sales     819,355       909,464   Royalties     10,936       8,206   Products subtotal     830,291       917,670   Rentals     5,016       17,757   Total     835,307       935,427                     Interest expense:                 Product sales     8,895       7,269   Royalties     —         —     Products subtotal     8,895       7,269   Rentals     1,255       3,266   Total     10,150       10,535                     Net income (loss) before taxes:                 Product sales     (387,402 )     (91,669 ) Royalties     10,936       8,206   Products subtotal     (376,466 )     (83,463 ) Rentals     3,761       14,491   Total   $ (372,705 )   $ (68,972 ) There were no intersegment revenues. At March 31, 2024, $185,549 of our assets were used in the Rentals segment, with the remainder, $8,142,821, used in the Products and unallocated segments.

v3.24.1.1.u2

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2024
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	9.  SUBSEQUENT EVENTS We evaluated all of our activity and concluded that no subsequent events have occurred that would require recognition in our financial statements or disclosure in the notes to our financial statements.

v3.24.1.1.u2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation.  These statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission ("SEC") and accounting principles generally accepted in the United States ("GAAP") for interim financial information.  They do not include all information and notes required by GAAP for complete financial statements.  However, except as disclosed herein, there has been no material change in the information disclosed in the notes to financial statements included in Lifeloc's Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the SEC.  In the opinion of management, the accompanying unaudited financial statements contain all adjustments, consisting of normal recurring accruals necessary for a fair presentation of the financial position as of March 31, 2024 and December 31, 2023, and the results of operations and cash flows for the quarters ended March 31, 2024 and March 31, 2023. Operating results for the interim periods presented are not necessarily indicative of the results that may be expected for a full year.  The Company's 2023 Annual Report on Form 10-K includes certain definitions and a summary of significant accounting policies and should be read in conjunction with this Form 10-Q.
Use of Estimates in the Preparation of Financial Statements	Use of Estimates in the Preparation of Financial Statements.   The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions. Such estimates and assumptions affect the reported amounts of assets and liabilities as well as disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expense during the reporting period.  Actual results could differ from those estimates.
Fair Value Measurement	Fair Value Measurement.  Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("ASC 820"), provides a comprehensive framework for measuring fair value and expands disclosures which are required about fair value measurements. Specifically, ASC 820 sets forth a definition of fair value and establishes a hierarchy prioritizing the inputs to valuation techniques, giving the highest priority to quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable value inputs. ASC 820 defines the hierarchy as follows: Level 1 - Quoted prices are available in active markets for identical assets or liabilities as of the reported date. The types of assets and liabilities included in Level 1 are highly liquid and actively traded instruments with quoted prices, such as equity securities listed on the New York Stock Exchange. Level 2 - Pricing inputs are other than quoted prices in active markets, but are either directly or indirectly observable as of the reported date. The types of assets and liabilities in Level 2 are typically either comparable to actively traded securities or contracts or priced with models using highly observable inputs.  Level 3 - Significant inputs to pricing that are unobservable as of the reporting date. The types of assets and liabilities included in Level 3 are those with inputs requiring significant management judgment or estimation, such as complex and subjective models and forecasts used to determine the fair value of financial transmission rights.
Inventories	Inventories.   Inventories are stated at the lower of cost (first-in, first-out basis) or net realizable value. We reduce inventory for estimated obsolete or unmarketable inventory equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand and market conditions. If actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required.  At March 31, 2024 and December 31, 2023, inventory consisted of the following: Schedule of inventories                     2024     2023   Raw materials & deposits   $ 2,774,784     $ 2,696,659   Work-in-process     17,331       26,269   Finished goods     612,046       671,062   Total gross inventories     3,404,161       3,393,990   Less reserve for obsolescence     (386,656 )     (369,156 ) Total net inventories   $ 3,017,505     $ 3,024,834
Income Taxes	Income Taxes.  We account for income taxes under the provisions of ASC Topic 740, Accounting for Income Taxes ("ASC 740"). We have determined an estimated annual effective tax rate.  The rate will be revised, if necessary, as of the end of each successive interim period during our fiscal year to our best current estimate. The estimated annual effective tax rate is applied to the year-to-date ordinary income (loss) at the end of the interim period.  ASC 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.  This pronouncement also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition.
