Direct Investment (FEPI) 10-Q 15 May 18 2018 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2018	May 15, 2018
Document And Entity Information
Entity Registrant Name	FIRST EQUITY PROPERTIES INC
Entity Central Index Key	726,516
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		1,057,628
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2,018
Entity Small Business	true

Balance Sheets (Unaudited)

Balance Sheets (Unaudited) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Assets
Notes receivable and accrued interest - related parties	$ 1,597,021	$ 2,106,229
Intercompany receivable	510,662	1,702
Cash and cash equivalents	1,750	914
Total assets	2,109,433	2,108,845
Liabilities and Shareholders' Equity
Notes payable and accrued interest - related parties	836,506	836,953
Intercompany payable	367,115	367,115
Accounts payable - other	29,025	669
Accounts payable - related parties	18,660	18,000
Total liabilities	1,251,306	1,222,737
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)	(529,131)	(501,150)
Total shareholders' equity	858,127	886,108
Total liabilities and shareholders' equity	$ 2,109,433	$ 2,108,845

Balance Sheets (Unaudited) (Par

Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2018	Dec. 31, 2017
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

Statements of Operations (Unaud

Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Revenue
Revenue from operations	$ 0	$ 0
Total revenue	0	0
Operating Expenses
Administrative fees - related parties	18,000	18,000
General and administrative	3,026	2,026
Legal and professional fees	29,400	28,551
Total operating expenses	50,426	48,577
Income (loss) before interest expense and taxes	(50,426)	(48,577)
Other income (expense)
Interest income - related parties	42,575	50,658
Interest expense - related parties	(20,130)	(20,130)
Net income (loss) applicable to common shareholders	$ (27,981)	$ (18,049)
Earnings (loss) per share	$ (0.03)	$ (0.02)
Weighted average shares outstanding	1,057,628	1,057,628

Shareholders Equity (Unaudited)

Shareholders Equity (Unaudited) - 3 months ended Mar. 31, 2018 - USD ($)	Common Stock	Additional Paid-In Capital	Retained Earningd (Deficit)	Total
Beginning balance, shares at Dec. 31, 2017	1,057,628
Beginning balance, value at Dec. 31, 2017	$ 10,576	$ 1,376,682	$ (501,150)	$ 886,108
Net income (loss)			(27,981)	(27,981)
Ending balance, shares at Mar. 31, 2018	1,057,628
Ending balance, value at Mar. 31, 2018	$ 10,576	$ 1,376,682	$ (529,131)	$ 858,127

Statements of Cash Flows (Unaud

Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash Flows from Operating Activities
Net Income (Loss)	$ (27,981)	$ (18,049)
Adjustments to reconcile net income applicable to common shareholders to net cash provided by (used in) operating activities:
Interest receivable - related parties	9,208	1,126
Intercompany receivable	(508,960)	0
Intercompany payable	0	0
Accounts payable - other	28,356	24,494
Accounts payable - related parties	660	(7,186)
Interest payable - related parties	(447)	(447)
Net cash provided by (used for) operating activities	(499,164)	(62)
Cash Flows from Investing Activities
Notes receivable - related parties	500,000	0
Net cash provided by (used for) investing activities	500,000	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	836	(62)
Cash and cash equivalents at the beginning of period	914	900
Cash and cash equivalents at the end of period	1,750	838
Supplemental disclosures of cash flow information:
Cash paid for interest expense to related parties	$ 20,577	$ 20,577

1. ORGANIZATION AND BASIS OF PR

1. ORGANIZATION AND BASIS OF PRESENTATION	3 Months Ended
	Mar. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
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 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, 2017. Operating results for the three month period ended March 31, 2018 are not necessarily indicative of the results that may be expected for any subsequent quarter or for the fiscal year ending December 31, 2018. 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	3 Months Ended
	Mar. 31, 2018
Income Tax Disclosure [Abstract]
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 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	3 Months Ended
	Mar. 31, 2018
Receivables [Abstract]
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 $1,165,292 and $389,154 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, 2019. A payment was received in March 2018 for $51,783 which paid the remaining interest balance due in 2017. 2018 2017 Notes receivable – related parties Unsecured, due on demand, interest rate of 10%, due monthly $ 1,554,446 $ 2,054,446 Accrued interest – related parties 42,575 51,783 Total notes and accounts receivable – related parties $ 1,597,021 $ 2,106,229 Subsequent payments for interest on notes receivable were received in May 2018 for $42,575 which makes the interest receivable balances current.

