Algorhythm (RIME) 10-Q 14 Feb 19 2019 Q3 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	9 Months Ended
	Dec. 31, 2018	Feb. 14, 2019
Document And Entity Information [Abstract]
Entity Registrant Name	SINGING MACHINE CO INC
Entity Central Index Key	923,601
Document Type	10-Q
Document Period End Date	Dec. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--03-31
Entity Filer Category	Non-accelerated Filer
Entity Small Business Flag	true
Entity Emerging Growth Company	false
Entity Ex Transition Period	false
Entity Common Stock, Shares Outstanding		38,384,753
Trading Symbol	SMDM
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2,019

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Dec. 31, 2018	Mar. 31, 2018
Current Assets
Cash	$ 1,581,245	$ 813,908
Accounts receivable, net of allowances of $244,300 and $82,102, respectively	10,601,844	1,066,839
Due from PNC Bank		6,212
Inventories, net	6,118,569	8,536,934
Prepaid expenses and other current assets	112,383	137,970
Deferred financing costs	13,333	13,333
Total Current Assets	20,100,112	11,732,354
Property and equipment, net	582,434	450,305
Deferred financing costs, net of current portion	6,667	16,667
Deferred tax assets	515,136	937,137
Other non-current assets	12,039	11,523
Total Assets	21,216,388	13,147,986
Current Liabilities
Accounts payable	3,359,610	1,614,748
Accrued expenses	1,738,631	701,932
Current portion of bank term note payable	250,000	500,000
Revolving line of credit	2,931,118
Refunds due to customers		445,484
Reserve for sales returns	2,050,486	726,000
Current portion of capital leases	14,282
Total Current Liabilities	11,866,886	5,091,631
Bank term note payable, net of current portion		125,000
Capital leases, net of current portion	21,152
Total Liabilities	11,888,038	5,342,206
Commitments and Contingencies
Shareholders' Equity
Preferred stock, $1.00 par value; 1,000,000 shares authorized; no shares issued and outstanding
Additional paid-in capital	19,672,314	19,624,063
Accumulated deficit	(10,727,812)	(12,201,103)
Total Shareholders' Equity	9,328,350	7,805,780
Total Liabilities and Shareholders' Equity	21,216,388	13,147,986
Common Class A [Member]
Shareholders' Equity
Common stock
Common Class B [Member]
Shareholders' Equity
Common stock	383,848	382,820
Starlight Consumer Electronics USA, Inc. [Member]
Current Assets
Accounts receivable related party	7,054	7,054
Cosmo Communications Canada,Ltd [Member]
Current Assets
Accounts receivable related party	199,707
Winglight Pacific Ltd [Member]
Current Assets
Accounts receivable related party	1,465,977	1,150,104
Starlight Electronics Co Ltd [Member]
Current Liabilities
Due to related party	468,256	210,756
Starlight R&D, Ltd. [Member]
Current Liabilities
Due to related party	110,846	113,116
Merrygain Holding Co Ltd [Member]
Current Liabilities
Due to related party	128,290	89,803
Subordinated Debt [Member] | Starlight Marketing Development, Ltd [Member]
Current Liabilities
Due to related party	815,367	689,792
Subordinated related party debt - net of current portion		$ 125,575

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)	Dec. 31, 2018	Mar. 31, 2018
Allowance for doubtful accounts receivable, net	$ 244,300	$ 82,102
Preferred stock, par value	$ 1	$ 1
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common Class A [Member]
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000	100,000
Common stock, shares issued
Common stock, shares outstanding
Common Class B [Member]
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	38,384,753	38,282,028
Common stock, shares outstanding	38,384,753	38,282,028

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Income Statement [Abstract]
Net Sales	$ 19,452,450	$ 21,461,835	$ 45,593,906	$ 58,203,731
Cost of Goods Sold	13,826,176	15,464,273	34,369,467	43,389,465
Gross Profit	5,626,274	5,997,562	11,224,439	14,814,266
Operating Expenses
Selling expenses	2,236,777	1,971,728	4,698,141	4,816,931
General and administrative expenses	1,629,054	1,739,664	4,341,175	4,784,167
Bad debt expense (recovery), net	(104,244)	(164,680)	(155,596)	2,157,561
Depreciation	64,357	66,623	200,138	153,225
Total Operating Expenses	3,825,944	3,613,335	9,083,858	11,911,884
Income from Operations	1,800,330	2,384,227	2,140,581	2,902,382
Other Expenses
Interest expense	(139,729)	(145,922)	(235,290)	(241,503)
Finance costs	(3,333)	(3,333)	(10,000)	(28,272)
Total Other Expenses	(143,062)	(149,255)	(245,290)	(269,775)
Income Before Income Tax Provision	1,657,268	2,234,972	1,895,291	2,632,607
Income Tax Provision	(367,255)	(1,080,142)	(422,000)	(1,220,511)
Net Income	$ 1,290,013	$ 1,154,830	$ 1,473,291	$ 1,412,096
Net Income per Common Share
Basic	$ 0.03	$ 0.03	$ 0.04	$ 0.04
Diluted	$ 0.03	$ 0.03	$ 0.04	$ 0.04
Weighted Average Common and Common Equivalent Shares:
Basic	38,384,753	38,282,028	38,338,599	38,271,946
Diluted	39,459,369	39,137,161	39,413,214	39,127,079

