Significant Accounting Policies | 6 Months Ended |
Dec. 31, 2014 |
Notes to Financial Statements | |
2. Significant Accounting Policies | Basis of Presentation |
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The accompanying condensed financial statements of SnackHealthy, Inc. for the three and six months ended December 31, 2014 and 2013 are unaudited and, in the opinion of management, contain all adjustments that are of a normal and recurring nature necessary to present fairly the financial position and results of operations for such periods. These condensed financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared on an accrual basis in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) have been condensed or omitted pursuant to SEC regulations. The condensed financial statements should be read in conjunction with the consolidated financial statements and related notes contained in the Company’s 2014 Annual Report on Form 10-K filed on October 27, 2014. The results of operations for the three and six months ended December 31, 2014 are not necessarily indicative of the results expected for the year ended June 30, 2015 or of other future periods. |
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Principles of Consolidation |
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The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary SnackHealthy, Inc. until its dissolution effective October 4, 2013. All significant inter–company transactions and balances have been eliminated in consolidation |
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Estimates |
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The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. |
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Cash and Cash Equivalents |
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The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents. |
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Inventory |
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Inventory comprises packaged healthy snacks ready for final sale, and is stated at the lower of cost or market value. Cost is determined by the first-in, first-out method. |
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Financial Instruments |
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The carrying value of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, and due to related parties, as reported in the accompanying balance sheets, approximates fair value due to the short term nature of these financial instruments. |
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Property and Equipment |
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Property and equipment are stated at cost and depreciated on the straight-line method over the estimated life of the asset, which is three to seven years. |
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Websites Development Cost |
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The Company has adopted the provisions of FASB Accounting Standards Codification No. 350 Intangible-Goodwill and Other. Costs incurred in the planning state of a websites are expensed, while costs incurred in the development stage are capitalized and amortized over the estimated three-year life of the asset. All website development costs have been totally amortized at December 31, 2014. |
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Other Assets |
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The drink license is being amortized over three years. |
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Long-Lived Assets |
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In accordance with ASC 350, the Company regularly reviews the carrying value of intangible and other long-lived assets for the existence of facts or circumstances, both internally and externally, that may suggest impairment. If impairment testing indicates a lack of recoverability, an impairment loss is recognized by the Company if the carrying amount of a long-lived asset exceeds its fair value. |
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Income Taxes |
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The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”) Income Taxes. Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740-10-25, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. |
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Revenue Recognition |
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Revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, products are shipped, which is when title and risk of loss pass to the customer and collectability of the amount is reasonably assured. Specifically, revenue is recognized when products are shipped, which is when title and risk of loss pass to the customer. The Company classifies selling discounts and rebates, if any, as a reduction of revenue. |
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Advertising Costs |
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The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred no advertising expenses during the three and six month periods ended December 31, 2014 and 2013. |
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Stock-Based Compensation |
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In December 2004, the FASB issued FASB Accounting Standards Codification No. 718, Compensation – Stock Compensation. Under FASB Accounting Standards Codification No. 718, companies are required to measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which employees are required to provide services. Share-based compensation arrangements include stock options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans. As such, compensation cost is measured on the date of grant at their fair value. Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant. The Company applies this statement prospectively. |
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Equity instruments (“instruments”) issued to other than employees are recorded on the basis of the fair value of the instruments, as required by FASB Accounting Standards Codification No. 718. FASB Accounting Standards Codification No. 505, Equity Based Payments to Non-Employees defines the measurement date and recognition period for such instruments. In general, the measurement date is when either a (a) performance commitment, as defined, is reached or (b) the earlier of (i) the non-employee performance is complete or (ii) the instruments are vested. The measured value related to the instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in the FASB Accounting Standards Codification. |
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Basic and Diluted Net Loss per Common Share |
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Net Loss per Common Share is computed pursuant to FASB Accounting Standards Codification No. 260, Earnings per Share. Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed in the same way as for Basic net loss. |
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At December 31, 2014 the Company had 4,716,000 common shares remaining to be issued in satisfaction of the settlement agreement. These shares have not been included in the number diluted shares because their effect would be anti-dilutive as the Company realized losses all periods presented in these financial statements. |
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Reclassifications |
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Certain amounts previously presented for prior year have been reclassified. The reclassifications had no effect on net loss, total assets, or stockholders' deficit. |
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Recent Accounting Pronouncements |
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The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations. |