Gex Management (GXXM) 10-Q 20 Aug 18 2018 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 17, 2018
Document and Entity Information
Entity Registrant Name	GEX MANAGEMENT, INC.
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
Amendment Flag	false
Entity Central Index Key	1,681,556
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		12,486,070
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q2

Balance Sheets

Balance Sheets - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Current Assets:
Cash and Cash Equivalents	$ 402,105	$ 410,096
Accounts Receivable, net of Allowance for Doubtful Accounts of $92,102 and $0 as of June 30, 2018 and December 31, 2017, respectively	393,417	91,532
Accounts Receivable – Related Party	0	30,771
Other Current Assets	65,594	88,749
Total Current Assets	861,116	621,148
Investment in Payroll Express	511,120	0
Property, Plant and Equipment (Net)	2,429,069	2,463,377
Other Assets	253,701	4,471
TOTAL ASSETS	4,055,006	3,088,996
Current Liabilities:
Accounts Payable	61,024	48,280
Accrued Expenses and Other	121,143	20,514
Derivative Liability	20,455	0
Accrued Interest Payable	18,889	7,433
Convertible Notes Payable	152,026	0
Notes Payable Current Portion	2,453,339	56,649
Total Current Liabilities	2,826,876	132,876
Non-Current Liabilities
Notes Payable	1,225,114	1,254,271
Line of Credit –- Related Party	218,600	352,100
Total Long Term Liabilities	1,443,714	1,606,371
TOTAL LIABILITIES	4,270,590	1,739,247
SHAREHOLDERS’ EQUITY (DEFICIT)
Preferred Stock, $0.001 par value, 20,000,000 shares authorized, 0 shares issued and outstanding	0	0
Common Stock, $0.001 par value, 200,000,000 shares authorized, 11,922,231 and 11,797,231 shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively	11,922	11,797
Additional Paid-in-Capital	3,166,053	2,651,178
Accumulated Deficit	(3,393,559)	(1,313,226)
TOTAL SHAREHOLDERS’ EQUITY (DEFICIT)	(215,584)	1,349,749
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)	$ 4,055,006	$ 3,088,996

Balance Sheets (Parenthetical)

Balance Sheets (Parenthetical) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Allowance for Doubtful Accounts	$ 92,102	$ 0
Preferred stock shares par value	$ 0.001	$ 0.001
Preferred stock shares authorized	20,000,000	20,000,000
Preferred stock shares issued	0	0
Preferred stock shares outstanding	0	0
Common stock shares par value	$ .001	$ 0.001
Common stock shares authorized	200,000,000	200,000,000
Common stock shares issued	11,922,231	11,797,231
Common stock shares outstanding	11,922,231	11,797,231

Statements of Operations

Statements of Operations - USD ($)		3 Months Ended		6 Months Ended
		Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
Revenues		$ 3,093,230	$ 2,843,988	$ 6,669,781	$ 2,994,628
Revenues – Related Party		0	44,000	0	64,000
Total Revenues	[1]	3,093,230	2,887,988	6,669,781	3,058,628
Cost of Revenues		2,639,182	2,839,028	6,088,274	3,137,678
Gross Profit (Loss)		454,048	48,960	581,507	(79,050)
Operating Expenses
Depreciation and Amortization		14,654	14,508	34,307	14,652
Selling and Advertising		45,098	20,027	98,448	30,354
General and administrative expenses		1,240,379	164,551	1,806,772	336,339
Total Operating Expenses		1,300,131	199,086	1,939,527	381,345
Total Operating Income (Loss)		(846,083)	(150,126)	(1,358,020)	(460,395)
Other Income (Expense)
Gain on Extinguishment of Debt		0	172,872	0	172,872
Income from Investment in Payroll Express		35,197	0	35,197	0
Derivative Loss		(20,455)	0	(20,455)	0
Interest and Other (Expense)		(693,172)	(4,919)	(737,055)	(10,292)
Total Other Income (Expense)		(678,430)	167,953	(722,313)	162,580
Net income (loss) before income taxes		(1,524,513)	17,827	(2,080,333)	(297,815)
Provision for income taxes		0	0	0	0
NET INCOME (LOSS)		$ (1,524,513)	$ 17,827	$ (2,080,333)	$ (297,815)
BASIC and DILUTED
Weighted Average Shares Outstanding		11,900,256	11,334,179	11,805,401	11,226,047
Earnings (Loss) per Share		$ (0.13)	$ .00	$ (0.18)	$ (0.03)
[1]	Gross billings of $595,955 and $608,779 less payroll and payroll tax cost related to PEO clients of $561,039 and $585,210 for the three months ended 2018 and 2017, respectively, and gross billings of $1,779,687 and $608,779 less payroll and payroll tax cost related to PEO clients of $1,703,352 and $585,210 for the six months ended 2018 and 2017, respectively.

Consolidated Statements of Cash

Consolidated Statements of Cash Flow - USD ($)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash Flows (used by) Operating Activities:
Net Loss	$ (2,080,333)	$ (297,815)
Adjustments to reconcile net loss to net cash (used in) operating activities:
Depreciation and Amortization	34,307	14,652
Shares issued for Services	436,250	74,751
Warrants issued for debt issuance costs	78,751	0
Derivative loss	20,455	0
Gain on Extinguishment of Debt	0	(172,872)
Bad Debt Expense	92,102	0
Changes in assets and liabilities:
Accounts receivable	(393,987)	(11,610)
Accounts receivable –- Related Party	30,771	(4,500)
Other current assets	23,155	(43,791)
Deposits and other assets	(10,351)	(5,590)
Accounts payable	12,744	11,715
Accrued expenses	100,630	(47,390)
Accrued interest payable	11,456	10,292
Net cash (used in) operating activities	(1,644,050)	(472,158)
Cash Flows from (used in) Investing Activities:
Purchase of customer contracts	0	(37,500)
Acquisition of equity interest in Payroll Express (PE)	(500,000)	0
Deposit for future acquisition of additional equity in PE	(250,000)	0
Net cash (used in) investing activities	(750,000)	(37,500)
Cash Flows from (used in) Financing Activities:
Proceeds from sale of common stock	0	402,086
Proceeds (payments) from (to) notes payable – related party	(133,500)	50,000
Payments on long term notes payable	(29,157)	0
Net Borrowings (Payments) on short term notes payable	2,548,716	0
Net cash provided by financing activities	2,386,059	452,086
NET INCREASE (DECREASE) IN CASH	(7,991)	(57,572)
CASH AT BEGINNING OF PERIOD	410,096	307,395
CASH AT END OF PERIOD	402,105	249,823
SUPPLEMENTAL DISCLOSURES:
Income taxes paid	0	0
Interest paid	590,209	0
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Accounts Payable converted to Common Stock	0	45,000
Debt and Interest converted to Common Stock	0	345,745
Common Stock Issued for Services	$ 0	$ 74,751

