Exhibit 99.3
BUCKSHOT TRUCKING LLC
FINANCIAL STATEMENTS
For the Years Ended December 31, 2023 and 2022
BUCKSHOT TRUCKING LLC INDEX TO THE FINANCIAL STATEMENTS
| Pages | |
| Independent Auditors Report | 1 |
| Balance Sheets | 2 |
| Statements of Income | 3 |
| Statements of Changes in Members’ Equity | 4 |
| Statements of Cash Flows | 5 |
| Notes to the Financial Statements | 6-12 |
INDEPENDENT AUDITORS’ REPORT
To the Members of Buckshot Trucking LLC
We have audited the accompanying financial statements of Buckshot Trucking LLC (the “Company”), which comprise the balance sheets as of December 31, 2023 and 2022, and the related statements of income, members’ equity, and cash flows for the years then ended, and the related notes to the financial statements.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinion
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are available to be issued.
Auditors’ Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards, we:
● | Exercise professional judgment and maintain professional skepticism throughout the audit. |
● | Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. |
● | Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Accordingly, no such opinion is expressed. |
● | Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. |
● | Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time. |
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.
/s/ Pannell Kerr Forster of Texas, P.C.
Houston, Texas
June 25, 2024
BUCKSHOT TRUCKING LLC
Balance Sheets
| December 31, | ||||||||
| 2023 | 2022 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
Cash and cash equivalents | $ | 331,990 | $ | 369,974 | ||||
Accounts receivable, net | 975,625 | 871,513 | ||||||
Prepaid expenses and other current assets | 149,219 | - | ||||||
Total current assets | 1,456,834 | 1,241,487 | ||||||
Right of use assets – finance leases, net | 293,358 | 231,122 | ||||||
Property and equipment, net | 1,684,117 | 1,839,047 | ||||||
Total assets | $ | 3,434,309 | $ | 3,311,656 | ||||
| Liabilities and members' equity | ||||||||
| Current liabilities | ||||||||
Line of credit | $ | - | $ | 15,702 | ||||
Accounts payable and accrued expenses | 74,539 | 97,200 | ||||||
Finance leases, current portion | 66,806 | 62,697 | ||||||
Notes payable, current portion | 459,179 | 372,644 | ||||||
Total current liabilities | 600,524 | 548,243 | ||||||
Finance leases, net of current portion | 45,386 | 48,931 | ||||||
Notes payable, net of current portion | 628,315 | 828,630 | ||||||
Total liabilities | 1,274,225 | 1,425,804 | ||||||
Commitments and contingencies (Note 10) | ||||||||
Members' equity | 2,160,084 | 1,885,852 | ||||||
Total liabilities and members' equity | $ | 3,434,309 | $ | 3,311,656 | ||||
The accompanying notes are an integral part of these financial statements.
BUCKSHOT TRUCKING LLC
Statements of Income
| For the Years Ended December 31, | ||||||||
| 2023 | 2022 | |||||||
Net revenues | $ | 8,039,157 | $ | 7,498,996 | ||||
Cost of transportation and services (exclusive of depreciation) | 2,384,015 | 3,018,983 | ||||||
Gross Profit | 5,655,142 | 4,480,013 | ||||||
Costs and expenses: | ||||||||
Sales, general and administrative expense | 4,240,900 | 2,907,518 | ||||||
Depreciation and amortization expense | 362,462 | 181,611 | ||||||
Impairment on property and equipment | 110,000 | - | ||||||
Loss on disposal of assets | 30,235 | 51,878 | ||||||
Total costs and expenses | 4,743,597 | 3,141,007 | ||||||
Operating income | 911,545 | 1,339,006 | ||||||
Other income (expense): | ||||||||
Other income (expense), net | 113,929 | 1,153 | ||||||
Interest expense | (100,134 | ) | (73,412 | ) | ||||
Total other income (expense) | 13,795 | (72,259 | ) | |||||
Net income | $ | 925,340 | $ | 1,266,747 | ||||
The accompanying notes are an integral part of these financial statements.
BUCKSHOT TRUCKING LLC
Statements of Changes in Members’ Equity
For the Years Ended December 31, 2023 and 2022
Total Members' Equity | ||||
Balance at January 1, 2022 | $ | 1,168,729 | ||
Capital contributions | 17,906 | |||
Distributions | (567,530 | ) | ||
Net income | 1,266,747 | |||
Balance at December 31, 2022 | 1,885,852 | |||
Distributions | (651,108 | ) | ||
Net income | 925,340 | |||
Balance at December 31, 2023 | $ | 2,160,084 | ||
The accompanying notes are an integral part of these financial statements.
