NOTES TO FINANCIAL STATEMENTS
NOTE 1 Organization & Description of Business
The Company was incorporated in the State of Nevada on December 10, 1999 as Silver River Ventures, Inc. On February 24, 2006, the Company completed the acquisition of BioForce Nanosciences Holdings Inc. (BioForce), a Delaware corporation, and changed the corporate name at that time. The acquisition was made pursuant to an agreement entered into on November 30, 2005 ("Merger Agreement"), whereby we agreed to merge our newly created, wholly owned subsidiary, Silver River Acquisitions, Inc., with and into BioForce, with BioForce being the surviving entity. The Companys mission is to become a leading provider of vitamin, mineral and other nutritional supplements, powders and beverages, formulated to promote a healthier lifestyle for active individuals in all age ranges.
NOTE 2 Summary of Significant Accounting Policies
Basis of Presentation
The Companys financial statements have been prepared and presented in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP).
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash
At December 31, 2018 and 2017, the Companys cash consisted of the following:
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December 31,
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2018
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2017
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Checking Account
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$ 28,788
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$ 12,220
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Cash on Hand
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605
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2,105
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Total Cash
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$ 29,393
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$ 14,325
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Accounts Receivable
The Company considers accounts receivable to be fully collectible. Accordingly, no allowance for doubtful accounts is required. If amounts become uncollectible they will be charged to operations when that determination is made.
Earnings (Loss) per Share
Earnings (loss) per share of common stock are computed in accordance with FASB ASC 260 Earnings per Share. Basic earnings (loss) per share are computed by dividing income or loss available to common shareholders by the weighted-average number of common shares outstanding for each period. Diluted earnings per share are calculated by adjusting the weighted average number of shares outstanding assuming conversion of all potentially dilutive stock options, warrants and convertible securities, if dilutive. Common stock equivalents that are anti-dilutive are excluded from both diluted weighted average number of common shares outstanding and diluted earnings (loss) per share.
F-7
BIOFORCE NANOSCIENCES HOLDINGS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 2 Summary of Significant Accounting Policies - continued
Stock-Based Compensation
We periodically issue shares of our common stock to non-employees in exchange for goods and services. We account for stock issued to non-employees in accordance with ASC 505-50,
Equity
, whereas the value of the stock compensation is based upon the measurement date as determined at either (a) the date at which a performance commitment is reached, or (b) at the date at which the necessary performance to earn the equity instruments is complete.
Fair Value of Financial Instruments
The estimated fair values for financial instruments are determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The carrying amounts of accounts payable, accrued liabilities, and notes payable approximate fair value given their short term nature or effective interest rates.
The estimated fair values for financial instruments are determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The carrying amounts of accounts payable and accrued liabilities approximate fair value given their short term nature or effective interest rates.
Revenue Recognition
Beginning January 1, 2018, the Company implemented ASC 606,
Revenue from Contracts with Customers
. Although the new revenue standard is expected to have an immaterial impact, if any, on our ongoing net income, we did implement changes to our processes related to revenue recognition and the control activities within them. These included the development of new policies based on the five-step model provided in the new revenue standard, ongoing contract review requirements, and gathering of information provided for disclosures.
The Company recognizes revenue and cost of goods sold from product sales or services rendered when control of the promised goods are transferred to our clients in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods and services. To achieve this core principle, we apply the following five steps: identify the contract with the client, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to performance obligations in the contract and recognize revenues when or as the Company satisfies a performance obligation.
Inventory.
Inventory is carried at the lower of cost or (net realizable value), using last- in, first-out method of determining cost. The Company only orders inventory once a sales invoice is obtained. Inventory consists of finished goods of the BioForce Eclipse supplement, shipped from our private-label.
All existing inventory is considered current and usable and no reserve for obsolescence was carried for the years ended December 31, 2018 and 2017.
Derivative Instruments
The Company evaluates its convertible debt, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 810-10-05-4 of the FASB Accounting Standards Codification and paragraph 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the Statement of Operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity.
In circumstances where the embedded conversion option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single, compound derivative instrument.
The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Equity instruments that are initially classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected within 12 months of the balance sheet date. As of December 31, 2018 and 2017 there were no derivative liabilities.
