Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |
Oct. 31, 2018 | Feb. 19, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | INNOVATIVE DESIGNS INC | |
Entity Central Index Key | 0001190370 | |
Document Type | 10-K/A | |
Document Period End Date | Oct. 31, 2018 | |
Amendment Flag | true | |
Amendment description | The purpose of this Amendment No. 1 to Innovative Designs, Inc. Annual Report on Form 10-K for the fiscal year ended October 31, 2018 is to amend the report of independent registered public accounting firm and the financial statements and the Management’s Discussion and Analysis of Financial Condition and Results of Operations. The report of independent registered public accounting firm originally filed with the Form 10-K did not contain the independent registered public accounting form’s electronic signature. The electronic signature is included on the report of independent registered registered public accounting firm in the Form 10-K/A. We are filing this Amendment No. 1 to reflect the restatement of our financial statements contained herein. During April of 2019, management of the Company concluded that because of an error in calculating costs for House Wrap that was produced during the current fiscal year, the Company should restate its previously issued financial statements for the fiscal year ended October 31, 2018. Please see Note 1 – Restatement contained in the Notes to the Financial Statements appearing in this Form 10-K/A Amendment 1 which further describes the effect of these restatements. No other changes have been made to the Form 10-K. This Amendment No. 1 to the For 10-K is presented as of the filing date of the original Form 10-K and does not modify or update in any way the disclosures made in the original Form 10-K. Pursuant to Rule 12b-15 under the Securities and Exchange Act of 1934, as amended, this Form 10-K/A includes new certifications by our principle executive officer and principal financial officer under Sections 302 and 906 of the Sarbanes-Oxley Act of 2002. Except for the items noted above no other information included in the Company’s original Form 10-K is being amended by this Form 10-K/A. | |
Current Fiscal Year End Date | --10-31 | |
Entity a Well-known Seasoned Issuer | No | |
Entity a Voluntary Filer | No | |
Entity's Reporting Status Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity File Number | 000-51791 | |
Entity Public Float | $ 1,614,466 | |
Entity Common Stock, Shares Outstanding | 28,149,560 | |
Document Fiscal Period Focus | FY | |
Document Fiscal Year Focus | 2018 |
BALANCE SHEETS
BALANCE SHEETS - USD ($) | Oct. 31, 2018 | Oct. 31, 2017 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 112,203 | $ 214,871 |
Accounts receivable - Net of allowance for doubtful accounts of $9,320 as of October 31, 2018 and $0 as of October 31, 2017 | 13,455 | 23,805 |
Inventory - net of inventory reserve of $75,468 as of October 31, 2018 and $51,000 as of October 31, 2017, respectively | 721,262 | 729,845 |
Inventory on consignment | 1,625 | 1,624 |
Deposits on inventory | 57,330 | 70,000 |
Prepaid expenses | 11,669 | 14,653 |
Total current assets | 917,544 | 1,054,798 |
PROPERTY AND EQUIPMENT - NET | 131,532 | 160,862 |
OTHER ASSETS | ||
Advance to employee | 8,200 | 4,000 |
Deposit on equipment | 617,000 | 617,000 |
TOTAL OTHER ASSETS | 625,200 | 621,000 |
TOTAL ASSETS | 1,674,276 | 1,836,660 |
CURRENT LIABILITIES | ||
Accounts payable | 194,963 | 129,278 |
Current portion of notes payable | 18,628 | 18,096 |
Current portion of related party debt | 0 | |
Accrued interest expense | 22,885 | 44,184 |
Due to stockholders | 145,350 | 118,500 |
Accrued expenses | 10,775 | 25,102 |
Total current liabilities | 392,601 | 335,160 |
LONG TERM LIABILITIES | ||
Long-term portion of notes payable | 100,858 | 119,262 |
TOTAL LIABILITIES | 493,459 | 454,422 |
STOCKHOLDERS' EQUITY | ||
Common stock, $0.0001 par value, 100,800,000 and 100,000,000 shares authorized as of October 31, 2018 and 2017, and 27,789,560 and 26,392,310 issued and outstanding as of October 31, 2018 and 2017, respectively | 2,780 | 2,639 |
Additional paid-in capital | 10,106,731 | 9,725,412 |
Accumulated deficit | (8,928,694) | (8,345,812) |
Total stockholders' equity | 1,180,817 | 1,382,239 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 1,674,276 | $ 1,836,661 |
BALANCE SHEETS (Parenthetical)
BALANCE SHEETS (Parenthetical) - USD ($) | Oct. 31, 2018 | Oct. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 9,320 | $ 0 |
Inventory obsolete reserve | $ 75,468 | $ 51,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 100,800,000 | 100,000,000 |
Common stock, issued | 27,789,560 | 26,392,310 |
Common stock, outstanding | 27,789,560 | 26,392,310 |
STATEMENTS OF OPERATIONS
STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Income Statement [Abstract] | ||
REVENUES - NET OF RETURNS AND ALLOWANCES | $ 249,682 | $ 367,955 |
OPERATING EXPENSES | ||
Cost of sales | 188,791 | 216,250 |
Selling, general and administrative expenses | 648,363 | 755,836 |
LOSS FROM OPERATIONS | (587,472) | (604,131) |
OTHER EXPENSE | ||
Other income | 28,284 | |
Other expense | (1,034) | (4,846) |
Interest expense | (22,660) | (24,078) |
TOTAL OTHER EXPENSE | 4,590 | (28,924) |
NET LOSS | $ (582,882) | $ (633,055) |
Basic | ||
Net Loss Per Common Share (in dollars per share) | $ (0.021) | $ (0.025) |
Weighted Average Number of Common Shares Outstanding (in shares) | 27,122,315 | 25,582,984 |
Statement of Shareholders' Equi
Statement of Shareholders' Equity - USD ($) | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Balance at beginning at Oct. 31, 2016 | $ 2,537 | $ 9,455,674 | $ (7,712,757) | $ 1,745,454 |
Balance at beginning (in shares) at Oct. 31, 2016 | 25,370,310 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Shares issued for services | $ 30 | 97,670 | 97,700 | |
Shares issued for services (in shares) | 300,000 | |||
Sale of stock | $ 72 | 172,068 | 172,140 | |
Sale of stock (in shares) | 722,000 | |||
Net loss | (633,055) | (633,055) | ||
Balance at end at Oct. 31, 2017 | $ 2,639 | 9,725,412 | (8,345,812) | 1,382,239 |
Balance at end (in shares) at Oct. 31, 2017 | 26,392,310 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Shares issued for services | $ 24 | 69,876 | 69,900 | |
Shares issued for services (in shares) | 240,000 | |||
Sale of stock | $ 117 | 311,443 | 311,560 | |
Sale of stock (in shares) | 1,157,250 | |||
Net loss | (582,882) | (582,882) | ||
Balance at end at Oct. 31, 2018 | $ 2,780 | $ 10,106,731 | $ (8,928,694) | $ 1,180,817 |
Balance at end (in shares) at Oct. 31, 2018 | 27,789,560 |
STATEMENTS OF CASH FLOWS
STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (582,882) | $ (633,055) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Allowance for doubtful accounts | 9,320 | |
Allowance for obsolete inventory | 24,468 | 11,000 |
Common stock issued for services | 69,900 | 97,700 |
Depreciation | 33,588 | 30,963 |
(Increase) decrease from changes in: | ||
Accounts receivable | 100 | 48,338 |
Inventory | (15,885) | 195,742 |
Deposits on inventory | 12,670 | (70,000) |
Prepaid expenses | 2,984 | 2,832 |
Advance to employees | (4,200) | |
Increase (decrease) from changes in: | ||
Accounts payable | 65,685 | 12,766 |
Accrued interest expense | (21,299) | (5,701) |
Accrued expenses | (14,327) | (68,231) |