BUCKSHOT TRUCKING LLC
Statements of Cash Flows
| For the Years Ended December 31, | ||||||||
| 2023 | 2022 | |||||||
Cash Flows from Operating Activities | ||||||||
Net income | $ | 925,340 | $ | 1,266,747 | ||||
| Adjustment to reconcile net income to cash provided by operating activities: | ||||||||
Depreciation and amortization expenses | 362,462 | 181,611 | ||||||
Impairment on property and equipment | 110,000 | - | ||||||
Provision for bad debts | - | 127,450 | ||||||
Loss on disposal on assets | 30,235 | 51,878 | ||||||
Changes in operating assets and liabilities: | ||||||||
Account receivable | (104,112 | ) | (343,502 | ) | ||||
Prepaid expenses and other current assets | 247,559 | 10,000 | ||||||
Accounts payable and accrued expenses | (22,661 | ) | (14,832 | ) | ||||
Net cash provided by operating activities | 1,548,823 | 1,279,352 | ||||||
Cash flows from Investing Activities | ||||||||
Purchases of property and equipment | (58,568 | ) | (194,797 | ) | ||||
Proceeds from sale of property and equipment | 18,399 | 80,000 | ||||||
Net cash used in investing activities | (40,169 | ) | (114,797 | ) | ||||
Cash flows from Financing Activities | ||||||||
Proceeds from line of credit drawdown | 40,000 | 75,000 | ||||||
Repayment of line of credit drawdown | (55,702 | ) | (107,572 | ) | ||||
Finance lease payments | (84,236 | ) | (29,047 | ) | ||||
Payment to finance prepaid insurance | (342,767 | ) | - | |||||
Payments on notes payable | (452,825 | ) | (331,607 | ) | ||||
Contributions from members | - | 17,905 | ||||||
Distributions to members | (651,108 | ) | (567,530 | ) | ||||
Net cash used in financing activities | (1,546,638 | ) | (942,851 | ) | ||||
Net (decrease) increase in cash and cash equivalents | (37,984 | ) | 221,704 | |||||
Cash and cash equivalents, beginning of year | 369,974 | 148,270 | ||||||
Cash and cash equivalents, end of the year | $ | 331,990 | $ | 369,974 | ||||
Supplemental cash flow information: | ||||||||
Interest paid | $ | 100,134 | $ | 73,412 | ||||
Supplemental non-cash investing and financing activities: | ||||||||
Debt issued to acquire equipment, related party | $ | 243,409 | $ | 130,104 | ||||
Debt issued to acquire equipment | 211,358 | 963,432 | ||||||
Debt cancelled relating to equipment trade-ins | 84,933 | 14,329 | ||||||
Financed insurance premiums | 396,778 | - | ||||||
The accompanying notes are an integral part of these financial statements.
BUCKSHOT TRUCKING LLC
NOTES TO THE FINANCIAL STATEMENTS
Note 1 — Organization and Business Operations
Buckshot Trucking LLC (“Buckshot” or the “Company”), a Wyoming limited liability company, is a trucking contractor, headquartered in Colorado since 2017. The Company provides hot shot trucking services predominately to the oil and gas industry. To date, our Company has grown to offer multiple service lines in multiple sectors. Our simple approach to quality service, safety, and dependability has earned Buckshot Trucking LLC the opportunity to provide services across the United States to a diverse group of over 100 customers.
Note 2 — Summary of Significant Accounting Policies
Basis of Presentation
The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), expressed in U.S. dollars. The accompanying financial statements reflect all adjustments including normal recurring adjustments, which, in the opinion of management, are necessary to present fairly the financial position, results of operations, and cash flows for the periods presented in accordance with GAAP. References to GAAP issued by the FASB in these accompanying notes to the financial statements are to the FASB Accounting Standards Codification (“ASC”).
Use of Estimates
The preparation of the accompanying financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts and disclosures of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates are adjusted to reflect actual experience when necessary. Such estimates included, but are not limited to, revenue recognition, lease accounting, useful lives of fixed assets, allowance for credit losses and estimation of contingencies. Our actual results may differ from our estimates.
Cash
Cash consists of a cash account held at a financial institution. The Company considers all short-term investments with an original maturity date of three months or less to be cash equivalents.
Accounts Receivable
Trade accounts receivable are recognized and carried at billed amounts less an allowance for credit losses. The Company adopted the Current Expected Credit Losses (“CECL”) guidance effective January 1, 2023. The Company maintains the allowance for estimated losses resulting from the inability of the Company’s customers to make required payments. The allowance represents the current estimate of lifetime expected credit losses over the remaining duration of existing accounts receivable considering current market conditions and supportable forecasts when appropriate. The estimate is a result of the Company’s ongoing evaluation of collectability, customer creditworthiness, historical levels of credit losses, and future expectations. The allowance for credit losses as of December 31, 2023 and 2022 was $127,450 for both years, respectively.
