Electronic Systems Technology (ELST) 10-Q 29 Oct 24 2024 Q3 Quarterly report Financial data

Cover

Cover - shares	9 Months Ended
	Sep. 30, 2024	Oct. 30, 2024
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2024
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-31
Entity File Number	000-27793
Entity Registrant Name	ELECTRONIC SYSTEMS TECHNOLOGY INC
Entity Central Index Key	0000752294
Entity Tax Identification Number	91-1238077
Entity Incorporation, State or Country Code	WA
Entity Address, Address Line One	415 N. Roosevelt St.
Entity Address, Address Line Two	STE B1
Entity Address, City or Town	Kennewick
Entity Address, State or Province	WA
Entity Address, Postal Zip Code	99336
City Area Code	509
Local Phone Number	735-9092
Trading Symbol	ELST
Title of 12(g) Security	Common Stock, $0.001 par value
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		4,946,502

CONDENSED BALANCE SHEETS (Unaud

CONDENSED BALANCE SHEETS (Unaudited) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Current assets
Cash and cash equivalents	$ 158,223	$ 486,252
Certificates of deposit	400,000	400,000
Accounts receivable, net	59,365	52,592
Inventories	785,755	722,457
Prepaid expenses	29,679	19,278
Accrued interest receivable	1,342	1,906
Total current assets	1,434,364	1,682,485
Property and equipment, net of depreciation	16,450	18,255
Right to use – Lease, net of amortization	0	30,298
Total assets	1,450,814	1,731,038
Current liabilities
Accounts payable	21,754	37,355
Accrued wages and bonus	1,208	4,188
Accrued vacation pay	24,072	21,243
Lease liability, current	0	30,773
Other accrued liabilities	397	10,221
Total current liabilities	47,431	103,780
Total liabilities	47,431	103,780
Stockholders’ equity
Common stock, $0.001 par value 50,000,000 shares authorized 4,946,502 and 4,946,502 shares issued and outstanding, respectively	4,947	4,947
Additional paid-in capital	933,105	933,105
Retained earnings	465,331	689,206
Total stockholders' equity	1,403,383	1,627,258
Total liabilities and stockholders' equity	$ 1,450,814	$ 1,731,038

CONDENSED BALANCE SHEETS (Una_2

CONDENSED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Sep. 30, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	4,946,502	4,946,502
Common stock, shares outstanding	4,946,502	4,946,502

CONDENSED STATEMENTS OF OPERATI

CONDENSED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Statement [Abstract]
SALES - NET	$ 293,936	$ 342,721	$ 983,566	$ 1,233,016
COST OF SALES	(145,429)	(178,435)	(461,953)	(586,631)
GROSS PROFIT	148,507	164,286	521,613	646,385
Operating Expenses
General and administrative	59,881	55,829	211,328	202,086
Research and development	28,236	26,114	92,263	82,798
Marketing and sales	133,313	133,223	458,442	454,819
TOTAL OPERATING EXPENSE	221,430	215,166	762,033	739,703
OPERATING LOSS	(72,923)	(50,880)	(240,420)	(93,318)
OTHER INCOME
Interest income	5,482	8,375	16,545	17,559
TOTAL OTHER INCOME	5,482	8,375	16,545	17,559
NET LOSS BEFORE INCOME TAX	(67,441)	(42,505)	(223,875)	(75,759)
Benefit (provision) for income tax	0	0	0	0
NET LOSS	$ (67,441)	$ (42,505)	$ (223,875)	$ (75,759)
Basic loss per share	$ (0.01)	$ (0.01)	$ (0.05)	$ (0.02)
Diluted loss per share	$ (0.01)	$ (0.01)	$ (0.05)	$ (0.02)
Basic weighted average shares used in computing loss per share	4,946,502	4,946,502	4,946,502	4,946,502
Diluted weighted average shares used in computing loss per share	4,946,502	4,946,502	4,946,502	4,946,502