Net cash used in operating activities | (419,878) | (377,646) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (4,258) | (14,900) |
Net cash used in investing activities | (4,258) | (14,900) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from sale of stock | 311,560 | 172,140 |
Proceeds from stockholder advances | 53,350 | |
Proceeds from stockholders advances | 43,172 | |
Payments on stockholder advances | (26,500) | (43,672) |
Payments on notes payable | (17,872) | (67,000) |
Payments on notes payable - related party | ||
Proceeds from notes payable | ||
Net cash provided by financing activities | 320,538 | 104,640 |
Net decrease in cash and cash equivalents | (103,598) | (287,906) |
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR | 214,871 | 502,777 |
CASH AND CASH EQUIVALENTS, END OF THE YEAR | 112,203 | 214,871 |
Supplemental disclosure of cash flow information: | ||
Stock issuance for debt and interest conversion | ||
Cash paid for interest | $ 43,959 | $ 29,779 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Oct. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations We operate two reportable segments: Apparel and House Wrap. Our apparel segment offers a wide variety of extreme cold weather apparel and related items. Our House Wrap segment offers our INSULTEX House Wrap which has an R-value of 3 and an R-value of 6 and our own seam tape. Basis of Accounting Fiscal Year End Estimates Cash and Cash Equivalents Revenue Recognition Fair Value of Financial Instruments Estimated Uncollectable Accounts Inventory During the fiscal year ended October 31, 2010, the Company discontinued its hunting and swimming lines of apparel. A reserve balance of approximately $75,000 and $51,000 was recorded as of October 31, 2018 and 2017, respectively. The reserve is evaluated on a quarterly basis and adjusted accordingly. Deposits on Inventory Property and Equipment For financial reporting purposes, depreciation is primarily provided on the straight-line method over the estimated useful lives of depreciable assets, which range from 5 to 7 years. Deposits on Equipment Impairment of Long-lived Assets Income Taxes Income Taxes In addition, ASC 740 clarifies the accounting for uncertainty in tax positions and requires that a company recognize in its financial statements the impact of a tax position, only if it is more likely than not of being sustained upon examination, based on the technical merits of the position. The Company recognized no material adjustments to the liability for unrecognized income tax benefits. The Company’s policy regarding the classification of interest and penalties recognized in accordance with ASC 740 is to classify them as income tax expense in its financial statements, if applicable. The Company is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. Concentration of Credit Risk Shipping and Handling Net Income Per Common Share Earnings per Share Stock-Based Compensation Compensation - Stock Compensation Recent Accounting Standards Update In February 2016, the FASB issued ASU 2016-02, “Leases”, which added a requirement than an entity, when acting as a lessee, should recognize in the balance sheet a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term. For public business entities, ASU 2016-02 is effective for fiscal years beginning after December 15, 2019 including interim periods within fiscal years beginning after December 15, 2020. Early application is permitted. Management is determining if the adoption of this guidance will have any impact on the financial statements and notes thereto. Restatement |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Oct. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | 2. PROPERTY AND EQUIPMENT Property and equipment are summarized by major classifications as follows: 2018 2017 Equipment $ 221,835 $ 217,577 Containers 14,900 14,900 Furniture and fixtures 11,083 11,083 Leasehold improvements 4,806 4,806 Automobile 9,121 9,121 261,745 257,487 Less accumulated depreciation 130,213 96,265 Property and equipment - net $ 131,532 $ 161,222 |
BORROWINGS
BORROWINGS | 12 Months Ended |
Oct. 31, 2018 | |
Debt Disclosure [Abstract] | |
BORROWINGS | 3. BORROWINGS Borrowings at October 31, 2018 and 2017 consisted of the following: 2018 2017 Due to Stockholders Note Payable $8,000 - Roberta Riccelli, February 2012. Due June 17, 2012; interest is 10% for 120 days. Note was extended through a verbal agreement with no set maturity date. $ 5,000 $ 5,000 Note Payable $20,000 - Corinthian Development, January 15, 2013. Due May 15, 2013; payable on demand; interest is 10%; Note was extended through a verbal agreement with no set maturity date. 10,000 10,000 Note Payable $25,000 - Sol & Tina Waxman Family Foundation, March 2015. Amended January 15, 2018 for $30,250; Due January 5, 2019; interest is 10%. 30,250 27,500 Note Payable $90,000 - Joseph Riccelli, Sr., May 2013. Due November 22, 2013; interest is 10% for 180 days. Note was extended through a verbal agreement with no set maturity date. 13,500 40,000 Note Payable $50,000 - Lawrence Fraser, May 29, 2018. Due June 1, 2019; interest is 10% annually. Note was extended through a verbal agreement with no set maturity date. 50,000 — Note Payable $40,672 - Riccelli Properties, August 7, 2017. Due February 7, 2018; interest is 10%. 36,600 36,000 Total Due to Stockholders $ 145,350 $ 118,500 Notes Payable Note Payable - U.S. Small Business Administration. Due July 2035; payable in monthly installments of $1,820 including interest at 2.9% annum. $ 119,486 $ 137,358 Total Borrowings 264,836 255,858 Less Due to Stockholders 145,350 118,500 Less Current Portion of Notes Payable 18,628 18,096 Total Long Term Portion of Notes Payable $ 100,858 $ 119,262 Maturities of long-term debt are as follows: Year Ending Notes October 31 Stockholders Payable Amount Due 2019 $ 145,350 18,628 $ 163,978 2020 — 19,168 19,168 2021 — 19,739 19,739 2022 — 20,319 20,319 2023 — 20,916 20,916 Thereafter — 20,716 20,716 Total $ 145,350 $ 119,486 $ 264,836 DUE TO STOCKHOLDERS In February 2012, the Company entered into a note payable with Roberta Riccelli for $8,000. This loan was to be used to fund operations of the Company. This loan is due on demand, including interest at 10% for 120 days. This note was extended through a verbal agreement. The loan balance as of October 31, 2018 and 2017 was $5,000. In January 2013, the Company entered into a note payable with Corinthian Development for $20,000. This loan was to be used to fund operations of the Company. This loan is due on demand, including interest at 10% with an original repayment date of May 2013. This note was extended through a verbal agreement. The loan balance at October 31, 2018 and 2017 was $10,000. In May 2013, the Company entered into a note payable with the Sol & Tina Waxman Family Foundation for $100,000. This loan was to be used to fund operations of the Company. The Company’s CEO has pledged 250,000 shares of his stock, as collateral. This note is also personally guaranteed by the Company’s CEO. There have been various subsequent amendments to the original note agreement. The most recent amendment was made in January 2018 for the balance of $30,250. Interest is payable at 10% and total payment is due by January 5, 2019. The loan balance at October 31, 2018 and 2017 was $30,250 and $27,500, respectively. In May 2013, the Company entered into a note payable with its CEO, Joseph Riccelli, for $90,000. This loan was to be used to fund operations of the Company. This loan is due on demand, including interest at 10% with an original repayment date of November 2013. This note was extended through a verbal agreement. The loan balance at October 31, 2018 and 2017 was $13,500 and $40,000, respectively. During May 2018, the Company entered into a note payable agreement with Lawrence Fraser for $50,000. This loan was used to fund the operations of the Company. This loan is due on June 1, 2019, including interest at 10%. The loan balance at October 31, 2018 was $50,000. During August 2017, the Company entered into a note payable agreement with Riccelli Properties, which is wholly owned and operated by the Company’s CEO, Joseph Riccelli, in the amount of $40,672. This amount reflects payments made by Riccelli Properties on the Small Business Association promissory note. Riccelli Properties sold the real estate that was collateral on the promissory note. The note has a term of 6 months and an interest rate of 10%. This loan balance at October 31, 2018 and 2017 was $36,600 and $36,000, respectively. NOTES PAYABLE In July 2005, the Company was approved for a low interest promissory note from the U.S. Small Business Administration in the amount of $280,100. In January 2006 the Company amended the promissory note with the Small Business Administration increasing the principal balance to $430,500. The note bears an annual interest rate of 2.9% and matures on July 13, 2035. Monthly payments, including principal and interest, of $1,820 are due monthly. A payment was made on the note of $40,672 during the year ended October 31, 2017 due to the sale of real estate by Riccelli Properties that was collateral on the promissory note. The loan balance was $119,486 and $137,358 at October 31, 2018 and 2017, respectively. This note is guaranteed by the Company’s CEO. |
EXCLUSIVE LICENSING AND MANUFAC
EXCLUSIVE LICENSING AND MANUFACTURING AGREEMENT | 12 Months Ended |
Oct. 31, 2018 | |
Exclusive Licensing And Manufacturing Agreement | |
EXCLUSIVE LICENSING AND MANUFACTURING AGREEMENT | 4. EXCLUSIVE LICENSING AND MANUFACTURING AGREEMENT On April 16, 2006, the Company entered into an Exclusive License and Manufacturing Agreement (the “Agreement”) with the Ketut Group, with an effective date of April 1, 2006, whereby the Company acquired an exclusive license to develop, use, sell, manufacture and market products related to or utilizing INSULTEX™, Korean Patent Number, (0426429) or any INSULTEX Technology. At the behest of the Board of Directors, the INSULTEX trademark was chosen as the mark to identify the product utilized by Innovative since its inception and was originally registered by Joseph Riccelli on February 17, 2005. The new trademark, intended to avoid confusion arising from the use of the old Eliotex trademark in association with a new, subsequent, different and separately-patented product, was assigned by Mr. Riccelli to the Company on April 25, 2006, with that assignment to become effective upon final approval of the Statement of Use by the United States Patent and Trademark Office. The License was awarded by the Korean inventor, an individual who is part of the Ketut Group, and the manufacturer of INSULTEX™. The Company received an exclusive forty (40) year worldwide license, except for Korea and Japan, with an initial term of ten (10) years and an option to renew the License for up to three (3) successive ten (10) year terms. The first ten-year option was exercised. Additionally, the Company was granted the exclusive rights to any current or future inventions, improvements, discoveries, patent applications and letters of patent which the Ketut Group controls or may control related to INSULTEX™. Furthermore, the Company has the right to grant sub-licenses to other manufacturers for the use of INSULTEX™ or any INSULTEX Technology. |
CONCENTRATIONS
CONCENTRATIONS | 12 Months Ended |
Oct. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS | 5. CONCENTRATIONS Revenues from three customers were approximately 51% and 34% of the Company’s revenues for the fiscal years ended October 31, 2018 and 2017, respectively. Three customers accounted for approximately 86% and 71% of the Company’s accounts receivable as of October 31, 2018 and 2017, respectively. The Company only has one supplier of INSULTEX, the special material which is manufactured within the apparel of the Company. Additionally, the Company only has one manufacturer that produces the apparel on behalf of the Company, located in Indonesia, and one manufacturer that produces house wrap on behalf of the Company in Massachusetts. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Oct. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 6. INCOME TAXES In prior years, the Company incurred net operating losses and, accordingly, no provision for income taxes has been recorded. In addition, no benefit for income taxes has been recorded due to the uncertainty of the realization of any tax assets. For the 2017 tax year, fiscal year end October 31, 2018, the Company had net operating loss carryforwards of approximately $5,700,000 for tax purposes. The carryforwards are available to offset taxable income of future periods and begin to expire after the Company’s 2037 tax year, fiscal year end October 31, 2038. Effective for tax years ending in 2018 or later, net operating losses cannot be carried back but can be carried forward to future tax years indefinitely. Realization of the deferred tax benefit related to the carryforward is dependent upon the Company generating sufficient taxable income in the future, against which the loss can be offset, which is not guaranteed Deferred income taxes reflect the net tax effect of temporary differences between carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as tax benefits of net operating loss carryforwards. The significant components of the Company’s deferred tax assets and liabilities relate to the following: 2018 2017 Net operating loss carryforward $ 2,554,625 $ 2,000,000 Depreciation — — Net deferred tax assets before valuation allowance 2,554,625 2,000,000 Less: Valuation allowance (2,554,625 ) (2,000,000 ) Net deferred tax assets $ — $ — For financial reporting purposes, the Company has incurred losses in previous years. Based on the available objective evidence, including the Company’s previous losses, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets as of October 31, 2018 and 2017, respectively. The effective income tax rate varied from the statutory Federal tax rate as follows: 2018 2017 Federal statutory rate 21 % 34 % Effect of net operating losses (21 %) (34 %) Effective income tax rate — — The Company’s effective tax rate is lower than what would be expected if the federal statutory rate were applied to income (loss) before taxes, primarily due to net operating loss carryforwards. On December 22, 2017, the President signed into law the Tax Cuts and Jobs Act (H.R.1) (the “Act”). The Act includes a number of changes to existing tax law impacting businesses including, among other things, a permanent reduction in the corporate income tax rate from 34% to 21%. The rate reduction applies to tax years beginning on or after January 1, 2018. As a result of the reduction in the corporate income tax rate under the Act, the Company had to revalue its net deferred tax liability, for the fiscal year ended October 31, 2017. The did not change the Company’s net income for the fiscal year ended October 31, 2018. |