Prepaid Expenses
The prepaid expenses as of December 31, 2023 consist primarily of a prepayment towards the Company’s insurance policy.
Property and Equipment
We generally record property and equipment at cost, or in the case of acquired property and equipment, at fair value at the date of acquisition. Maintenance and repair expenditures are charged to expense as incurred.
We compute depreciation expense on a straight-line basis over the estimated useful lives of the assets as follows:
| Classification | Estimated Useful Life | |
| Vehicles, containers, tractors, trailers and tankers | 5-10 years |
Impairment of Long-Lived Assets
The Company reviews long-lived assets, including its vehicles, containers, tractors, trailers, tankers and lease assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured first by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If such assets are impaired, an impairment loss would be recognized based on the excess of the carrying amount of the asset above the fair value of the asset. As of December 31, 2023, the Company recorded an impairment of $110,000 to its property and equipment based on a third party appraisal.
Leases
We determine if an arrangement is a lease at inception. We recognize operating or finance lease right-of-use assets and liabilities at the lease commencement date based on the estimated present value of the lease payments over the lease term. Most of our leases are finance leases that provide a fixed interest rate. In cases where a fixed interest rate is not available, we choose to use incremental borrowing rates based on our existing debt arrangements available at commencement date to determine the present value of future lease payments.
We include options to extend or terminate a lease in the lease term when we are reasonably certain to exercise such options. We exclude variable lease payments (such as payments based on an index or reimbursements of lessor costs) from our initial measurement of the lease liability. We recognize leases with an initial term of 12 months or less as lease expense over the lease term and those leases are not recorded on our Balance Sheets. We account for lease and non-lease components within a contract as a single lease component for our real estate leases, if any. Currently the Company includes its 12 month operating lease for office space as a monthly lease expense within the Statement of Income. The Company includes its finance leases in the ROU assets and lease liabilities on the Balance Sheets.
Accrued Expenses
The accrued expenses as of December 31, 2023 and 2022 are related to the freight pay owed to contractors and amounts accrued for payroll and related benefits.
Revenue Recognition
Revenue is accounted for under ASC 606 Revenue from Contracts with Customers through the following steps:
■ | Identify the contract with a customer; |
■ | Identify the performance obligations in the contract; |
■ | Determine the transaction price; |
■ | Allocate the transaction price to performance obligations in the contract; and |
■ | Recognize revenue when or as the Company satisfies a performance obligation. |
Through trucking agreements, executed with the customers, the Company provides a service: providing vehicles and/or drivers to assist with customers’ transport of goods.
The Company recognizes revenue when control of promised services are transferred to a customer in an amount equal to the consideration expected to be received for those services.
Performance Obligations
A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when the performance obligation is satisfied.
We generate revenue by providing truck brokerage and other transportation services for our customers. Additional services may be provided to our customers under their transportation contracts, including unloading and other incidental services. The transaction price is based on the consideration specified in the customer’s contract.
A performance obligation is created when a customer under a transportation contract submits a bill of lading for the transport of goods from origin to destination. These performance obligations are satisfied as the shipments move from origin to destination. We recognize transportation revenue on a per shipment basis as a shipment moves from origin to destination and the related costs are recognized as incurred. Some of our customer contracts contain our promise to stand ready to provide transportation services. Performance obligations are generally short-term, with transit times usually less than one week. Generally, customers are billed on shipment of the freight or on a monthly basis and make payments in line with approved payment terms. When we do not control the specific services, we recognize revenue as the difference between the amount the customer pays us for the service less the amount we are charged by third parties who provide the service.
Generally, we can adjust our pricing based on contractual provisions related to achieving agreed-upon performance metrics, changes in volumes, services and market conditions. Revenue relating to these pricing adjustments is estimated and included in the consideration if it is probable that a significant revenue reversal will not occur in the future. The estimate of variable consideration is determined by the expected value or most likely amount method and factors in current, past and forecasted experience with the customer. Customers are billed based on terms specified in the revenue contract and they pay us according to approved payment terms.
Contract Costs
We expense the incremental costs of obtaining contracts when incurred if the amortization period of the assets is one year or less. These costs are included in cost of transportation services (exclusive of depreciation and amortization).
Insurance
The Company purchased insurance to provide for the costs of medical, casualty, liability, vehicular, cargo, workers’ compensation, cyber risk and property claims. We periodically evaluate our level of insurance coverage and adjust our insurance levels based on risk tolerance and premium expense.
