Description of Business and Summary of Significant Accounting Policies | 6 Months Ended | 12 Months Ended |
Feb. 28, 2015 | Aug. 31, 2014 |
Notes to Financial Statements | | |
Note 2 - Description of Business and Summary of Significant Accounting Policies | Mix1 Life, Inc. (“the Company”) was incorporated under the laws of the State of Nevada, U.S. on June 10, 2009. | ACCOUNTING BASIS |
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Mix1 is an emerging beverage and nutritional supplements company currently with a product line of natural, ready-to-drink protein shakes. Our shakes offer a complete and balanced macronutrient mix and are intended to be consumed as a post work out, snack replacement, meal supplement or a meal replacement. Mix1 beverages have a high protein content (on average 26 grams per serving) and are unique due to their fruit-based flavors, relatively low calorie count and superior taste. Our shakes have a twelve month shelf life with no need for refrigeration and are currently served in a twelve ounce PET (polyethylene terephthalate) bottle. | The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted an August 31 fiscal year end. |
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The Company adopted the provisions of FASB Accounting Standards Update No. 2014-10 Development Stage Entities (Topic 915) (“the Update”) in these financials statements. The Update removes the definition of a development stage entity from the Master Glossary of the Accounting Standards Codification, thereby removing the financial reporting distinction between development stage entities to: (1) present inception-to-date information in the statements of income, cash flows, and shareholder equity, (2) label the financial statements as those of a development stage entity, (3) disclose a description of the development stage activities in which the entity is engaged, and (4) disclose in the first year in which the entity is no longer a development stage entity that in prior years it had been in the development stage. For the public business entities, the amendment is effective for annual reporting periods beginning after December 14, 2014. The requirements of this pronouncement do not have a material effect on the financial statements. | GOING CONCERN |
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The accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s annual report filed with the SEC on its 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for our interim period are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements that would substantially duplicate the disclosure contained in the audited financial statements for the year ended August 31, 2014, as reported in the Form 10-K, have been omitted. | These financial statements have been prepared in accordance with accounting principles generally accepted in the United States applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company has not generated substantial revenue to date and consequently its operations are subject to all risks inherent in the establishment of a new business enterprise. For the period from inception, June 10, 2009, through August 31, 2014 the Company has accumulated losses of $2,056,290. Management’s plan is to have the Company fully operational in the coming year with substantial sales. Management will continue to raise capital through the sale of equity and/or debt financing as required but there is no certainty that such financing will be available at acceptable terms. These financial statements do not include any adjustments to reflect the future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that might result from the outcome of this uncertainty. |
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There financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has limited cash and, as yet, has not generated any substantial revenues, raising substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand, sales, loans from investors and/or issuance of common shares. | IMPAIRMENT OF LONG-LIVED ASSETS |
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| The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets and definite–lived intangible assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell. |
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| FAIR VALUE OF FINANCIAL INSTRUMENTS |
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| The Company has adopted FASB ASC 820-10-50, “Fair Value Measurements”. This guidance defines fair value, establishes a three-level valuation hierarchy for disclosures of fair measurement and enhances disclosure requirements for fair measure. The three levels are defined as follows: |
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| Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for the identical assets or liabilities in active markets. |
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| Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. |
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| Level 3 inputs to valuation methodology are unobservable and significant to the fair measurement. |
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| | | Quoted Active Markets | | | Significant Other | | | Significant | | | | |
| | | for Identical Assets | | | Observable Inputs | | | Unobservable Inputs | | | | |
| | | (Level 1) | | | (Level 2) | | | (Level 3) | | | Total | |
| 31-Aug-13 | | $ | - | | | $ | - | | | $ | - | | | $ | - | |
| August 31, 2014 -Warrants | | $ | - | | | $ | 275,796 | | | $ | - | | | $ | 275,796 | |
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| The carrying amounts reported in the balance sheets for the cash and cash equivalents, and current liabilities each qualify as financial instruments and are a reasonable estimate of fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. |
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| DEVELOPMENT STAGE COMPANY |
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| The accompanying financial statements have been prepared in accordance with generally accepted accounting principles related to development-stage companies. A development-stage company is one in which planned principal operations have not commenced or if its operations have commenced, there has been no significant revenues there from. |
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| USE OF ESTIMATES |
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| The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
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| CASH AND CASH EQUIVALENTS |
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| For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents. |
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| REVENUE RECOGNITION |
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| Revenue is recognized when the earnings process is complete and the risk and rewards of ownership have transferred to the customer, which is generally considered to have occurred upon the receipt of product by the customer. The earnings process is complete once the customer order has been placed and approved, the product shipped has been received by the customer, and there is reasonable assurance of the collection of the sales proceeds. The Company offers its customers a variety of sales and incentive programs, including discounts, allowances, slotting fees, and co-op advertising; such amounts, along with coupon redemption, are recorded as a reduction in revenue. |
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| INCOME TAXES |
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| The Company utilizes the liability method of accounting for income taxes. Under the liability method deferred tax assets and liabilities are determined based on the differences between financial reporting basis and the tax basis of the assets and liabilities and are measured using enacted tax rates and laws that will be in effect, when the differences are expected to reverse. An allowance against deferred tax assets is recognized, when it is more likely than not, that such tax benefits will not be realized. |
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| Any deferred tax asset is considered immaterial and has been fully offset by a valuation allowance because at this time the Company believes that it is more likely than not that the future tax benefit will not be realized as the Company has limited operations. |
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| ADVERTISING COSTS |
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| The Company expenses advertising costs as these are incurred. Marketing expenses totaled $98,524 and $3,403 in 2014 and 2013, respectively. |
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| LOSS PER COMMON SHARE |
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| Basic loss per share is calculated using the weighted-average number of common shares outstanding during each reporting period. Diluted loss per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each reporting period. The Company does not have any potentially dilutive instruments. |
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| In September 2014, a former officer and director of the Company returned 3,333,333 shares of his common stock to the Company’s treasury. Those shares were immediately retired by the Company and have not been included in the Company’s weighted average number of shares outstanding computation for the years ended August 31, 2014 and 2013. Those shares are reported in these financial statements as having been cancelled prior to August 31, 2013. |
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| STOCK-BASED COMPENSATION |
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| The Company records stock-based compensation in accordance with ASC 718, “Compensation – Stock Based Compensation” and ASC 505 “Equity Based Payments to Non-Employees”, which requires the measurement and recognition of compensation expense based on estimated fair market values for all share-based awards made to employees and directors, including stock options. |
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| ASC 718 requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option-pricing model as its method of determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Company’s expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of operations over the requisite service period. |
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| All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. To date, the Company has not adopted a stock option plan and has not granted any stock options. |
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| CONCENTRATIONS OF CREDIT RISK |
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| Accounts at banks are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. As of August 31, 2014, account balances did not exceed federally insured limits. |
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| RECENT ACCOUNTING PRONOUNCEMENTS |
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| Management does not expect the future adoption of any recently issued accounting pronouncement to have a significant impact on its financial position, results of operations, or cash flows. |