Cover
Cover - USD ($) | 12 Months Ended | ||
Jan. 31, 2021 | May 31, 2021 | Jul. 31, 2020 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Annual Report | true | ||
Document Period End Date | Jan. 31, 2021 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2020 | ||
Current Fiscal Year End Date | --01-31 | ||
Entity File Number | 333-216868 | ||
Entity Registrant Name | Chee Corp. | ||
Entity Central Index Key | 0001696898 | ||
Entity Tax Identification Number | 32-0509577 | ||
Entity Incorporation, State or Country Code | NV | ||
Entity Address, Address Line One | 1206 East Warner Road | ||
Entity Address, Address Line Two | Suite 101-I | ||
Entity Address, Address Line Three | Gilbert | ||
Entity Address, State or Province | AZ | ||
Entity Address, Postal Zip Code | 85296 | ||
City Area Code | 480 | ||
Local Phone Number | 225-4052 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Elected Not To Use the Extended Transition Period | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 24,145 | ||
Entity Common Stock, Shares Outstanding | 7,207,250 |
BALANCE SHEETS
BALANCE SHEETS - USD ($) | Jan. 31, 2021 | Jan. 31, 2020 |
Current Assets | ||
Cash | $ 914,695 | $ 106 |
Prepaid expenses | 1,290 | |
Current assets - discontinued operations | 10,272 | |
Total Current Assets | 915,985 | 10,378 |
Advance to Klusman Family Holdings, LLC, a related party | 50,000 | |
Notes receivable from Klusman Family Holdings, LLC, a related party, including accrued interest of $745 | 160,745 | |
Non-current assets - discontinued operations | 833 | |
Total Assets | 1,126,730 | 11,211 |
Current Liabilities | ||
Accounts payable and accrued expenses | 91,645 | 3,300 |
Accrued interest payable to Klusman Family Holdings, LLC, a related party | 1,659 | |
Due to related party | 29,750 | |
Total Current Liabilities | 93,304 | 33,050 |
Total Liabilities | 93,304 | 33,050 |
Commitments and contingencies | ||
Stockholder's Equity | ||
Common stock, $0.001 par value; authorized - 75,000,000 shares; issued, issuable, and outstanding - 7,207,250 shares and 5,707,250 shares at January 31, 2021 and 2020, respectively | 7,207 | 5,707 |
Additional paid in capital | 1,558,721 | 22,938 |
Accumulated income (deficit) | (532,502) | (50,484) |
Total Stockholder's Equity | 1,033,426 | (21,839) |
Total Liabilities and Stockholder's Equity | $ 1,126,730 | $ 11,211 |
BALANCE SHEETS (Parenthetical)
BALANCE SHEETS (Parenthetical) - $ / shares | Jan. 31, 2021 | Jan. 31, 2020 |
Statement Condensed Balance Sheets Unaudited Parenthetical Abstract | ||
Common stock par value | $ 0.001 | $ 0.001 |
Common stock shares authorized | 75,000,000 | 75,000,000 |
Common stock shares issued | 7,207,250 | 5,707,250 |
Common stock shares outstanding | 7,207,250 | 5,707,250 |
STATEMENTS OF OPERATIONS
STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Jan. 31, 2021 | Jan. 31, 2020 | |
Statements Of Operations | ||
REVENUES | ||
General and Administrative Expenses | ||
Compensation to officers, directors, affiliates, and other related parties | 342,500 | |
Other | 137,070 | 35,386 |
Total costs and expenses | 480,570 | 35,386 |
Loss from operations | (480,570) | (35,386) |
Other income (expense): | ||
Interest income, related party | 745 | |
Interest expense, related party | (1,688) | |
Total other income (expense), net | (943) | |
Loss from continuing operations | (481,513) | (35,386) |
Income (loss) from discontinued operations | (505) | 8,921 |
NET INCOME/LOSS | $ (482,018) | $ (26,465) |
NET LOSS PER SHARE: BASIC AND DILUTED | ||
Loss from continuing operations | $ (0.08) | $ (0.01) |
Income (loss) from discontinued operations | 0 | 0 |
Net loss | $ (0.08) | $ (0.01) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED | 5,763,534 | 5,707,250 |
STATEMENTS OF STOCKHOLDERS' EQU
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIENCY) - USD ($) | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Beginning Balance at Jan. 31, 2019 | $ 5,707 | $ 22,938 | $ (24,019) | $ 4,626 |
Beginning Balance (in shares) at Jan. 31, 2019 | 5,707,250 | |||
Loans and advances payable contributed to capital by related party | ||||
Proceeds from sale of common stock | ||||
Net loss for the period | (26,465) | (26,465) | ||
Ending Balance at Jan. 31, 2020 | $ 5,707 | 22,938 | (50,484) | (21,839) |
Ending Balance (in shares) at Jan. 31, 2020 | 5,707,250 | |||
Loans and advances payable contributed to capital by related party | 37,283 | 37,283 | ||
Proceeds from sale of common stock | $ 1,500 | 1,498,500 | 1,500,000 | |
Proceeds from sale of common stock (in shares) | 1,500,000 | |||
Net loss for the period | (482,018) | (482,018) | ||
Ending Balance at Jan. 31, 2021 | $ 7,207 | $ 1,558,721 | $ (532,502) | $ 1,033,426 |
Ending Balance (in shares) at Jan. 31, 2021 | 7,207,250 |
STATEMENTS OF CASH FLOWS
STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Jan. 31, 2021 | Jan. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss for the period | $ (482,018) | $ (26,465) |
Loss (income) from discontinued operations | (505) | 8,921 |
Net loss from continuing operations | (481,513) | (35,386) |
Changes in operating assets and liabilities: | ||
Advances from related parties | 7,533 | |
Prepaid expenses | (1,290) | |
Accrued interest receivable | (745) | |
Accounts payable and accrued expenses | 88,345 | 3,300 |
Accrued interest payable, related party | 1,659 | |
CASH FLOWS USED IN OPERATING ACTIVITIES | (386,011) | (32,086) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Related party loans | (50,000) | |
Notes receivable from Klusman Family Holdings, LLC, a related party | (160,000) | |
CASH FLOWS USED IN INVESTING ACTIVITIES | (210,000) | |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Loan from Farm House Partners, LLC, a related party | 50,000 | 13,700 |
Proceeds from sale of common stock to a related party | 1,500,000 | |
Loan from Michael Witherill, a related party | 4,770 | |
Repayment of loans from Farm House Partners, LLC and Michael Witherill | (54,770) | |
CASH FLOWS USED IN FINANCING ACTIVITIES | 1,500,000 | 13,700 |
Net cash provided by discontinued operations | 10,600 | 14,662 |
NET INCREASE/DECREASE IN CASH | 914,589 | (3,724) |
Cash, beginning of period | 106 | 3,830 |
Cash, end of period | 914,695 | 106 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Interest paid | 29 | |
Income taxes paid | ||
Noncash investing and financing activities: | ||
Loan payable contributed to capital by related party | $ 37,283 |
ORGANIZATION AND BASIS OF PRESE
ORGANIZATION AND BASIS OF PRESENTATION | 12 Months Ended |
Jan. 31, 2021 | |
Organization And Basis Of Presentation | |