Liabilities for the risks we retain, including estimates of claims incurred but not reported, are not discounted and are estimated, in part, by considering historical cost experience, demographic and severity factors, and judgments about current and expected levels of cost per claim and retention levels. Changes in these assumptions and factors can impact actual costs paid to settle the claims and those amounts may be different than estimates. As of December 31, 2023 and 2022, there have been no liabilities incurred.
Advertising Costs
Advertising costs are expensed as incurred. As of December 31, 2023 and 2022, the Company incurred advertising costs totaling to $10,219 and $26,763, respectively.
Income Taxes
The Company is treated as a partnership for tax reporting purposes, therefore no provision for federal, state and local income taxes for the Company have been made in the accompanying financial statements, as individual members are responsible for their proportionate share of the Company’s taxable income. The Company recognizes the impact from an uncertain tax position only if that position is more-likely-than-not of being sustained upon examination by the taxing authority, based on the technical merits of the position. However, should the Company be subject to examination by the taxing authority, any adjustments required would be passed through to the members for such adjustments. The Company will account for interest and penalties relating to uncertain tax provisions in the current period statements of operations, as necessary. At December 31, 2023 and 2022, the Company did not have any uncertain tax positions.
Concentration of Risks
Financial instruments that potentially subject the Company to a significant concentration of credit risk consist primarily of cash and cash equivalents and accounts receivable. Cash balances may exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance limit of $250,000. The Company has not experienced any losses in such accounts.
As of December 31, 2023 and 2022, two customers accounted for 21% and 35%, respectively, of the Company’s revenue.
As of December 31, 2023, there were no customers that accounted for more than 10% of total accounts receivable. As of December 31, 2022, one customer accounted for 11% of the Company’s accounts receivables.
Fair Value of Financial Instruments
Fair value is the price that would be received to sell an asset, or the amount paid to transfer a liability in an orderly transaction between market participants at the measurement date. There is a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The Company classifies fair value balances based on the observability of those inputs. The three levels of the fair value hierarchy are as follows:
Level 1 - Inputs based on unadjusted quoted market prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
Level 2 - Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar instruments in markets that are not active or for which all significant inputs are observable or can be corroborated by observable market data.
Level 3 - Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are both unobservable for the asset and liability in the market and significant to the overall fair value measurement.
In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. The Company establishes the fair value of its assets and liabilities using the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and establishes a fair value hierarchy based on the inputs used to measure fair value. The recorded amounts of certain financial instruments, including money markets classified as cash equivalents, accounts receivable, accounts payable, accrued expenses, debt at fixed interest rates, and other liabilities approximate fair value due to their relatively short maturities.
The Company’s policy is to record transfers between levels, if any, as of the beginning of the fiscal year. For the years ending December 31, 2023 and 2022, no transfers between levels have been recognized.
Recent Accounting Pronouncements
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which modifies lease accounting for lessees to increase transparency and comparability by recording lease assets and liabilities for operating leases and disclosing key information about leasing arrangements. In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases, and ASU No. 2018-11, Leases (Topic 842), Targeted Improvements, which affect certain aspects of the previously issued guidance. In December 2018, the FASB issued ASU No. 2018-20, Narrow- Scope Improvements for Lessor, Leases (Topic 842), which provides guidance on sales tax and other taxes collected from lessees. In December 2019, the FASB issued ASU No. 2019-01, Codification Improvements to Topic 842, Leases, which affect certain aspects of the previously issued guidance. Amendments include an additional transition method that allows entities to apply the new standard on the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings, as well as a new practical expedient for lessors. The Company adopted this new guidance utilizing the modified retrospective transition method, effective January 1, 2022 and there was no material impact.
In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326). This standard requires a new method for recognizing credit losses that is referred to as the current expected credit loss (“CECL”) method. The CECL method requires the recognition of all losses expected over the life of a financial instrument upon origination or purchase of the instrument unless the Company elects to recognize such instruments at fair value with changes in profit and loss (the fair value option). This standard is effective for the Company for fiscal years beginning after December 15, 2022. The Company adopted this new guidance January 1, 2023 and there was no material impact on the Company’s financial statements but did change how the allowance for credit losses is determined.
Note 3 – Accounts receivables, net
The Company classifies its trade receivables as either current or past due. The following reflects the credit quality of the Company’s receivables, as delinquency status has been identified as the primary credit quality indicator, based on the recorded amount of the receivable in delinquent status.