COMMITMENTS
COMMITMENTS | 12 Months Ended |
Oct. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS | 7. COMMITMENTS The Company leases its executive offices/warehouse space from Frank Riccelli, a stockholder and brother of our Chief Executive Officer, for $3,500 per month. The lease is based on a verbal agreement with month to month terms. For the fiscal years ended October 31, 2018 and 2017 rent expense totaled $42,000. |
QUARTERLY FINANCIAL INFORMATION
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | 12 Months Ended |
Oct. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | 8. QUARTERLY FINANCIAL INFORMATION (UNAUDITED) First Second Third Fourth 2018 Quarter Quarter Quarter Quarter Year Revenue $ 116,203 $ 17,163 $ 34,149 $ 82,167 $ 249,682 Loss from operations $ (138,990 ) $ (155,805 ) $ (145,870 ) $ (146,807 ) $ (587,472 ) Net loss $ (146,249 ) $ (158,023 ) $ (154,221 ) $ (124,389 ) $ (582,882 ) Weighted average shares outstanding 26,732,245 27,033,872 27,228,038 27,492,223 27,122,315 Basic loss per share (0.005 ) (0.006 ) (0.006 ) (0.005 ) (0.021 ) First Second Third Fourth 2017 Quarter Quarter Quarter Quarter Year Revenue $ 169,210 $ 39,162 $ 41,811 $ 117,772 $ 367,955 Loss from $ (110,754 ) $ (157,147 ) $ (181,520 ) $ (154,710 ) $ (604,131 ) Net loss $ (119,240 ) $ (160,751 ) $ (186,966 ) $ (166,098 ) $ (633,055 ) Weighted average shares outstanding 25,370,310 25,396,265 25,616,962 25,942,310 2 Basic loss (0.005 ) (0.006 ) (0.007 ) (0.006 ) (0.025 ) |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Oct. 31, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | 9. SEGMENT INFORMATION We have organized our operations into two segments as discussed in Note 1 to the financial statements. We rely on an internal management reporting process that provides segment information for purposes of making financial decisions and allocating resources. The following tables present our business segment information for the fiscal years ending October 31, 2018 and 2017: 2018 2017 Revenues: Apparel $ 117,147 $ 183,661 Housewrap 132,535 184,294 Total Revenues $ 249,682 $ 367,955 Assets: Apparel $ 500,208 $ 677,566 Housewrap 1,202,325 1,159,095 Total $ 1,702,533 $ 1,836,661 Capital Expenditures: Apparel $ 4,258 $ — Housewrap — 14,900 Total $ 4,258 $ 14,900 Depreciation: Apparel $ 9,961 $ 7,336 Housewrap 23,627 23,627 Total $ 33,588 $ 30,963 |
COMMON STOCK
COMMON STOCK | 12 Months Ended |
Oct. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
COMMON STOCK | 10. COMMON STOCK During the quarter ended January 31, 2017, there was no stock sold or issued. During the quarter ended April 30, 2017, the Company issued 30,000 shares of common stock to one director for services performed during February 2017 valued at $7,500. The stock was issued at a price of $0.25 per share. Pursuant to Rule 12b-15 under the Securities and Exchange Act of 1934, as amended, this Form 10-Q includes new certifications by our principal executive officer and principal financial officer under Sections 302 and 906 of the Sarbanes-Oxley Act of 2002. During the quarter ended July 31, 2017, the Company issued 130,000 shares of common stock to two shareholders for services performed in April and May 2017 valued at $40,200 in total. The stock was issued at a price of $0.30 and $0.34 per share. Pursuant to Rule 12b-15 under the Securities and Exchange Act of 1934, as amended, this Form 10-Q includes new certifications by our principal executive officer and principal financial officer under Sections 302 and 906 of the Sarbanes-Oxley Act of 2002. Additionally, for the quarter ended July 31, 2017, the Company sold 217,000 shares of common stock to three previous stockholders for total proceeds of $40,590. The stock was issued at a price ranging from $0.18-$0.22 per share. We believe that Section 4(2) of the Securities Act of 1933, as amended, was available because these transactions did not involve a public offering and there was no general solicitation or general advertising involved in these transactions. We placed legends on the stock certificates stating that the securities were not registered under the Securities Act and set forth the restrictions on their transferability and sale. During the quarter ended October 31, 2017, the Company issued 140,000 shares of common stock to one shareholder and one individual for services performed in September and October 2017 valued at $50,000 in total. The stock was issued at a price of $0.25 and $0.40 per share. Pursuant to Rule 12b-15 under the Securities and Exchange Act of 1934, as amended, this Form 10-Q includes new certifications by our principal executive officer and principal financial officer under Sections 302 and 906 of the Sarbanes-Oxley Act of 2002. Additionally, for the quarter ended October 31, 2017, the Company sold 505,000 shares of common stock for total proceeds of $131,950. The stock was issued at a price ranging from $0.25 - $0.40 per share to three new investors and three stockholders. We believe that Section 4(2) of the Securities Act of 1933, as amended, was available because these transactions did not involve a public offering and there was no general solicitation or general advertising involved in these transactions. We placed legends on the stock certificates stating that the securities were not registered under the Securities Act and set forth the restrictions on their transferability and sale. During the quarter ended January 31, 2018, the Company issued 50,000 shares of common stock to one individual for services performed during December 2017 valued at $20,000. The stock was issued at a price of $0.40 per share. In addition, the Company sold 351,000 shares of common stock to three individuals for total proceeds of $111,560. The stock was issued at a price ranging from $0.30-$0.32 per share. During the quarter ended April 30, 2018, the Company issued 55,000 shares of common stock to two individuals for services performed in April 2018 valued at $9,900. The stock was issued at a price of $0.18 per share. In addition, the Company sold 356,250 shares of common stock to three individuals for total proceeds of $105,000. The stock was issued at a price ranging from $0.25-$0.32 per share. During the quarter ended July 31, 2018, the Company issued 5,000 shares of common stock to one individual for services performed in May 2018 valued at $1,000 in total. The stock was issued at a price of $0.20 per share. In addition, the Company sold 25,000 shares of common stock to one individual for total proceeds of $5,000. The stock was issued at a price of $0.20 per share. We believe that Section 4(2) of the Securities Act of 1933, as amended, was available because these transactions and the transaction cited above did not involve a public offering and there was no general solicitation or general advertising involved in these transactions. We placed legends on the stock certificates stating that the securities were not registered under the Securities Act and set forth the restrictions on their transferability and sale. During the quarter ended October 31, 2018, the Company issued 130,000 shares of common stock to two shareholders for services performed in September and October 2018 valued at $39,000 in total. The stock was issued at a price of $0.80 per share. Additionally, for the quarter ended October 31, 2018, the Company sold 425,000 shares of common stock for total proceeds of $90,000. The stock was issued at a price ranging from $0.20 - $0.25 per share to three stockholders. We believe that Section 4(2) of the Securities Act of 1933, as amended, was available because these transactions did not involve a public offering and there was no general solicitation or general advertising involved in these transactions. We placed legends on the stock certificates stating that the securities were not registered under the Securities Act and set forth the restrictions on their transferability and sale. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Oct. 31, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 11. RELATED PARTY TRANSACTIONS The Company has entered into various debt agreements with related parties. These agreements are classified as shareholder loans within Note 3 to the financial statements. The Company has entered into a verbal lease agreement as further discussed in Note 7 to the financial statements. |
LITIGATION
LITIGATION | 12 Months Ended |
Oct. 31, 2018 | |
Litigation | |
LITIGATION | 12. LITIGATION On November 4, 2016, the Federal Trade Commission (FTC) filed a complaint against the Company in the U.S. District Court Western District of Pennsylvania, number 16-1669. In the complaint, the FTC alleges that, among other matters, the Company does not have substantiation of claims made by the Company regarding the R value and energy efficiency of its INSULTEX House Wrap products. The complaint asks as redress of rescission of revenue the Company received from the sale of House Wrap and a permanent injunction. The parties are currently in the expert discovery phase. As a result of the partial federal government shutdown, a new trial date has been set for July 29, 2019. The Company strongly denies the allegation and intends to vigorously defend itself. It is the Company’s belief that the complaint is based on improper testing of the INSULTEX products using the wrong type of testing equipment. |
GOING CONCERN
GOING CONCERN | 12 Months Ended |
Oct. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GOING CONCERN | 13. GOING CONCERN The Company had a net loss of $582,882 and a negative cash flow from operations of $418,948 for the year ended October 31, 2018. In addition, the Company has an accumulated deficit of $8,928,694. Management of the Company has represented that they will be able to continue to support the Company’s cash needs through sales, sales of Company stock, and borrowings from private parties. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Oct. 31, 2018 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 14. SUBSEQUENT EVENTS In accordance with ASC Topic 855, “ Subsequent Events During January 2019, the Company sold 360,000 shares of stock to five individuals for total proceeds of $61,200. The stock was issued for $0.17 per share. Each Unit consisted of 60,000 shares of common stock and a warrant to purchase 60,000 shares of common stock. The strike price of the warrant was $.17 per share. The term was three years. The Company also agreed to register the shares and the shares underlying the warrants. Each Unit was priced at $10,200. Each purchaser was an “accredited investor”. The Company believes that Section 4(2) of the Securities Act of 1933, as amended, was available because these transactions did not involve a public offering and there was no general solicitation or general advertising involved in these transactions. The Company has placed legends on the stock certificates stating that the securities were not registered under the Securities Act and set forth the restrictions on their transferability and sale. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Oct. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Nature of Operations We operate two reportable segments: Apparel and House Wrap. Our apparel segment offers a wide variety of extreme cold weather apparel and related items. Our House Wrap segment offers our INSULTEX House Wrap which has an R-value of 3 and an R-value of 6 and our own seam tape. |
Basis of Accounting | Basis of Accounting |
Fiscal Year End | Fiscal Year End |
Estimates | Estimates |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Revenue Recognition | Revenue Recognition |
Fair Value of Financial Instruments | Fair Value of Financial Instruments |
Estimated Uncollectable Accounts | Estimated Uncollectable Accounts |
Inventory | Inventory During the fiscal year ended October 31, 2010, the Company discontinued its hunting and swimming lines of apparel. A reserve balance of approximately $75,000 and $51,000 was recorded as of October 31, 2018 and 2017, respectively. The reserve is evaluated on a quarterly basis and adjusted accordingly. |
Deposits on Inventory | Deposits on Inventory |
Property and Equipment | Property and Equipment For financial reporting purposes, depreciation is primarily provided on the straight-line method over the estimated useful lives of depreciable assets, which range from 5 to 7 years. |
Deposits on Equipment | Deposits on Equipment |
Impairment of Long-lived Assets | Impairment of Long-lived Assets |
Income Taxes | Income Taxes Income Taxes In addition, ASC 740 clarifies the accounting for uncertainty in tax positions and requires that a company recognize in its financial statements the impact of a tax position, only if it is more likely than not of being sustained upon examination, based on the technical merits of the position. The Company recognized no material adjustments to the liability for unrecognized income tax benefits. The Company’s policy regarding the classification of interest and penalties recognized in accordance with ASC 740 is to classify them as income tax expense in its financial statements, if applicable. The Company is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. |
Concentration of Credit Risk | Concentration of Credit Risk |
Shipping and Handling | Shipping and Handling |
Net Income Per Common Share | Net Income Per Common Share Earnings per Share |
Stock-Based Compensation | Stock-Based Compensation Compensation - Stock Compensation |
Recent Accounting Standards Update | Recent Accounting Standards Update In February 2016, the FASB issued ASU 2016-02, “Leases”, which added a requirement than an entity, when acting as a lessee, should recognize in the balance sheet a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term. For public business entities, ASU 2016-02 is effective for fiscal years beginning after December 15, 2019 including interim periods within fiscal years beginning after December 15, 2020. Early application is permitted. Management is determining if the adoption of this guidance will have any impact on the financial statements and notes thereto. |
Restatement | Restatement |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment summarized by major classifications | Property and equipment are summarized by major classifications as follows: 2018 2017 Equipment $ 221,835 $ 217,577 Containers 14,900 14,900 Furniture and fixtures 11,083 11,083 Leasehold improvements 4,806 4,806 Automobile 9,121 9,121 261,745 257,487 Less accumulated depreciation 130,213 96,265 Property and equipment - net $ 131,532 $ 161,222 |