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities
Net Income	$ 1,473,291	$ 1,412,096
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation	200,138	153,225
Amortization of deferred financing costs	10,000	28,272
Change in inventory reserve	(56,780)	(125,000)
Change in allowance for bad debts	162,198	2,166,677
Stock based compensation	42,879	163,581
Change in net deferred tax assets	422,001	576,461
Changes in operating assets and liabilities:
Accounts receivable	(9,697,203)	(12,844,066)
Due from PNC Bank	6,212	242,859
Accounts receivable - related parties	(515,580)	(1,213,269)
Inventories	2,475,145	(3,599,858)
Prepaid expenses and other current assets	25,587	44,483
Other non-current assets	(516)
Accounts payable	1,744,862	3,005,248
Accrued expenses	1,036,699	2,121,919
Due to related parties	293,717	285,620
Refunds due to customers	(445,484)	(38,460)
Reserve for sales returns	1,324,486	2,987,357
Net cash used in operating activities	(1,498,348)	(4,632,855)
Cash flows from investing activities
Purchase of property and equipment	(288,740)	(255,776)
Net cash used in investing activities	(288,740)	(255,776)
Cash flows from financing activities
Net proceeds from revolving line of credit	2,931,118	3,465,332
Proceeds from bank term note		1,000,000
Payment of bank term note	(375,000)	(250,000)
Proceeds from exercise of stock options	6,400
Payment of deferred financing costs		(40,000)
Payment on subordinated related party debt		(1,109,064)
Payments on capital leases	(8,093)
Net cash provided by financing activities	2,554,425	3,066,268
Net change in cash	767,337	(1,822,363)
Cash at beginning of period	813,908	2,305,439
Cash at end of period	1,581,245	483,076
Supplemental disclosures of cash flow information:
Cash paid for interest	215,501	222,649
Cash paid for income taxes		30,000
Equipment purchased under capital lease	$ 43,527

Basis of Presentation

Basis of Presentation	9 Months Ended
	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	NOTE 1 – BASIS OF PRESENTATION OVERVIEW The Singing Machine Company, Inc., a Delaware corporation (the “Company”, “SMC”, “The Singing Machine”) and its three wholly-owned subsidiaries SMC (Comercial Offshore De Macau) Limitada (“Macau Subsidiary”), SMC Logistics, Inc. (“SMC-L”) and SMC-Music, Inc.(“SMC-M”) are primarily engaged in the development, marketing, and sale of consumer karaoke audio systems, accessories, musical instruments and musical recordings. The products are sold by SMC to retailers and distributors for resale to consumers.