The following reflects the Company’s trade receivables for the periods presented:
| December 31, | January 1, | |||||||||||
| 2023 | 2022 | 2022 | ||||||||||
Accounts receivable | $ | 1,103,075 | $ | 998,963 | $ | 665,461 | ||||||
Allowance for credit losses | (127,450 | ) | (127,450 | ) | - | |||||||
Accounts receivable, net | $ | 975,625 | $ | 871,513 | $ | 665,461 | ||||||
Note 4 — Property and Equipment, net
| December 31, | ||||||||
| 2023 | 2022 | |||||||
| Property and equipment | ||||||||
Vehicles, tractors, trailers and tankers | $ | 2,339,767 | $ | 2,077,962 | ||||
Less: accumulated depreciation | (655,650 | ) | (238,915 | ) | ||||
Total property and equipment, net | $ | 1,684,117 | $ | 1,839,047 | ||||
Depreciation expenses for property and equipment was $339,898 and $166,772 for the years ended December 31, 2023 and 2022, respectively.
Note 5 – Leases
The following amounts were recorded in the Company’s balance sheets relating to its finance leases:
| December 31, | ||||||||
2023 | 2022 | |||||||
ROU assets, net | $ | 293,358 | $ | 231,122 | ||||
Lease liabilities: | ||||||||
Current lease liabilities | $ | 66,806 | $ | 62,697 | ||||
Non-current lease liabilities | 45,386 | 48,931 | ||||||
Total lease liabilities | $ | 112,192 | $ | 111,628 | ||||
| Other supplemental information: | ||||||||
Weighted average remaining lease term | 1.0 years | 1.9 years | ||||||
Weighted average discount rate | 9.97 | % | 7.77 | % | ||||
Amortization of the right of use assets was $22,564 and $14,839 for the years ended December 31, 2023 and 2022, respectively.
The future repayments of the finance leases as of December 31, 2023 were as follows:
2024 | $ | 67,182 | ||
2025 | 40,008 | |||
2026 | 5,377 | |||
Total principal outstanding | 112,567 | |||
Less accrued interest | (375 | ) | ||
Total finance leases outstanding | $ | 112,192 |
Note 6 - Line of Credit
The Company holds a line of credit with a third-party lending facility to assist in cash flow needs and financing. The Company had drawdowns of $40,000 and $75,000 in 2023 and 2022, respectively. As of December 31, 2023 and 2022, the balance outstanding under the line of credit was $- and $15,702, respectively.
Note 7 –Notes Payable
The Company holds multiple notes with various institutions for funding the purchases of their fleet of trucks, tractors and trailers. The weighted average interest rates on these loans were 6.58% and 5.67% as of December 31, 2023 and 2022, respectively.
The future repayments of the notes payable as of December 31, 2023 were as follows:
Notes payable | Related party - notes payable | Total | ||||||||||
2024 | $ | 329,220 | $ | 129,959 | $ | 459,179 | ||||||
2025 | 241,722 | 23,758 | 265,480 | |||||||||
2026 | 185,468 | 10,883 | 196,351 | |||||||||
2027 | 114,219 | - | 114,219 | |||||||||
2028 | 52,265 | - | 52,265 | |||||||||
Total notes payable outstanding | $ | 922,894 | $ | 164,600 | $ | 1,087,494 | ||||||
Note 8 – Members’ Equity
As of December 31, 2023 and 2022, the Company has 100 units authorized, issued and outstanding, which are held by the two managing members, owning 75% and 25% respectively.
Note 9 – Related Party Transactions
As of December 31, 2023 and 2022, the Company made principal payments directly to financial institutions on behalf of one of the managing members for use of trucks and trailers controlled by an entity owned by the member, totaling
$48,476 and $41,105, respectively.
During the years ended December 31, 2023 and 2022, the Company acquired from the members trucks and trailers totaling $243,409 and $130,104, respectively. These purchases were financed by the issuance of notes payable issued directly to the members for similar amounts. As of December 31, 2023 and 2022, the amounts owed under these notes payable to the members totaled $164,600 and $94,232, respectively. Interest paid to the members for the years ended December 31, 2023 and 2022 under these notes payable totaled $10,000 and $4,800, respectively (See note 7).
Note 10 – Commitments and Contingencies
From time to time the Company may be subject to various legal proceedings, claims and litigation, which arise in the ordinary course of operations. In the opinion of management, the amount of liability, if any, with respect to these actions would not materially affect the financial position or results of operations of the Company.
Note 11 – Subsequent Events
Management has evaluated events and transactions occurring subsequent to December 31, 2023, for items that should potentially be recognized or disclosed in these financial statements. The evaluation was conducted through June 25, 2024, the date the financial statements were available to be issued.