| ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1. ORGANIZATION, OPERATIONS
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Canfield Medical
Supply, Inc. (the “Company”), was incorporated in the State of Ohio on March 3, 1992, and changed domicile to Colorado
on April 18, 2012. The Company is in the business of home health services, primarily the selling of durable medical equipment and
medical supplies to the public, nursing homes, hospitals, and other end users. The accompanying financial statements have
been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results of operations and cash flows for the Nine months ended
September 30, 2018 and 2017 have been made. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States
of America have been condensed or omitted. It is suggested that these financial statements be read in conjunction with the
financial statements and notes thereto included in the Company’s December 31, 2017 audited financial statements. The
results of operations for the periods ended September 30, 2018 and 2017 are not necessarily indicative of the operating results
for the full year. Use of estimates The preparation
of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions
that affect 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 and cash equivalents The Company considers
all highly liquid investments with an original maturity of twelve months or less as cash equivalents. Accounts receivable The majority of
the Company’s revenues are received from Medicare, Medicaid, and private insurance companies. As such, the Company
records revenues at allowable amounts, net of estimated allowances and discounts based on contracted prices and historical collection
rates. The Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful
accounts and records bad debt expense when deemed necessary. At September 30, 2018 and December 31, 2017, the Company has determined
that no allowance for doubtful accounts is necessary. Equipment Equipment is recorded
at cost and depreciated under straight line method over each item's estimated useful life. Inventory The Company carries
inventory of durable medical equipment and medical supplies for resale. Inventory is accounted for on a first–in
first-out basis. Revenue recognition The
Company’s primary source of revenue is reimbursement from Medicare, Medicaid, and private insurance companies for the sale
of medical equipment and supplies to patients. Revenue from product sales is recognized subsequent to a patient (customer) ordering
a product at an agreed-upon price, and when delivery has occurred and collectability is reasonably assured. A purchase arrangement
is evidenced by a written order, with delivery considered as made after physical customer acceptance. Although rare, defective
products may be returned, with other return issues considered on a case-by-case basis. Services, such as periodic scheduled deliveries,
are contracted in writing, and generally billed monthly. Any service revenue earned by the Company for services, such as safety
and set up consulting or claims processing, is recorded after the service is performed. Rental of durable home medical equipment
is evidenced by written contract, with revenue recognized when rent is earned. Advertising
costs Advertising
costs are expensed as incurred. The Company had advertising costs during the Nine months ended September 30, 2018 and 2017 of $13,386
and $5,215 respectively. Income tax The
Company accounts for income taxes pursuant to ASC 740. Under ASC 740, deferred taxes are provided for using the liability method
whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred
tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported
amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion
of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax
assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Net income
(loss) per share The
net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding.
Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included
in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share. There
were no potentially dilutive debt or equity instruments issued or outstanding during the Nine months ended September 30, 2018 or
2017. Financial instruments The
carrying value of the Company’s financial instruments, as reported in the accompanying balance sheets, approximates fair
value. Concentrations Financial
instruments that potentially subject the Company to concentrations of credit risk include cash and cash equivalents. The
Company places its cash and cash equivalents at well-known financial institutions, where at times, such balances may exceed FDIC
insurance limits. The
Company receives a significant amount of its revenues in reimbursements from Medicare and Medicaid through competitive bidding
processes. There is no guarantee that the Company will continue to be selected as a winning contract supplier under future
bidding rounds. Long-lived
assets 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 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. For
the nine months ended September 30, 2018 and 2017, we did not recognize any impairment charges. Products and
services, geographic areas and major customers The
Company’s business of medical supply sales constitutes one operating segment. All revenues each year were domestic and to
external customers. |