Liquidity

Liquidity	9 Months Ended
	Dec. 31, 2018
Liquidity
Liquidity	NOTE 2 - LIQUIDITY The Company reported net income of approximately $1,290,000 and $1,473,000 for the three and nine months ended December 31, 2018, respectively as compared to net income of approximately $1,155,000 and $1,412,000 for the three and nine months ended December 31, 2017. The Company’s net income and cash flow continue to be affected by the Toys R Us bankruptcy as net sales decreased to approximately $19,452,000 and $45,594,000 for the three and nine months ended December 31, 2018, respectively from approximately $21,462,000 and $58,204,000 for the three and nine months ended December 31, 2017, respectively. Lost sales from Toys R Us of approximately $9,986,000 and a decrease in sales to one major customer of approximately $3,419,000 due to the elimination of one promotional product accounted for most of the decrease in sales for the nine months ended December 31, 2018. To assist with the Company’s cash requirements during fiscal 2019 our parent company agreed to continue to delay payment of related party trade debt as well as payments due on subordinated debt until the end of peak season when liquidity improves. Our parent company suspended a portion of monthly service and development fees totaling approximately $99,000 for six months commencing July 1, 2018 through December 31, 2018. Management believes that it has adequate cash available on its revolving credit facility to meet all obligations for the next twelve months. To assist the Company in remaining compliant with its revolving credit facility covenants, PNC Bank issued a third amendment and waiver in August 2018 to the Revolving Credit Facility and the Security Agreement in effect for fiscal 2019 amending the fixed charge coverage ratio and annual capital expenditure limits. While management continues to assess the long term effect of the Toys R Us bankruptcy, management is confident that the temporary suspension of payments on related party debt, suspension of service and development fees for six months, availability of cash from our revolving credit facility and significant efforts to reduce inventory levels during the current fiscal year will be adequate to meet the company’s liquidity requirements for the next twelve months.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Dec. 31, 2018
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	NOTE 3-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION The condensed consolidated financial statements include the accounts of the Company and all of its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated in the condensed consolidated financial statements. The accompanying unaudited financial statements for the three and nine months ended December 31, 2018 and 2017 have been prepared in accordance with generally accepted accounting principles applicable to interim financial information and the requirements of Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission. Accordingly, they do not include all of the information and disclosures required by accounting principles generally accepted in the United States for complete consolidated financial statements. In the opinion of management, such condensed consolidated financial statements include all adjustments (consisting of normal recurring accruals) necessary for the fair presentation of the condensed consolidated financial position and the condensed consolidated results of operations. The condensed consolidated results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year. The condensed consolidated balance sheet information as of March 31, 2018 was derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2018. The interim condensed consolidated financial statements should be read in conjunction with that report. USE OF ESTIMATES The Singing Machine makes estimates and assumptions in the ordinary course of business relating to sales returns and allowances, warranty reserves, inventory reserves and reserves for promotional incentives that affect the reported amounts of assets and liabilities and of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Future events and their effects cannot be determined with absolute certainty; therefore, the determination of estimates requires the exercise of judgment. Historically, past changes to these estimates have not had a material impact on the Company’s financial condition. However, circumstances could change which may alter future expectations. COLLECTIBILITY OF ACCOUNTS RECEIVABLE The Singing Machine’s allowance for doubtful accounts is based on management’s estimates of the creditworthiness of its customers, current economic conditions and historical information, and, in the opinion of management, is believed to be in an amount sufficient to respond to normal business conditions. Management sets 100% reserves for customers in bankruptcy and other reserves based upon historical collection experience. The Company is subject to chargebacks from customers for cooperative marketing programs, defective returns, return freight and handling charges that are deducted from open invoices and reduce collectability of open invoices. Should business conditions deteriorate or any major customer default on its obligations to the Company, this allowance may need to be significantly increased, which would have a negative impact on operations. FOREIGN CURRENCY TRANSLATION The functional currency of the Macau Subsidiary is the Hong Kong dollar. The financial statements of the subsidiary are translated to U.S. dollars using period-end rates of exchange for assets and liabilities, and average rates of exchange for the period for revenues, costs, and expenses. Net gains and losses resulting from foreign exchange transactions and translations were not material during the periods presented. Concentration of Credit Risk At times, the Company maintains cash in United States bank accounts that are more than the Federal Deposit Insurance Corporation insured amounts. The Company also maintains cash balances in foreign financial institutions. The amounts at foreign financial institutions at December 31, 2018 and March 31, 2018 are approximately $1,596,000 and $54,000, respectively. Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of accounts receivable. INVENTORY Inventories are comprised primarily of electronic karaoke equipment, microphones and accessories, and are stated at the lower of cost or net realizable value, as determined using the first in, first out method. Inventories also include an estimate for the net realizable value of expected future inventory returns due to warranty and allowance programs (See ADOPTION OF NEW ACCOUNTING STANDARDS). As of December 31, 2018 and March 31, 2018 the estimated amounts for these future inventory returns were approximately $1,348,000 and $479,000, respectively. The Company reduces inventory on hand to its net realizable value on an item-by-item basis when it is apparent that the expected realizable value of an inventory item falls below its original cost. A charge to cost of sales results when the estimated net realizable value of specific inventory items declines below cost. Management regularly reviews the Company’s investment in inventories for such declines in value. As of December 31, 2018 and March 31, 2018 the Company had inventory reserves of approximately $223,000 and $280,000, respectively, for estimated excess and obsolete inventory. LONG-LIVED ASSETS The Company reviews long-lived assets for impairment whenever circumstances and situations change such that there is an indication that the carrying amounts may not be recoverable. If the undiscounted future cash flows attributable to the related assets are less than the carrying amount, the carrying amounts are reduced to fair value and an impairment loss is recognized in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 360-10-05, “Accounting for the Impairment or Disposal of Long-Lived Assets.” PROPERTY AND EQUIPMENT Property and equipment are stated at cost, less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred. Depreciation is provided for in amounts sufficient to relate the cost of depreciable assets to their estimated useful lives using accelerated and straight-line methods. FAIR VALUE OF FINANCIAL INSTRUMENTS We follow FASB ASC 825, Financial Instruments, which requires disclosures of information about the fair value of certain financial instruments for which it is practicable to estimate that value. For purposes of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amounts of the Company’s short-term financial instruments, including accounts receivable, accounts payable, accrued expenses, refunds due to customers and due to/from related parties approximates fair value due to the relatively short period to maturity for these instruments. The carrying amounts on the bank term note payable, the subordinated debt to Starlight Marketing Development, Ltd. (related party) and capital leases approximate fair value due to the relatively short period to maturity and related interest accrued at a rate similar to market rates. The carrying amounts on the revolving line of credit approximates fair value due the relatively short period to maturity and related interest accrued at market rates. REVENUE RECOGNITION AND RESERVE FOR SALES RETURNS The Company recognizes revenue in accordance with FASB ASC 606, “Revenue from Contracts with Customers” (See ADOPTION OF NEW ACCOUNTING STANDARDS). The Company’s contracts with customers consist of one performance obligation (the sale of the Company’s products). Revenue is recognized when the goods are delivered and control of the goods sold is transferred to the customer. The Company’s contracts have no financing elements, payment terms are less than 120 days and have no further contract asset or liability obligations once control of goods is transferred to the customer. Revenue is recorded in the amount of consideration the Company expects to receive for the sale of these goods. Costs incurred in fulfilling contracts with customers include administrative costs associated with the procurement of goods which are included in general and administrative expenses, in-bound freight costs which are included in the cost of goods sold and accrued sales representative commissions which are included in selling expenses in the