Revenue Recognition	Revenue Recognition.  In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services.  We adopted this ASU on January 1, 2018 retrospectively, with the cumulative effect of initial application (which was zero) recognized in retained earnings on that date. Revenue from product sales and supplies is generally recorded when we ship the product and title has passed to the customer, or when agreed milestones are met in the case of product developments, provided that we have evidence of a customer arrangement and can conclude that collection is probable.  The prices at which we sell our products are fixed and determinable at the time we accept a customer's order. We recognize revenue from sales to stocking distributors when there is no right of return, other than for normal warranty claims, and generally have no ongoing obligations related to product sales, except for normal warranty. The sales of licenses to our training courses are recognized as revenue at the time of sale. Training and certification revenues are recognized at the time the training and certification occurs.  Data recording revenue is recognized based on each day’s usage of enrolled devices. Revenues arising from extended warranty contracts are booked as sales over their life on a straight-line basis. We have discontinued arranging for customer financing and leasing through unrelated third parties and instead are providing for customer financing and leasing ourselves, which we recognize as revenue over the applicable lease term.  Occasionally, we rent used equipment to customers, and in those cases, we recognize the revenues as they are earned over the life of the contract.  Royalty income is recognized in accordance with agreed upon terms, when performance obligations are satisfied, the amount is fixed or determinable and collectability is reasonably assured. Rental income from space leased to our tenants is recognized in the month in which it is due, which approximates if it were recognized on a straight-line basis over the term of the related lease. On occasion we receive customer deposits for future product orders and product developments.  Customer deposits are initially recorded as a liability and recognized as revenue when the product is shipped and title has passed to the customer, or when agreed milestones are met in the case of product developments. Topic 606 requires the disaggregation of revenue into broad categories, which we have defined as shown below for the three months ended March 31, 2024 and March 31, 2023. Schedule of disaggregation of revenue                 Product sales:   2024     2023     Product sales and supplies   $ 1,911,824     $ 1,900,828     Training, certification and data recording     204,059       211,249     Service plans and equipment rental     18,551       21,282     Product sales subtotal     2,134,434       2,133,359   Royalties     10,936       8,206   Rental income     8,073       22,989   Total revenues   $ 2,153,443     $ 2,164,554
Deferred Revenue	Deferred Revenue.  Deferred revenues arise from service contracts and from development contracts.  Revenues from service contracts are recognized on a straight-line basis over the life of the contract, generally one year, and are included in product revenue in our statements of income.  However, there are occasions when they are written for longer terms up to four years.  The revenues from that portion of the contract that extend beyond one year are shown in our balance sheets as long term.  Deferred revenues also result from progress payments received on development contracts; those revenues are recognized when the contract is complete, and are included in product revenue in our statements of income.  All development contracts are for less than one year and all deferred revenues from this source are shown in our balance sheets as short term.
Recent Accounting Pronouncements	Recent Accounting Pronouncements.  We have reviewed all recently issued, but not yet effective, accounting pronouncements and do not expect them to have a material effect on our financial statements.
Stock-Based Compensation	Stock-Based Compensation.  Stock-based compensation is presented in accordance with the guidance of ASC Topic 718, Compensation – Stock Compensation ("ASC 718").  Under the provisions of ASC 718, companies are required to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model.  The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in our statement of income. ASC 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the accompanying statement of income. Stock-based compensation expense recognized during the period is based on the value of the portion of share-based payment awards that is ultimately expected to vest during the period.  We used the Black-Scholes option-pricing model to determine fair value. Our determination of fair value of share-based payment awards on the date of grant using an option-pricing model is affected by our stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to our expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. Although the fair value of employee stock options is determined in accordance with ASC 718 using an option-pricing model, that value may not be indicative of the fair value observed in a willing buyer/willing seller market transaction. Stock-based compensation expense recognized under ASC 718 for the three months ended March 31, 2024 and 2023 was 0 and $17,202 respectively. These amounts consist of stock-based compensation expenses from grants of employee stock options which are allocated to General and Administrative Expense when incurred.
Segment Reporting	Segment Reporting.   We have concluded that we have two operating segments, including our primary business which is as a developer, manufacturer and marketer of portable hand-held breathalyzers and related accessories, supplies and education.  As a result of purchasing our building on October 31, 2014, we have a second business segment consisting of renting portions of our building to one tenant, whose lease expires on June 30, 2025.