1. DESCRIPTION OF BUSINESS AND

1. DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES	Organization and Description of Business GEX Management, Inc. (“GEX”, the “Company”, “we”, “our”, “us”) is a professional services company that was originally formed in 2004 as Group Excellence Management, LLC d/b/a MyEasyHQ. The Company converted from a limited liability company to a C corporation in March 2016, and changed its name to GEX Management, Inc. in April 2016. On January 25, 2017, GEX obtained its license to operate as a Professional Employer Organization (“PEO”), and we began offering PEO services in April 2017. The Company formed GEX Staffing, LLC (“GEX Staffing”) in March 2017. The initial funding and first transactions occurred in GEX Staffing in September 2017. The consolidated financials include the accounts of GEX Staffing, LLC. Staffing and PEO services make up a majority of our revenue. On December 29, 2017 GEX purchased 100% of the membership interest in AMAST Consulting, LLC (“AMAST”), which owned a multi-use office building in Lowell, Arkansas, which had an occupancy rate of 100% at the time of the acquisition. The terms of the Agreement to purchase AMAST include the fulfillment of the lease obligations of the current tenants, as well as the assumption of the debt that is collateralized by the building and associated property. The consolidated financials include the assets and debt of AMAST. Basis of Presentation Our financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”), as well as the applicable regulations and rules of the Securities and Exchange Commission (“SEC”). This requires management to make estimates and assumptions that affect the amounts reported in the financial statements and their accompanying notes. The actual results could differ from those estimates. The accompanying interim, unaudited consolidated financial statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2017 included in the Company’s Annual Report on Form 10-K, filed with the SEC on April 10, 2018. All adjustments necessary for a fair statement of the results for the interim periods have been made. All adjustments are of a normal and recurring nature. Principles of Consolidation The consolidated financial statements include the accounts of GEX Management, Inc. and its wholly owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. There have been no significant changes to our accounting policies that have a material impact on our financial statements and accompanying notes. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents include cash in banks and short-term investments with original maturities of three months or less. Accounts Receivable Accounts receivable consists of accrued services and consulting receivables due from customers and are unsecured. The receivables are generally due within 30 to 45 days after the date of the invoice. Accounts receivable is carried at their face amount, less an allowance for doubtful accounts. GEX’s policy is not to charge interest on receivables after the invoice becomes past due. Write-offs are recorded at the time when a customer receivable is deemed uncollectible. The Company incurred $92,102 of bad debt expense for each of the three and six months ended June 30, 2018. No bad debt expense was incurred for the three or six months ended June 30, 2017. Equity Method Investments The Company has accounted for its investment in Payroll Express, LLC (“PE”), a Santa Clara, CA based professional services firm that provides a wide array of back office and managed services related to medical staffing needs for its healthcare clients that includes clinical practices and Ambulatory Surgery Centers (ASCs), as an equity method investment due to its ability to assert significant influence over PE’s operational and financial policies. This investment was initially accounted for at cost. The Company recognizes its proportionate share of PE’s earnings (after the effect of basis differences) as an increase in its Investment in PE and as Income from Investment in PE. Property and Equipment Property and Equipment, net is carried at the cost of purchase, acquisition or construction, and is depreciated over the estimated useful lives of the assets. Assets acquired in a business combination are stated at estimated fair value. Costs associated with repair and maintenance are expensed as they are incurred. Costs associated with improvements which extend the life, increase the capacity or improve the efficiency of our property and equipment are capitalized and depreciated over the remaining life of the related asset. Depreciation and amortization are provided using the straight-line methods over the useful lives of the assets as follows: Useful Life Buildings 30 Years Office Furniture & Equipment 5 Years Impairment of Long-Lived Assets The Company records an impairment of long-lived assets used in operations, other than goodwill, and its equity method investments when events or circumstances indicate that the asset might be impaired and the estimated undiscounted cash flows to be generated by those assets over their remaining lives are less than the carrying amount of those items. The net carrying value of assets not recoverable is reduced to fair value, which is typically calculated using the discounted cash flow method. Revenue Recognition Effective on January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) GEX enters into contracts with its clients for professional services, staffing and/or PEO services. GEX's contract stipulates the rate and price charged to each client. GEX's contracts for these services are generally cancellable at any time by either party with 30-days’ written notice. GEX fulfills its performance obligations each month, and the contracts generally have a term of one year with an automatic renewal after 12 months. The duration between invoicing and when GEX completes its contractual, performance obligations are satisfied is not significant. For the Company's PEO services, payment is generally due on the date the invoice is sent to the client. For staffing and professional services payment is generally due 30 days after the invoice is sent to the client. GEX does not have significant financing components or significant payment terms. GEX's revenue is generally recognized ratably, month-to-month as co-employees or staffed employees perform their service at the client's worksite. Generally, GEX's PEO clients are invoiced concurrently with each payroll of its co-employees, and clients that utilize GEX's staffing and back office services are billed concurrently with each payroll or on a monthly basis. PEO Services Professional Employment Organization (“PEO”) service revenues represent the fees charged to clients for administering payroll and payroll tax transactions for our clients’ Co-Employed Employees (“CEEs”), access to our HR and benefits administration services, consulting related to employment and benefit law compliance and general employment consulting related fees. PEO service revenues are recognized in the period the PEO services are performed as stipulated in the Client Service Agreement (“CSA”), where these fees are fixed or determinable, when the PEO client is invoiced and collectability is reasonably assured. GEX is not considered the primary obligor with respect to CEE’s payroll and payroll tax, and insurance payments and therefore, these payments are not reflected as either revenue or expense in our statements of operations. PEO-related revenues also include revenues generated from insurance administration for our PEO clients. These insurance-related revenues include insurance-related billings, as well as administrative fees that GEX collects from PEO clients and withholds from CEEs for health benefit insurance plans provided by third-party insurance carriers. Insurance-related revenues are recognized over the period the insurance coverage is provided and where collectability is reasonably assured. Staffing Services and Professional Services Staffing services revenue is derived from supplying temporary staff to clients. Temporary staff generally consists of temporary workers working under a contract for a fixed period of time, or on a specific client project. The temporary staff includes both GEX employees and third-parties contracted by GEX. Temporary staff are provided to clients through a Staffing Service Agreement (‘SSA’) involving a specified service that the temporary staff will provide to the client. When GEX is the principal or primary obligor for the temporary staff, GEX records the gross amount of the revenue and expense from the SSA. GEX is generally the primary obligor when GEX is responsible for the fulfillment of services under the SSA, even if the temporary staff are not employees of GEX. This typically occurs when GEX contracts third-parties to fulfill all or part of the SSA with the client, but GEX remains the holder of the credit risk associated with the SSA, and GEX has total discretion in establishing the pricing under the SSA. All other Professional Services revenues are recognized in the period the services are performed as stipulated in the client’s Outsourcing Agreement, when the client is invoiced, and collectability is reasonably assured. Revenue recognition for arrangements with multiple deliverables constituting a single unit of accounting is recognized generally over the greater of the term of the arrangement or the expected period of performance. Income Taxes The Company uses the liability method in the computation of income tax expense and the current and deferred income taxes payable. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized. Fair Value Measurements ASC Topic 820 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and requires certain disclosures about fair value measurements. In general, fair value of financial instruments is based upon quoted market prices, where available. If such quoted market prices are not available, fair value is based upon internally developed models that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include amounts to reflect counterparty credit quality and the Company’s credit worthiness, among other things, as well as unobservable parameters. Earnings Per Share Earnings per share are calculated in accordance with ASC 260 “Earnings per Share”. Basic income (loss) per share is computed by dividing the period income (loss) available to common shareholders by the weighted average number of common shares outstanding. Diluted earnings (loss) per share is computed by dividing the income (loss) available to common share holders by the weighted average number of common shares outstanding plus additional common shares that would have been outstanding if dilutive potential common shares had been issued. For purposes of this calculation, common stock dividends, warrants and options to acquire common stock, would be considered common stock equivalents in periods in which they have a dilutive effect and are excluded from this calculation in periods in which these are anti-dilutive to the net loss per share. As of June 30, 2018, the Company had 80,000 potentially dilutive shares pursuant to convertible debt and 90,000 potentially dilutive warrant shares outstanding. At December 31, 2017, the Company has no potentially dilutive common shares. Earnings per share information for the three and six months ended June 30, 2017 has been retroactively adjusted to reflect the stock split that occurred in December 2017. Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. Such reclassifications have had no effect on the financial position as of December 31, 2017 or operations or cash flows for the periods ended June 30, 2017. Going Concern To date, the Company has funded its operations primarily through public and private offerings of common stock, our line of credit, short-term discounted and convertible notes payable. The Company has identified several potential financing sources in order to raise the capital necessary to fund operations through June 30, 2019. In addition to the aforementioned current sources of capital that will provide additional short-term liquidity, the Company is currently exploring various other alternatives including debt and equity financing vehicles, strategic partnerships, government programs that may be available to the Company, as well as trying to generate additional sales and increase margins. However, at this time the Company has no commitments to obtain any additional funds, and there can be no assurance such funds will be available on acceptable terms or at all. If the Company is unable to obtain additional funding and improve its operations, the Company’s financial condition and results of operations may be materially adversely affected and the Company may not be able to continue operations, which raises substantial doubt about its ability to continue as a going concern. Additionally, even if the Company raises sufficient capital through additional equity or debt financing, strategic alternatives or otherwise, there can be no assurances that the revenue or capital infusion will be sufficient to enable it to develop its business to a level where it will be profitable or generate positive cash flow. If the Company raises additional funds through the issuance of equity or convertible debt securities, the percentage ownership of our stockholders could be significantly diluted, and these newly issued securities may have rights, preferences or privileges senior to those of existing stockholders. If the Company incurs additional debt, a substantial portion of its operating cash flow may be dedicated to the payment of principal and interest on such indebtedness, thus limiting funds available for business activities. The terms of any debt securities issued could also impose significant restrictions on the Company’s operations. Broad market and industry factors may seriously harm the market price of our common stock, regardless of our operating performance, and may adversely impact our ability to raise additional funds. Similarly, if the Company’s common stock is delisted from the public exchange markets, it may limit its ability to raise additional funds. The consolidated financial statements for the three and six months ended June 30, 2018 were prepared on the basis of a going concern which contemplates that the Company will be able to realize assets and discharge liabilities in the normal course of business. Accordingly, they do not give effect to adjustments that would be necessary should the Company be required to liquidate its assets. The ability of the Company to meet its total liabilities of $4,270,590 at June 30, 2018, and to continue as a going concern is dependent upon the availability of future funding, continued growth in billings and sales contracts, and the Company’s ability to profitably meet its after-sale service commitments with its existing customers. The financial statements do not include any adjustments that might result from the outcome of these uncertainties.