CONDENSED STATEMENTS OF CASH FL

CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (223,875)	$ (75,759)
Noncash items included in net loss:
Depreciation and amortization	3,109	1,423
Stock based compensation	0	693
Changes in operating assets and liabilities:
Accounts receivable, net	(6,773)	45,216
Inventories	(63,298)	(84,399)
Accrued interest receivable	564	(1,466)
Prepaid expenses	(10,401)	10,191
Employee retention tax credit receivable	0	63,000
Accounts payable	(15,601)	(106,414)
Other accrued liabilities	(10,450)	(14,040)
NET CASH USED IN OPERATING ACTIVITIES	(326,725)	(161,555)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets	(1,304)	(19,769)
Certificates of deposit redeemed	1,000,000	1,001,699
Certificates of deposit purchased	(1,000,000)	(1,150,000)
NET CASH USED IN INVESTING ACTIVITIES	(1,304)	(168,070)
NET DECREASE IN CASH AND CASH EQUIVALENTS	(328,029)	(329,625)
Cash and cash equivalents at beginning of period	486,252	751,118
Cash and cash equivalents at end of period	$ 158,223	$ 421,493

CONDENSED STATEMENTS OF CHANGES

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Beginning balance, value at Dec. 31, 2022	$ 4,947	$ 932,412	$ 849,989	$ 1,787,348
Beginning balance, shares at Dec. 31, 2022	4,946,502
Net income (loss)			(92,124)	(92,124)
Ending balance, value at Mar. 31, 2023	$ 4,947	932,412	757,865	1,695,224
Ending balance, shares at Mar. 31, 2023	4,946,502
Beginning balance, value at Dec. 31, 2022	$ 4,947	932,412	849,989	1,787,348
Beginning balance, shares at Dec. 31, 2022	4,946,502
Net income (loss)				(75,759)
Ending balance, value at Sep. 30, 2023	$ 4,947	933,105	774,230	1,712,282
Ending balance, shares at Sep. 30, 2023	4,946,502
Beginning balance, value at Mar. 31, 2023	$ 4,947	932,412	757,865	1,695,224
Beginning balance, shares at Mar. 31, 2023	4,946,502
Net income (loss)			58,870	58,870
Stock based compensation		693		693
Ending balance, value at Jun. 30, 2023	$ 4,947	933,105	816,735	1,754,787
Ending balance, shares at Jun. 30, 2023	4,946,502
Net income (loss)			(42,505)	(42,505)
Ending balance, value at Sep. 30, 2023	$ 4,947	933,105	774,230	1,712,282
Ending balance, shares at Sep. 30, 2023	4,946,502
Beginning balance, value at Dec. 31, 2023	$ 4,947	933,105	689,206	1,627,258
Beginning balance, shares at Dec. 31, 2023	4,946,502
Net income (loss)			(85,574)	(85,574)
Ending balance, value at Mar. 31, 2024	$ 4,947	933,105	603,632	1,541,684
Ending balance, shares at Mar. 31, 2024	4,946,502
Beginning balance, value at Dec. 31, 2023	$ 4,947	933,105	689,206	1,627,258
Beginning balance, shares at Dec. 31, 2023	4,946,502
Net income (loss)				(223,875)
Ending balance, value at Sep. 30, 2024	$ 4,947	933,105	465,331	1,403,383
Ending balance, shares at Sep. 30, 2024	4,946,502
Beginning balance, value at Mar. 31, 2024	$ 4,947	933,105	603,632	1,541,684
Beginning balance, shares at Mar. 31, 2024	4,946,502
Net income (loss)			(70,860)	(70,860)
Ending balance, value at Jun. 30, 2024	$ 4,947	933,105	532,772	1,470,824
Ending balance, shares at Jun. 30, 2024	4,946,502
Net income (loss)			(67,441)	(67,441)
Ending balance, value at Sep. 30, 2024	$ 4,947	$ 933,105	$ 465,331	$ 1,403,383
Ending balance, shares at Sep. 30, 2024	4,946,502

