| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE
1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A
summary of significant accounting policies of Tribus Enterprises, Inc. (the “Company”) is presented to assist in understanding
the Company’s consolidated financial statements. The accounting policies presented in these footnotes conform to accounting principles
generally accepted in the United States of America and have been consistently applied in the preparation of the accompanying consolidated
financial statements. These consolidated financial statements and notes are representations of the Company’s management who are
responsible for their integrity and objectivity. Organization,
Nature of Business and Trade Name The
Company was incorporated in the State of Washington on March 29, 2017 for the purpose of developing, designing, manufacturing and distributing
hand tools. Upon incorporation, the Company entered into a share exchange agreement with Tribus Innovations, LLC and acquired all of
the outstanding ownership interests of Tribus Innovations, LLC. Tribus Innovations, LLC was formed on December 1, 2015. The transaction
was accounted for as a reverse merger and these financial statements present the historical financial information of Tribus Innovations,
LLC from its inception and include the financial information of the Company from the completion of the share exchange agreement on March
29, 2017. Basis
of Presentation and Use of Estimates The
preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date
of the consolidated financial statements and the reported amounts of revenue and expenses during the reported period. Actual results
could differ from those estimates. Management further acknowledges that it is solely responsible for adopting sound accounting practices,
establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company’s system of
internal accounting control is designed to assure, among other items, that (1) recorded transactions are valid; (2) all valid transactions
are recorded and (3) transactions are recorded in the period in a timely manner to produce financial statements which present fairly
the financial condition, results of operations and cash flows of the company for the respective periods being presented. Cash
and Cash Equivalents For
purposes of the statement of cash flows, the Company considers all short-term debt securities purchased with maturity of three months
or less to be cash equivalents. There were no cash equivalents as of March 31, 2021 or 2020. Research
and Development Research
and development costs are charged to operations when incurred and are included in operating expenses. The amounts charged in the years
ended March 31, 2021 and 2020 were $12,781 and $82,002, respectively. Principles
of Consolidation The
Company prepares its consolidated financial statements on the accrual basis of accounting. The accompanying consolidated financial statements
include the accounts of the Company and its wholly owned subsidiary, both of which have a fiscal year end of March 31. All intercompany
accounts, balances and transactions have been eliminated in the consolidation. Revenue
and Cost Recognition The
Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue
from Contracts with Customers The
Company offers a lifetime warranty for manufacturing defects on products sold. The Company has estimated future costs that will be incurred
under its lifetime warranty program based on its historical defect rate. As of March 31, 2021, $3,055 was recorded as an estimated warranty
liability. Due to limited sales no estimate was made as of March 31, 2020. However, the Company anticipates the amounts associated with
revenues recognized as of March 31, 2020 to be immaterial to the financial statements.
Warranty Expense
as of March 31, 2021
Beginning Balance $ -
Payments Made $ -
Warrany
Accrual $ 3,055
Ending Balance $ 3,055 The
Company recognized revenues of $199,653 and $33,737 during the years ended March 31, 2021 and 2020, respectively. Fair
Value of Financial Instruments The
Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized
or disclosed at fair value in the financial statements on a recurring basis. The Company defines fair value as the price that would be
received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement
date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, the Company
considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions
that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions
and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value
into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant
to the fair value measurement: Level
1 Level
2 Level
3 The
Company’s valuation techniques used to measure the fair value of money market funds and certain marketable equity securities were
derived from quoted prices in active markets for identical assets or liabilities. The valuation techniques used to measure the fair value
of all other financial instruments, all of which have counterparties with high credit ratings, were valued based on quoted market prices
or model driven valuations using significant inputs derived from or corroborated by observable market data. In
accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other
items at fair value. The Company has not elected the fair value option for any eligible financial instruments. Capital
Stock The
Company has authorized one hundred million (100,000,000) shares of common stock with $0.001 par value at March 31, 2021 and 2020. At
March 31, 2021 and 2020, the Company authorized twenty-five million (25,000,000) shares of preferred stock with $0.001 par value. Of
the 25,000,000 authorized shares of preferred stock, 20,000,000 are designated as series A convertible stock and 5,000,000
designated as series B convertible stock. Income
Taxes The
Company recognizes the tax effects of transactions in the year in which such transactions enter into the determination of net income,
regardless of when reported for tax purposes. Basic
Net Loss Per Share Basic
net loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average
number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income
available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted
average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity.
The net loss per share during the year ended March 31, 2021 and 2020 is due to the Company’s net losses during the period and
dilutive securities and considered anti-dilutive. At
March 31, 2021 and 2020, the Company had 6,666,666 and 19,999,998 shares of series A convertible preferred stock and 4,999,800 and 3,910,000
shares of series B convertible stock outstanding, respectively. Each share of series A convertible preferred stock is convertible to
10 shares of common stock at the discretion of the board of directors and each share of series B convertible preferred stock is convertible
to 4 shares of common stock at the option of the stockholder. The outstanding preferred stock as of March 31, 2021 and 2020 represented
86,665,860 and 215,639,980 new dilutive common shares if converted at the applicable rates. The effects of these notes have been excluded
as the conversion would be anti-dilutive due to the net loss incurred in each period presented. Advertising
Costs The
Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred $56,310 and $310 of such
costs during the years ended March 31, 2021 and 2020, respectively. Recently
Issued Accounting Pronouncements Recent
accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC did not, or are not believed
by management to, have a material impact on the Company’s present or future financial statements. Related
Parties The
Company follows subtopic 850-10 of the FASB Accounting Standards Codification for the identification of related parties and disclosure
of related party transactions. Pursuant
to Section 850-10-20 the related parties include (a) affiliates of the registrant; (b) entities for which investments in their equity
securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825–10–15,
to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing
trusts that are managed by or under the trusteeship of management; (d) principal owners of the Company; (e) management of the Company;
(f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies
of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and
(g) Other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership
interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting
parties might be prevented from fully pursuing its own separate interests. The
financial statements include disclosures of material related party transactions, other than compensation arrangements, expense allowances,
and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation
of financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved;
(b) description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods
for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions
on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented
and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d) amounts due from
or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement. Property
and equipment Property
and equipment are stated at cost less accumulated depreciation. The Company provides for depreciation using the straight-line method
over the estimated useful lives of the related assets, which range from three to ten years. Leasehold improvements are amortized
over the shorter of the useful life of the related assets or the lease term. Maintenance and repair costs are expensed as they are incurred
while renewals and improvements which extend the useful life of an asset are capitalized. At the time of retirement or disposal of property
and equipment, the cost and related accumulated depreciation and amortization are removed from the accounts and any resulting gain or
loss is reflected in the consolidated results of operations. Refer to Note 8 – Equipment Inventory The
Company recognizes the cost of inventory through cost of goods sold as product is shipped to customers on an average cost basis. The
value of inventory is carried at the lower of cost or market of raw materials purchased to manufacture the finished goods, direct labor
associated with manufacturing and certain overhead related to the manufacturing facility. Refer to Note 6 – Inventory. |