2. OTHER CURRENT ASSETS

2. OTHER CURRENT ASSETS	6 Months Ended
	Jun. 30, 2018
Other Assets [Abstract]
OTHER CURRENT ASSETS	At June 30, 2018 and December 31, 2017, Other Current Assets were as follows: June 30, 2018 Dec 31, 2017 Other Current Assets: Prepaids $ 53,565 $ 116,623 Other Current Assets 12,029 2,709 Acquired Customer Contracts - 37,500 Accumulated Amortization - (68,083 ) Total Other Current Assets $ 65,594 $ 88,749 In 2017, the Company purchased customer contracts on March 31, 2017 and started amortizing those contracts in April 2017 along with other contracts entered into in the 2nd quarter of 2017. The Company fully amortized the contracts at December 31, 2017 so it recorded no amortization in the three or six months ended June 30, 2018.

3. STOCKHOLDERS' EQUITY

3. STOCKHOLDERS' EQUITY	6 Months Ended
	Jun. 30, 2018
SHAREHOLDERS’ EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY	General The Company is authorized to issue 200,000,000 common shares at a par value of $0.001 per share. These shares have full voting rights. In April 2018, the Company issued shares of 125,000 of common stock at $3.49 per share to a non-officer employee. The Company recognized compensation expense of $436,250 recorded in General and Administrative Expenses on the Consolidated Statement of Operations for the three and six months ended June 30 2018. At June 30, 2018 and December 31, 2017, there were 11,922,231 and 11,797,231 common shares outstanding, respectively. Also, in April 2018, the Company agreed to issue 19,456 shares of common stock for $48,640. The related shares were not issued as of June 30, 2018 and the amount due was recorded in Accrued Expenses on the Consolidated Balance Sheet. The Company is authorized to issue 20,000,000 preferred shares at a par value of $0.001 per share. These shares have full voting rights. At June 30, 2018 and December 31, 2017 there were no preferred shares outstanding. The preferred stock ranks senior to the common stock of the Company in each case with respect to dividend distributions and distributions of assets upon the liquidation, dissolution or winding up of the Company whether voluntary or involuntary. In May 2018, the Company issued 50,000 warrant shares related to the issuance of convertible notes payable. These warrants have a five-year term with a conversion price of $4.00 per common share. In June 2018, the Company issued 40,000 warrant shares related to the issuance of a note payable. These warrants have a two-year term with a conversion price of $1.66 per common share. Upon issuance, the fair value of these warrants totaled $78,751. The following table outlines the activity relative to these warrants for the 6 months ended June 30, 2018: Weighted- Number Average of Exercise Warrant Shares Price Outstanding, at December 31, 2017 - $ - Granted 90,000 2.96 Exercised - - Forfeited or expired - - Outstanding, at end of period 90,000 2.96 Exercisable, at June 30, 2018 90,000 $ 266,400 Weighted average fair value of warrants granted during the period $ 86,360 The following table summarizes the warrants outstanding as of June 30, 2018: Weighted - Average Number Remaining Contractual Number Exercise of Warrants Life of Warrants of Warrants Prices Outstanding Outstanding Exercisable $ 4.00 50,000 4.84 years 50,000 $ 1.66 40,000 1.52 years 40,000 90,000 90,000 During the three months ended June 30, 2017, GEX entered into a Conversion Agreement with two consultants that had a $45,000 balance with the Company and issued a total of 30,000 shares of the Company’s common stock at a cost basis of $1.50 per share in order to settle this outstanding balance. During the three months ended June 30, 2017, the Company issued 115,248 shares of its common stock to its Chief Executive Officer under a Debt Conversion Agreement, for the extinguishment of $345,745 in debt and accrued interest owed by GEX under the Line of Credit as of the Debt Conversion date. During the three months ended June 30, 2017, the Company also issued a total of 14,252 and 2,500 shares of the Company’s common stock to a third-party investor and a third-party advisor, respectively.