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($)	3 Months Ended						9 Months Ended
	Sep. 30, 2024	Jun. 30, 2024	Mar. 31, 2024	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure [Table]
Net Income (Loss)	$ (67,441)	$ (70,860)	$ (85,574)	$ (42,505)	$ 58,870	$ (92,124)	$ (223,875)	$ (75,759)

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
	Sep. 30, 2024
Insider Trading Arrangements [Line Items]
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

BASIS OF PRESENTATION

BASIS OF PRESENTATION	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
BASIS OF PRESENTATION	NOTE 1 - BASIS OF PRESENTATION The unaudited condensed financial statements, including notes, of Electronic Systems Technology, Inc. (the "Company") are representations of the Company’s management, which is responsible for their integrity and objectivity. The accompanying unaudited condensed financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, as well as the instructions to Form 10-Q. Accordingly, the financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of September 30, 2024 and its results of operations, cash flows, and changes in stockholders’ equity for the three and nine months ended September 30, 2024, and 2023. The balance sheet at December 31, 2023 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. All amounts presented are in U.S. dollars. For further information, refer to the financial statements and footnotes thereto in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. The results of operations for the three and nine-month periods ended September 30, 2024 are not necessarily indicative of the results expected for the full fiscal year or for any other fiscal period. The Company estimates that for 2024 the anticipated effective annual federal income tax rate will be 0%. New Accounting Pronouncements Management does not believe that any recently issued but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, amending reportable segment disclosure requirements to include disclosure of incremental segment information on an annual and interim basis. Among the disclosure enhancements are new disclosures regarding significant segment expenses that are regularly provided to the chief operating decision-maker and included within each reported measure of segment profit or loss, as well as other segment items bridging segment revenue to each reported measure of segment profit or loss. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and for interim periods beginning January 1, 2025, and are applied retrospectively. Early adoption is permitted. We are currently evaluating the effect the updated standard will have on our consolidated financial statements and disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024 and are applied prospectively. Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the effect the updated standard will have on our consolidated financial statements and disclosures.

INVENTORIES

INVENTORIES	9 Months Ended
	Sep. 30, 2024
Inventory Disclosure [Abstract]
INVENTORIES	NOTE 2 - INVENTORIES Inventories are stated at lower of direct cost or net realizable value with cost determined using the FIFO (first in, first out) method. Inventories consist of the following: Schedule of inventories September 30, December 31, Parts $ 102,834 $ 118,472 Work in progress 406,658 313,597 Finished goods 276,263 290,388 Total inventories $ 785,755 $ 722,457

EARNINGS (LOSS) PER SHARE

EARNINGS (LOSS) PER SHARE	9 Months Ended
	Sep. 30, 2024
Earnings Per Share [Abstract]
EARNINGS (LOSS) PER SHARE	NOTE 3 - EARNINGS (LOSS) PER SHARE Basic earnings (loss) per share excludes dilution and is computed by dividing income (loss) available to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted earnings (loss) per share reflects potential dilution occurring if securities or other contracts to issue common stock were exercised or converted into Common Stock or resulted in the issuance of common stock that then shared in the earnings of the Company. At September 30, 2024 and 2023, the Company had 225,000 225,000

STOCK OPTIONS

STOCK OPTIONS	9 Months Ended
	Sep. 30, 2024
Share-Based Payment Arrangement [Abstract]
STOCK OPTIONS	NOTE 4 - STOCK OPTIONS As of September 30, 2024, there were 225,000 0.40 1.0 0