BORROWINGS (Tables)
BORROWINGS (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of borrowings | Borrowings at October 31, 2018 and 2017 consisted of the following: 2018 2017 Due to Stockholders Note Payable $8,000 - Roberta Riccelli, February 2012. Due June 17, 2012; interest is 10% for 120 days. Note was extended through a verbal agreement with no set maturity date. $ 5,000 $ 5,000 Note Payable $20,000 - Corinthian Development, January 15, 2013. Due May 15, 2013; payable on demand; interest is 10%; Note was extended through a verbal agreement with no set maturity date. 10,000 10,000 Note Payable $25,000 - Sol & Tina Waxman Family Foundation, March 2015. Amended January 15, 2018 for $30,250; Due January 5, 2019; interest is 10%. 30,250 27,500 Note Payable $90,000 - Joseph Riccelli, Sr., May 2013. Due November 22, 2013; interest is 10% for 180 days. Note was extended through a verbal agreement with no set maturity date. 13,500 40,000 Note Payable $50,000 - Lawrence Fraser, May 29, 2018. Due June 1, 2019; interest is 10% annually. Note was extended through a verbal agreement with no set maturity date. 50,000 — Note Payable $40,672 - Riccelli Properties, August 7, 2017. Due February 7, 2018; interest is 10%. 36,600 36,000 Total Due to Stockholders $ 145,350 $ 118,500 Notes Payable Note Payable - U.S. Small Business Administration. Due July 2035; payable in monthly installments of $1,820 including interest at 2.9% annum. $ 119,486 $ 137,358 Total Borrowings 264,836 255,858 Less Due to Stockholders 145,350 118,500 Less Current Portion of Notes Payable 18,628 18,096 Total Long Term Portion of Notes Payable $ 100,858 $ 119,262 |
Schedule of long-term debt maturities | Maturities of long-term debt are as follows: Year Ending Notes October 31 Stockholders Payable Amount Due 2019 $ 145,350 18,628 $ 163,978 2020 — 19,168 19,168 2021 — 19,739 19,739 2022 — 20,319 20,319 2023 — 20,916 20,916 Thereafter — 20,716 20,716 Total $ 145,350 $ 119,486 $ 264,836 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of deferred tax assets and liabilities | The significant components of the Company’s deferred tax assets and liabilities relate to the following: 2018 2017 Net operating loss carryforward $ 2,554,625 $ 2,000,000 Depreciation — — Net deferred tax assets before valuation allowance 2,554,625 2,000,000 Less: Valuation allowance (2,554,625 ) (2,000,000 ) Net deferred tax assets $ — $ — |
Schedule of effective income tax rate varied from statutory federal tax rate | The effective income tax rate varied from the statutory Federal tax rate as follows: 2018 2017 Federal statutory rate 21 % 34 % Effect of net operating losses (21 %) (34 %) Effective income tax rate — — |
QUARTERLY FINANCIAL INFORMATI_2
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of quaterly financial information | First Second Third Fourth 2018 Quarter Quarter Quarter Quarter Year Revenue $ 116,203 $ 17,163 $ 34,149 $ 82,167 $ 249,682 Loss from operations $ (138,990 ) $ (155,805 ) $ (145,870 ) $ (146,807 ) $ (587,472 ) Net loss $ (146,249 ) $ (158,023 ) $ (154,221 ) $ (124,389 ) $ (582,882 ) Weighted average shares outstanding 26,732,245 27,033,872 27,228,038 27,492,223 27,122,315 Basic loss per share (0.005 ) (0.006 ) (0.006 ) (0.005 ) (0.021 ) First Second Third Fourth 2017 Quarter Quarter Quarter Quarter Year Revenue $ 169,210 $ 39,162 $ 41,811 $ 117,772 $ 367,955 Loss from $ (110,754 ) $ (157,147 ) $ (181,520 ) $ (154,710 ) $ (604,131 ) Net loss $ (119,240 ) $ (160,751 ) $ (186,966 ) $ (166,098 ) $ (633,055 ) Weighted average shares outstanding 25,370,310 25,396,265 25,616,962 25,942,310 2 Basic loss (0.005 ) (0.006 ) (0.007 ) (0.006 ) (0.025 ) |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Oct. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of business segment information | The following tables present our business segment information for the fiscal years ending October 31, 2018 and 2017: 2018 2017 Revenues: Apparel $ 117,147 $ 183,661 Housewrap 132,535 184,294 Total Revenues $ 249,682 $ 367,955 Assets: Apparel $ 500,208 $ 677,566 Housewrap 1,202,325 1,159,095 Total $ 1,702,533 $ 1,836,661 Capital Expenditures: Apparel $ 4,258 $ — Housewrap — 14,900 Total $ 4,258 $ 14,900 Depreciation: Apparel $ 9,961 $ 7,336 Housewrap 23,627 23,627 Total $ 33,588 $ 30,963 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narraive) | Jul. 12, 2016USD ($) | Oct. 31, 2018USD ($)SegmentInstallment | Oct. 31, 2017USD ($) |
Product Information [Line Items] | |||
Number of reportable segments | Segment | 2 | ||
Number of days for return policy | 5 days | ||
Return products from customers | $ 683 | $ 5,165 | |
Allowance | 9,320 | 0 | |
Inventory valuation reserves | 75,468 | 51,000 | |
Deposits on inventory | 57,330 | 70,000 | |
Purchase price machinery and equipment | $ 500,000 | ||
Number of installments | Installment | 4 | ||
Description of purchase price payment terms | The first installment of $300,000 is to be made at the execution of the agreement. The second installment of $200,000 is to be made when the machinery and equipment is ready to be shipped to the United States. The third installment of $100,000 is to be made once the machinery and equipment is producing INSULTEX, and the fourth and final installment of $100,000 is to be made after the first commercial production run of INSULTEX is completed. | ||
Advance payment for machinery and equipment | $ 100,000 | ||
Uninsured cash balances | 0 | 0 | |
Shipping and handling costs | 16,247 | 18,825 | |
FDIC insured coverage | 250,000 | ||
Inventory | 721,262 | 729,845 | |
Inventory overstated | 28,257 | ||
Decrese in inventory | $ (28,257) | ||
Minimum [Member] | |||
Product Information [Line Items] | |||
Estimated useful lives of property and equipment | 5 years | ||
Maximum [Member] | |||
Product Information [Line Items] | |||
Estimated useful lives of property and equipment | 7 years | ||
Hunting & Swimming Lines of Apparel [Member] | |||
Product Information [Line Items] | |||
Inventory valuation reserves | $ 75,000 | $ 51,000 | |
Ketut Jaya [Member] | |||
Product Information [Line Items] | |||
Purchase price machinery and equipment | $ 700,000 | ||
Shipping and handling costs | $ 17,000 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) | Oct. 31, 2018 | Oct. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment - gross | $ 261,745 | $ 257,487 |
Less accumulated depreciation | 130,213 | 96,265 |
Property and equipment - net | 131,532 | 160,862 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - gross | 221,835 | 217,577 |
Containers [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - gross | 14,900 | 14,900 |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - gross | 11,083 | 11,083 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - gross | 4,806 | 4,806 |
Automobile [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment - gross | $ 9,121 | $ 9,121 |
PROPERTY AND EQUIPMENT (Detai_2
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 33,588 | $ 30,963 |
BORROWINGS (Details)
BORROWINGS (Details) - USD ($) | 12 Months Ended | ||
Oct. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2006 | |
Debt Instrument [Line Items] | |||