accompanying condensed consolidated statements of income. The Company disaggregates revenues by major geographic region as most of its revenue is generated by the sales of karaoke hardware and the Company has no other material business segments (See NOTE 10). The Company generally does not allow products to be returned other than return allowance programs for goods returned to the customer for various reasons and accordingly records a sales return reserve based on historic return amounts, specific events as identified and management estimates. The Company’s reserve for sales returns were approximately $2,050,000 and $726,000 as of December, 2018 and March 31, 2018, respectively. SHIPPING AND HANDLING COSTS Shipping and handling costs are performed by both the Company and third party logistics companies. Shipping and handling activities are performed before the customer obtains control of the goods sold to them and are considered activities to fulfill the Company’s promise to transfer the goods. These expenses are classified as a component of selling expenses in the accompanying condensed consolidated statements of operations. STOCK BASED COMPENSATION The Company follows the provisions of the FASB ASC 718-20, “Compensation – Stock Compensation Awards Classified as Equity”. ASC 718-20 requires all share-based payments to employees including grants of employee stock options, be measured at fair value and expensed in the condensed consolidated statements of income over the service period (generally the vesting period). The Company uses the Black-Scholes option valuation model to value stock options. ADVERTISING Costs incurred for producing and publishing advertising of the Company are charged to operations the first time the advertising takes place. The Company has entered into cooperative advertising agreements with its major customers that specifically indicated that the customer must spend the cooperative advertising fund upon the occurrence of mutually agreed events. The percentage of the cooperative advertising allowance ranges from 1% to 13% of the purchase. The customers must advertise the Company’s products in the customer’s catalog, local newspaper and other advertising media. The customer must submit the proof of the performance (such as a copy of the advertising showing the Company’s products) to the Company to request for the allowance. The customer does not have the ability to spend the allowance at their discretion. The Company believes that the identifiable benefit from the cooperative advertising program and the fair value of the advertising benefit is equal or greater than the cooperative advertising expense. Advertising expense for the three months ended December 31, 2018 and 2017 was approximately $1,328,000 and $1,026,000, respectively. Advertising expense for the nine months ended December 31, 2018 and 2017 was approximately $2,877,000 and $2,650,000, respectively. As of December 31, 2018 and March 31, 2018, there was an accrual for cooperative advertising allowances of approximately $1,019,000 and $207,000, respectively. These amounts were a component of accrued expenses in the condensed consolidated balance sheets. RESEARCH AND DEVELOPMENT COSTS Research and development costs are charged to results of operations as incurred. These expenses are shown as a component of selling, general and administrative expenses in the condensed consolidated statements of income. For the three months ended December 31, 2018 and 2017, these amounts totaled approximately $27,000 and $40,000, respectively. For the nine months ended December 31, 2018 and 2017, these amounts totaled approximately $64,000 and $138,000, respectively. INCOME TAXES The Company follows the provisions of FASB ASC 740 “Accounting for Income Taxes.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributed to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax base. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. If it is more likely than not that some portion of a deferred tax asset will not be realized, a valuation allowance is recognized. The Company analyzes its deferred tax assets and liabilities at the end of each interim period and, based on management’s best estimate of its full year effective tax rate, recognizes cumulative adjustments to its deferred tax assets and liabilities. On December 22, 2017 the Tax Act was enacted which reduced the U.S. federal corporate tax rate from 35% to 21% effective January 1, 2018. As a result of the Tax Act we have estimated that our effective tax rate for the fiscal year ending March 31, 2019 will be approximately 22% The effective tax rate for the full year ended March 31, 2018 was approximately 28%. As of December 31, 2018 and March 31, 2018, The Singing Machine had gross deferred tax assets of approximately $515,000 and $937,000, respectively. The Company recorded an income tax provision of approximately $367,000 and $1,080,000 for the three months ended December 31, 2018 and 2017, respectively. The Company recorded an income tax provision of approximately $422,000 and $1,221,000 for the nine months ended December 31, 2018 and 2017, respectively. The Company recognizes a liability for uncertain tax positions. An uncertain tax position is defined as a position in a previously filed tax return or a position expected to be taken in a future tax return that is not based on clear and unambiguous tax law and which is reflected in measuring current or deferred income tax assets and liabilities for interim or annual periods. The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The Company measures the tax benefits recognized based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. As of December 31, 2018, there were no uncertain tax positions that resulted in any adjustment to the Company’s provision for income taxes. The Company recognizes interest and penalties related to unrecognized tax benefits in its provision for income taxes. The Company currently has no liabilities recorded for accrued interest or penalties related to uncertain tax provisions. As of December 31, 2018, the Company is subject to U.S. Federal income tax examinations for the tax years ended March 31, 2016 and subsequent years. COMPUTATION OF EARNINGS PER SHARE Income per common share is computed by dividing net income by the weighted average of common shares outstanding during the period. As of December 31, 2018 and 2017 total potential dilutive shares from common stock options amounted to approximately 2,350,000 and 2,450,000 shares, respectively. These shares were included in the computation of diluted earnings per share for the three and nine months ended December 31, 2018 and 2017. ADOPTION OF NEW ACCOUNTING STANDARDS In May 2014, the FASB issued ASU 2014-09, Topic 606, “Revenue from Contracts with Customers”, (“ASC 606”) which outlines a single comprehensive model for companies to use when accounting for revenue arising from contracts with customers. The core principle of the revenue recognition model is that an entity recognizes revenue to depict the transfer of goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted ASC 606 on April 1, 2018 using the full retrospective approach with the application of the standard reflected in the prior year reporting period. After examining the Company’s performance obligations in its contracts, it was determined that there was no effect to the company’s retained earnings or net income during the periods reported. Management determined that most of the Company’s customers (other than distributors) have “customer acceptance rights” in that customers are allowed to return defective goods within a specified period after shipment (generally between 6 and 9 months) after goods have been shipped. Prior to adoption of ASC 606, the Company recognized a liability for the estimated net amount of sales less the estimated net realizable value of expected returned goods at the time of sale. The liability for estimated return goods was approximately $247,000 at March 31, 2018 and was reported in warranty provisions on the consolidated balance sheet. The adoption of ASC 606 required that the net realizable value of estimated return goods be disaggregated from estimated sales return reserves and reported as a current asset and the amount of estimated sales amount to be credited to customers be recognized in current liabilities on the consolidated balance sheet. As a result of the adoption of ASC 606 the net realizable value of estimated returned goods of approximately $479,000 was reclassified to inventory on April 1, 2018 on the condensed consolidated balance sheet. Estimated sales amounts to be credited to customers due to inventory warranty and allowance programs of approximately $726,000 was reported in reserve for sales returns on the consolidated balance sheet on April 1, 2018. (Refer to Note 4 - INVENTORY and Note 12 - RESERVE FOR SALES RETURNS) The following table shows the financial line items that were affected by the adoption of ASC 606: As reported at ASC 606 Under ASC 606 March 31, 2018 Adjustment April 1, 2018 CONSOLIDATED BALANCE SHEET - MARCH 31, 2018 Assets Current Assets Inventories, net $ 8,057,774 $ 479,160 $ 8,536,934 Liabilities Current Liabilities Reserve for sales returns $ - $ 726,000 $ 726,000 Warranty provisions $ 246,840 $ (246,840 ) $ - As reported at ASC 606 Under ASC 606 December 31, 2017 Adjustment December 31, 2017 CONSOLIDATED STATEMENT OF CASH FLOWS - DECEMBER 31, 2017 Cash flows from operating activities: Inventories $ (1,758,501 ) $ (1,841,357 ) $ (3,599,858 ) Reserve for sales returns $ - $ 2,987,357 $ 2,987,357 Warranty provisions $ 1,146,000 $ (1,146,000 ) $ - RECENT ACCOUNTING PRONOUNCEMENTS In February 2016, the FASB issued ASU 2016-02, Topic 842, as amended, “Leases” . The new standard is effective for us on April 1, 2019 with early adoption permitted. We expect to adopt the new standard on its effective date. A modified retrospective approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. We expect that this statement will have a material effect on our financial statements. While we continue to assess all of the effects of adoption, we currently believe the most significant affects relate to the recognition of new ROU assets and lease liabilities on our balance sheet for our operating leases and providing significant new disclosures about our leasing activities.