ORGANIZATION AND BASIS OF PRESENTATION | 1. ORGANIZATION AND BASIS OF PRESENTATION Chee Corp. (the “Company”) was incorporated on October 26, 2016 under the laws of the State of Nevada. The Company underwent a change in control effective September 4, 2020 and in conjunction therewith its business operations through September 30, 2020 were accounted for as discontinued operations. From October 1, 2020 through January 31, 2021, the Company’s operations were limited and focused on developing a new business operation involving investment in commercial real estate in Arizona. Change in Control Transaction Effective September 4, 2020, Farm House Partners, LLC, an Arizona limited liability company, purchased 4,500,000 shares of the Company’s common stock from Da Wei Jiang pursuant to a Stock Purchase Agreement, representing 78.8% of the issued and outstanding shares of common stock of the Company. Farm House Partners, LLC is owned 67% by Klusman Family Holdings, LLC, an Arizona limited liability company, and 17% by Debbie Rasmussen, the wife of Michael Witherill. The amount of consideration for the purchase of such shares of common stock was a cash payment of $283,973, which was financed through short-term borrowings from two unaffiliated third parties. As a condition of closing of the transaction, Zhang Shufang, the sole director and officer of the Company, resigned from all of his positions and Aaron Klusman and Michael Witherill were appointed as directors of the Company. In addition, Mr. Klusman was appointed as Chairman and Chief Executive Officer of the Company and Mr. Witherill was appointed Vice-Chairman, Secretary, and Treasurer of the Company. The effective date of the resignation and appointments was September 18, 2020. The effective date of the resignation and appointments was September 18, 2020. On March 2, 2021, Mr. Witherill resigned from his positions as Vice-Chairman, Secretary, and Treasurer, and Rick Gean was appointed to such positions. Mr. Gean served as a consultant to the Company from February 18, 2021, to March 2, 2021. On April 27, 2021, John Morgan was appointed as a director of the Company. Business As described above, the Company underwent a change in control transaction effective September 4, 2020, as a result of which new management of the Company terminated the Company’s existing business operations and decided to reorient the Company’s business activities into commercial real estate. On December 15, 2020, the Company entered into a binding Letter of Intent with Klusman Family Holdings, LLC, and Aaron Klusman, pursuant to which the Company agreed to purchase 100% of the membership interest in Klusman Family Holdings, LLC from Aaron Klusman, who is also Chief Executive Officer, Chairman of the Board, and a Director of the Company, for consideration consisting of payments totaling $1,500,000 and the issuance of 10,945,250 shares of common stock of the Company. Klusman Family Holdings, LLC is engaged in the business of acquiring, leasing, and managing real property in Arizona. The transaction is currently anticipated to close subsequent to July 31, 2021, although there can be no assurances that the Company will be able to complete this transaction. Upon closing, the Company expects that this transaction would be accounted for as a reverse recapitalization. The Company has suffered losses from operations and negative operating cash flows since inception. As of January 31, 2021, the Company had not yet commenced any business activities in commercial real estate. The Company’s future business activities will be subject to significant risks and uncertainties, including the need for and availability of additional capital. Discontinued Operations and Reclassifications Prior to the change in control transaction described above, the Company was in the early stages of developing and financing a business plan to distribute 3D goods and accessories in China. As a result of the change in control transaction, the Company’s former business operations (for the period from October 1, 2020 through September 30, 2020) have been presented as discontinued operations as of January 31, 2021 and for the year ended January 31, 2021. Comparative amounts as of January 31, 2020 and for the year ended January 31, 2020 have been reclassified to conform to the current year’s presentation. These changes did not impact the Company’s net loss, shareholders’ equity (deficiency) or operating cash flows for any reported period. Going Concern The Company’s financial statements have been presented on the basis that the Company is a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As reflected in the accompanying financial statements, the Company has suffered losses from operations and negative operating cash flows since inception. During the year ended January 31, 2021, the Company incurred a net loss of $482,018. As discussed above, the Company underwent a change in control effective September 4, 2020 and in conjunction therewith its business operations through September 30, 2020 were accounted for as discontinued operations. From October 1, 2020 through January 31, 2021, the Company’s operations were limited and focused on developing a new business operation involving investment in commercial real estate in Arizona. The Company has financed its working capital requirements since October 1, 2020 through short-term borrowings, including from its new control shareholder, and sales of common stock. At January 31, 2021, the Company did not have sufficient cash resources available to fund its operations and will therefore need to raise additional funds in the short-term. However, there can be no assurances that the Company will be successful in this regard. As a result, management has concluded that there is substantial doubt about the Company’s ability to continue as a going concern. In addition, the Company’s independent registered public accounting firm, in their report on the Company’s financial statements for the year ended January 31, 2021, has also expressed substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to raise additional funds and implement its business plan, and to ultimately achieve sustainable operating revenues and profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. The development and expansion of the Company’s business subsequent to January 31, 2021 will be dependent on many factors, including the capital resources available to the Company. No assurances can be given that any future financing will be available or, if available, that they will be on terms that are satisfactory to the Company or adequate to fund the development and expansion of the Company’s business operations to a level that is commercially viable and self-sustaining. There is also significant uncertainty as to the effect that the coronavirus pandemic may have on the availability, amount, and type of financing in the future. If cash resources are insufficient to satisfy the Company’s ongoing cash requirements, the Company would be required to scale back or discontinue its operations, obtain funds, if available, although there can be no certainty, through strategic alliances that may require the Company to relinquish rights to any assets, or to discontinue its operations entirely. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Jan. 31, 2021 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Preparation The accompanying financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”). Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the 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 expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. The most significant estimates to be made by management in the preparation of the financial statements are expected to relate to valuing equity instruments issued; the realization of deferred tax assets; and accruals for contingent liabilities. Risks and Uncertainties The Company has suffered losses from operations and negative operating cash flows since inception. The Company underwent a change in control effective September 4, 2020 and in conjunction therewith its business operations through September 30, 2020 were accounted for as discontinued operations. From October 1, 2020 through January 31, 2021, the Company’s operations were limited and focused on developing a new business operation involving investment in commercial real estate in Arizona. On December 15, 2020, the Company entered into a binding Letter of Intent with Klusman Family Holdings, LLC, and Aaron Klusman, pursuant to which the Company agreed to purchase 100% of the membership interest in Klusman Family Holdings, LLC from Aaron Klusman, who is also Chief Executive Officer, Chairman of the Board, and a Director of the Company, for consideration consisting of payments totaling $1,500,000 and the issuance of 10,945,250 shares of common stock of the Company. Klusman Family Holdings, LLC is engaged in the business of acquiring, leasing, and managing real property in Arizona. The transaction is currently anticipated to close subsequent to July 31, 2021, although there can be no assurances that the Company will be able to complete this transaction. Upon closing, the Company expects that this transaction would be accounted for as a reverse recapitalization. The Company’s proposed business and operations are sensitive to general business and economic conditions in the United States generally and in Arizona specifically. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the economy. A host of factors beyond the Company’s control could cause fluctuations in these conditions. Adverse developments in these general business and economic conditions could have a material adverse effect on the Company’s financial condition and the results of its operations, both in the short-term and the long-term, as well as on the Company’s ability to complete the transaction with Klusman Family Holdings, LLC as described above. The Company has financed its working capital requirements since October 1, 2020 through short-term borrowings, including from its new control shareholder, and sales of common stock. At January 31, 2021, the Company did not have sufficient cash resources available to fund its operations and will therefore need to raise additional funds in the short-term. However, there can be no assurances that the Company will be successful in this regard. The Company has received significant financial support from a private investor, Lawrence Silver, to allow the Company to fund its business operations in 2021. From early January 2021 through May 8, 2021, the Company has raised working capital from Lawrence Silver through the sale of shares and short-term borrowings, which has provided an aggregate of $1,500,000 of equity capital and $500,000 of debt capital (as described in Notes 6 and 9) The working capital provided by Lawrence Silver has provided the Company with the resources to fund the Company’s advances to Klusman Family Holdings, LLC to acquire various real estate properties in Arizona (as described in Notes 3 and 9). As of May 8, 2021, Lawrence Silver currently owns approximately 28.5% of the issued and outstanding shares of the Company’s common stock, and the Company has an interest-bearing unsecured promissory note of $500,000 payable to Lawrence Silver that matures on June 22, 2021. Cash The Company maintains its cash balances with financial institutions with high credit ratings and in accounts insured by the Federal Deposit Insurance Corporation (the “FDIC”). The Company may periodically have cash balances in banks in excess of FDIC insurance limits. The Company has not experienced any losses to date resulting from this practice. Concentrations The Company may periodically contract with consultants and vendors to provide services related to the Company’s business activities. Agreements for these services may be for a specific time period or for a specific project or task. Income Taxes The Company accounts for income taxes under an asset and liability approach for financial accounting and reporting for income taxes. Accordingly, the Company recognizes deferred tax assets and liabilities for the expected impact of differences between the financial statements and the tax basis of assets and liabilities. The Company records a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized. In the event the Company was to determine that it would be able to realize its deferred tax assets in the future in excess of its recorded amount, an adjustment to the deferred tax assets would be credited to operations in the period such determination was made. Alternatively, should the Company determine that it would not be able to realize all or part of its deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to operations in the period such determination was made. As the Company’s net operating losses in the respective jurisdictions in which it operates have yet to be utilized, all previous tax years remain open to examination by the respective taxing authorities. The Company had no unrecognized tax benefits as of January 31, 2021 and does not anticipate any material amount of unrecognized tax benefits within the next 12 months. The Company accounts for uncertainties in income tax law under a comprehensive model for the financial statement recognition, measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax returns as prescribed by GAAP. The tax effects of a position are recognized only if it is “more-likely-than-not” to be sustained by the taxing authority as of the reporting date. If the tax position is not considered “more-likely-than-not” to be sustained, then no benefits of the position are recognized. As of January 31, 2021, the Company had no uncertain tax positions, and will continue to evaluate for uncertain tax positions in subsequent periods. In future periods, any interest and penalties related to uncertain tax positions will be recognized as a component of income tax expense. Stock-Based Compensation The Company intends to periodically issue common stock and stock options to officers, directors, employees, contractors and consultants for services rendered. Options vest and expire according to terms established at the issuance date of each grant. Stock grants, which are generally time vested, will be measured at the grant date fair value and charged to operations ratably over the vesting period. The Company will account for stock-based payments to officers, directors, employees, contractors, and consultants by measuring the cost of services received in exchange for equity awards utilizing the grant date fair value of the awards, with the cost recognized as compensation expense over the period during which the individual is required to perform services in exchange for the award, which is generally over the vesting period of the award. The fair value of stock options granted as stock-based compensation will be determined utilizing the Black-Scholes option-pricing model, and is effected by several variables, the most significant of which are the life of the equity award, the exercise price of the stock option as compared to the fair market value of the common stock on the grant date, and the estimated volatility of the common stock. Estimated volatility is based on the historical volatility of the Company’s common stock over an appropriate calculation period, or, if not available, by reference to the volatility of a representative sample of comparable public companies. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair market value of the common stock is determined by reference to the quoted market price of the Company’s common stock on the grant date. The Company will recognize the fair value of stock-based compensation awards in in the Company’s statements of operations. Through January 31, 2021, the Company has not incurred any stock-based compensation costs. The Company will issue new shares of common stock to satisfy any stock option exercises. Fair Value of Financial Instruments The authoritative guidance with respect to fair value established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels and requires that assets and liabilities carried at fair value be classified and disclosed in one of three categories, as presented below. Disclosure as to transfers in and out of Levels 1 and 2, and activity in Level 3 fair value measurements, is also required. Level 1. Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded securities and exchange-based derivatives. Level 2. Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange-based derivatives, mutual funds, and fair-value hedges. Level 3. Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently traded non-exchange-based derivatives and commingled investment funds and are measured using present value pricing models. The Company will determine the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company will perform an analysis of the assets and liabilities at each reporting period end. The Company’s financial instruments include or are expected to include prepaid expenses, advance to a related party, accounts payable, accrued expenses, and due to related parties. The estimated fair value of these instruments is expected to approximate their respective carrying amounts due to the short-term nature of these instruments. Earnings (Loss) Per Share The Company’s computation of earnings (loss) per share (“EPS”) includes basic and diluted EPS. Basic EPS is measured as the income (loss) attributable to common stockholders divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., convertible notes payable, convertible preferred stock and stock options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. Loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the respective periods. Basic and diluted loss per common share is the same for all periods presented. Leases Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) (“ASU 2016-02”) requires a lessee to record a right-of-use asset and a corresponding lease liability at the inception of the lease initially measured at the present value of the lease payments. ASU 2016-02 requires recognition in the statement of operations of a single lease cost that is calculated as a total cost of the lease allocated over the lease term, generally on a straight-line basis. ASU 2016-02 excludes short-term operating leases with a lease term of 12 months or less at the commencement date, and that do not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. The Company did not have any leases within the scope of ASU 2016-02 at January 31, 2021. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 significantly changes how entities measure credit losses for most financial assets, including accounts and notes receivables. ASU 2016-13 will replace the current “incurred loss” approach with an “expected loss” model, under which companies will recognize allowances based on expected rather than incurred losses. Entities will apply the provisions of ASU 2016-13 as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which ASU 2016-13 is effective. ASU 2016-13 will be effective for the Company for interim and annual reporting periods beginning after December 15, 2022. Management is currently in the process of assessing the impact of the adoption of ASU-2016-13 on the Company’s financial statement presentation and disclosures. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions and enhances and simplifies various aspects of the income tax accounting guidance in ASC 740. ASU 2019-12 is effective for interim and annual reporting periods beginning after December 15, 2020. The adoption of ASU 2019-12 is not expected to have any impact on the Company’s financial statement presentation or disclosures. In August 2020, the FASB issued ASU 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06). ASU 2020-06 simplifies the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. Limiting the accounting models results in fewer embedded conversion features being separately recognized from the host contract as compared with current GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. ASU 2020-06 also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. ASU 2020-06 will be effective for public companies for fiscal years beginning after December 15, 2023. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, and only if adopted as of the beginning of such fiscal year. The adoption of ASU 2020-06 is not expected to have any impact on the Company’s financial statement presentation or disclosures, with any effect being largely dependent on the composition and terms of outstanding financial instruments at the time of adoption. Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. |
ADVANCE TO KLUSMAN FAMILY HOLDI
ADVANCE TO KLUSMAN FAMILY HOLDINGS, LLC | 12 Months Ended |
Jan. 31, 2021 | |
Notes to Financial Statements | |
ADVANCE TO KLUSMAN FAMILY HOLDINGS, LLC | 3. ADVANCE AND NOTES RECEIVABLE FROM KLUSMAN FAMILY HOLDINGS, LLC Advance to Klusman Family Holdings, LLC On October 27, 2020, the Company paid $50,000 to Klusman Family Holdings, LLC (“KFH”) as an advance against the purchase price under a binding letter of intent for the Company to acquire 100% of the membership interest in KFH, a company engaged in the commercial real estate business in Arizona. The advance is non-interest bearing and non-refundable. Consideration for the Company’s acquisition of the membership interest in KFH will consist of payments totaling $1,500,000 and the issuance of 10,945,250 shares of common stock of the Company. The $50,000 advance has been accounted for as a non-current asset on the Company’s balance sheet at January 31, 2021. The transaction is currently anticipated to close subsequent to July 31, 2021, although there can be no assurances that the Company will be able to complete this transaction. Upon closing, the Company expects that this transaction would be accounted for as a reverse recapitalization. Notes Receivable from Klusman Family Holdings, LLC On January 12, 2021, the Company advanced the amount of $100,000 to KFH. Repayment of this amount was evidenced by a promissory note executed by KFH and payable to the Company. The note matures on June 30, 2021, is unsecured, bears interest at a rate of 10% per annum, and the unpaid principal and interest may be accelerated upon an event of default as defined thereunder. The amount advanced is to be used by KFH exclusively toward the purchase of real property known as the Collab located at 325 North Ash Street in Gilbert, Arizona. The $100,000 note receivable, and related accrued interest in the amount of $548, have been accounted for as non-current assets on the Company’s balance sheet at January 31, 2021. On January 19, 2021, the Company, advanced the amount of $60,000 to KFH. The advance was evidenced by a promissory note payable by KFH to the Company. The note matures on June 30, 2021, is unsecured, bears interest at a rate of 10% per annum, and the unpaid principal and interest may be accelerated upon an event of default as defined thereunder. The amount advanced is to be used by KFH exclusively toward the purchase of real property known as the Collab located at 325 North Ash Street in Gilbert, Arizona. The $60,000 note receivable, and related accrued interest in the amount of $197, have been accounted for as non-current assets on the Company’s balance sheet at January 31, 2021. Additional notes receivable from KFH are described in Note 9. Information regarding the parties to these transactions is included in the description of the September 4, 2020 change in control transaction described in Note 1. |
PROMISSORY NOTE PAYABLE TO FARM
PROMISSORY NOTE PAYABLE TO FARM HOUSE PARTNERS, LLC | 12 Months Ended |
Jan. 31, 2021 | |
Notes to Financial Statements | |
