Sterling Consolidated (STCC) 10-Q 21 May 18 2018 Q1 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2018	May 21, 2018
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2018
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q1
Entity Registrant Name	STERLING CONSOLIDATED Corp
Entity Central Index Key	1,555,972
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Trading Symbol	STCC
Entity Common Stock, Shares Outstanding		40,715,540

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Current assets
Cash and cash equivalents	$ 25,474	$ 36,888
Account receivable, net	936,346	756,914
Inventory, net	2,313,257	2,505,175
Notes receivable and other current assets	28,057	37,861
Derivative asset	197	0
Total current assets	3,303,331	3,336,838
Property and equipment, net	1,698,395	1,751,216
Intangible assets, net	81,693	86,007
Deferred tax asset	574,613	533,581
Total assets	5,658,032	5,707,642
Current liabilities
Accounts payable and accrued expenses	1,264,187	1,272,926
Bank line of credit	828,858	828,858
Other liabilities	69,501	62,393
Derivative liability	0	2,176
Current portion of long-term notes payable	1,082,763	31,183
Total current liabilities	3,245,309	2,197,536
Other liabilities
Long-term notes payable, related parties	1,645,462	1,681,281
Long-term notes payable	14,610	1,073,972
Total other liabilities	1,660,072	2,755,253
Total liabilities	4,905,381	4,952,789
Stockholders' equity
Preferred stock, $0.001 par value; 10,000,000 shares authorized, no shares issued	0	0
Common stock, $0.001 par value; 200,000,000 shares authorized, 40,715,540 and 40,715,540 shares issued and outstanding as of March 31, 2018 and December 31, 2017, respectively	40,716	40,716
Additional paid-in capital	1,963,318	1,963,318
Common stock subscribed	97,500	0
Accumulated deficit	(1,348,883)	(1,249,181)
Total stockholders' equity	752,651	754,853
Total liabilities and stockholders' equity	$ 5,658,032	$ 5,707,642

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2018	Dec. 31, 2017
Preferred Stock, Par or Stated Value Per Share	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	10,000,000	10,000,000
Preferred Stock, Shares Issued	0	0
Common Stock, Par or Stated Value Per Share	$ 0.001	$ 0.001
Common Stock, Shares Authorized	200,000,000	200,000,000
Common Stock, Shares, Issued	40,715,540	40,715,540
Common Stock, Shares, Outstanding	40,715,540	40,715,540

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Revenues
O-rings and rubber product sales	$ 1,754,356	$ 1,743,459
Freight services	43,100	39,885
Total revenues	1,797,456	1,783,344
Cost of sales
Cost of goods	1,260,031	1,159,844
Cost of services	70,224	60,143
Total cost of sales	1,330,255	1,219,987
Gross profit	467,201	563,357
Operating expenses
Sales and marketing	90,177	49,042
General and administrative	358,028	344,381
Research and development	112,500	0
Total operating expenses	560,705	393,423
Operating income	(93,504)	169,934
Other income (expense)
Other income	3,112	9,386
Gain on interest rate swap	2,373	5,039
Loss on disposal of software	(20,498)	0
Interest expense	(32,217)	(36,095)
Total other expense	(47,230)	(21,670)
Income (loss) before provision for income taxes	(140,734)	148,264
Provision (benefit) for income taxes	(41,032)	59,305
Net income (loss)	$ (99,702)	$ 88,959
Net income (loss) per share of common stock:
Basic and diluted	$ 0	$ 0
Weighted average number of shares outstanding
Basic and diluted	40,715,540	40,715,540

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash flows from operating activities
Net income (loss)	$ (99,702)	$ 88,959
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	36,637	36,612
Bad debt expense	0	2,897
Loss on disposal of software	20,498	0
Gain on swap	(2,373)	(5,039)
Stock for services	97,500	0
Changes in operating assets and liabilities:
Accounts receivable	(179,432)	(198,815)
Inventory	191,918	79,587
Prepaids and other current assets	9,804	18,584
Deferred tax asset	(41,032)	59,305
Accounts payable and accrued interest payable	(8,739)	12,202
Other liabilities	7,108	1,383
Net cash provided by operating activities	32,187	95,675
Cash flows from investing activities
Purchase of fixed and intangible assets	0	(39,778)
Net cash provided by (used in) investing activities	0	(39,778)
Cash flows from financing activities
Net borrowing of bank line of credit	0	30,000
Payments on notes payable	(7,782)	(13,884)
Net loan - related party	(35,819)	(4,953)
Net cash provided by (used in) financing activities	(43,601)	11,163
Net change in cash and cash equivalents	(11,414)	67,060
Cash and cash equivalents at the beginning of period	36,888	6,814
Cash and cash equivalents at the end of period	25,474	73,874
Supplemental disclosures of cash flow information:
Cash paid for interest	32,217	33,767
Cash paid for taxes	$ 750	$ 750

BASIS OF PRESENTATION

BASIS OF PRESENTATION	3 Months Ended
	Mar. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	NOTE 1 – BASIS OF PRESENTATION The accompanying interim 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 as of and for the period ended, and for all periods presented herein, 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 condensed 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 March 31, 2018 and March 31, 2017 are not necessarily indicative of the operating results for the full years.

SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Significant Accounting Policies [Text Block]	NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES The accounting policies applied by the Company in these condensed interim financial statements are the same as those applied by the Company in its audited consolidated financial statements as at and for the year ended December 31, 2017. On January 1, 2018, we adopted the new accounting standard ASC 606, Revenue from Contracts with Customers The impact of recording this change as of January 1, 2018 resulted in an increase in no change to deferred revenue at that date and a no corresponding change in retained earnings as well. The impact of adopting the new revenue standard in 2018 did not create a material impact on our financial statements. The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates. On an ongoing basis, we evaluate our estimates, including those related to the accounts receivable and sales allowances, fair values of financial instruments, useful lives of intangible assets and property and equipment, inventory valuations, income taxes, and contingent liabilities, among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Inventories, which are entirely 20 March 31, December 31, Finished goods $ 2,899,021 $ 3,090,939 Raw materials - - Work-in-progress - - Inventory Reserve (585,764) (585,764) Net Inventory $ 2,313,257 $ 2,505,175 The Company recognizes revenue based on Account Standards Codification (“ASC”) Revenue from Contracts with Customers The Company has adopted ASC Update 2017-11 , Earnings Per Share (Topic 260), 10,800,000 December 27, 2018 The computation of basic earnings (loss) per share of common stock is based on the weighted average number of shares outstanding during the periods presented. The computation of fully diluted earnings (loss) per share includes common stock equivalents outstanding at the balance sheet date. The Company had 10,800,000 and zero stock options and warrantsthat were considered as common stock equivalents as of March 31, 2018 and 2017, respectively. The Company’s management has considered all recent accounting pronouncements. Management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.

STOCK TRANSACTIONS

STOCK TRANSACTIONS	3 Months Ended
	Mar. 31, 2018
Stockholders' Equity Note [Abstract]
Stockholders' Equity Note Disclosure [Text Block]	NOTE 3 – STOCK TRANSACTIONS On January 29, 2018, the Company signed a stock for services agreement authorizing the issuance of 750,000 97,500 Regulation A Offering and Property Dividend On February 14, 2018, the Company announced a property dividend of its internally developed cryptocurrency, DiMO. The dividend called for 950 October 26, 2018 December 14, 2018 Additionally, on February 14, 2018, the Company filed a registration statement under Regulation A to offer up to 55,555,555 0.90

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2018
Subsequent Events [Abstract]
Subsequent Events [Text Block]	NOTE 4 – SUBSEQUENT EVENTS The Company reviewed any significant transactions that would qualify for subsequent event reporting up through May 21, 2018. None were noted.

SIGNIFICANT ACCOUNTING POLICI10

SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Use of Estimates, Policy [Policy Text Block]	Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates. On an ongoing basis, we evaluate our estimates, including those related to the accounts receivable and sales allowances, fair values of financial instruments, useful lives of intangible assets and property and equipment, inventory valuations, income taxes, and contingent liabilities, among others. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities.
Inventory, Policy [Policy Text Block]	Inventories, which are entirely 20 March 31, December 31, Finished goods $ 2,899,021 $ 3,090,939 Raw materials - - Work-in-progress - - Inventory Reserve (585,764) (585,764) Net Inventory $ 2,313,257 $ 2,505,175
Revenue Recognition, Policy [Policy Text Block]	Revenue Recognition The Company recognizes revenue based on Account Standards Codification (“ASC”) Revenue from Contracts with Customers
Earnings Per Share, Policy [Policy Text Block]	The Company has adopted ASC Update 2017-11 , Earnings Per Share (Topic 260), 10,800,000 December 27, 2018 The computation of basic earnings (loss) per share of common stock is based on the weighted average number of shares outstanding during the periods presented. The computation of fully diluted earnings (loss) per share includes common stock equivalents outstanding at the balance sheet date. The Company had 10,800,000 and zero stock options and warrantsthat were considered as common stock equivalents as of March 31, 2018 and 2017, respectively.
New Accounting Pronouncements, Policy [Policy Text Block]	Recent Accounting Pronouncements The Company’s management has considered all recent accounting pronouncements. Management believes that these recent pronouncements will not have a material effect on the Company’s financial statements

SIGNIFICANT ACCOUNTING POLICI11

SIGNIFICANT ACCOUNTING POLICIES (Tables)	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Schedule of Inventory, Current [Table Text Block]	March 31, December 31, Finished goods $ 2,899,021 $ 3,090,939 Raw materials - - Work-in-progress - - Inventory Reserve (585,764) (585,764) Net Inventory $ 2,313,257 $ 2,505,175

SIGNIFICANT ACCOUNTING POLICI12

SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Finished goods	$ 2,899,021	$ 3,090,939
Raw materials	0	0
Work-in-progress	0	0
Inventory Reserve	(585,764)	(585,764)
Net Inventory	$ 2,313,257	$ 2,505,175

SIGNIFICANT ACCOUNTING POLICI13

SIGNIFICANT ACCOUNTING POLICIES (Details Textual) - shares	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Summary Of Significant Accounting Policies [Line Items]
Estimated Losses of Obsolete or Slow Moving Inventory Percent	20.00%
Incremental Common Shares Attributable to Dilutive Effect of Call Options and Warrants	10,800,000	0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number	10,800,000
Share Based Payment Award Options Vested Issuance Date	Dec. 27, 2018

STOCK TRANSACTIONS (Details Tex

STOCK TRANSACTIONS (Details Textual) - USD ($)	1 Months Ended		3 Months Ended
	Feb. 14, 2018	Jan. 29, 2018	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Dividend Called On Shares	950
Dividends Payable, Date of Record	Oct. 26, 2018
Dividends Payable, Date to be Paid	Dec. 14, 2018
Common Stock, Par or Stated Value Per Share			$ 0.001		$ 0.001
Research and Development Expense			$ 112,500	$ 0
proprietary cryptocurrency [Member]
Stock Issued During Period, Shares, Issued for Services		750,000
Common Stock, Par or Stated Value Per Share		$ 0.13
Research and Development Expense			$ 97,500
Regulation A [Member]
Stock Issued During Period, Shares, New Issues	55,555,555
Sale of Stock, Price Per Share	$ 0.90