Direct Investment (FEPI) 10-Q 14 Aug 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2017	Aug. 09, 2017
Document and Entity Information
Entity Registrant Name	FIRST EQUITY PROPERTIES INC
Entity Trading Symbol	fepi
Document Type	10-Q
Document Period End Date	Jun. 30, 2017
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	2,017
Document Fiscal Period Focus	Q2

BALANCE SHEET (Unaudited)

BALANCE SHEET (Unaudited) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
Notes receivable and accrued interest - related parties	$ 2,105,666	$ 2,106,229
Cash and cash equivalents	316	900
Total assets	2,105,982	2,107,129
Liabilities and Shareholders' Equity
Notes payable and accrued interest - related parties	836,729	836,953
Accounts payable - other	0	4,732
Accounts payable - related parties	392,193	375,728
Total liabilities	1,228,922	1,217,413
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)	(510,198)	(497,542)
Total shareholders' equity	877,060	889,716
Total liabilities and shareholders' equity	$ 2,105,982	$ 2,107,129

BALANCE SHEETS (Unaudited) (PAR

BALANCE SHEETS (Unaudited) (PARENTHETICALS) - $ / shares	Jun. 30, 2017	Dec. 31, 2016
Statement of Financial Position [Abstract]
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
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

STATEMENT OF OPERATIONS (unaudi

STATEMENT OF OPERATIONS (unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016
Income Statement [Abstract]
Revenue from operations	$ 0	$ 0	$ 0	$ 0
Total revenue	0	0	0	0
Operating Expenses
Administrative fees - related parties	18,000	15,000	36,000	30,000
General and administrative	7,474	7,418	38,051	40,965
Total operating expenses	25,474	22,418	74,051	70,965
Income (loss) before interest expense and taxes	(25,474)	(22,418)	(74,051)	(70,965)
Other income (expense)
Interest income - related parties	51,221	51,221	101,878	102,441
Interest expense - related parties	(20,354)	(20,354)	(40,483)	(40,707)
Net income (loss) applicable to common shareholders	$ 5,393	$ 8,449	$ (12,656)	$ (9,231)
Earnings (loss) per share	$ .01	$ .01	$ (.01)	$ (.01)
Weighted average shares outstanding	1,057,628	1,057,628	1,057,628	1,057,628

STATEMENT OF CHANGES IN SHAREHO

STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) - 6 months ended Jun. 30, 2017 - USD ($)	Common Stock	Additional Paid-In Capital	Retained Earningd (Deficit)	Total
Beginning balance, shares at Dec. 31, 2016	1,057,628
Beginning balance, value at Dec. 31, 2016	$ 10,576	$ 1,376,682	$ (497,542)	$ 889,716
Net income (loss)			(12,656)	(12,656)
Ending balance, shares at Jun. 30, 2017	1,057,628
Ending balance, value at Jun. 30, 2017	$ 10,576	$ 1,376,682	$ (510,198)	$ 877,060

STATEMENT OF CASH FLOWS (unaudi

STATEMENT OF CASH FLOWS (unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016
Cash Flows from Operating Activities
Net Income (Loss)	$ (12,656)	$ (9,231)
Adjustments to reconcile net income applicable to common shareholders to net cash provided by (used in) operating activities:
Interest receivable - related parties	563	(50,658)
Increase (decrease) in
Accounts payable - other	(4,732)	1,844
Accounts payable - related parties	16,465	37,650
Interest payable - related parties	(224)	20,130
Net cash provided by (used for) operating activities	(584)	(265)
Cash Flows from Investing Activities
Notes receivable - related parties	0	0
Net cash provided by (used for) investing activities	0	0
Cash Flows from Financing Activities
Notes payable - related parties	0	0
Net cash provided by (used for) financing activities	0	0
Net increase (decrease) in cash and cash equivalents	(584)	(265)
Cash and cash equivalents at the beginning of period	900	867
Cash and cash equivalents at the end of period	316	602
Supplemental disclosures of cash flow information:
Cash paid for interest expense to related parties	20,130	20,577
Cash received for interest on notes receivable	$ 50,658	$ 51,783

1. ORGANIZATION AND BASIS OF PR

1. ORGANIZATION AND BASIS OF PRESENTATION	6 Months Ended
	Jun. 30, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
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 Company’s 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. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2016. Operating results for the six month period ended June 30, 2017 are not necessarily indicative of the results that may be expected for any subsequent quarter or for the fiscal year ending December 31, 2017. 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.

2. FEDERAL INCOME TAXES

2. FEDERAL INCOME TAXES	6 Months Ended
	Jun. 30, 2017
Income Tax Disclosure [Abstract]
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 Company’s 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.