4. NOTES PAYABLE

4. NOTES PAYABLE	6 Months Ended
	Jun. 30, 2018
Notes Payable [Abstract]
NOTES PAYABLE	At June 30, 2018 and December 31, 2017, Notes Payable were as follows: June 30, 2018 Dec 31, 2017 Note Payable: Real Estate Lien Interest at 4.5%; $9,540 monthly principal & interest; Balloon payment due March 22, 2022 $ 1,278,272 $ 1,310,920 Discounted Notes Payable: Weekly payments totaling $26,654 Daily payments totaling $18,245 Debt matures by December 21,2018 1,851,930 - Less Discounts on Notes Payable (462,346 ) - Discounted Note Payable: Principal and interest due August 1, 2018 500,000 - Interest at 15% Less Discount on Notes Payable (51,537 ) - Convertible Notes Payable: Principal and interest due May 3, 2019 200,000 - Interest at 10% Less Discount on Notes Payable (47,974 ) - Discounted Note Payable - Related Party: Weekly payments of $44,995 Debt matures on November 9, 2018 864,355 - Less Discount on Notes Payable (302,221 ) - Note Payable - Related Party: Line of Credit up to $500,000; Due April 1, 2020 218,600 352,100 Interest at 6% Total Notes Payable 4,049,079 1,663,020 Less Current Portion (2,605,365 ) (56,649 ) Long-term Notes Payable $ 1,443,714 $ 1,606,371 In March 2018, the Company entered into an Agreement to sell $1,066,050 of the Company's future receipts for $772,500 to provide liquidity for the Company's expansion opportunities. This agreement is personally guaranteed by Carl Dorvil, the Company's Chief Executive Officer and Chairman. The Company During the three months ended June 30, 2018, the Company entered into six discounted Notes Payable Agreements to sell its future accounts receivable and revenues to provide liquidity for working capital and the Company's expansion opportunities. On April 18, the Company entered into an Agreement to sell $490,000 of the Company's future accounts receivable for $350,000. On April 25, 2018, the Company entered into an Agreement to sell $299,800 of the Company's future accounts receivable for $200,000. On April 25, 2018, the Company entered into an Agreement to sell $374,750 of the Company's future accounts receivable for $250,000. On May 31, 2018, the Company sold $583,600 of its future accounts receivable for $400,000. On June 14, 2018, the Company entered into an Agreement to sell $299,800 of the Company’s future receivables for $200,000. On June 27, 2018, the Company sold $909,350 of its future accounts receivable for $650,000. These Agreements are personally guaranteed by Carl Dorvil, the Company's Chief Executive Officer and Chairman and by Chelsea Christopherson, the Company's President and Chief Operating Officer. The Company incurred a total of $143,500 related to origination fees on these notes. The full amount of the notes is due within twelve months. The Company recognized interest expense related to these notes totaling $ 416,239 for the three and six months ended June 30, 2018. On June 28, 2018, the Company paid $164,890 to pay off the April 25 note. On April 26, 2018, the Company entered into two Securities Purchase Agreements, pursuant to which the Company issued Convertible Promissory Notes (“the Notes”) with principal amounts totaling up to $1,000,000, bearing interest at 10% per annum. The total amounts of the Notes that can be funded (consideration that can be loaned to the Company) is up to $887,500, after discounts of $112,500 prorated over the term of the Notes. Amounts borrowed by the Company mature in twelve months after the date of funding, and can be prepaid up to six months after issuance subject to prepayment penalties and approval by the Note holders. Any amounts outstanding on the Notes can be converted into Common Stock at a conversion price of $2.50 per share for the first six months and at a discount of up to 50% thereafter to the then current market value of the Company’s stock commencing six months after issuance. Conversion is at the sole discretion of the holders of the Notes. In May 2018, the Company borrowed $200,000 under the Notes, and received $175,000 after giving effect to discounts of 10% for each note and origination fees. The Notes are personally guaranteed by Carl Dorvil, the Company's Chief Executive Officer and Chairman and by Chelsea Christopherson, the Company's President and Chief Operating Officer. The Company incurred a total of $5,000 related to origination fees on the Notes. Additionally, the Company issued 50,000 warrant shares for debt issuance costs at an exercise price of $4.00 per share. The warrants are exercisable for five years and had a fair market value of $31,852 on the date of issuance. The Notes bear interest at 10% per annum. The Company recognized $12,000 of interest expense related to the Notes for the three and six months ended June 30, 2018. The conversion options are considered to be derivative liabilities with a fair value of zero at inception. On June 30, 2018, the fair value of the derivative liabilities was $20,455, and the Company recognized a loss of the same amount during the three months ended June 30, 2018. On June 4, 2018, the Company entered into a discounted Promissory Note Payable with a principal balance of $500,000, and bearing interest at a rate of 15% per annum. This note is personally guaranteed by Carl Dorvil, the Company's Chief Executive Officer. In connection with this note, the Company issued 40,000 warrant shares for its common stock. The exercise price for the warrants is $1.66 per common share and the warrants expire in 24 months from date of issuance. The Company recognized $47,335 of interest expense, including the amortization of debt issuance costs and the discount related to the Notes for the three and six months ended June 30, 2018. This note was due to be paid in full by August 1, 2018. The Company has been in negotiations to restructure this loan, as it was originally intended as a bridge loan with a term of 57 days. Pursuant to these negotiations, in August 2018, the maturity date on the note was extended to August 30, 2018. In consideration of this extension, the Company has agreed to change the exercise price on the outstanding warrants to $0.01 per share and issued and additional 40,000 warrant shares at an exercise price of $0.01 per share. The Real Estate Lien Note had a balance of $1,278,272. The following is a schedule of the minimum principal payments required under the loan as of June 30, 2018: Year Ended Amount Remainder of 2018 $ 28,001 2019 59,252 2020 61,973 2021 64,821 2022 67,798 2023 and beyond 996,427 Total $ 1,278,272 Total interest expense was $687,084 and $4,919 for the three months ended June 30, 2018 and 2017, respectively. For the six months ended June 30, 2018 and 2017, total interest expense was $732,638 and $10,292, respectively.

5. ACCOUNTS RECEIVABLE AND CONC

5. ACCOUNTS RECEIVABLE AND CONCENTRATION OF CREDIT RISK	6 Months Ended
	Jun. 30, 2018
Receivables [Abstract]
ACCOUNTS RECEIVABLE AND CONCENTRATION OF CREDIT RISK	As of June 30, 2018, one customer accounted for 25% while four other customers accounted for 26% of the Company’s outstanding accounts receivable balance. As of December 31, 2017, three customers made up 86% of the Company’s outstanding accounts receivable balance, and 25% were related party receivables as of June December 31, 2017. The Company had no related party receivables at June 30, 2018. For the three months ended June 30, 2018 and June 30, 2017, one customer accounted for 24.73% and two customers accounted for 95.18% of the Company’s net revenue, respectively of which 0% and 45.3% were related party revenues for the three months ended and June 30, 2018 and 2017, respectively. For the six months ended June 30, 2018 and June 30, 2017, one customer accounted for 37.37% and two customers accounted for 95.18% of the Company’s net revenue, respectively of which 0% and 45.3% were related party revenues for the three months ended and June 30, 2018 and 2017, respectively.

6. PROPERTY AND EQUIPMENT

6. PROPERTY AND EQUIPMENT	6 Months Ended
	Jun. 30, 2018
Property, Plant and Equipment [Abstract]
PROPERTY AND EQUIPMENT	The Company had the following property and equipment as of June 30, 2018 and December 31, 2017: June 30, 2018 Dec 31, 2017 Land $ 333,778 $ 333,778 Buildings 2,125,642 2,125,642 Office Equipment 5,844 5,844 Total Fixed Assets 2,465,264 2,465,264 Accumulated Depreciation (36,195 ) (1,887 ) Property and Equipment, net $ 2,429,069 $ 2,463,377 Depreciation expense was $14,654 and $14,508 for the three months ended June 30, 2018 and 2017, respectively. Depreciation expense for the six months ended June 30, 2018 and 2017, was $34,307 and $14,652, respectively.