REVENUE

REVENUE	9 Months Ended
	Sep. 30, 2024
Revenue from Contract with Customer [Abstract]
REVENUE	NOTE 5 – REVENUE The Company’s product revenue includes industrial wireless products and accessories such as antennas, power supplies and cable assemblies. The Company also provides direct site support and engineering services to customers, such as repair and upgrade of its products. During the three-month periods ended September 30, 2024 and 2023, the Company’s revenue from products sales was $ 275,936 336,621 18,000 6,100 During the nine-month periods ended September 30, 2024 and 2023, the Company’s revenue from products sales was $ 947,566 1,209,516 36,000 23,500 The Company’s customers, to which trade credit terms are extended, consist of United States and local governments and foreign and domestic companies. Domestic sales for the three-month periods ended September 30, 2024 and 2023 were $ 247,572 338,948 46,364 3,773 Domestic sales for the nine-month periods ended September 30, 2024 and 2023 were $ 830,167 1,208,539 153,399 24,477 For the three-month period ended September 30, 2024, sales to two customers represented more than 10% of total revenue. Three customers represented more than 10% of total revenue for the same period in 2023. Schedule of revenue 2024 Sales 2024 %age of Total Sales 2023 Sales 2023 %age of Total Sales Customer A $ 40,771 14 % $ 64,698 19 % Customer B 39,518 13 % 57,456 17 % Customer C — — % 33,119 10 % For the nine-month period ended September 30, 2024, sales to no one customer represented more than 10% of total revenue, one customer represented more than 10% of total revenue for the same period in 2023. 2024 Sales 2024 %age of Total Sales 2023 Sales 2023 %age of Total Sales Domestic customer A $ — — % $ 262,149 21 % As of September 30, 2024 and 2023, the Company had a sales order backlog of $ 5,109 124,125 For the three and nine-month periods ended September 30, 2024 and 2023, lease expenses of $ 11,616 and $ 11,576 and $ 34,835 and $ 34,727 , respectively, are included in the following expense classifications on the statement of operations: Schedule of lease expense classifications on the statement of operations For the three-month period ended September 30, 2024 2023 Cost of sales Operating expenses Total Cost of sales Operating expenses Total Base rent pursuant to lease agreement $ 5,751 $ 4,526 $ 10,277 $ 5,751 $ 4,526 $ 10,277 Variable lease costs 749 590 1,339 727 572 1,299 Total lease costs $ 6,500 $ 5,116 $ 11,616 $ 6,478 $ 5,098 $ 11,576 For the nine-month period ended September 30, 2024 2023 Cost of sales Operating expenses Total Cost of sales Operating expenses Total Base rent pursuant to lease agreement $ 17,252 $ 13,578 $ 30,830 $ 17,252 $ 13,578 $ 30,830 Variable lease costs 2,241 1,764 4,005 2,181 1,716 3,897 Total lease costs $ 19,493 $ 15,342 $ 34,835 $ 19,433 $ 15,294 $ 34,727

INVENTORIES (Tables)

INVENTORIES (Tables)	9 Months Ended
	Sep. 30, 2024
Inventory Disclosure [Abstract]
Schedule of inventories	Schedule of inventories September 30, December 31, Parts $ 102,834 $ 118,472 Work in progress 406,658 313,597 Finished goods 276,263 290,388 Total inventories $ 785,755 $ 722,457

REVENUE (Tables)

REVENUE (Tables)	9 Months Ended
	Sep. 30, 2024
Revenue from Contract with Customer [Abstract]
Schedule of revenue	Schedule of revenue 2024 Sales 2024 %age of Total Sales 2023 Sales 2023 %age of Total Sales Customer A $ 40,771 14 % $ 64,698 19 % Customer B 39,518 13 % 57,456 17 % Customer C — — % 33,119 10 % For the nine-month period ended September 30, 2024, sales to no one customer represented more than 10% of total revenue, one customer represented more than 10% of total revenue for the same period in 2023. 2024 Sales 2024 %age of Total Sales 2023 Sales 2023 %age of Total Sales Domestic customer A $ — — % $ 262,149 21 %
Schedule of lease expense classifications on the statement of operations	Schedule of lease expense classifications on the statement of operations For the three-month period ended September 30, 2024 2023 Cost of sales Operating expenses Total Cost of sales Operating expenses Total Base rent pursuant to lease agreement $ 5,751 $ 4,526 $ 10,277 $ 5,751 $ 4,526 $ 10,277 Variable lease costs 749 590 1,339 727 572 1,299 Total lease costs $ 6,500 $ 5,116 $ 11,616 $ 6,478 $ 5,098 $ 11,576 For the nine-month period ended September 30, 2024 2023 Cost of sales Operating expenses Total Cost of sales Operating expenses Total Base rent pursuant to lease agreement $ 17,252 $ 13,578 $ 30,830 $ 17,252 $ 13,578 $ 30,830 Variable lease costs 2,241 1,764 4,005 2,181 1,716 3,897 Total lease costs $ 19,493 $ 15,342 $ 34,835 $ 19,433 $ 15,294 $ 34,727

