Direct Investment (FEPI) 10-Q 13 Aug 19 2019 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2019	Aug. 13, 2019
Document And Entity Information
Entity Registrant Name	FIRST EQUITY PROPERTIES INC
Entity Central Index Key	0000726516
Document Type	10-Q
Document Period End Date	Jun. 30, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity's Reporting Status Current?	Yes
Is Entity Emerging Growth Company?	false
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Common Stock, Shares Outstanding		1,057,628
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2019

Balance Sheets (Unaudited)

Balance Sheets (Unaudited) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Assets
Notes receivable and accrued interest - related parties	$ 1,553,267	$ 1,592,418
Accounts receivable - related parties	168,535
Cash and cash equivalents	45,251	201,057
Total assets	1,767,053	1,793,475
Liabilities and Shareholders' Equity
Notes payable and accrued interest - related parties	584,360	584,360
Accounts payable - other	4,454
Accounts payable - related parties	367,115	367,565
Total liabilities	955,929	951,925
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
Paid in capital	1,376,682	1,376,682
Retained earnings (deficit)	(576,134)	(545,708)
Total shareholders' equity	811,124	841,550
Total liabilities and shareholders' equity	$ 1,767,053	$ 1,793,475

Balance Sheets (Unaudited) (Par

Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Jun. 30, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Preferred Stock, par value	$ .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	$ .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		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Operating Expenses
Administrative fees - related parties	$ 18,000	$ 18,000	$ 36,000	$ 36,000
General and administrative	5,482	5,125	8,872	8,151
Legal and professional fees	3,394	3,450	33,601	32,851
Total operating expenses	26,876	26,575	78,473	77,002
Income (loss) before interest expense and taxes	(26,876)	(26,575)	(78,473)	(77,002)
Other income (expense)
Interest income - related parties	38,725	38,755	77,025	81,330
Interest expense - related parties	(14,569)	(16,894)	(28,978)	(37,024)
Net income (loss) applicable to common shareholders	$ (2,720)	$ (4,714)	$ (30,426)	$ (32,696)
Earnings (loss) per share			$ (0.03)	$ (0.03)
Weighted average shares outstanding	1,057,628	1,057,628	1,057,628	1,057,628

Shareholders Equity (Unaudited)

Shareholders Equity (Unaudited) - USD ($)	Common Stock	Additional Paid-In Capital	Retained Earnings / Accumulated 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)			(32,696)	(32,696)
Ending balance, shares at Jun. 30, 2018	1,057,628
Ending balance, value at Jun. 30, 2018	$ 10,576	1,376,682	(533,846)	853,412
Beginning balance, shares at Dec. 31, 2018	1,057,628
Beginning balance, value at Dec. 31, 2018	$ 10,576	1,376,682	(545,708)	841,550
Net income (loss)			(30,426)	(30,426)
Ending balance, shares at Jun. 30, 2019	1,057,628
Ending balance, value at Jun. 30, 2019	$ 10,576	$ 1,376,682	$ (576,134)	$ 811,124

Statements of Cash Flows (Unaud

Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018
Cash Flows from Operating Activities
Net Income (Loss)	$ (30,426)	$ (32,696)
Adjustments to reconcile net income applicable to common shareholders to net cash provided by (used in) operating activities:
Interest receivable - related parties	39,151	13,029
Accounts receivable - related parties	(168,535)	(265,860)
Accounts payable - other	4,454	2,707
Accounts payable - related parties	(450)
Interest payable - related parties		(10,394)
Net cash provided by (used for) operating activities	(155,806)	(293,214)
Cash Flows from Investing Activities
Notes receivable - related parties		500,000
Net cash provided by (used for) investing activities		500,000
Cash Flows from Financing Activities
Notes payable - related parties		(207,015)
Net cash provided by (used for) financing activities		(207,015)
Net increase (decrease) in cash and cash equivalents	(155,806)	(229)
Cash and cash equivalents at the beginning of period	201,057	914
Cash and cash equivalents at the end of period	45,251	685
Supplemental disclosures of cash flow information:
Cash paid for interest expense to related parties	$ 28,978	$ 47,417

1. ORGANIZATION AND BASIS OF PR

1. ORGANIZATION AND BASIS OF PRESENTATION	6 Months Ended
	Jun. 30, 2019
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, 2018. Operating results for the six month period ended June 30, 2019 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	6 Months Ended
	Jun. 30, 2019
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	6 Months Ended
	Jun. 30, 2019
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 $1,164,113 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. 2019 2018 Notes receivable – related parties Unsecured, due on demand, interest rate of 10%, due monthly $ 1,553,267 $ 1,553,267 Accrued interest – related parties 0 39,151 Total notes and accounts receivable – related parties $ 1,553,267 $ 1,592,418