7. RELATED PARTY TRANSACTIONS

7. RELATED PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2018
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	Policy on Related Party Transactions The Company has a formal, written policy that includes procedures intended to ensure compliance with the related party provisions in common practice for public companies. For purposes of the policy, a “related party transaction” is a transaction in which the Company participates and in which a related party (including all of GEX’s directors and executive officers) has a direct or indirect material interest. Any transaction exceeding the 1% threshold, and any transaction involving consulting, financial advisory, legal or accounting services that could impair a director’s independence, must be approved by the Board of Directors. Any related party transaction in which an executive officer or a Director has a personal interest, must be approved by the Board of Directors, following appropriate disclosure of all material aspects of the transaction. Related Party Transactions Debt Agreements On March 1, 2015 the Company entered into a Line of Credit Agreement with P413. P413 agreed to loan the Company up to $500,000 at a rate of 6%. GEX’s CEO, Carl Dorvil, is a majority member interest owner in P413. This line of credit has a balance of $218,600 and $352,100 at June 30, 2018 and December 31, 2017, respectively. On May 2, 2018, this line of credit was extended to April 1, 2020. Professional Service Agreements On March 1, 2015 the Company entered into an Outsourcing Agreement with P413 Management, LLC (“P413”) to provide back office services to P413. GEX’s CEO, Carl Dorvil, is a majority member interest owner in P413. The Company reported no revenues under this Agreement for the three and six months ended June 30, 2018 and 2017, respectively. On September 1, 2015 the Company entered into an Outsourcing Agreement with Vicar Capital Advisors, LLC (“Vicar”) to provide back office services to Vicar. GEX’s CEO, Carl Dorvil, is a majority member interest owner in Vicar. The Company reported no revenues under this Agreement for the three or six months ended June 30, 2018. The Company reported no revenues for the three months ended June 30, 2017 and $1,116 in revenues for the six months ended June 30, 2017, respectively. Revenues For the three months ended June 30, 2018 and 2017, the Company had no revenues from related parties, and $44,000, respectively. For the six months ended June 30, 2018 and 2017, the Company had no revenues from related parties and $64,000, respectively.

8. COMMITMENTS AND CONTINGENCIE

8. COMMITMENTS AND CONTINGENCIES	6 Months Ended
	Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	The following are the minimum obligations under the lease related to the Company’s Corporate office as of June 30, 2018: Year ended Amount Remainder of 2018 $ 32,120 2019 60,225 Total $ 92,345 The Company owns a multi-use office building in Lowell, Arkansas which is leased to various tenants. The minimum rental income to be collected as of June 30, 2018 is as follows: Year Ended Amount Remainder of 2018 $ 73,452 2019 128,157 2020 37,616 Total $ 239,225 The Company recognized rental income of $36,228 and $74,138 for the three and six months ended June 30, 2018, respectively. The Company recognized and no rental income for the three and six months ended June 30, 2017.

9. ACQUISITIONS

9. ACQUISITIONS	6 Months Ended
	Jun. 30, 2018
Business Combinations [Abstract]
ACQUISITIONS	On May 2, 2018, the Company purchased a 25% interest in Payroll Express, LLC (PE), a California limited liability company for $500,000 in cash. The Company recognized this investment under the equity method due to its ability to exercise significant influence over the operating and financial policies of PE. Additionally, the Company has the right, but not the obligation, to purchase an additional 26% interest under similar terms. On June 11, 2018, the Company paid $250,000 in cash to the owners of Payroll Express as a deposit towards purchasing additional shares in PE and is recorded in Other Assets on the Balance Sheet. The purchase transaction was not finalized as of June 30, 2018. During the three months ended June 30, 2018, the Company recognized $35,197 in income from its investment in PE. Some additional disclosures related to Payroll Express are as follows: Selected Balance Sheet Data: June 30, 2018 Current Assets $ 910,738 Long-term Assets $ 9,346 Current Liabilities $ 783,126 Long-term Liabilities $ 16,576 Selected Income Statement Data for the three and six months ended June 30, 2018: Three and Six Months Ended June 30, 2018 Gross Profit $ 133,544 Net Income before Income Taxes $ 53,145

10. SUBSEQUENT EVENTS

10. SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2018
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	On July 9, 2018, the Company entered into a discounted Note Payable agreement to sell its future accounts receivable of $246,500 for $170,000. On July 23, 2018, the Company entered into a discounted Note Payable agreement to sell its future accounts receivable of $246,500 for $170,000. On August 14, 2018, the Company entered into a discounted Note Payable agreement to sell its future accounts receivable of $149,900 for $100,000. On August 17, 2018, the Company entered into a discounted Note Payable agreement to sell its future accounts receivable of $149,900 for $100,000. On August 1, 2018, the Company entered into a convertible note payable for $226,000 bearing interest at 12% per annum. All principal and interest is due on January 27, 2019. The note is convertible at the lesser of $2.50 per share or 65% of the market price on the date of conversion. In connection with this note payable, on August 9, 2018, the Company issued 207,339 shares for its common stock as a commitment fee. On August 14, 2018, the Company entered into a convertible note payable for $250,000 bearing interest at 10% per annum. All principal and interest is due on May 6, 2019. The note is convertible at $2.50 per share. In connection with this note payable, the Company issued 25,000 warrant shares for its common stock, exercisable at $4.00 per share. These warrants have a five year life. On July 30, 2018, the Company entered into a binding letter of intent with Endeavor Plus, Inc., a corporation in the healthcare business (“Endeavor”), pursuant to which it is anticipated that the shareholders of Endeavor will exchange 100% of the issued and outstanding shares of capital stock of Endeavor for an aggregate of 13,000,000 restricted shares of the Company’s common stock, $0.001 par value per share (the “Share Exchange”). As a result of the Share Exchange, Endeavor would become a wholly owned subsidiary of the Company. The parties intend for the Share Exchange to qualify as a tax-free reorganization under Section 368 of the Internal Revenue Code of 1986, as amended. The Company and Endeavor expect to enter into a definitive agreement for the Share Exchange (“Share Exchange Agreement”) by September 30, 2018, and to consummate the Share Exchange on or before December 31, 2018. On August 3, 2018, the Company entered into a Membership Interest Purchase Agreement with PE, pursuant to which the Company purchased an additional 26% of the membership interests of PE for a purchase price of (a) $250,000, plus (b) warrants (the “Warrants”) to purchase 2,000,000 shares of the Company’s common stock. As a result of this transaction, the Company now owns a total of 51% of the membership interests of PE. The Warrants are exercisable for a period of 24 months from the date of issuance. The Warrants provide for the purchase of shares of the Company's Common Stock an exercise price of $1.06 per share. The Warrants are exercisable for cash, or on a cashless basis. The number of shares of Common Stock to be deliverable upon exercise of the Warrants is subject to adjustment for subdivision or consolidation of shares and other standard dilutive event.

