Notes to the Financial Statements | 12 Months Ended |
Dec. 31, 2013 |
Notes to the Financial Statements | ' |
Note 1. The Company | ' |
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Note 1. The Company |
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Zaxis International Inc. ("the Company") was incorporated in California in 1984 and subsequently changed its domicile to Delaware in 1985. Prior to ceasing its operations in 2002, Zaxis manufactured and distributed products used in a molecular separation process known as electrophoresis, a procedure used in research, industrial and clinical laboratories worldwide. In November 2002, the Company and its subsidiaries filed a petition for bankruptcy in the U.S. Bankruptcy Court Northern District of Ohio. At present, the Company has no business operations and is deemed to be a shell company. |
Note 2. Going Concern | ' |
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Note 2. Going Concern |
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The accompanying financial statements have been prepared assuming the Company will continue as a going concern The Company has incurred losses, has negative operational cash flows and has no revenues. The future of the Company is dependent upon Management success in its efforts and limited resources to pursue and effect a business combination. |
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These conditions raise substantial doubt about the Company's ability to continue as a going concern. These financial statements do not include any adjustments that might arise from this uncertainty. |
Note 3. Basis of Presentation | ' |
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Note 3. Basis of Presentation |
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The Financial Statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America. In the opinion of management, the accompanying audited financial statements include all adjustments, consisting of only normal recurring accruals, necessary for a fair statement of financial position, results of operations, and cash flows. |
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Accounting Policies |
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Use of Estimates: The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from the estimates. |
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Cash and Cash Equivalents: For financial statement presentation purposes, the Company considers those short-term, highly liquid investments with original maturities of three months or less to be cash or cash equivalents. |
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Fair Value of Financial Instruments: Accounting Standard Codification (ASC) 825, "Disclosures about Fair Value of Financial Instruments," requires disclosure of fair value information about financial instruments. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2013 and 2012. These financial instruments include accounts payable and accrued expenses. Fair values were assumed to approximate carrying values for these financial instruments since they are short-term in nature and their carrying amounts approximate fair values. |
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Earnings per Common Share: Basic net loss per share is computed using the weighted average number of common shares outstanding during the year. Due to the net losses reported, dilutive common equivalent shares were excluded from the computation of diluted loss per share, as inclusion would be anti-dilutive for the periods presented. |
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Income Taxes: The Company accounts for income taxes in accordance with ASC # 740, "Accounting for Income Taxes," which requires recognition of estimated income taxes payable or refundable on income tax returns for the current year and for the estimated future tax effect attributable to temporary differences and carry-forwards. Measurement of deferred income tax is based on enacted tax laws including tax rates, with the measurement of deferred income tax assets being reduced by available tax benefits not expected to be realized. |
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ASC 740 requires that the Company recognize in its financial statements the impact of a tax position, if that position is more likely than not of being sustained on audit, based on the technical merits of the position. Management of the Company is not aware of any additional needed liability for unrecognized tax benefits at December 31, 2013 and 2012. Tax years subsequent to 2005 remain open to examination by US federal and state tax jurisdictions. |
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Impact of recently issued accounting standards: There were no new accounting pronouncements that had a significant impact on the Company’s operating results or financial position. |
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Reclassification: Certain amounts in the prior period cash flows have been reclassified to conform to the current period presentation. These reclassifications had no effect on net change in cash. |
Note 4. Stockholders' Deficit | ' |
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Note 4. Stockholders' Deficit |
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Common Stock |
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The articles of incorporation authorize the issuance of 100,000,000 shares of common stock, par value $0.0001. All issued shares of common stock are entitled to one vote per share of common stock. As of December 31, 2013, the Company has 1,695,126 shares of common stock issued and outstanding. |
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Preferred Stock |
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The articles of incorporation authorize the issuance of 10,000,000 shares of preferred stock with a par value of $0.0001 per share. None are issued |
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Stock Based Compensation |
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There were no grants of employee or non-employee stock or options in either fiscal period ended December 31, 2013 and 2012. |
Note 5. Convertible Notes to Related Party | ' |
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Note 5. Convertible Notes to Related Party |
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On October 2, 2009, we issued a convertible promissory note in the amount of $35,000. The note bears interest of 12% per annum until paid or converted. Interest is payable upon the maturity date, which was extended to December 31, 2014. The conversion rate is $0.10 per share. The note was issued in consideration of cash advances made to the Company by our President. |
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On August 1, 2011, we issued a convertible promissory note in the amount of $50,000. The note bears interests of 12% per annum until paid or converted. Interest is payable upon the maturity date, which was extended to on December 31, 2014. The conversion rate is $0.03 per share. The note was issued in consideration for cash advances made to the Company by our President. |
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In accordance to “ASC # 815”, Accounting for Derivative Instruments and Hedging Activities, we evaluated the holder’s non-detachable conversion right provision and liquidated damages clause, contained in the terms governing the Note to determine whether the features qualify as an embedded derivative instruments at issuance. Such non-detachable conversion right provision and liquidated damages clause did not need to be accounted for as derivative financial instruments. Additionally, since the conversion price of the two notes represented the fair market value of the Company’s common stock at the time of issuance, no beneficial conversion feature exists. |
Note 6. Related Party Transactions | ' |
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Note 6. Related Party Transactions |
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Fair value of services: Our President provides services to the Company, which services are accrued and are valued at $2,000 per month. The total of these accrued expenses was $24,000 for the years ended December 31, 2013 and 2012, respectively, and is reflected in the statement of operations as general and administrative expenses. |
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An entity controlled by the Company’s President provided office space to the Company valued at $1,000 per month. The total of $12,000 during the years ended December 31, 2013 and 2012, respectively, was recorded as accrued expenses and is reflected in the statement of operations as general and administrative expenses. |
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Due to Related Parties: Amounts due related parties consist of fair value of services provided by our President, accrued office space expenses, corporate regulatory compliance expenses and cash advances received from our President. |
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Such items due totaled $161,729 at December 31, 2013 and $119,779 at December 31, 2012. |
Note 7. Commitments and Contingencies | ' |
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Note 7. Commitments and Contingencies |
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There are no pending or threatened legal proceedings as of December 31, 2013. The Company has no non-cancellable operating leases. |
Note 8. Subsequent Events | ' |
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Note 8. Subsequent Events |