PROMISSORY NOTE PAYABLE TO FARM HOUSE PARTNERS, LLC | 4. PROMISSORY NOTES PAYABLE TO FARM HOUSE PARTNERS, LLC On October 27, 2020, the Company borrowed $50,000 from Farm House Partners, LLC (“Farm House”) and executed a promissory note payable to Farm House. The promissory note was unsecured, matures on October 27, 2021, and bears interest at a rate of 10% per annum. The principal amount of the promissory note was paid on January 29, 2021. The accrued interest of $1,306 was unpaid as of January 31, 2021. Farm House is the owner of approximately 62.5% of the shares of common stock of the Company and Michael Witherill, Vice-Chairman of the Company and the Company’s former Chief Financial Officer, Secretary, and Treasurer, is the sole manager of Farm House. On November 4, 2020, the Company borrowed $15,000 from Farm House. The promissory note payable was unsecured, matures on November 11, 2021, and bear the interest at a rate of 10% annum. The principal amount of the promissory note was paid on January 29, 2021. The accrued interest of $353 was unpaid as of January 31, 2021. On December 8, 2020 the Company executed a promissory note payable to Farm House, as lender, pursuant to which the Company borrowed $20,000. The note was scheduled to mature on January 31, 2021. The note is unsecured and bears no interest, and the unpaid principal may be accelerated upon an event of default as defined thereunder. This loan was paid in full on January 29, 2021. Information regarding the parties to this transaction is included in the description of the September 4, 2020 change in control transaction described in Note 1. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Jan. 31, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 5. RELATED PARTY TRANSACTIONS On June 16, 2020, the Company’s former director loaned the Company $4,003. The loan was unsecured, non-interest bearing, and due on demand. As of July 31, 2020, all loans from the former director aggregating $37,283 had been cancelled and contributed to capital. On October 13, 2020, the Company borrowed $4,770 from Michael Witherill pursuant to an unsecured promissory note payable. The note matured on November 13, 2020, was unsecured, and bore interest at a rate of 10% per annum. The principal balance of the promissory note, including related accrued interest in the amount of $29, was paid in full in November and December 2020. During September and October 2020, an entity affiliated with Michael Witherill, a director of the Company, loaned the Company $858. The loan was unsecured, non-interest bearing, and due on demand. The loan was repaid on December 9, 2020. During January 2021, the Company made one-time payments of $125,000 to each of Aaron Klusman and Michael Witherill as compensation for their services as directors and officers of the Company. Michael Witherill resigned as Chief Financial Officer, Secretary, and Treasurer of the Company on March 2, 2021. During the year ended January 31, 2021, the Company incurred salary and fees to officers, directors, consultants and professionals in the amount of $342,500 as follows: Aaron Klusman $ 175,000 Michael Witherill 150,000 Lanna Dodd 17,500 Total $ 342,500 The Company did not have any similar related party costs and expenses for the year ended January 31, 2020, as new officers and directors were appointed in conjunction with the change in control transaction that the Company underwent effective September 4, 2021, as described in Note 1. Additional related party transactions are described in Notes 3 and 4. |
STOCKHOLDERS' EQUITY (DEFICIENC
STOCKHOLDERS' EQUITY (DEFICIENCY) | 12 Months Ended |
Jan. 31, 2021 | |
Stockholders Equity | |
STOCKHOLDERS' EQUITY (DEFICIENCY) | 6. STOCKHOLDERS’ EQUITY (DEFICIENCY) The Company is authorized to issue a total of 75,000,000 shares of common stock, par value $0.001 per share, of which 7,207,250 shares and 5,707,250 shares were issued and outstanding at January 31, 2021 and 2020, respectively. As of July 31, 2020, all loans from a former director aggregating $37,283 had been cancelled and contributed to capital. Additional information regarding these loans is described in Note 5. On January 7, 2021, the Company, entered into a subscription agreement with Lawrence Silver pursuant to which the Company sold 400,000 shares of its common stock for a purchase price of $400,000. On January 29, 2021, the Company entered into a subscription agreement with Lawrence Silver pursuant to which the Company sold 1,000,000 shares for a purchase price of $1,000,000. In January 2021, the Company received proceeds of $100,000 from the sale of 100,000 shares of common stock to Lawrence Silver. On April 15, 2021, the Company and Lawrence Silver entered into a subscription agreement with respect to the sale of the 100,000 shares of common stock. As the proceeds were received by the Company prior to January 31, 2021, these shares are reflected as issuable and outstanding in the accompanying financial statements as of January 31, 2021. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Jan. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 7. INCOME TAXES Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets as of January 31, 2021 and 2020 are summarized below. January 31, 2021 2020 Net operating loss carryforwards $ 139,000 $ 15,300 Valuation allowance (139,000 ) (15,300 ) Net deferred tax assets $ — $ — In assessing the potential realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the Company attaining future taxable income during the periods in which those temporary differences become deductible. As of January 31, 2021, management was unable to determine if it is more likely than not that the Company’s deferred tax assets will be realized and has therefore recorded an appropriate valuation allowance against deferred tax assets at such dates. No federal tax provision has been provided for the years ended January 31, 2021 and 2020 due to the losses incurred during such periods. The reconciliation below presents the difference between the income tax rate computed by applying the U.S. federal statutory rate and the effective tax rate for the years ended January 31, 2021 and 2020. Years Ended 2021 2020 U. S. federal statutory tax rate 21.0 % 21.0 % Change in valuation allowance (21.0 )% (21.0 )% Effective tax rate 0.0 % 0.0 % At January 31, 2021, the Company has available net operating loss carryforwards for federal income tax purposes of approximately $554,800. Federal net operating losses, if not utilized earlier, expire through 2040. Additionally, at January 31, 2021, the Company has available net operating loss carryforwards for federal income tax purposes which were acquired from the accounting acquiree in connection with the reverse acquisition transaction. Under Internal Revenue Code Section 382, the Company’s ability to use these net operating loss carryforwards is severely limited because of statutory change in control provisions, as a result of which they are not material and are therefore not included in the deferred tax assets described herein. As the Company’s net operating losses have yet to be utilized, all tax years remain open to examination by federal authorities and other jurisdictions in which the Company currently operates or has operated in the past. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Jan. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 8. COMMITMENTS AND CONTINGENCIES Legal Matters The Company may, from time to time, be involved in legal proceedings, regulatory actions, claims, and litigation arising in the ordinary course of business, which are not expected to have a material adverse effect upon the Company’s financial statements. As of January 31, 2021, the Company was not a party to any pending or threatened legal proceedings. Impact of COVID-19 on the Company The global outbreak of COVID-19 has led to disruptions in general economic activities, as businesses and governments have taken broad actions to mitigate this public health crisis. Although the Company has not experienced any significant disruption to its business to date, these conditions could significantly negatively impact the Company’s business in the future. The extent to which the COVID-19 outbreak ultimately impacts the Company’s business, future revenues, results of operations and financial condition will depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to, the duration and spread of the outbreak, its severity and longevity, the actions to curtail the virus and treat its impact (including an effective vaccine), and how quickly and to what extent normal economic and operating conditions can resume. Even after the COVID-19 outbreak has subsided, the Company may be at risk of experiencing a significant impact to its business as a result of the global economic impact, including any economic downturn or recession that has occurred or may occur in the future. There is also significant uncertainty as to the effect that COVID-19 may have on the amount and type of financing available to the Company in the future. The Company intends to continue to monitor the situation and may adjust its current business plans as more information and guidance become available. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Jan. 31, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 9. SUBSEQUENT EVENTS The Company performed an evaluation of subsequent events through the date of filing of these financial statements with the SEC. There were no material subsequent events which affected, or could affect, the amounts or disclosures in the financial statements, other than as described below. Notes Receivable from Klusman Family Holdings, LLC On February 1, 2021, the Company advanced the amount of $500,000 to KFH. The obligation to repay the advance was evidenced by a promissory note payable to KFH to the Company. The note matures on June 30, 2021, is unsecured, bears interest at a rate of 10% annum, and the unpaid principal and interest may be accelerated upon an event of default as defined thereunder. The amount advanced is to be used by KFH exclusively toward the purchase of real property known as the Collab located at 325 North Ash Street in Gilbert, Arizona. On February 3, 2021, the Company advanced the amount of $135,000 to KFH. The obligation to repay the advance was evidenced by a promissory note payable by KFH to the Company. The note matures on June 30, 2021, are unsecured, bear interest at a rate of 10% per annum, and the unpaid principal and interest may be accelerated upon an event of default as defined thereunder. Of the amount advanced, $130,000 is to be used by KFH exclusively toward the purchase of real property known as Union Station located in Phoenix, Arizona. The remaining $5,000 of the amount advanced is to be used by KFH exclusively toward the purchase of real property known as the Ice House located in Phoenix, Arizona. On February 19, 2021, the Company advanced the amount of $50,000 to KFH. The obligation to repay the advance was evidenced by a promissory note payable by KFH to the Company. The note matures on June 30, 2021, is unsecured, bears interest at a rate of 10% per annum, and the unpaid principal and interest may be accelerated upon an event of default as defined thereunder. The amount advanced is to be used by KFH exclusively toward the purchase of real property known as the Chandler Airport Business Center located at 2270 South Airport Boulevard in Chandler, Arizona. On March 8, 2021, the Company advanced the amount of $25,000 to KFH. The obligation to repay the advance was evidenced by a promissory note payable by KFH to the Company. The note matures on June 30, 2021, is unsecured, bears interest at a rate of 10% per annum, and the unpaid principal and interest may be accelerated upon an event of default as defined thereunder. The amount advanced is to be used by KFH exclusively toward the purchase of real property referred to as the Collab located at 325 North Ash Street in Gilbert, Arizona. On March 23, 2021, the Company advanced the amount of $500,000 to KFH. The obligation to repay the advance was evidenced by a promissory note payable by KFH to the Company. The note matures on June 30, 2021, is unsecured, bears interest at a rate of 10% per annum, and the unpaid principal and interest may be accelerated upon an event of default as defined thereunder. The amount advanced is to be used by KFH exclusively toward the purchase of real property known referred to as the Collab located at 325 North Ash Street in Gilbert, Arizona. Notes Payable to Related Parties On March 24, 2021, the Company borrowed the amount of $500,000 from Lawrence Silver. The obligation to repay the advance was evidenced by a promissory note payable to Lawrence Silver by the Company. The note matures on June 22, 2021, is unsecured, bears interest at a rate of 10% per annum, and the unpaid principal and interest may be accelerated upon an event of default as defined thereunder. On March 25, 2021, the Company borrowed the amount of $90,000 from Farm House Partners, LLC.. The obligation to repay the advance was evidenced by a promissory note payable by the Company. The note matures on September 30, 2021, is unsecured, bears interest at a rate of 10% per annum, and the unpaid principal and interest may be accelerated upon an event of default as defined thereunder. On April 20, 2021, the Company executed a promissory note payable to Michael Witherill, pursuant to which the Company borrowed $8,000. The note matures on July 20, 2021, is unsecured and bears no interest. Michael Witherill is a director and Vice-Chairman of the Company. Appointment of New Director On April 27, 2021, John Morgan was appointed to the Board of Directors of the Company. John Morgan is also a director of Rivulet Media, Inc., a public company subject to the periodic reporting requirements of the Securities and Exchange Commission. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Jan. 31, 2021 | |
Summary Of Significant Accounting Policies | |
Basis of presentation | Basis of Preparation The accompanying financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”). |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the 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 expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. The most significant estimates to be made by management in the preparation of the financial statements are expected to relate to valuing equity instruments issued; the realization of deferred tax assets; and accruals for contingent liabilities. |
Risks and Uncertainties | Risks and Uncertainties The Company has suffered losses from operations and negative operating cash flows since inception. The Company underwent a change in control effective September 4, 2020 and in conjunction therewith its business operations through September 30, 2020 were accounted for as discontinued operations. From October 1, 2020 through January 31, 2021, the Company’s operations were limited and focused on developing a new business operation involving investment in commercial real estate in Arizona. On December 15, 2020, the Company entered into a binding Letter of Intent with Klusman Family Holdings, LLC, and Aaron Klusman, pursuant to which the Company agreed to purchase 100% of the membership interest in Klusman Family Holdings, LLC from Aaron Klusman, who is also Chief Executive Officer, Chairman of the Board, and a Director of the Company, for consideration consisting of payments totaling $1,500,000 and the issuance of 10,945,250 shares of common stock of the Company. Klusman Family Holdings, LLC is engaged in the business of acquiring, leasing, and managing real property in Arizona. The transaction is currently anticipated to close subsequent to July 31, 2021, although there can be no assurances that the Company will be able to complete this transaction. Upon closing, the Company expects that this transaction would be accounted for as a reverse recapitalization. The Company’s proposed business and operations are sensitive to general business and economic conditions