4. NOTES PAYABLE AND ACCRUED IN

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES	3 Months Ended
	Mar. 31, 2018
Debt Disclosure [Abstract]
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES	NOTE 4. NOTES PAYABLE AND ACCRUED INTEREST – RELATED PARTIES 2018 2017 Uncollateralized notes payable – related parties due on demand, interest rate of 10%, payable quarterly $ 816,376 $ 816,376 Accrued interest and intercompany – related parties 20,130 20,577 Total notes payable – related parties $ 836,506 $ 836,953 Long term debt and accrued interest is due December 31, 2019. Subsequent payments for principal and interest on notes payable were made in May 2018 totaling $207,016 and $20,130, respectively, which makes the notes and interest payable balances current.

5. RELATED PARTIES TRANSACTIONS

5. RELATED PARTIES TRANSACTIONS	3 Months Ended
	Mar. 31, 2018
Related Party Transactions [Abstract]
RELATED PARTIES TRANSACTIONS	NOTE 5. 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 three months ended March 31, 2018 was $18,000 which is included in General and Administrative expenses of the Statements of Operations.

6. SUBSEQUENT EVENTS

6. SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2018
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 6. SUBSEQUENT EVENTS The Company has evaluated subsequent events through May 15, 2018, the date the financial statements were available to be issued, and has determined that there has been subsequent payments received in May 2018 for interest on notes receivable and subsequent payments made in May 2018 for principal and interest owed on notes payable.

1. ORGANIZATION AND BASIS OF 13

1. ORGANIZATION AND BASIS OF PRESENTATION (Policies)	3 Months Ended
	Mar. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [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, 2017. Operating results for the three month period ended March 31, 2018 are not necessarily indicative of the results that may be expected for any subsequent quarter or for the fiscal year ending December 31, 2018.
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 RECEIVABLE AND ACCRU14

3. NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES (Tables)	3 Months Ended
	Mar. 31, 2018
Receivables [Abstract]
NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES	2018 2017 Notes receivable – related parties Unsecured, due on demand, interest rate of 10%, due monthly $ 1,554,446 $ 2,054,446 Accrued interest – related parties 42,575 51,783 Total notes and accounts receivable – related parties $ 1,597,021 $ 2,106,229

4. NOTES PAYABLE AND ACCRUED 15

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Tables)	3 Months Ended
	Mar. 31, 2018
Debt Disclosure [Abstract]
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES	2018 2017 Uncollateralized notes payable – related parties due on demand, interest rate of 10%, payable quarterly $ 816,376 $ 816,376 Accrued interest and intercompany – related parties 20,130 20,577 Total notes payable – related parties $ 836,506 $ 836,953

3. NOTES RECEIVABLE AND ACCRU16

3. NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES (Details) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Receivables [Abstract]
Notes receivable - related parties Unsecured, due on demand, interest rate of 10%, due monthly	$ 1,554,446	$ 2,054,446
Accrued interest - related parties	42,575	51,783
Total notes and accounts receivable - related parties	$ 1,597,021	$ 2,106,229

3. NOTES RECEIVABLE AND ACCRU17

3. NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES (Details Narrative) - USD ($)	3 Months Ended		4 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	May 15, 2018	Dec. 31, 2017
Notes receivable - related parties	$ 1,554,446			$ 2,054,446
Proceeds from notes receivable	500,000	$ 0
Interest income received	42,575	$ 50,658
Note Receivable 1 [Member]
Notes receivable - related parties	$ 1,565,292
Stated interet rate	10.00%
Receivable maturity date	Dec. 31, 2019
Note Receivable 2 [Member]
Notes receivable - related parties	$ 489,154
Stated interet rate	10.00%
Receivable maturity date	Dec. 31, 2019
Notes Receivable [Member]
Proceeds from notes receivable	$ 51,783
Notes Receivable [Member] | Subsequent Event [Member]
Proceeds from notes receivable			$ 42,575

4. NOTES PAYABLE AND ACCRUED 18

4. NOTES PAYABLE AND ACCRUED INTEREST – RELATED PARTIES - NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Details) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Debt Disclosure [Abstract]
Uncollateralized notes payable - related parties due on demand, interest rate of 10%, payable quarterly	$ 816,376	$ 816,376
Accrued interest and intercompany - related parties	20,130	20,577
Total notes payable - related parties	$ 836,506	$ 836,953

4. NOTES PAYABLE AND ACCRUED 19

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Details Narrative) - Note Payable [Member] - Subsequent Event [Member]	4 Months Ended
	May 15, 2018USD ($)
Repayment of notes payable, principal	$ 207,016
Repayment of notes payable, interest	$ 20,130

5. RELATED PARTIES TRANSACTIO20

5. RELATED PARTIES TRANSACTIONS (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Related party expense	$ 18,000	$ 18,000
Accounting And Admin [Member]
Related party expense	$ 18,000