Inventories, Net

Inventories, Net	9 Months Ended
	Dec. 31, 2018
Inventory Disclosure [Abstract]
Inventories, Net	NOTE 4- INVENTORIES, NET Inventories are comprised of the following components: December 31, March 31, 2018 2018 Finished Goods $ 4,935,458 $ 8,238,227 Estimated Return Goods 1,347,507 479,160 Inventory in Transit 58,824 99,547 Less: Inventory Reserve 223,220 280,000 Inventories, net $ 6,118,569 $ 8,536,934

Property and Equipment, Net

Property and Equipment, Net	9 Months Ended
	Dec. 31, 2018
Property, Plant and Equipment [Abstract]
Property and Equipment, Net	NOTE 5 - PROPERTY AND EQUIPMENT, NET A summary of property and equipment is as follows: USEFUL December 31, March 31, LIFE 2018 2018 Computer and office equipment 5 years $ 286,928 $ 286,928 Furniture and fixtures 7 years 98,410 98,410 Warehouse equipment 7 years 209,419 238,471 Molds and tooling 3-5 years 3,077,646 2,788,905 3,672,403 3,412,714 Accumulated depreciation (3,089,969 ) (2,962,409 ) Property and equipment, net $ 582,434 $ 450,305 Depreciation expense for the three months ended December 31, 2018 and December 31, 2017 was approximately $64,000 and $67,000, respectively. Depreciation expense for the nine months ended December 31, 2018 and December 31, 2017 was approximately $200,000 and $153,000 respectively.