Total Due to Stockholders | $ 145,350 | $ 118,500 | |
Total Borrowings | 264,836 | 255,858 | |
Less Due to Stockholders | 145,350 | 118,500 | |
Less Current Portion of Notes Payable | 18,628 | 18,096 | |
Total Long Term Portion of Notes Payable | 100,858 | 119,262 | |
2.9% Note Payable Due July 13, 2035 [Member] | U.S. Small Business Administration [Member] | |||
Debt Instrument [Line Items] | |||
Periodic installment | $ 1,820 | ||
Frequency of periodic payment | Monthly | ||
2.9% Note Payable Due July 13, 2035 [Member] | U.S. Small Business Administration [Member] | |||
Debt Instrument [Line Items] | |||
Face amount | $ 280,100 | ||
Periodic installment | $ 1,820 | ||
Frequency of periodic payment | Monthly | ||
Total Notes Payable | $ 119,486 | 137,358 | |
Roberta Riccelli [Member] | 10% Note Payable Due June 17, 2012 [Member] | |||
Debt Instrument [Line Items] | |||
Face amount | $ 8,000 | ||
Issuance date | Feb. 29, 2012 | ||
Maturity term | 120 days | ||
Description of maturity extended | Note was extended through a verbal agreement with no set maturity date. | ||
Total Due to Stockholders | $ 5,000 | 5,000 | |
Corinthian Development [Member] | 10% Note Payable Due May 15, 2013 [Member] | |||
Debt Instrument [Line Items] | |||
Face amount | $ 20,000 | ||
Issuance date | Jan. 15, 2013 | ||
Description of maturity extended | Note was extended through a verbal agreement with no set maturity date. | ||
Total Due to Stockholders | $ 10,000 | 10,000 | |
Sol & Tina Waxman Family Foundation [Member] | 10% Note Payable Due January 05, 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Issuance date | Mar. 31, 2015 | ||
Sol & Tina Waxman Family Foundation [Member] | 10% Note Payable Due January 05, 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Face amount | $ 25,000 | ||
Total Due to Stockholders | 30,250 | 27,500 | |
Joseph Riccelli, Sr [Member} | 10% Note Payable Due November 22, 2013 [Member] | |||
Debt Instrument [Line Items] | |||
Face amount | $ 90,000 | ||
Issuance date | May 31, 2013 | ||
Maturity term | 180 days | ||
Description of maturity extended | Note was extended through a verbal agreement with no set maturity date. | ||
Total Due to Stockholders | $ 13,500 | 40,000 | |
Joseph Riccelli, Sr [Member} | 10% Note Payable Due February 7, 2018 [Member] | Riccelli Properties [Member] | |||
Debt Instrument [Line Items] | |||
Face amount | $ 40,672 | ||
Issuance date | Aug. 7, 2017 | ||
Maturity term | 6 months | ||
Total Due to Stockholders | $ 36,600 | 36,000 | |
Lawrence Fraser [Member} | 10% Note Payable Due June 1, 2019 [Member] | |||
Debt Instrument [Line Items] | |||
Face amount | $ 50,000 | ||
Issuance date | May 29, 2018 | ||
Total Due to Stockholders | $ 50,000 |
BORROWINGS (Details 1)
BORROWINGS (Details 1) | Oct. 31, 2018USD ($) |
Debt Instrument [Line Items] | |
2019 | $ 163,978 |
2020 | 19,168 |
2021 | 19,739 |
2022 | 20,319 |
2023 | 20,916 |
Thereafter | 20,716 |
Total | 264,836 |
Notes Payable to Shareholders [Member] | |
Debt Instrument [Line Items] | |
2019 | 145,350 |
2020 | |
2021 | |
2022 | |
2023 | |
Thereafter | |
Total | 145,350 |
Notes Payable to Other [Member] | |
Debt Instrument [Line Items] | |
2019 | 18,628 |
2020 | 19,168 |
2021 | 19,739 |
2022 | 20,319 |
2023 | 20,916 |
Thereafter | 20,716 |
Total | $ 119,486 |
BORROWINGS (Details Narrative)
BORROWINGS (Details Narrative) - USD ($) | 12 Months Ended | |||
Oct. 31, 2018 | Oct. 31, 2017 | Jan. 31, 2007 | Jul. 31, 2006 | |
10% Note Payable Due June 17, 2012 [Member] | Roberta Riccelli [Member] | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 8,000 | |||
Maturity term | 120 days | |||
Loans balance outstanding | $ 5,000 | $ 5,000 | ||
10% Note Payable Due May 15, 2013 [Member] | Corinthian Development [Member] | ||||
Debt Instrument [Line Items] | ||||
Face amount | 20,000 | |||
Loans balance outstanding | 10,000 | 10,000 | ||
10% Note Payable Due January 05, 2018 [Member] | Sol & Tina Waxman Family Foundation [Member] | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 25,000 | |||
Number of shares collateral | 250,000 | |||
Loans balance outstanding | $ 30,250 | 27,500 | ||
10% Note Payable Due November 22, 2013 [Member] | Joseph Riccelli, Sr [Member} | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 90,000 | |||
Maturity term | 180 days | |||
Loans balance outstanding | $ 13,500 | 40,000 | ||
10% Note Payable Due June 1, 2019 [Member] | Lawrence Fraser [Member} | ||||
Debt Instrument [Line Items] | ||||
Face amount | 50,000 | |||
Loans balance outstanding | 50,000 | |||
Riccelli Properties [Member] | 10% Note Payable Due February 7, 2018 [Member] | Joseph Riccelli, Sr [Member} | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 40,672 | |||
Maturity term | 6 months | |||
Loans balance outstanding | $ 36,600 | 36,000 | ||
U.S. Small Business Administration [Member] | 2.9% Note Payable Due July 13, 2035 [Member] | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 280,100 | |||
Revised amended face amount | $ 430,500 | |||
Periodic installment | $ 1,820 | |||
Frequency of periodic payment | Monthly | |||
Repayment of debt amount | $ 40,672 | |||
Total Notes Payable | $ 119,486 | $ 137,358 |
EXCLUSIVE LICENSING AND MANUF_2
EXCLUSIVE LICENSING AND MANUFACTURING AGREEMENT (Details Narrative) - Ketut Jaya [Member] - Exclusive Licensing & Manufacturing Agreement [Member] | 12 Months Ended |
Oct. 31, 2018 | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Description of agreement | Exclusive license to develop, use, sell, manufacture and market\rproducts related to or utilizing INSULTEX™, Korean Patent Number, (0426429) or any INSULTEX Technology. |
Total license term worldwide license, except for Korea and Japan | 40 years |
Initial license term | 10 years |
Description of license renewal option | An option to renew the License for up to three (3) successive ten (10) year terms. |
Licence exercised term | 10 years |
CONCENTRATIONS (Details Narrati
CONCENTRATIONS (Details Narrative) | 12 Months Ended | |
Oct. 31, 2018CustomerSupplier | Oct. 31, 2017Customer | |
INSULTEX [Member] | ||
Concentration Risk [Line Items] | ||
Number of supplier | Supplier | 1 | |
Accounts Receivable [Member] | Customer [Member] | ||
Concentration Risk [Line Items] | ||
Number of customers | 3 | 3 |
Concentration risk, percentage | 86.00% | 71.00% |
Revenues [Member] | Customer [Member] | ||
Concentration Risk [Line Items] | ||
Number of customers | 3 | 3 |
Concentration risk, percentage | 51.00% | 34.00% |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | Oct. 31, 2018 | Oct. 31, 2017 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforward | $ 2,554,625 | $ 2,000,000 |
Net deferred tax assets before valuation allowance | 2,554,625 | 2,000,000 |
Less: Valuation allowance | (2,554,625) | (2,000,000) |
Net deferred tax assets |
INCOME TAXES (Details 1)
INCOME TAXES (Details 1) | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory rate | 21.00% | 34.00% |
Effect of net operating losses | (21.00%) | (34.00%) |
Effective income tax rate | 0.00% | 0.00% |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) | 12 Months Ended |
Oct. 31, 2018USD ($) | |
Income Tax Disclosure [Abstract] | |
Net operating loss carryforwards | $ 5,700,000 |
Expiration date | Oct. 31, 2038 |
COMMITMENTS (Details Narrative)
COMMITMENTS (Details Narrative) - USD ($) | 12 Months Ended | |