v3.24.1.1.u2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	3 Months Ended
	Mar. 31, 2024
Accounting Policies [Abstract]
Schedule of inventories	Schedule of inventories                     2024     2023   Raw materials & deposits   $ 2,774,784     $ 2,696,659   Work-in-process     17,331       26,269   Finished goods     612,046       671,062   Total gross inventories     3,404,161       3,393,990   Less reserve for obsolescence     (386,656 )     (369,156 ) Total net inventories   $ 3,017,505     $ 3,024,834
Schedule of disaggregation of revenue	Schedule of disaggregation of revenue                 Product sales:   2024     2023     Product sales and supplies   $ 1,911,824     $ 1,900,828     Training, certification and data recording     204,059       211,249     Service plans and equipment rental     18,551       21,282     Product sales subtotal     2,134,434       2,133,359   Royalties     10,936       8,206   Rental income     8,073       22,989   Total revenues   $ 2,153,443     $ 2,164,554

v3.24.1.1.u2

BASIC AND DILUTED INCOME (LOSS) PER COMMON SHARE (Tables)	3 Months Ended
	Mar. 31, 2024
Earnings Per Share [Abstract]
Schedule of basic and diluted net income (loss) per common share	Schedule of basic and diluted net income (loss) per common share                     2024     2023   Net income (loss)   $ (283,806 )   $ (53,788 ) Weighted average shares-basic     2,454,116       2,454,116   Effect of dilutive potential common shares     —         —     Weighted average shares-diluted     2,454,116       2,454,116   Net income (loss) per share-basic   $ (0.12 )   $ (0.02 ) Net income (loss) per share-diluted   $ (0.12 )   $ (0.02 ) Antidilutive employee stock options     —         —

v3.24.1.1.u2

STOCKHOLDERS' EQUITY (Tables)	3 Months Ended
	Mar. 31, 2024
Equity [Abstract]
Schedule of stock options outstanding and exercisable	Schedule of stock options outstanding and exercisable      STOCK OPTIONS OUTSTANDING     STOCK OPTIONS EXERCISABLE     Range of Exercise Prices     Number Outstanding     Weighted Average Remaining Contractual Life (in Years)       Weighted Average Exercise Price per Share     Number Exercisable     Weighted Average Exercise Price per Share   $ 3.80     123,000     1.80     $ 3.80     123,000   $ 3.80

v3.24.1.1.u2

COMMITMENTS AND CONTINGENCIES (Tables)	3 Months Ended
	Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]
Schedule of minimum future lease payments	Schedule of minimum future lease payments           2024     $ 40,452   2025       55,345   2026       57.000   2027       58,704   2028 – 2031       1,009,936   Total       1,221,437   Less financing cost       (11,817 ) Net term loan payable       1,209,620   Less current portion       (51,985 ) Long term portion     $ 1,157,635

v3.24.1.1.u2

INCOME TAXES (Tables)	3 Months Ended
	Mar. 31, 2024
Income Tax Disclosure [Abstract]
Schedule of provision for (benefit from) income taxes	Schedule of provision for (benefit from) income taxes                     Three Months Ended March 31,       2024     2023   Federal statutory rate   $ 78,268     $ (14,484 ) Effect of:                   State taxes, net of federal tax benefit     15,400       1,149     Other     (4,769 )     (1,849 ) Total   $ 88,899     $ (15,184 )

v3.24.1.1.u2

BUSINESS SEGMENTS (Tables)	3 Months Ended
	Mar. 31, 2024
Segment Reporting [Abstract]
Schedule of operations of business segments	Schedule of operations of business segments                 Revenues:   2024     2023   Product sales   $ 2,134,434     $ 2,133,359   Royalties     10,936       8,206   Products subtotal     2,145,370       2,141,565   Rentals     8,073       22,989   Total     2,153,443       2,164,554                     Gross profit:                 Product sales     819,355       909,464   Royalties     10,936       8,206   Products subtotal     830,291       917,670   Rentals     5,016       17,757   Total     835,307       935,427                     Interest expense:                 Product sales     8,895       7,269   Royalties     —         —     Products subtotal     8,895       7,269   Rentals     1,255       3,266   Total     10,150       10,535                     Net income (loss) before taxes:                 Product sales     (387,402 )     (91,669 ) Royalties     10,936       8,206   Products subtotal     (376,466 )     (83,463 ) Rentals     3,761       14,491   Total   $ (372,705 )   $ (68,972 )

v3.24.1.1.u2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Accounting Policies [Abstract]
Raw materials & deposits	$ 2,774,784	$ 2,696,659
Work-in-process	17,331	26,269
Finished goods	612,046	671,062
Total gross inventories	3,404,161	3,393,990
Less reserve for obsolescence	(386,656)	(369,156)
Total net inventories	$ 3,017,505	$ 3,024,834