1. DESCRIPTION OF BUSINESS AN16

1. DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Organization and Description of Business	GEX Management, Inc. (“GEX”, the “Company”, “we”, “our”, “us”) is a professional services company that was originally formed in 2004 as Group Excellence Management, LLC d/b/a MyEasyHQ. The Company converted from a limited liability company to a C corporation in March 2016, and changed its name to GEX Management, Inc. in April 2016. On January 25, 2017, GEX obtained its license to operate as a Professional Employer Organization (“PEO”), and we began offering PEO services in April 2017. The Company formed GEX Staffing, LLC (“GEX Staffing”) in March 2017. The initial funding and first transactions occurred in GEX Staffing in September 2017. The consolidated financials include the accounts of GEX Staffing, LLC. Staffing and PEO services make up a majority of our revenue. On December 29, 2017 GEX purchased 100% of the membership interest in AMAST Consulting, LLC (“AMAST”), which owned a multi-use office building in Lowell, Arkansas, which had an occupancy rate of 100% at the time of the acquisition. The terms of the Agreement to purchase AMAST include the fulfillment of the lease obligations of the current tenants, as well as the assumption of the debt that is collateralized by the building and associated property. The consolidated financials include the assets and debt of AMAST.
Basis of Presentation	Our financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”), as well as the applicable regulations and rules of the Securities and Exchange Commission (“SEC”). This requires management to make estimates and assumptions that affect the amounts reported in the financial statements and their accompanying notes. The actual results could differ from those estimates. The accompanying interim, unaudited consolidated financial statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2017 included in the Company’s Annual Report on Form 10-K, filed with the SEC on April 10, 2018. All adjustments necessary for a fair statement of the results for the interim periods have been made. All adjustments are of a normal and recurring nature.
Principles of Consolidation	The consolidated financial statements include the accounts of GEX Management, Inc. and its wholly owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. There have been no significant changes to our accounting policies that have a material impact on our financial statements and accompanying notes.
Use of Estimates	The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
Cash and Cash Equivalents	Cash and cash equivalents include cash in banks and short-term investments with original maturities of three months or less.
Accounts Receivable	Accounts receivable consists of accrued services and consulting receivables due from customers and are unsecured. The receivables are generally due within 30 to 45 days after the date of the invoice. Accounts receivable is carried at their face amount, less an allowance for doubtful accounts. GEX’s policy is not to charge interest on receivables after the invoice becomes past due. Write-offs are recorded at the time when a customer receivable is deemed uncollectible. The Company incurred $92,102 of bad debt expense for each of the three and six months ended June 30, 2018. No bad debt expense was incurred for the three or six months ended June 30, 2017.
Equity Method Investments	The Company has accounted for its investment in Payroll Express, LLC (“PE”), a Santa Clara, CA based professional services firm that provides a wide array of back office and managed services related to medical staffing needs for its healthcare clients that includes clinical practices and Ambulatory Surgery Centers (ASCs), as an equity method investment due to its ability to assert significant influence over PE’s operational and financial policies. This investment was initially accounted for at cost. The Company recognizes its proportionate share of PE’s earnings (after the effect of basis differences) as an increase in its Investment in PE and as Income from Investment in PE.
Property and Equipment	Property and Equipment, net is carried at the cost of purchase, acquisition or construction, and is depreciated over the estimated useful lives of the assets. Assets acquired in a business combination are stated at estimated fair value. Costs associated with repair and maintenance are expensed as they are incurred. Costs associated with improvements which extend the life, increase the capacity or improve the efficiency of our property and equipment are capitalized and depreciated over the remaining life of the related asset. Depreciation and amortization are provided using the straight-line methods over the useful lives of the assets as follows: Useful Life Buildings 30 Years Office Furniture & Equipment 5 Years
Impairment of Long-Lived Assets	The Company records an impairment of long-lived assets used in operations, other than goodwill, and its equity method investments when events or circumstances indicate that the asset might be impaired and the estimated undiscounted cash flows to be generated by those assets over their remaining lives are less than the carrying amount of those items. The net carrying value of assets not recoverable is reduced to fair value, which is typically calculated using the discounted cash flow method.
Revenue Recognition	Effective on January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) GEX enters into contracts with its clients for professional services, staffing and/or PEO services. GEX's contract stipulates the rate and price charged to each client. GEX's contracts for these services are generally cancellable at any time by either party with 30-days’ written notice. GEX fulfills its performance obligations each month, and the contracts generally have a term of one year with an automatic renewal after 12 months. The duration between invoicing and when GEX completes its contractual, performance obligations are satisfied is not significant. For the Company's PEO services, payment is generally due on the date the invoice is sent to the client. For staffing and professional services payment is generally due 30 days after the invoice is sent to the client. GEX does not have significant financing components or significant payment terms. GEX's revenue is generally recognized ratably, month-to-month as co-employees or staffed employees perform their service at the client's worksite. Generally, GEX's PEO clients are invoiced concurrently with each payroll of its co-employees, and clients that utilize GEX's staffing and back office services are billed concurrently with each payroll or on a monthly basis. PEO Services Professional Employment Organization (“PEO”) service revenues represent the fees charged to clients for administering payroll and payroll tax transactions for our clients’ Co-Employed Employees (“CEEs”), access to our HR and benefits administration services, consulting related to employment and benefit law compliance and general employment consulting related fees. PEO service revenues are recognized in the period the PEO services are performed as stipulated in the Client Service Agreement (“CSA”), where these fees are fixed or determinable, when the PEO client is invoiced and collectability is reasonably assured. GEX is not considered the primary obligor with respect to CEE’s payroll and payroll tax, and insurance payments and therefore, these payments are not reflected as either revenue or expense in our statements of operations. PEO-related revenues also include revenues generated from insurance administration for our PEO clients. These insurance-related revenues include insurance-related billings, as well as administrative fees that GEX collects from PEO clients and withholds from CEEs for health benefit insurance plans provided by third-party insurance carriers. Insurance-related revenues are recognized over the period the insurance coverage is provided and where collectability is reasonably assured. Staffing Services and Professional Services Staffing services revenue is derived from supplying temporary staff to clients. Temporary staff generally consists of temporary workers working under a contract for a fixed period of time, or on a specific client project. The temporary staff includes both GEX employees and third-parties contracted by GEX. Temporary staff are provided to clients through a Staffing Service Agreement (‘SSA’) involving a specified service that the temporary staff will provide to the client. When GEX is the principal or primary obligor for the temporary staff, GEX records the gross amount of the revenue and expense from the SSA. GEX is generally the primary obligor when GEX is responsible for the fulfillment of services under the SSA, even if the temporary staff are not employees of GEX. This typically occurs when GEX contracts third-parties to fulfill all or part of the SSA with the client, but GEX remains the holder of the credit risk associated with the SSA, and GEX has total discretion in establishing the pricing under the SSA. All other Professional Services revenues are recognized in the period the services are performed as stipulated in the client’s Outsourcing Agreement, when the client is invoiced, and collectability is reasonably assured. Revenue recognition for arrangements with multiple deliverables constituting a single unit of accounting is recognized generally over the greater of the term of the arrangement or the expected period of performance.
Income Taxes	The Company uses the liability method in the computation of income tax expense and the current and deferred income taxes payable. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.
Fair Value Measurements	ASC Topic 820 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and requires certain disclosures about fair value measurements. In general, fair value of financial instruments is based upon quoted market prices, where available. If such quoted market prices are not available, fair value is based upon internally developed models that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure that financial instruments are recorded at fair value. These adjustments may include amounts to reflect counterparty credit quality and the Company’s credit worthiness, among other things, as well as unobservable parameters.
Earnings Per Share	Earnings per share are calculated in accordance with ASC 260 “Earnings per Share”. Basic income (loss) per share is computed by dividing the period income (loss) available to common shareholders by the weighted average number of common shares outstanding. Diluted earnings (loss) per share is computed by dividing the income (loss) available to common share holders by the weighted average number of common shares outstanding plus additional common shares that would have been outstanding if dilutive potential common shares had been issued. For purposes of this calculation, common stock dividends, warrants and options to acquire common stock, would be considered common stock equivalents in periods in which they have a dilutive effect and are excluded from this calculation in periods in which these are anti-dilutive to the net loss per share. As of June 30, 2018, the Company had 80,000 potentially dilutive shares pursuant to convertible debt and 90,000 potentially dilutive warrant shares outstanding. At December 31, 2017, the Company has no potentially dilutive common shares. Earnings per share information for the three and six months ended June 30, 2017 has been retroactively adjusted to reflect the stock split that occurred in December 2017.
Reclassifications	Certain prior year amounts have been reclassified to conform to the current year presentation. Such reclassifications have had no effect on the financial position as of December 31, 2017 or operations or cash flows for the periods ended June 30, 2017.
Going Concern	To date, the Company has funded its operations primarily through public and private offerings of common stock, our line of credit, short-term discounted and convertible notes payable. The Company has identified several potential financing sources in order to raise the capital necessary to fund operations through June 30, 2019. In addition to the aforementioned current sources of capital that will provide additional short-term liquidity, the Company is currently exploring various other alternatives including debt and equity financing vehicles, strategic partnerships, government programs that may be available to the Company, as well as trying to generate additional sales and increase margins. However, at this time the Company has no commitments to obtain any additional funds, and there can be no assurance such funds will be available on acceptable terms or at all. If the Company is unable to obtain additional funding and improve its operations, the Company’s financial condition and results of operations may be materially adversely affected and the Company may not be able to continue operations, which raises substantial doubt about its ability to continue as a going concern. Additionally, even if the Company raises sufficient capital through additional equity or debt financing, strategic alternatives or otherwise, there can be no assurances that the revenue or capital infusion will be sufficient to enable it to develop its business to a level where it will be profitable or generate positive cash flow. If the Company raises additional funds through the issuance of equity or convertible debt securities, the percentage ownership of our stockholders could be significantly diluted, and these newly issued securities may have rights, preferences or privileges senior to those of existing stockholders. If the Company incurs additional debt, a substantial portion of its operating cash flow may be dedicated to the payment of principal and interest on such indebtedness, thus limiting funds available for business activities. The terms of any debt securities issued could also impose significant restrictions on the Company’s operations. Broad market and industry factors may seriously harm the market price of our common stock, regardless of our operating performance, and may adversely impact our ability to raise additional funds. Similarly, if the Company’s common stock is delisted from the public exchange markets, it may limit its ability to raise additional funds. The consolidated financial statements for the three and six months ended June 30, 2018 were prepared on the basis of a going concern which contemplates that the Company will be able to realize assets and discharge liabilities in the normal course of business. Accordingly, they do not give effect to adjustments that would be necessary should the Company be required to liquidate its assets. The ability of the Company to meet its total liabilities of $4,270,590 at June 30, 2018, and to continue as a going concern is dependent upon the availability of future funding, continued growth in billings and sales contracts, and the Company’s ability to profitably meet its after-sale service commitments with its existing customers. The financial statements do not include any adjustments that might result from the outcome of these uncertainties.