4. NOTES PAYABLE AND ACCRUED IN

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES	6 Months Ended
	Jun. 30, 2019
Debt Disclosure [Abstract]
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES	NOTE 4. NOTES PAYABLE AND ACCRUED INTEREST – RELATED PARTIES 2019 2018 Uncollateralized notes payable – related parties due on demand, interest rate of 10%, payable quarterly $ 584,360 $ 584,360 Accrued interest and intercompany – related parties 0 0 Total notes payable – related parties $ 584,360 $ 584,360 Long term debt and accrued interest is due December 31, 2019.

5. RELATED PARTIES TRANSACTIONS

5. RELATED PARTIES TRANSACTIONS	6 Months Ended
	Jun. 30, 2019
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 six months ended June 30, 2019 was $36,000 which is included in General and Administrative expenses of the Statements of Operations. Pillar owes the Company $168,535 at June 30, 2019. The Company owes another related entity $367,115 as of June 30, 2019.

6. SUBSEQUENT EVENTS

6. SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2019
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 6. SUBSEQUENT EVENTS The Company has evaluated subsequent events through August 13, 2019, the date the financial statements were available to be issued, and has determined that there are none to be reported.

1. ORGANIZATION AND BASIS OF _2

1. ORGANIZATION AND BASIS OF PRESENTATION (Policies)	6 Months Ended
	Jun. 30, 2019
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, 2018. Operating results for the six month period ended June 30, 2019 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 ACCRU_2

3. NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES (Tables)	6 Months Ended
	Jun. 30, 2019
Receivables [Abstract]
NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES	2019 2018 Notes receivable – related parties Unsecured, due on demand, interest rate of 10%, due monthly $ 1,553,267 $ 1,553,267 Accrued interest – related parties 0 39,151 Total notes and accounts receivable – related parties $ 1,553,267 $ 1,592,418

4. NOTES PAYABLE AND ACCRUED _2

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Tables)	6 Months Ended
	Jun. 30, 2019
Debt Disclosure [Abstract]
NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES	2019 2018 Uncollateralized notes payable – related parties due on demand, interest rate of 10%, payable quarterly $ 584,360 $ 584,360 Accrued interest and intercompany – related parties 0 0 Total notes payable – related parties $ 584,360 $ 584,360

3. NOTES RECEIVABLE AND ACCRU_3

3. NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Receivables [Abstract]
Notes receivable - related parties Unsecured, due on demand, interest rate of 10%, due monthly	$ 1,553,267	$ 1,553,267
Accrued interest - related parties	0	39,151
Total notes and accounts receivable - related parties	$ 1,553,267	$ 1,592,418

3. NOTES RECEIVABLE AND ACCRU_4

3. NOTES RECEIVABLE AND ACCRUED INTEREST - RELATED PARTIES (Details Narrative) - USD ($)	6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Dec. 31, 2018	Sep. 30, 2018
Notes receivable - related parties	$ 1,553,267		$ 1,553,267
Proceeds from notes receivable		$ 500,000
Note Receivable 1 [Member]
Notes receivable - related parties				$ 1,164,113
Stated interet rate				10.00%
Note Receivable 2 [Member]
Notes receivable - related parties				$ 389,154
Stated interet rate				10.00%

4. NOTES PAYABLE AND ACCRUED _3

4. NOTES PAYABLE AND ACCRUED INTEREST – RELATED PARTIES - NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Details) - USD ($)	Jun. 30, 2019	Dec. 31, 2018
Debt Disclosure [Abstract]
Uncollateralized notes payable - related parties due on demand, interest rate of 10%, payable quarterly	$ 584,360	$ 584,360
Accrued interest and intercompany - related parties	0	0
Total notes payable - related parties	$ 584,360	$ 584,360

4. NOTES PAYABLE AND ACCRUED _4

4. NOTES PAYABLE AND ACCRUED INTEREST - RELATED PARTIES (Details Narrative)	6 Months Ended
	Jun. 30, 2019
Debt Disclosure [Abstract]
Debt maturity date	Dec. 31, 2019

5. RELATED PARTIES TRANSACTIO_2

5. RELATED PARTIES TRANSACTIONS (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2019	Jun. 30, 2018	Jun. 30, 2019	Jun. 30, 2018
Related party expense	$ 18,000	$ 18,000	$ 36,000	$ 36,000
Pillar Capital [Member]
Related party expense			168,535
Related Entity [Member]
Related party expense			$ 367,115