v3.24.1.1.u2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Product Information [Line Items]
Total revenues	$ 2,153,443	$ 2,164,554
Product Sales And Supplies [Member]
Product Information [Line Items]
Total revenues	1,911,824	1,900,828
Training Certification And Data Recording [Member]
Product Information [Line Items]
Total revenues	204,059	211,249
Service Plans And Equipment Rental [Member]
Product Information [Line Items]
Total revenues	18,551	21,282
Product Sales Subtotal [Member]
Product Information [Line Items]
Total revenues	2,134,434	2,133,359
Royalties [Member]
Product Information [Line Items]
Total revenues	10,936	8,206
Rental Income [Member]
Product Information [Line Items]
Total revenues	$ 8,073	$ 22,989

v3.24.1.1.u2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Accounting Policies [Abstract]
Stock-based compensation expense	$ 0	$ 17,202

v3.24.1.1.u2

BASIC AND DILUTED INCOME (LOSS) PER COMMON SHARE (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Earnings Per Share [Abstract]
Net income (loss)	$ (283,806)	$ (53,788)
Weighted average shares-basic	2,454,116	2,454,116
Effect of dilutive potential common shares	0	0
Weighted average shares-diluted	2,454,116	2,454,116
Net income (loss) per share-basic	$ (0.12)	$ (0.02)
Net income (loss) per share-diluted	$ (0.12)	$ (0.02)
Antidilutive employee stock options	0	0

v3.24.1.1.u2

STOCKHOLDERS' EQUITY (Details) - Price Range 1 [Member]	3 Months Ended
	Mar. 31, 2024 $ / shares shares
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items]
Range of exercise prices	$ 3.80
Stock option outstanding | shares	123,000
Weighted average remaining contractual life (in years)	1 year 9 months 18 days
Weighted average exercise price per share	$ 3.80
Number of options exercisable | shares	123,000
Weighted average exercise price per share, exercisable	$ 3.80

v3.24.1.1.u2

STOCKHOLDERS' EQUITY (Details Narrative) - shares	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options, exercised	0	0
Common stock, authorized shares	50,000,000		50,000,000
Plan 2013 [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options available for grant	0

v3.24.1.1.u2

COMMITMENTS AND CONTINGENCIES (Details)	Mar. 31, 2024 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2024	$ 40,452
2025	55,345
2026	57.000
2027	58,704
2028 - 2031	1,009,936
Total	1,221,437
Less financing cost	(11,817)
Net term loan payable	1,209,620
Less current portion	(51,985)
Long term portion	$ 1,157,635

v3.24.1.1.u2

COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($)		3 Months Ended
	Oct. 31, 2014	Mar. 31, 2024
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Facilities Purchased	$ 1,949,139
Periodic Payment		$ 7,453
Final payment		773,727
Outstanding purchase orders issued to vendors		2,770,163
Bank Of America [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Term Loan	$ 1,581,106
Citywide Banks [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Principal amount		$ 1,350,000

v3.24.1.1.u2

INCOME TAXES (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Federal statutory rate	$ 78,268	$ (14,484)
State taxes, net of federal tax benefit	15,400	1,149
Other	(4,769)	(1,849)
Total	$ 88,899	$ (15,184)

v3.24.1.1.u2

BUSINESS SEGMENTS (Details) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Product Sales [Member]
Segment Reporting Information [Line Items]
Revenues	$ 2,134,434	$ 2,133,359
Gross profit	819,355	909,464
Interest expense	8,895	7,269
Net income (loss) before taxes	(387,402)	(91,669)
Royalties [Member]
Segment Reporting Information [Line Items]
Revenues	10,936	8,206
Gross profit	10,936	8,206
Interest expense	0	0
Net income (loss) before taxes	10,936	8,206
Products Subtotal [Member]
Segment Reporting Information [Line Items]
Revenues	2,145,370	2,141,565
Gross profit	830,291	917,670
Interest expense	8,895	7,269
Net income (loss) before taxes	(376,466)	(83,463)
Rentals [Member]
Segment Reporting Information [Line Items]
Revenues	8,073	22,989
Gross profit	5,016	17,757
Interest expense	1,255	3,266
Net income (loss) before taxes	3,761	14,491
Total [Member]
Segment Reporting Information [Line Items]
Revenues	2,153,443	2,164,554
Gross profit	835,307	935,427
Interest expense	10,150	10,535
Net income (loss) before taxes	$ (372,705)	$ (68,972)

v3.24.1.1.u2

BUSINESS SEGMENTS (Details Narrative)	Mar. 31, 2024 USD ($)
Segment Reporting [Abstract]
Rentals segment	$ 185,549
Rentals segment remainder	$ 8,142,821

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