1. DESCRIPTION OF BUSINESS AN17

1. DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (Tables)	6 Months Ended
	Jun. 30, 2018
Accounting Policies [Abstract]
Property and equipment useful life	Useful Life Buildings 30 Years Office Furniture & Equipment 5 Years

2. OTHER CURRENT ASSETS (Tables

2. OTHER CURRENT ASSETS (Tables)	6 Months Ended
	Jun. 30, 2018
Other Assets [Abstract]
Other Current Assets	June 30, 2018 Dec 31, 2017 Other Current Assets: Prepaids $ 53,565 $ 116,623 Other Current Assets 12,029 2,709 Acquired Customer Contracts - 37,500 Accumulated Amortization - (68,083 ) Total Other Current Assets $ 65,594 $ 88,749

3. STOCKHOLDERS' EQUITY (Tables

3. STOCKHOLDERS' EQUITY (Tables)	6 Months Ended
	Jun. 30, 2018
SHAREHOLDERS’ EQUITY (DEFICIT)
Warrant activity	Weighted- Number Average of Exercise Warrant Shares Price Outstanding, at December 31, 2017 - $ - Granted 90,000 2.96 Exercised - - Forfeited or expired - - Outstanding, at end of period 90,000 2.96 Exercisable, at June 30, 2018 90,000 $ 266,400 Weighted average fair value of warrants granted during the period $ 86,360
Warrants outstanding	Weighted - Average Number Remaining Contractual Number Exercise of Warrants Life of Warrants of Warrants Prices Outstanding Outstanding Exercisable $ 4.00 50,000 4.84 years 50,000 $ 1.66 40,000 1.52 years 40,000 90,000 90,000

4. NOTES PAYABLE (Tables)

4. NOTES PAYABLE (Tables)	6 Months Ended
	Jun. 30, 2018
Notes Payable [Abstract]
Notes payable	June 30, 2018 Dec 31, 2017 Note Payable: Real Estate Lien Interest at 4.5%; $9,540 monthly principal & interest; Balloon payment due March 22, 2022 $ 1,278,272 $ 1,310,920 Discounted Notes Payable: Weekly payments totaling $26,654 Daily payments totaling $18,245 Debt matures by December 21,2018 1,851,930 - Less Discounts on Notes Payable (462,346 ) - Discounted Note Payable: Principal and interest due August 1, 2018 500,000 - Interest at 15% Less Discount on Notes Payable (51,537 ) - Convertible Notes Payable: Principal and interest due May 3, 2019 200,000 - Interest at 10% Less Discount on Notes Payable (47,974 ) - Discounted Note Payable - Related Party: Weekly payments of $44,995 Debt matures on November 9, 2018 864,355 - Less Discount on Notes Payable (302,221 ) - Note Payable - Related Party: Line of Credit up to $500,000; Due April 1, 2020 218,600 352,100 Interest at 6% Total Notes Payable 4,049,079 1,663,020 Less Current Portion (2,605,365 ) (56,649 ) Long-term Notes Payable $ 1,443,714 $ 1,606,371
Schedule of the minimum principal payments	Year Ended Amount Remainder of 2018 $ 28,001 2019 59,252 2020 61,973 2021 64,821 2022 67,798 2023 and beyond 996,427 Total $ 1,278,272

6. PROPERTY AND EQUIPMENT (Tabl

6. PROPERTY AND EQUIPMENT (Tables)	6 Months Ended
	Jun. 30, 2018
Property, Plant and Equipment [Abstract]
Property and equipment	June 30, 2018 Dec 31, 2017 Land $ 333,778 $ 333,778 Buildings 2,125,642 2,125,642 Office Equipment 5,844 5,844 Total Fixed Assets 2,465,264 2,465,264 Accumulated Depreciation (36,195 ) (1,887 ) Property and Equipment, net $ 2,429,069 $ 2,463,377

8. COMMITMENTS AND CONTINGENC22

8. COMMITMENTS AND CONTINGENCIES (Tables)	6 Months Ended
	Jun. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Minimum obligations under the lease	Year ended Amount Remainder of 2018 $ 32,120 2019 60,225 Total $ 92,345
Minimum rental income to be collected	Year Ended Amount Remainder of 2018 $ 73,452 2019 128,157 2020 37,616 Total $ 239,225