in the United States generally and in Arizona specifically. These conditions include short-term and long-term interest rates, inflation, fluctuations in debt and equity capital markets and the general condition of the economy. A host of factors beyond the Company’s control could cause fluctuations in these conditions. Adverse developments in these general business and economic conditions could have a material adverse effect on the Company’s financial condition and the results of its operations, both in the short-term and the long-term, as well as on the Company’s ability to complete the transaction with Klusman Family Holdings, LLC as described above. The Company has financed its working capital requirements since October 1, 2020 through short-term borrowings, including from its new control shareholder, and sales of common stock. At January 31, 2021, the Company did not have sufficient cash resources available to fund its operations and will therefore need to raise additional funds in the short-term. However, there can be no assurances that the Company will be successful in this regard. The Company has received significant financial support from a private investor, Lawrence Silver, to allow the Company to fund its business operations in 2021. From early January 2021 through May 8, 2021, the Company has raised working capital from Lawrence Silver through the sale of shares and short-term borrowings, which has provided an aggregate of $1,500,000 of equity capital and $500,000 of debt capital (as described in Notes 6 and 9) The working capital provided by Lawrence Silver has provided the Company with the resources to fund the Company’s advances to Klusman Family Holdings, LLC to acquire various real estate properties in Arizona (as described in Notes 3 and 9). As of May 8, 2021, Lawrence Silver currently owns approximately 28.5% of the issued and outstanding shares of the Company’s common stock, and the Company has an interest-bearing unsecured promissory note of $500,000 payable to Lawrence Silver that matures on June 22, 2021. |
Cash | Cash The Company maintains its cash balances with financial institutions with high credit ratings and in accounts insured by the Federal Deposit Insurance Corporation (the “FDIC”). The Company may periodically have cash balances in banks in excess of FDIC insurance limits. The Company has not experienced any losses to date resulting from this practice. |
Concentration | Concentrations The Company may periodically contract with consultants and vendors to provide services related to the Company’s business activities. Agreements for these services may be for a specific time period or for a specific project or task. |
Income Taxes | Income Taxes The Company accounts for income taxes under an asset and liability approach for financial accounting and reporting for income taxes. Accordingly, the Company recognizes deferred tax assets and liabilities for the expected impact of differences between the financial statements and the tax basis of assets and liabilities. The Company records a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized. In the event the Company was to determine that it would be able to realize its deferred tax assets in the future in excess of its recorded amount, an adjustment to the deferred tax assets would be credited to operations in the period such determination was made. Alternatively, should the Company determine that it would not be able to realize all or part of its deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to operations in the period such determination was made. As the Company’s net operating losses in the respective jurisdictions in which it operates have yet to be utilized, all previous tax years remain open to examination by the respective taxing authorities. The Company had no unrecognized tax benefits as of January 31, 2021 and does not anticipate any material amount of unrecognized tax benefits within the next 12 months. The Company accounts for uncertainties in income tax law under a comprehensive model for the financial statement recognition, measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax returns as prescribed by GAAP. The tax effects of a position are recognized only if it is “more-likely-than-not” to be sustained by the taxing authority as of the reporting date. If the tax position is not considered “more-likely-than-not” to be sustained, then no benefits of the position are recognized. As of January 31, 2021, the Company had no uncertain tax positions, and will continue to evaluate for uncertain tax positions in subsequent periods. In future periods, any interest and penalties related to uncertain tax positions will be recognized as a component of income tax expense. |
Stock-Based Compensation | Stock-Based Compensation The Company intends to periodically issue common stock and stock options to officers, directors, employees, contractors and consultants for services rendered. Options vest and expire according to terms established at the issuance date of each grant. Stock grants, which are generally time vested, will be measured at the grant date fair value and charged to operations ratably over the vesting period. The Company will account for stock-based payments to officers, directors, employees, contractors, and consultants by measuring the cost of services received in exchange for equity awards utilizing the grant date fair value of the awards, with the cost recognized as compensation expense over the period during which the individual is required to perform services in exchange for the award, which is generally over the vesting period of the award. The fair value of stock options granted as stock-based compensation will be determined utilizing the Black-Scholes option-pricing model, and is effected by several variables, the most significant of which are the life of the equity award, the exercise price of the stock option as compared to the fair market value of the common stock on the grant date, and the estimated volatility of the common stock. Estimated volatility is based on the historical volatility of the Company’s common stock over an appropriate calculation period, or, if not available, by reference to the volatility of a representative sample of comparable public companies. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair market value of the common stock is determined by reference to the quoted market price of the Company’s common stock on the grant date. The Company will recognize the fair value of stock-based compensation awards in in the Company’s statements of operations. Through January 31, 2021, the Company has not incurred any stock-based compensation costs. The Company will issue new shares of common stock to satisfy any stock option exercises. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The authoritative guidance with respect to fair value established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels and requires that assets and liabilities carried at fair value be classified and disclosed in one of three categories, as presented below. Disclosure as to transfers in and out of Levels 1 and 2, and activity in Level 3 fair value measurements, is also required. Level 1. Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded securities and exchange-based derivatives. Level 2. Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange-based derivatives, mutual funds, and fair-value hedges. Level 3. Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently traded non-exchange-based derivatives and commingled investment funds and are measured using present value pricing models. The Company will determine the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company will perform an analysis of the assets and liabilities at each reporting period end. The Company’s financial instruments include or are expected to include prepaid expenses, advance to a related party, accounts payable, accrued expenses, and due to related parties. The estimated fair value of these instruments is expected to approximate their respective carrying amounts due to the short-term nature of these instruments. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share The Company’s computation of earnings (loss) per share (“EPS”) includes basic and diluted EPS. Basic EPS is measured as the income (loss) attributable to common stockholders divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., convertible notes payable, convertible preferred stock and stock options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. Loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the respective periods. Basic and diluted loss per common share is the same for all periods presented. |