F-8
BIOFORCE NANOSCIENCES HOLDINGS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 3 Recently Issued Accounting Standards
The Company has implemented all new accounting pronouncements that are in effect and is evaluating any that may impact its financial statements, including revenue recognition. The Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
NOTE 4 Prepaid Expenses
Prepaid expenses consist of the following at December 31, 2018 and 2017:
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December 31,
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2018
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2017
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Filing Fees
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$
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$ 2,083
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Total Prepaid Expenses
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$
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$ 2,083
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NOTE 5 Going Concern
The Companys financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has reported recurring losses from operations. As a result, there is an accumulated deficit at December 31, 2018 and 2017.
While the Company is attempting to continue operations and generate revenues, the Companys cash position may not be significant enough to support the Companys daily operations. Management believes that the actions presently being taken to further implement the Companys business plan; to expand sales with a dynamic marketing campaign and generate revenues provide the opportunity for the Company to continue as a going concern. While the Company believes in the viability of its strategy to generate revenues and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Companys ability to further implement its business plan and generate revenues.
NOTE 6 Related Party Transactions
The Companys Director, Secretary and Acting CFO, Richard Kaiser, is the operator of Yes International, a full-service investor relations firm. He handles duties of the Company regarding his officer capacities as the Secretary and Acting CFO, but also provides investor relations services through Yes International for the Company at no charge.
During the year ended December 31, 2018 and 2017, a majority shareholder and the CFO paid all expenses of the Company in the amount of $77,533 and $25,898, respectively. These amounts paid will not be reimbursed to the shareholder or the CFO; therefore, additional paid in capital was increased by $77,533 and $25,898 respectively for the years ended December 31, 2018 and 2017.
NOTE 7 Stock
Preferred Stock
Preferred stock consists of 100,000,000 shares authorized at $0.001 par value. At December 31, 2018 and 2017 there were -0- shares issued and outstanding. On December 5, 2017, the Company amended its Articles of Incorporation in order to increase authorized preferred stock to 100,000,000 shares from 50,000,000.
Common Stock
Common stock consists of 900,000,000 shares authorized at $0.001 par value. At December 31, 2018 and 2017, there were 76,308,587 and 76,295,171 shares issued and outstanding, respectively. On December 5, 2017, the Company amended its Articles of Incorporation in order to increase authorized common stock to 900,000,000 shares.
During the year ended December 31, 2017, the Company issued 188,000 shares of common stock in exchange for product payment that was recorded in accounts payable in the amount of $11,280. The fair value of the shares issued was based on the market price of the Companys common stock on the measurement date.
During the year ended December 31, 2018, the Company issued 13,416 shares of common stock in exchange for product payment that was recorded in accounts payable in the amount of $11,808. The fair value of the shares issued was based on the market price of the Companys common stock on the measurement date which was an overpayment of the accounts payable to the vendor. The overpayment of $998 is included in loss on liability settlement in the statement of operations at December 31, 2018.
NOTE 8 Commitments and Contingencies
The Company has no commitments and contingencies.
F-9
BIOFORCE NANOSCIENCES HOLDINGS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 9 Concentrations
For the year ended December 31, 2018, the Companys sales were with one (1) customer and amounted to $16,310. For the year ended December 31, 2018, the Companys purchases were with one (1) vendor and amounted to $11,645.
NOTE 10 Income Taxes
Income taxes are computed based on Net income (loss) provided in the financial statements at federal and state applicable rates. Income tax expense at December 31, 2018 and 2017 was $-0- due to the Companys net loss.
The effective income tax rate of 0% for the years ended December 31, 2018 and 2017 differed from the statutory rate, due primarily to net operating losses incurred by the Company in the respective periods. For the year ended December 31, 2018 a tax benefit of approximately $18,300 would have been generated. For the year ended December 31, 2017 a tax benefit of approximately $6,600 would have been generated. However, all benefits have been fully offset through an allowance account due to the uncertainty of the utilization of the net operating losses. As of December 31, 2018 the Company had net operating losses of approximately $67,700 that would result in a deferred tax asset of approximately $18,300. However, the Company has established a valuation allowance in the full amount of the deferred tax asset due to the uncertainty of the utilization of operating losses in future periods.
NOTE 11 Subsequent Events
On January 23, 2019 the board of directors issued a resolution to issue 4,626 shares to pay a vendors bill of $4,080 included in accounts payable at December 31, 2018.
F-10