9. ACQUISITIONS (Tables)

9. ACQUISITIONS (Tables)	6 Months Ended
	Jun. 30, 2018
Business Combinations [Abstract]
Acquisition	Selected Balance Sheet Data: June 30, 2018 Current Assets $ 910,738 Long-term Assets $ 9,346 Current Liabilities $ 783,126 Long-term Liabilities $ 16,576 Selected Income Statement Data for the three and six months ended June 30, 2018: Three and Six Months Ended June 30, 2018 Gross Profit $ 133,544 Net Income before Income Taxes $ 53,145

1. DESCRIPTION OF BUSINESS AN24

1. DESCRIPTION OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (Details Narrative)	6 Months Ended
	Jun. 30, 2018
Buildings
Useful life	30 years
Office Furniture & Equipment
Useful life	5 years

2. OTHER CURRENT ASSETS (Detail

2. OTHER CURRENT ASSETS (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Other Assets [Abstract]
Prepaids	$ 53,565	$ 116,623
Other Current Assets	12,029	2,709
Acquired Customer Contracts	0	37,500
Accumulated Amortization	0	(68,083)
Total Other Current Assets	$ 65,594	$ 88,749

3. STOCKHOLDERS' EQUITY (Detail

3. STOCKHOLDERS' EQUITY (Details)	6 Months Ended
	Jun. 30, 2018$ / sharesshares
SHAREHOLDERS’ EQUITY (DEFICIT)
Number of warrants outstanding, beginning | shares	0
Number of warrants granted | shares	90,000
Number of warrants exercised | shares	0
Number of warrants forfeited or expired | shares	0
Number of warrants outstanding, ending | shares	90,000
Number of warrants exercisable | shares	90,000
Weighted average exercise price outstanding, beginning	$ .00
Weighted average exercise price granted	2.96
Weighted average exercise price exercised	.00
Weighted average exercise price forfeited or expired	.00
Weighted average exercise price outstanding, ending	2.96
Weighted average exercise price exercisable	266,400
Weighted average fair value of warrants granted during the period	$ 86,360

3. STOCKHOLDERS' EQUITY (Deta27

3. STOCKHOLDERS' EQUITY (Details 1) - shares	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Number of warrants outstanding	90,000	0
Number of warrants exercisable	90,000
$ 4
Number of warrants outstanding	50,000
Weighted average remaining contractual life of warrants outstanding	4 years 10 months 2 days
Number of warrants exercisable	50,000
$ 1.66
Number of warrants outstanding	40,000
Weighted average remaining contractual life of warrants outstanding	1 year 6 months 7 days
Number of warrants exercisable	40,000

3. STOCKHOLDERS' EQUITY (Deta28

3. STOCKHOLDERS' EQUITY (Details Narrative) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
SHAREHOLDERS’ EQUITY (DEFICIT)
Common stock shares authorized	200,000,000	200,000,000
Common stock shares par value	$ .001	$ 0.001
Common stock shares outstanding	11,922,231	11,797,231
Preferred stock shares authorized	20,000,000	20,000,000
Preferred stock shares par value	$ 0.001	$ 0.001
Preferred stock shares outstanding	0	0

4. NOTES PAYABLE (Details)

4. NOTES PAYABLE (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Total Notes Payable	$ 4,049,079	$ 1,663,020
Less: Current Portion	(2,605,365)	(56,649)
Long-Term Notes Payable	1,443,714	1,606,371
Note Payable: Real Estate Lien
Note payable	1,278,272	1,310,920
Discounted Notes Payable
Note payable	1,851,930	0
Less Discount on Note Payable	(462,346)	0
Discounted Notes Payable
Note payable	500,000	0
Less Discount on Note Payable	(51,537)	0
Convertible Notes Payable
Note payable	200,000	0
Less Discount on Note Payable	(47,974)	0
Discounted Note Payable - Related Party
Note payable	864,355	0
Less Discount on Note Payable	(302,221)	0
Note Payable - Related Party
Note payable	$ 218,600	$ 352,100

4. NOTE PAYABLE (Details 1)

4. NOTE PAYABLE (Details 1)	Jun. 30, 2018USD ($)
Notes Payable [Abstract]
Remainder of 2018	$ 28,001
2,019	59,252
2,020	61,973
2,021	64,821
2,022	67,798
2023 and beyond	996,427
Total	$ 1,278,272

4. NOTE PAYABLE (Details Narrat

4. NOTE PAYABLE (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Notes Payable [Abstract]
Interest expense	$ 687,084	$ 4,919	$ 732,638	$ 10,292

5. ACCOUNTS RECEIVABLE AND CO32

5. ACCOUNTS RECEIVABLE AND CONCENTRATION OF CREDIT RISK (Details Narrative)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Accounts Receivable | One Customer
Concentration risk			25.00%
Accounts Receivable | Four Customers
Concentration risk			26.00%
Accounts Receivable | Three Customers
Concentration risk					86.00%
Revenue | One Customer
Concentration risk	24.73%		37.37%
Revenue | Two Customers
Concentration risk		95.18%		95.18%

6. PROPERTY AND EQUIPMENT (Deta

6. PROPERTY AND EQUIPMENT (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017
Fixed Assets	$ 2,465,264	$ 2,465,264
Accumulated Depreciation	(36,195)	(1,887)
Property and Equipment, net	2,429,069	2,463,377
Land
Fixed Assets	333,778	333,778
Buildings
Fixed Assets	2,125,642	2,125,642
Office Equipment
Fixed Assets	$ 5,844	$ 5,844

6. PROPERTY AND EQUIPMENT (De34

6. PROPERTY AND EQUIPMENT (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 14,654	$ 14,508	$ 34,307	$ 14,652

7. RELATED PARTY TRANSACTIONS (

7. RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Revenues	$ 0	$ 44,000	$ 0	$ 64,000
Agreement 1
Agreement balance payable	218,600		218,600		$ 352,100
Agreement 2
Revenues			0	0
Agreement 3
Revenues	$ 0	$ 0	$ 0	$ 1,116

8. COMMITMENTS AND CONTINGENC36

8. COMMITMENTS AND CONTINGENCIES (Details)	Jun. 30, 2018USD ($)
Commitments and Contingencies Disclosure [Abstract]
Remainder of 2018	$ 32,120
2,019	60,225
Total	$ 92,345

8. COMMITMENTS AND CONTINGENC37

8. COMMITMENTS AND CONTINGENCIES (Details 1)	Jun. 30, 2018USD ($)
Commitments and Contingencies Disclosure [Abstract]
Remainder of 2018	$ 73,452
2,019	128,157
2,020	37,616
Total	$ 239,225

8. COMMITMENTS AND CONTINGENC38

8. COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Commitments and Contingencies Disclosure [Abstract]
Rental income	$ 36,228	$ 0	$ 74,138	$ 0

9. ACQUISITIONS (Details)

9. ACQUISITIONS (Details)	6 Months Ended
	Jun. 30, 2018USD ($)
Business Combinations [Abstract]
Current Assets	$ 910,738
Long-term Assets	9,346
Current Liabilities	783,126
Long-term Liabilities	16,576
Gross Profit	133,544
Net Income before Income Taxes	$ 53,145