Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 12, 2015 | |
Document and Entity Information | ||
Entity Registrant Name | FIRST EQUITY PROPERTIES INC | |
Entity Trading Symbol | fepi | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Amendment Flag | false | |
Entity Central Index Key | 726,516 | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 1,057,628 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED BALANCE SHEETS (un
CONSOLIDATED BALANCE SHEETS (unaudited) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Assets {1} | ||
Notes receivable and accrued interest - related parties | $ 2,106,229 | $ 2,172,752 |
Cash and cash equivalents | 1,618 | 1,776 |
Total assets | 2,107,847 | 2,174,528 |
Liabilities and Shareholders' Equity | ||
Notes payable and accrued interest - related parties | 836,953 | 877,850 |
Accounts payable - other | 3,788 | 3,177 |
Accounts payable - related parties | 387,038 | 417,555 |
Total liabilities | 1,227,779 | 1,298,582 |
Shareholders' equity | ||
Common stock, $0.01 par value; 40,000,000 shares authorized; 1,057,628 issued and outstanding | 10,576 | 10,576 |
Preferred stock, $0.01 par value; 4,960,000 shares authorized; none issued or outstanding | 0 | 0 |
Paid in capital | 1,376,682 | 1,376,682 |
Retained earnings (deficit) | (507,190) | (511,312) |
Total shareholders' equity | 880,068 | 875,946 |
Total liabilities and shareholders' equity | $ 2,107,847 | $ 2,174,528 |
CONSOLIDATED BALANCE SHEETS PAR
CONSOLIDATED BALANCE SHEETS PARENTHETICALS - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Parentheticals | ||
Common stock par value | $ 0.01 | $ 0.01 |
Common stock shares authorized | 40,000,000 | 40,000,000 |
Common stock shares issued | 1,057,628 | 1,057,628 |
Common stock shares outstanding | 1,057,628 | 1,057,628 |
Preferred stock par value | $ 0.01 | $ 0.01 |
Preferred stock shares authorized | 4,960,000 | 4,960,000 |
Preferred stock shares issued | 0 | 0 |
Preferred stock shares outstanding | 0 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenue | ||||
Interest income - related parties | $ 51,783 | $ 54,149 | $ 156,229 | $ 164,871 |
Total income | 51,783 | 54,149 | 156,229 | 164,871 |
Operating Expenses | ||||
General and administrative - related parties | 15,000 | 15,000 | 45,000 | 45,000 |
General and administrative | 3,248 | 5,037 | 10,920 | 10,992 |
Legal and professional fees | 4,238 | 11,049 | 33,465 | 33,643 |
Total operating expenses | 22,486 | 31,086 | 89,385 | 89,635 |
Income (loss) before interest expense and taxes | 29,297 | 23,063 | 66,844 | 75,236 |
Other income (expense) | ||||
Interest expense - related parties | (20,577) | (26,621) | (62,722) | (86,761) |
Income (loss) before income taxes | 8,720 | (3,558) | 4,122 | (11,525) |
Income tax (expense) benefit | 0 | 0 | 0 | 0 |
Net income (loss) applicable to common shareholders | $ 8,720 | $ (3,558) | $ 4,122 | $ (11,525) |
Earnings (loss) per share | $ 0.01 | $ 0 | $ 0 | $ (0.01) |
Weighted average shares outstanding | 1,057,628 | 1,057,628 | 1,057,628 | 1,057,628 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (unaudited) - 9 months ended Sep. 30, 2015 - USD ($) | Common Stock Shares | Common Stock Amount | Paid in Capital | Retained Earnings (Deficit) | Total Equity |
Balances at at Jan. 01, 2015 | 1,057,628 | 10,576 | 1,376,682 | (511,312) | 875,946 |
Net income (loss) | $ 0 | $ 0 | $ 0 | $ 4,122 | $ 4,122 |
Balances at. at Sep. 30, 2015 | 1,057,628 | 10,576 | 1,376,682 | (507,190) | 880,068 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash Flows from Operating Activities | ||
Net Income (Loss) | $ 4,122 | $ (11,525) |
(Increase) decrease in | ||
Interest receivable - related parties | 1,870 | 75,883 |
Increase (decrease) in | ||
Accounts payable - other | 611 | 229 |
Accounts payable - related parties | (30,517) | 18,638 |
Interest payable - related parties | (1,132) | (70,914) |
Net cash provided by (used for) operating activities | (25,046) | 12,311 |
Cash Flows from Investing Activities | ||
Notes receivable - related parties | 64,653 | 304,985 |
Net cash provided by (used for) investing activities | 64,653 | 304,985 |
Cash Flows from Financing Activities | ||
Notes payable - related parties | (39,765) | (314,000) |
Net cash provided by (used for) financing activities | (39,765) | (314,000) |
Net increase (decrease) in cash and cash equivalents | (158) | 3,296 |
Cash and cash equivalents at the beginning of period | 1,776 | 346 |
Cash and cash equivalents at the end of period | 1,618 | 3,642 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest to related parties | 63,856 | 157,674 |
Cash received for interest on notes receivable | $ 158,099 | $ 240,754 |
ORGANIZATION AND BASIS OF PRESE
ORGANIZATION AND BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2015 | |
ORGANIZATION AND BASIS OF PRESENTATION | |