INVENTORIES (Details)

INVENTORIES (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Parts	$ 102,834	$ 118,472
Work in progress	406,658	313,597
Finished goods	276,263	290,388
Total inventories	$ 785,755	$ 722,457

EARNINGS (LOSS) PER SHARE (Deta

EARNINGS (LOSS) PER SHARE (Details Narrative) - shares	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Earnings Per Share [Abstract]
Outstanding stock options	225,000	225,000

STOCK OPTIONS (Details Narrativ

STOCK OPTIONS (Details Narrative) - Share-Based Payment Arrangement, Option [Member]	9 Months Ended
	Sep. 30, 2024 USD ($) $ / shares shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options outstanding | shares	225,000
Weighted average exercise price | $ / shares	$ 0.40
Weighted average remaining life	1 year
Intrinsic value | $	$ 0

REVENUE (Details)

REVENUE (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Disaggregation of Revenue [Line Items]
Sales	$ 293,936	$ 342,721	$ 983,566	$ 1,233,016
Customer A [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Disaggregation of Revenue [Line Items]
Sales	$ 40,771	$ 64,698
Percentage of total sales	14%	19%
Customer B [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Disaggregation of Revenue [Line Items]
Sales	$ 39,518	$ 57,456
Percentage of total sales	13%	17%
Customer C [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Disaggregation of Revenue [Line Items]
Sales	$ 0	$ 33,119
Percentage of total sales	0%	10%
Domestic Customer A [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Disaggregation of Revenue [Line Items]
Sales			$ 0	$ 262,149
Percentage of total sales			0%	21%

REVENUE (Details 1)

REVENUE (Details 1) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Base rent pursuant to lease agreement	$ 10,277	$ 10,277	$ 30,830	$ 30,830
Variable lease costs	1,339	1,299	4,005	3,897
Total lease costs	11,616	11,576	34,835	34,727
Cost of Sales [Member]
Base rent pursuant to lease agreement	5,751	5,751	17,252	17,252
Variable lease costs	749	727	2,241	2,181
Total lease costs	6,500	6,478	19,493	19,433
Operating Expense [Member]
Base rent pursuant to lease agreement	4,526	4,526	13,578	13,578
Variable lease costs	590	572	1,764	1,716
Total lease costs	$ 5,116	$ 5,098	$ 15,342	$ 15,294

REVENUE (Details Narrative)

REVENUE (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Disaggregation of Revenue [Line Items]
Revenue	$ 293,936	$ 342,721	$ 983,566	$ 1,233,016
[custom:SalesOrderBacklog]			5,109	124,125
Lease, Cost	11,616	11,576	34,835	34,727
Geographic Distribution, Domestic [Member]
Disaggregation of Revenue [Line Items]
Revenue	247,572	338,948	830,167	1,208,539
Geographic Distribution, Foreign [Member]
Disaggregation of Revenue [Line Items]
Revenue	46,364	3,773	153,399	24,477
Product [Member]
Disaggregation of Revenue [Line Items]
Revenue	275,936	336,621	947,566	1,209,516
Maintenance [Member]
Disaggregation of Revenue [Line Items]
Revenue	$ 18,000	$ 6,100	$ 36,000	$ 23,500