Bank Financing

Bank Financing	9 Months Ended
	Dec. 31, 2018
Debt Disclosure [Abstract]
Bank Financing	NOTE 6 – BANK FINANCING Revolving Credit Facility On June 22, 2017, the Company renewed the existing revolving credit facility (the “Revolving Credit Facility”) with PNC Bank, National Association (“PNC”) for an additional three years expiring on July 15, 2020. The outstanding loan balance cannot exceed $15,000,000 during peak selling season between August 1 and December 31 (with the ability of the Company to request an additional $5,000,000 of availability during peak selling season if required) and is reduced to a maximum of $7,500,000 between January 1 and July 31. At December 31, 2018 and March 31, 2018, the outstanding balance of the Revolving Credit Facility was approximately $2,931,000 and $0, respectively. As of December 31, 2018 there was approximately $4,435,000 available to borrow on the Revolving Credit Facility. Usage under the Revolving Credit Facility shall not exceed the sum of the following (the “Borrowing Base”): ● Up to 85% of the company’s eligible domestic and Canadian accounts receivable and up to 90% of eligible foreign credit insured accounts aged less than 60 days past due (not to exceed 90 days from invoice date, cross aged on the basis of 50% or more past due with certain specific accounts qualifying for up to 120 days from invoice date not to exceed 30 days from the due date; plus ● Up to the lesser of (a) 60% of the cost of eligible inventory or (b) 85% of net orderly liquidation value percentage of eligible inventory (annual inventory appraisals required); minus ● Applicable reserves including a dilution reserve equal to 100% of the Company’s advertising and return accrual reserves. Dilution reserve not to exceed availability generated from eligible accounts receivable. The Revolving Credit Facility includes the following sub-limits: ● Letters of Credit to be issued limited to $3,000,000. ● Inventory availability limited to $5,000,000. ● $500,000 eligible in-transit inventory sublimit within the $5,000,000 total inventory. ● Mandatory pay-down to $1,000,000 (excluding letters of credit) for any 30 consecutive days between February 1 and April 30. The Revolving Credit Facility must comply with the following quarterly financial covenants to avoid default: ● Fixed charge coverage ratio test of 1.1:1 times measured on a rolling four quarter basis, defined as EBITDA less non-financed capital expenditures, cash dividends and distributions paid and cash taxes paid divided by the sum of interest and principal on all indebtedness. ● Capital expenditures limited to $375,000 per year. On August 2, 2018, PNC issued a third amendment and waiver (“third amendment”) to the Revolving Credit Facility, the Security Agreement in effect for fiscal 2019. The third amendment waived existing violations of the fixed charge coverage ratio of 1.1:1 and increased maximum capital expenditures from $300,000 to $375,000 per fiscal year. The Company incurred an amendment fee of $10,000 upon execution of the agreement. Interest on the Revolving Line of Credit is accrued at .75% per annum over PNC’s announced prime rate with an option for the Company to elect the 1, 2 or 3 month fully absorbed PNC LIBOR Rate plus 2.75% per annum with a default rate of 2% over the applicable rate. There is an unused facility fee equal to .375% per annum on the unused portion of the Revolving Credit Facility which will be calculated on the basis of a 360 day year for the actual number of days elapsed and will be payable quarterly in arrears. During the three months ended December 31, 2018 and 2017 the Company incurred interest expense of approximately $100,000 and $114,000, respectively, on amounts borrowed against the Revolving Credit Facility. During the nine months ended December 31, 2018 and 2017, the Company incurred interest expense of approximately $155,000 and $188,000 respectively on amounts borrowed against the Revolving Credit Facility. During the three months ended December 31, 2018 and 2017, the Company incurred an unused facility fee of approximately $8,000 and $6,000, respectively on the unused portion of the Revolving Credit Facility. During the nine months ended December 31, 2018 and 2017, the Company incurred an unused facility fee of approximately $23,000 and $20,000 respectively on the unused portion of the Revolving Credit Facility. The Revolving Line of Credit is secured by first priority security interests in all of the named borrowers’ tangible and intangible assets as well as first priority security interests of 100% of member or ownership interests of any of its domestic existing or newly formed subsidiaries and first priority lien on up to 65% of the borrowers’ foreign subsidiary’s existing or subsequently formed or acquired foreign subsidiaries. The Revolving Credit Facility is also secured by a related-party debt subordination agreement with Starlight Marketing Development, Ltd. in the amount of approximately $815,000. Costs associated with renewal of the Revolving Credit Facility of approximately $40,000 were deferred and are being amortized over the term of the agreement. During the three months ended December 31, 2018 and 2017 the Company incurred amortization expense of approximately $3,000 associated with the amortization of deferred financing costs from the original Revolving Credit Facility. During the nine months ended December 31, 2018 and 2017, the Company incurred amortization expense of approximately $10,000 and $28,000, respectively. Term Note Payable In connection with the amendments above and in addition to the maximum availability limits on the Revolving Line of Credit, the agreement also includes a two-year term note (“Term Note”) in the amount of $1,000,000 the proceeds of which were used to pay down a portion of the subordinated related party debt of approximately $1,924,000 in June 2017. The term note bears interest at 1.75% per annum over PNC’s announced prime rate or 1, 2, or 3 month PNC LIBOR Rate plus 3.75%. The term note is payable in quarterly installments of $125,000 plus accrued interest. The outstanding balance on the Term Note was $250,000 and $625,000 as of December 31, 2018 and March 31, 2018, respectively. During the three months ended December 31, 2018 and 2017 the Company incurred interest expense of approximately $3,000 and $10,000, respectively. During the nine months ended December 31, 2018 and 2017 the Company incurred interest expense of approximately $20,000 and $17,000 respectively. The subordination agreement has been amended reducing the amount of related party subordinated debt to the remaining amount due of approximately $815,000. Provision has also been made to allow repayment of the remaining $815,000 in quarterly installments of $123,000 including interest accrued at 6% per annum commencing September 30, 2017. Payments of $123,000 are only permitted upon receipt of the Company’s quarterly compliance certificate; the Company having met the mandatory pay-down of the Revolving Credit Facility to $1,000,000 and average excess availability for the prior 30 days (after subtraction of third party trade payables 30 days or more past due) of no less than $1,000,000 after giving effect to the payment. As part of the Conditions to Installment Payment of the subordinated debt, payments not made under this note that cannot be made as a result of the foregoing prohibition shall not be deemed an Event of Default and can be made as soon as the Company is able to demonstrate that it meets the liquidity requirements defined above. The installment payment of $123,000 due on December 31, 2017, March 31, 2018, June 30, 2018, September 30, 2018 and December 31, 2018 were not made due to the Toys R Us bankruptcy’s unfavorable effect on cash flow. During the three months ended December 31, 2018 and 2017 the Company incurred interest expense of approximately $4,000 and $12,000, respectively on the related party subordinated debt. During the nine months ended December 31, 2018 and 2017 the Company incurred interest expense of approximately $20,000 and $26,000 respectively on the related party subordinated debt.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Dec. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	NOTE 7 - COMMITMENTS AND CONTINGENCIES LEGAL MATTERS Management is currently not aware of any legal proceedings. OPERATING LEASES The Company has operating lease agreements for office and warehouse facilities in Fort Lauderdale, Florida; Ontario, California; and Macau expiring at varying dates. Rent expense for the three months ended December 31, 2018 and 2017 was approximately $180,000 and $177,000, respectively. Rent expense for the nine months ended December 31, 2018 and 2017 was approximately $530,000 and $500,000, respectively. In addition, the Company maintains various warehouse equipment and office equipment operating leases. Future minimum lease payments under property and equipment leases with terms exceeding one year as of December 31, 2018 are as follows: Operating Leases For period ending December 31, 2019 $ 650,000 2020 451,000 2021 119,000 2022 116,000 2023 and beyond 181,000 $ 1,517,000