Leases | Leases Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) (“ASU 2016-02”) requires a lessee to record a right-of-use asset and a corresponding lease liability at the inception of the lease initially measured at the present value of the lease payments. ASU 2016-02 requires recognition in the statement of operations of a single lease cost that is calculated as a total cost of the lease allocated over the lease term, generally on a straight-line basis. ASU 2016-02 excludes short-term operating leases with a lease term of 12 months or less at the commencement date, and that do not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. The Company did not have any leases within the scope of ASU 2016-02 at January 31, 2021. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 significantly changes how entities measure credit losses for most financial assets, including accounts and notes receivables. ASU 2016-13 will replace the current “incurred loss” approach with an “expected loss” model, under which companies will recognize allowances based on expected rather than incurred losses. Entities will apply the provisions of ASU 2016-13 as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which ASU 2016-13 is effective. ASU 2016-13 will be effective for the Company for interim and annual reporting periods beginning after December 15, 2022. Management is currently in the process of assessing the impact of the adoption of ASU-2016-13 on the Company’s financial statement presentation and disclosures. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions and enhances and simplifies various aspects of the income tax accounting guidance in ASC 740. ASU 2019-12 is effective for interim and annual reporting periods beginning after December 15, 2020. The adoption of ASU 2019-12 is not expected to have any impact on the Company’s financial statement presentation or disclosures. In August 2020, the FASB issued ASU 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06). ASU 2020-06 simplifies the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. Limiting the accounting models results in fewer embedded conversion features being separately recognized from the host contract as compared with current GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. ASU 2020-06 also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. ASU 2020-06 will be effective for public companies for fiscal years beginning after December 15, 2023. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, and only if adopted as of the beginning of such fiscal year. The adoption of ASU 2020-06 is not expected to have any impact on the Company’s financial statement presentation or disclosures, with any effect being largely dependent on the composition and terms of outstanding financial instruments at the time of adoption. Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Company’s financial statement presentation or disclosures. |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Related Party Transactions | |
Schedule of Related Party Transactions | During the year ended January 31, 2021, the Company incurred salary and fees to officers, directors, consultants and professionals in the amount of $342,500 as follows: Aaron Klusman $ 175,000 Michael Witherill 150,000 Lanna Dodd 17,500 Total $ 342,500 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Jan. 31, 2021 | |
Disclosure Income Taxes Tables Abstract | |
Schedule of Deferred Tax Assets | Significant components of the Company’s deferred tax assets as of January 31, 2021 and 2020 are summarized below. January 31, 2021 2020 Net operating loss carryforwards $ 139,000 $ 15,300 Valuation allowance (139,000 ) (15,300 ) Net deferred tax assets $ — $ — |
Schedule of Income Tax Provisions | The reconciliation below presents the difference between the income tax rate computed by applying the U.S. federal statutory rate and the effective tax rate for the years ended January 31, 2021 and 2020. Years Ended 2021 2020 U. S. federal statutory tax rate 21.0 % 21.0 % Change in valuation allowance (21.0 )% (21.0 )% Effective tax rate 0.0 % 0.0 % |
ORGANIZATION AND BASIS OF PRE_2
ORGANIZATION AND BASIS OF PRESENTATION (Detail Narrative) - USD ($) | 12 Months Ended | ||
Jan. 31, 2021 | Jan. 31, 2020 | Sep. 04, 2020 | |
Common Shares Purchased | 7,207,250 | 5,707,250 | |
Net Loss | $ 482,018 | $ 26,465 | |
Farm House Partners, LLC [Member] | |||
Common Shares Purchased | 4,500,000 |
ADVANCE TO KLUSMAN FAMILY HOL_2
ADVANCE TO KLUSMAN FAMILY HOLDINGS, LLC (Details Narrative) - USD ($) | Jan. 31, 2021 | Oct. 27, 2020 | Jan. 31, 2020 |
Advance to Klusman Family Holdings, LLC, a related party | $ 50,000 | ||
Klusman Family Holdings, LLC [Member] | |||
Advance to Klusman Family Holdings, LLC, a related party | $ 50,000 |
PROMISSORY NOTE PAYABLE TO FA_2
PROMISSORY NOTE PAYABLE TO FARM HOUSE PARTNERS, LLC (Details Narrative) - USD ($) | Oct. 27, 2020 | Jan. 31, 2021 | Jan. 31, 2020 |
Accured Interest | $ 1,659 | ||
Farm House Partners, LLC [Member] | |||
Promissory Note Payable | $ 50,000 | ||
Maturity Date | Oct. 27, 2021 | ||
Interest rate | 10.00% | ||
Accured Interest | $ 1,306 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2021 | Jan. 31, 2020 | |
Related Party Transactions | $ 342,500 | |
Aaron Klusman | ||
Related Party Transactions | 175,000 | |
Michael Witherill [Member] | ||
Related Party Transactions | 150,000 | |
Lanna Dodd [Member] | ||
Related Party Transactions | $ 17,500 |
RELATED PARTY TRANSACTIONS (D_2
RELATED PARTY TRANSACTIONS (Details Narrative) - Michael Witherill [Member] | Oct. 13, 2020USD ($) |
Promissory Note Payable | $ 4,770 |
Maturity Date | Nov. 13, 2020 |
Interest rate | 10.00% |
STOCKHOLDERS' EQUITY (DEFICIE_2
STOCKHOLDERS' EQUITY (DEFICIENCY) (Details Narrative) - $ / shares | Jan. 31, 2021 | Jan. 31, 2020 |
Stockholders Equity Deficiency | ||
Common stock par value | $ 0.001 | $ 0.001 |
Common stock shares authorized | 75,000,000 | 75,000,000 |
Common stock shares issued | 7,207,250 | 5,707,250 |
Common stock shares outstanding | 7,207,250 | 5,707,250 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | Jan. 31, 2021 | Jan. 31, 2020 |
Disclosure Income Taxes Details Abstract | ||
Net operating loss carryforwards | $ 139,000 | $ 15,300 |
Valuation allowance | (139,000) | (15,300) |
Net deferred tax assets |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) | 12 Months Ended | |
Jan. 31, 2021 | Jan. 31, 2020 | |
Disclosure Income Taxes Details 2Abstract | ||
U. S. federal statutory tax rate | 21.00% | 21.00% |
Change in valuation allowance | (21.00%) | (21.00%) |
Effective tax rate |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) | Jan. 31, 2021USD ($) |
Disclosure Income Taxes Details Narrative Abstract | |
Net Operating Carryforward Loss | $ 554,800 |