3. NOTES RECEIVABLE AND ACCRUED

3. NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES	6 Months Ended
	Jun. 30, 2017
Receivables [Abstract]
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 due to the Company 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, 2017. A payment was received in March 2017 for $51,783 which paid the remaining interest balance due in 2016 and in May 2017 for $50,657 which made the interest receivable balances current. 2017 2016 Notes receivable – related parties Unsecured, due on demand, interest rate of 10%, due monthly $ 2,054,446 $ 2,054,446 Accrued interest – related parties 51,220 51,783 Total notes and accounts receivable – related parties $ 2,105,666 $ 2,106,229 Subsequent payments for interest on notes receivable were received in July 2017 for $51,220 which makes the interest receivable balances current.

4. NOTES PAYABLE AND ACCRUED IN

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES	6 Months Ended
	Jun. 30, 2017
Debt Disclosure [Abstract]
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES	2017 2016 Uncollateralized notes payable – related parties due on demand, interest rate of 10%, payable quarterly $ 816,376 $ 816,376 Accrued interest and intercompany – related parties 20,353 20,577 Total notes payable – related parties $ 836,729 $ 836,953 Long term debt and accrued interest is due December 31, 2017. Subsequent payments for interest on notes payable were made in July 2017 totaling $20,353 which makes the notes and interest payable balances current.

5. RELATED PARTIES TRANSACTIONS

5. RELATED PARTIES TRANSACTIONS	6 Months Ended
	Jun. 30, 2017
Related Party Transactions [Abstract]
RELATED PARTIES TRANSACTIONS	Transactions involving related parties cannot be presumed to be carried out on an arm’s length basis due to the absence of free market forces that naturally exist in business dealings between two or more unrelated entities. Related party transactions may not always be favorable to our business and may include terms, conditions and agreements that are not necessarily beneficial to or in best interest of our company. 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 six months ended June 30, 2017 was $36,000 which is included in General and Administrative expenses of the Statements of Operations.

6. SUBSEQUENT EVENTS

6. SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2017
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	The Company has evaluated subsequent events through August 9, 2017, the date the financial statements were available to be issued, and has determined that there has been subsequent payments received in July 2017 for interest on notes receivable and subsequent payments made in 2017 for interest owed on notes payable.

1. ACCOUNTING POLICIES (Policie

1. ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2017
Accounting Policies [Abstract]
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 Company’s 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. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2016. Operating results for the six month period ended June 30, 2017 are not necessarily indicative of the results that may be expected for any subsequent quarter or for the fiscal year ending December 31, 2017.
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.

3. NOTES RECIEVABLE AND ACCRUED

3. NOTES RECIEVABLE AND ACCRUED INTEREST - RELATED PARTIES (Tables)	6 Months Ended
	Jun. 30, 2017
Receivables [Abstract]
NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES	2017 2016 Notes receivable – related parties Unsecured, due on demand, interest rate of 10%, due monthly $ 2,054,446 $ 2,054,446 Accrued interest – related parties 51,220 51,783 Total notes and accounts receivable – related parties $ 2,105,666 $ 2,106,229

4. NOTES PAYABLE AND ACCRUED 15

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Tables)	6 Months Ended
	Jun. 30, 2017
Debt Disclosure [Abstract]
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES	2017 2016 Uncollateralized notes payable – related parties due on demand, interest rate of 10%, payable quarterly $ 816,376 $ 816,376 Accrued interest and intercompany – related parties 20,353 20,577 Total notes payable – related parties $ 836,729 $ 836,953

3. NOTES RECEIVABLE AND ACCRU16

3. NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Receivables [Abstract]
Notes receivable - related parties	$ 2,054,446	$ 2,054,446
Accrued interest - related parties	51,220	51,783
Total notes and accounts receivable - related parties	$ 2,105,666	$ 2,106,229

3. NOTES RECEIVABLE AND ACCRU17

3. NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2017	Jun. 30, 2016	Dec. 31, 2016
Notes receivable - related parties	$ 2,054,446		$ 2,054,446		$ 2,054,446
Interest income received	51,221	$ 51,221	101,878	$ 102,441
Note Receivable 1 [Member]
Notes receivable - related parties	$ 1,565,292		$ 1,565,292		$ 489,154
Notes Receivable [Member]
Stated interest rate			10.00%
Receivable maturity date			Dec. 31, 2017
Interest income received			$ 51,783	$ 50,657

4. NOTES PAYABLE AND ACCRUED 18

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Details) - USD ($)	Jun. 30, 2017	Dec. 31, 2016
Debt Disclosure [Abstract]
Notes payable - related parties	$ 816,376	$ 816,376
Accrued interest - related parties	20,353	20,577
Notes payable and accrued interest - related parties	$ 836,729	$ 836,953

4. NOTES PAYABLE AND ACCRUED 19

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Details Narrative) - Note payable - related parties [Member]	6 Months Ended
	Jun. 30, 2017
Debt stated interest rate	10.00%
Debt maturity date	Dec. 31, 2017

5. RELATED PARTIES TRANSACTIO20

5. RELATED PARTIES TRANSACTIONS (Details)	6 Months Ended
	Jun. 30, 2017USD ($)
Accounting and administrative expenses [Member]
Related party expense	$ 36,000