ORGANIZATION AND BASIS OF PRESENTATION | NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION Organization and business First Equity Properties, Inc. is a Nevada based corporation organized in December 19, 1996 and the Company is headquartered in Dallas, TX. The Companys principal line of business and source of revenue is currently investments and interest on notes receivable. The Company is currently in the business of real estate investing. FEPI is a publicly traded company however, no trading market presently exists for the shares of common stock and its value is therefore not determinable. Basis of presentation The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, or GAAP, have been condensed or omitted in accordance with such rules and regulations, although management believes the disclosures are adequate to prevent the information presented from being misleading. In the opinion of management, all adjustments (consisting of normal recurring matters) considered necessary for a fair presentation have been included. The year-end Balance Sheet at December 31, 2014, was derived from the audited financial statements at that date, but does not include all of the information and disclosures required by GAAP for complete financial statements. For further information, refer to the financial statements and notes thereto included in the Companys Annual Report on Form 10-K for the year ended December 31, 2014. Cost capitalization Costs related to planning and developing a project are capitalized and classified as Real Estate development costs in the Consolidated Balance Sheets. We capitalized certain operating expenses until development is substantially complete, but no later than one year from the cessation of major development activity. Newly issued accounting pronouncements We have considered all other newly issued accounting guidance that is applicable to our operations and the preparation of our statements, including that which we have not yet adopted. We do not believe that any such guidance will have a material effect on our financial position or results of operation. |
FEDERAL INCOME TAXES
FEDERAL INCOME TAXES | 9 Months Ended |
Sep. 30, 2015 | |
FEDERAL INCOME TAXES | |
FEDERAL INCOME TAXES | NOTE 2. FEDERAL INCOME TAXES The Company accounts for income taxes in accordance with Accounting Standards Codification, (ASC) No. 740, Accounting for Income Taxes. ASC 740 requires an asset and liability approach to financial accounting for income taxes. In the event differences between the financial reporting basis and the tax basis of the Companys assets and liabilities result in deferred tax assets, ASC 740 requires an evaluation of the probability of being able to realize the future benefits indicated. Recognition of the benefits of deferred tax assets will require the Company to generate future taxable income. There is no assurance that the Company will generate earnings in future years. |
NOTES RECEIVABLE AND ACCRUED IN
NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES | 9 Months Ended |
Sep. 30, 2015 | |
NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES | |
NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES | NOTE 3. NOTES RECEIVABLE AND ACCRUED INTEREST RELATED PARTIES Receivables from related parties primarily consist of two notes of $1,565,292 and $489,154 which are payable in quarterly installments of interest only. The notes accrue interest at 10% per annum. The maturity date of these notes has been extended to December 31, 2015. A payment was received in March 2015 for $72,752.12 which paid the remaining interest balance due in 2014 and some principal on these notes. Also, a payment for $150,000 was received in July 2015 which made the notes and interest receivable balances current. 2015 2014 Notes receivable related parties Unsecured, due on demand, interest rate of 10%, due monthly $ 2,054,446 $ 2,119,099 Accrued interest related parties 51,783 53,653 Total notes and accounts receivable related parties $ 2,106,229 $ 2,172,752 |
NOTES PAYABLE AND ACCRUED INTER
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES | 9 Months Ended |
Sep. 30, 2015 | |
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES | |
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES | NOTE 4. NOTES PAYABLE AND ACCRUED INTEREST RELATED PARTIES 2015 2014 Uncollateralized notes payable related parties due on demand, interest rate of 10%, payable quarterly $ 816,376 $ 856,140 Accrued interest and intercompany related parties 20,577 21,710 Total notes payable related parties $ 836,953 $ 877,850 Principal and interest payments due by period Total 2015 2016 2017 2018 2019 therafter Long term debt $ 836,953 $ 836,953 $ - $ - $ - $ - $ - $ 836,953 $ 836,953 $ - $ - $ - $ - $ - |
RELATED PARTIES TRANSACTIONS
RELATED PARTIES TRANSACTIONS | 9 Months Ended |
Sep. 30, 2015 | |
RELATED PARTIES TRANSACTIONS | |
RELATED PARTIES TRANSACTIONS | NOTE 5. RELATED PARTIES TRANSACTIONS Transactions involving related parties The Company has an administrative agreement with Pillar Income Asset Management, Inc., an affiliated entity, for accounting and administrative services. The total expense of the nine months ended September 30, 2015 was $45,000 which is included in General and Administrative expenses of the Consolidated Statement of Operations. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2015 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 6. SUBSEQUENT EVENTS |
ACCOUNTING POLICIES (POLICIES)
ACCOUNTING POLICIES (POLICIES) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies | |
Organization and Business | Organization and business First Equity Properties, Inc. is a Nevada based corporation organized in December 19, 1996 and the Company is headquartered in Dallas, TX. The Companys principal line of business and source of revenue is currently investments and interest on notes receivable. The Company is currently in the business of real estate investing. FEPI is a publicly traded company however, no trading market presently exists for the shares of common stock and its value is therefore not determinable. |
Basis of presentation | Basis of presentation The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, or GAAP, have been condensed or omitted in accordance with such rules and regulations, although management believes the disclosures are adequate to prevent the information presented from being misleading. In the opinion of management, all adjustments (consisting of normal recurring matters) considered necessary for a fair presentation have been included. The year-end Balance Sheet at December 31, 2014, was derived from the audited financial statements at that date, but does not include all of the information and disclosures required by GAAP for complete financial statements. For further information, refer to the financial statements and notes thereto included in the Companys Annual Report on Form 10-K for the year ended December 31, 2014. |
Cost capitalization | Cost capitalization Costs related to planning and developing a project are capitalized and classified as Real Estate development costs in the Consolidated Balance Sheets. We capitalized certain operating expenses until development is substantially complete, but no later than one year from the cessation of major development activity. |
Newly issued accounting pronouncements | Newly issued accounting pronouncements We have considered all other newly issued accounting guidance that is applicable to our operations and the preparation of our statements, including that which we have not yet adopted. We do not believe that any such guidance will have a material effect on our financial position or results of operation. |
NOTES RECIEVABLE AND ACCRUED IN
NOTES RECIEVABLE AND ACCRUED INTEREST - RELATED PARTIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
NOTES RECIEVABLE AND ACCRUED INTEREST - RELATED PARTIES | |
NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES | A payment for $150,000 was received in July 2015 which made the notes and interest receivable balances current. 2015 2014 Notes receivable related parties Unsecured, due on demand, interest rate of 10%, due monthly $ 2,054,446 $ 2,119,099 Accrued interest related parties 51,783 53,653 Total notes and accounts receivable related parties $ 2,106,229 $ 2,172,752 |
NOTES PAYABLE AND ACCRUED INT15
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES {2} | |
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES | 2015 2014 Uncollateralized notes payable related parties due on demand, interest rate of 10%, payable quarterly $ 816,376 $ 856,140 Accrued interest and intercompany related parties 20,577 21,710 Total notes payable related parties $ 836,953 $ 877,850 Principal and interest payments due by period Total 2015 2016 2017 2018 2019 therafter Long term debt $ 836,953 $ 836,953 $ - $ - $ - $ - $ - $ 836,953 $ 836,953 $ - $ - $ - $ - $ - |
NOTES RECEIVABLE AND ACCRUED 16
NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES (DETAILS) - USD ($) | Sep. 30, 2015 | Sep. 30, 2014 |
NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES {3} | ||
Unsecured, due on demand, interest rate of 10%, due monthly | $ 2,054,446 | $ 2,119,099 |
Accrued interest - related parties | 51,783 | 53,653 |
Total notes and accounts receivable - related parties | $ 2,106,229 | $ 2,172,752 |
RECEIVABLES RELATED PARTIES (DE
RECEIVABLES RELATED PARTIES (DETAILS) - USD ($) | Sep. 30, 2015 | Jul. 31, 2015 | Mar. 31, 2015 |
Receivables related parties | |||
Receivable related parties primary note 1 mature on 31/12/2015 | $ 1,565,292 | ||
Receivable related parties primary note 2 31/12/2015 | $ 489,154 | ||
Notes accrued interest per annum at | 10.00% | ||
Payment received | $ 72,752 | ||
Subsequent payment for principal and interest on notes receivable | $ 150,000 |
NOTES PAYABLE AND ACCRUED INT18
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (DETAILS) - USD ($) | Sep. 30, 2015 | Sep. 30, 2014 |
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES DETAILS | ||
Uncollateralized notes payable - related parties due on demand, interest rate of 10%, payable quarterly | $ 816,376 | $ 856,140 |
Accrued interest and intercompany - related parties | 20,577 | 21,710 |
Total notes payable - related parties | $ 836,953 | $ 877,850 |
LONG TERM DEBT PAYMENTS DUE BY
LONG TERM DEBT PAYMENTS DUE BY PERIOD (DETAILS) - USD ($) | Sep. 30, 2015 | Sep. 30, 2014 |
Long term debt Payments due by period | ||
Long term debt Payments due in 2015 | $ 836,953 | $ 836,953 |
Long term debt Payments due in 2016 | 0 | 0 |
Long term debt Payments due in 2017 | 0 | 0 |
Long term debt Payments due in 2018 | 0 | 0 |
Long term debt Payments due in 2019 | 0 | 0 |
Long term debt Payments due Thereafter | 0 | 0 |
Long term debt Payments due Total | $ 836,953 | $ 836,953 |
RELATED PARTIES (DETAILS)
RELATED PARTIES (DETAILS) | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Related Parties | |
Total expense | $ 45,000 |