Stock Options

Stock Options	9 Months Ended
	Dec. 31, 2018
Equity [Abstract]
Stock Options	NOTE 8 - STOCK OPTIONS A summary of stock option activity for the nine months ended December 31, 2018 is summarized below: December 31, 2018 Number of Options Weighted Average Exercise Price Stock Options: Balance at beginning of period 2,330,000 $ 0.22 Granted 100,000 $ 0.55 Exercised (80,000 ) $ 0.08 Forfeited - - Balance at end of period 2,350,000 $ 0.24 Options exercisable at end of period 2,250,000 $ 0.23 The following table summarizes information about employee stock options outstanding at December 31, 2018: Range of Exercise Price Number Outstanding at December 31, 2018 Weighted Average Remaining Contractural Life Weighted Average Exercise Price Number Exercisable at December 31, 2018 Weighted Average Exercise Price $.03 - $.33 1,770,000 4.0 $ 0.15 1,770,000 $ 0.15 $.45 - $.93 580,000 8.4 $ 0.48 480,000 $ 0.49 2,350,000 2,250,000

Common Stock Issuances

Common Stock Issuances	9 Months Ended
	Dec. 31, 2018
Equity [Abstract]
Common Stock Issuances	NOTE 9 - COMMON STOCK ISSUANCES On August 1, 2018, the Company issued 22,725 shares of its common stock to our Board of Directors at $0.55 per share, pursuant to our annual director compensation plan for the fiscal year ending March 31, 2018. The Company recorded director compensation of $0 and $12,500, respective during the three and nine months ended December 31, 2018. On August 3, 2018 the Company issued 80,000 shares of its common stock to a former director who exercised 80,000 stock options at an average option price of $.08 per share. Accordingly, the Company received $6,400 from the former director for the execution of the transaction.

Geographical Information

Geographical Information	9 Months Ended
	Dec. 31, 2018
Segment Reporting [Abstract]
Geographical Information	NOTE 10 - GEOGRAPHICAL INFORMATION Sales to customers outside of the United States for the three and nine months ended December 31, 2018 and 2017 were primarily made by the Macau Subsidiary. Sales by geographic region for the periods presented are as follows: FOR THE THREE MONTHS ENDED FOR THE NINE MONTHS ENDED December 31, December 31, 2018 2017 2018 2017 North America $ 18,627,982 $ 20,534,288 $ 41,704,128 $ 54,163,819 Europe 679,499 927,547 3,657,429 3,943,299 Australia 100,768 - 179,923 - South Africa 44,201 - 46,701 96,613 Others - - 5,725 - $ 19,452,450 $ 21,461,835 $ 45,593,906 $ 58,203,731 The geographic area of sales is based primarily on the location where the product is delivered.