Oct. 31, 2018 | Oct. 31, 2017 | |
Operating Leased Assets [Line Items] | ||
Rent expense, per month | $ 42,000 | $ 42,000 |
Frank Riccelli [Member] | ||
Operating Leased Assets [Line Items] | ||
Rent expense, per month | $ 3,500 | |
Description of lease agreement | The lease is based on a verbal agreement with month to month terms. |
QUARTERLY FINANCIAL INFORMATI_3
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||
Revenue | $ 82,167 | $ 34,149 | $ 17,163 | $ 116,203 | $ 117,772 | $ 41,811 | $ 39,162 | $ 169,210 | $ 249,682 | $ 367,955 |
Loss from operations | (146,807) | (145,870) | (155,805) | (138,990) | (154,710) | (181,520) | (157,147) | (110,754) | (587,472) | (604,131) |
Net Loss | $ (124,389) | $ (154,221) | $ (158,023) | $ (146,249) | $ (166,098) | $ (186,966) | $ (160,751) | $ (119,240) | $ (582,882) | $ (633,055) |
Weighted average shares outstanding (in shares) | 27,492,223 | 27,228,038 | 27,033,872 | 26,732,245 | 25,942,310 | 25,616,962 | 25,396,265 | 25,370,310 | 27,122,315 | 25,582,984 |
Basic loss per share (in dollars per share) | $ (0.005) | $ (0.006) | $ (0.006) | $ (0.005) | $ (0.006) | $ (0.007) | $ (0.006) | $ (0.005) | $ (0.021) | $ (0.025) |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | |
Segment Reporting Information [Line Items] | ||||||||||
Total Revenues | $ 82,167 | $ 34,149 | $ 17,163 | $ 116,203 | $ 117,772 | $ 41,811 | $ 39,162 | $ 169,210 | $ 249,682 | $ 367,955 |
Assets | 1,702,533 | 1,836,661 | 1,702,533 | 1,836,661 | ||||||
Capital Expenditures | 4,258 | 14,900 | ||||||||
Depreciation | 33,588 | 30,963 | ||||||||
Apparel Segment [Member] | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Total Revenues | 117,147 | 183,661 | ||||||||
Assets | 500,208 | 677,566 | 500,208 | 677,566 | ||||||
Capital Expenditures | 4,258 | |||||||||
Depreciation | 9,961 | 7,336 | ||||||||
Housewrap Segment [Member] | ||||||||||
Segment Reporting Information [Line Items] | ||||||||||
Total Revenues | 132,535 | 184,294 | ||||||||
Assets | $ 1,202,325 | $ 1,159,095 | 1,202,325 | 1,159,095 | ||||||
Capital Expenditures | 14,900 | |||||||||
Depreciation | $ 23,627 | $ 23,627 |
SEGMENT INFORMATION (Details Na
SEGMENT INFORMATION (Details Narrative) | 12 Months Ended |
Oct. 31, 2018Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
COMMON STOCK (Details Narrative
COMMON STOCK (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | Sep. 30, 2017 | May 31, 2017 | |
Class of Stock [Line Items] | |||||||||||
Number of shares issued during the period | 425,000 | ||||||||||
Value of shares issued during the period | $ 90,000 | $ 311,560 | $ 172,140 | ||||||||
Value of shares issued for services | $ 69,900 | $ 97,700 | |||||||||
Two Shareholders [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.80 | $ 0.80 | |||||||||
Number of shares issued for services | 130,000 | ||||||||||
Value of shares issued for services | $ 39,000 | ||||||||||
One Individuals [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of shares issued during the period | 25,000 | ||||||||||
Value of shares issued during the period | $ 5,000 | ||||||||||
Share price (in dollars per share) | $ 0.20 | $ 0.40 | |||||||||
Number of shares issued for services | 5,000 | 50,000 | |||||||||
Value of shares issued for services | $ 1,000 | $ 20,000 | |||||||||
Three Individuals [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of shares issued during the period | 356,250 | 351,000 | |||||||||
Value of shares issued during the period | $ 105,000 | $ 111,560 | |||||||||
Two Individuals [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.18 | ||||||||||
Number of shares issued for services | 55,000 | ||||||||||
Value of shares issued for services | $ 9,900 | ||||||||||
Two Shareholders [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.30 | $ 0.34 | |||||||||
Number of shares issued for services | 130,000 | ||||||||||
Value of shares issued for services | $ 40,200 | ||||||||||
One Director [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.25 | ||||||||||
Number of shares issued for services | 30,000 | ||||||||||
Value of shares issued for services | $ 7,500 | ||||||||||
Three Shareholders [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of shares issued during the period | 217,000 | ||||||||||
Value of shares issued during the period | $ 40,590 | ||||||||||
Three Investors and Three Shareholder [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of shares issued during the period | 505,000 | ||||||||||
Value of shares issued during the period | $ 131,950 | ||||||||||
One Shareholder and One Individuals [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.40 | $ 0.40 | $ 0.25 | ||||||||
Number of shares issued for services | 140,000 | ||||||||||
Value of shares issued for services | $ 50,000 | ||||||||||
Maximum [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.20 | 0.20 | |||||||||
Maximum [Member] | Three Individuals [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.32 | $ 0.32 | |||||||||
Maximum [Member] | Three Shareholders [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.22 | ||||||||||
Maximum [Member] | Three Investors and Three Shareholder [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.40 | 0.40 | |||||||||
Minimum [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.25 | $ 0.25 | |||||||||
Minimum [Member] | Three Individuals [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.25 | $ 0.30 | |||||||||
Minimum [Member] | Three Shareholders [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.18 | ||||||||||
Minimum [Member] | Three Investors and Three Shareholder [Member] | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ 0.25 | $ 0.25 |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2018 | Oct. 31, 2017 | |
Going Concern | ||||||||||
Net loss | $ (124,389) | $ (154,221) | $ (158,023) | $ (146,249) | $ (166,098) | $ (186,966) | $ (160,751) | $ (119,240) | $ (582,882) | $ (633,055) |
Net cash used in operating activities | (419,878) | (377,646) | ||||||||
Accumulated deficit | $ (8,928,694) | $ (8,345,812) | $ (8,928,694) | $ (8,345,812) |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Jan. 31, 2019 | Oct. 31, 2018 | Apr. 30, 2018 | Jan. 31, 2018 | Oct. 31, 2018 | Oct. 31, 2017 | |
Number of shares issued during the period | 425,000 | |||||
Value of shares issued during the period | $ 90,000 | $ 311,560 | $ 172,140 | |||
Three Individuals [Member] | ||||||
Number of shares issued during the period | 356,250 | 351,000 | ||||
Value of shares issued during the period | $ 105,000 | $ 111,560 | ||||
Three Individuals [Member] | Subsequent Event [Member] | ||||||
Number of shares issued during the period | 360,000 | |||||
Value of shares issued during the period | $ 61,200 | |||||
Share price (in dollars per share) | $ 0.17 | |||||
Warrants description | Each Unit was priced at $10,200. Each purchaser was an “accredited investor”. The Company believes that Section 4(2) of the Securities Act of 1933, as amended, was available because these transactions did not involve a public offering and there was no general solicitation or general advertising involved in these transactions. The Company has placed legends on the stock certificates stating that the securities were not registered under the Securities Act and set forth the restrictions on their transferability and sale. |