Related Party Transactions

Related Party Transactions	9 Months Ended
	Dec. 31, 2018
Related Party Transactions [Abstract]
Related Party Transactions	NOTE 11 – RELATED PARTY TRANSACTIONS DUE TO/FROM RELATED PARTIES On December 31, 2018 and March 31, 2018, in the aggregate the Company had approximately $1,673,000 and $1,157,000, respectively, due from related parties for goods and services sold to these companies. On December 31, 2018 and March 31, 2018, the Company had amounts due to other related party companies in the amounts of approximately $707,000 and $414,000 for engineering fees, storage and administrative services provided to the Company by these related parties. SUBORDINATED DEBT In connection with the Revolving Credit Facility the Company was required to subordinate related party debt to Starlight Marketing Development, Ltd. (“subordinated debt”) in the amount of approximately $1,924,000. The Revolving Credit Facility renewal agreement included a Term Note in the amount of $1,000,000, the proceeds of which were used to pay down a portion of the subordinated debt. The remaining subordinated debt of approximately $924,000 bears interest at 6% and is scheduled to be paid in quarterly installments of $123,000 which include interest and commenced September 30, 2017. The remaining amount due on the subordinated debt of approximately $815,000 was classified as a current liability as of December 31, 2018 on the condensed consolidated balance sheets. The subordinated debt was classified as a current portion of approximately $690,000 and a long-term portion of $125,000 as of March 31, 2018 on the condensed consolidated balance sheets. The installment payments of $123,000 due on December 31, 2017, March 31, 2018, June 30, 2018, September 30, 2018 and December 31, 2018 were not made due to the Toys R Us bankruptcy’s unfavorable effect on cash flow. During the three months ended December 31, 2018 and 2017 the Company incurred interest expense of approximately $4,000 and $12,000, respectively, related to the subordinated debt. During the nine months ended December 31, 2018 and 2017 the Company incurred interest expense of approximately $20,000 and $26,000, respectively, related to the subordinated debt. TRADE During the three months ended December 31, 2018 and December 31, 2017 the Company sold approximately $33,000 and $0, respectively to Winglight Pacific, Ltd. (“Winglight”), a related party, at a discounted price, similar to prices granted to major direct import customers shipped internationally with freight prepaid. The average gross profit margin on sales to Winglight for the three months ended December 31, 2018 and December 31, 2017 was 23.1% and NA, respectively. During the nine months ended December 31, 2018 and December 31, 2017 the Company sold approximately $1,183,000 and $1,462,000, respectively to Winglight at a discounted price, similar to prices granted to major direct import customers shipped internationally with freight prepaid. The average gross profit margin on sales to Winglight for the nine months ended December 31, 2018 and December 31, 2017 was 30.0% and 21.8%, respectively. The product was shipped to Cosmo Communications of Canada (“Cosmo”), another related company and the Company’s primary distributor of its products to Canada. These amounts were included as a component of net sales in the accompanying condensed consolidated statements of income. During the three months ended December 31, 2018 and December 31, 2017 the Company sold approximately $16,000 and $210,000, respectively of product to Cosmo from its California warehouse facility. During the nine months ended December 31, 2018 and December 31, 2017 the Company sold approximately $655,000 and $533,000, respectively of product to Cosmo from its California warehouse facility. These amounts were included as a component of net sales in the accompanying condensed consolidated statements of income. The Company incurred service expenses from Starlight Electronics Co, Ltd, (“SLE”) a related party. The services from SLE for the three months ended December 31, 2018 and 2017 were approximately $87,000 and $131,000, respectively. The purchases from SLE for the nine months ended December 31, 2018 and 2017 were approximately $268,000 and $270,000, respectively. These amounts were included as a component of cost of goods sold in the accompanying condensed consolidated statements of income. The Company purchased services from Merrygain Holding Co. Ltd, (“Merrygain”) a related party. The purchases from Merrygain for the three three months ended December 31, 2018 and 2017 were approximately $0 and $39,000, respectively. The purchases from Merrygain for the nine months ended December 31, 2018 and 2017 were approximately $38,000 and $115,000, respectively. These amounts were included as a component of general and administrative expenses in the accompanying condensed consolidated statements of income.

Reserve for Sales Returns

Reserve for Sales Returns	9 Months Ended
	Dec. 31, 2018
Reserve For Sales Returns
Reserve for sales Returns	NOTE 12 – RESERVE FOR SALES RETURNS A return program for defective goods is negotiated with each of our wholesale customers on a year-to-year basis. Customers are either allowed to return defective goods within a specified period of time after shipment (between 6 and 9 months) or granted a “defective allowance” consisting of a fixed percentage (between 1% and 5%) off of invoice price in lieu of returning defective products. The Company does make occasional exceptions to this return policy and accordingly records a sales return reserve based on historic return amounts, specific exceptions as identified and management estimates. The Company records a sales reserve for its return goods programs at the time of sale for estimated sales returns that may occur. The liability for defective goods is included in the reserve for sales returns on the condensed consolidated balance sheets. Changes in the Company’s reserve for sales returns are presented in the following table: Nine Months Ended December 31, December 31, 2018 2017 Reserve for sales returns at beginning of the fiscal year $ 726,000 $ 600,000 * Provision for estimated sales returns 3,235,305 4,751,858 Sales returns received (1,910,819 ) (1,764,501 ) Reserve for sales returns at end of the period $ 2,050,486 $ 3,587,357 * The reserve for sales returns at the beginning of the period ended December 30,2017 has been adjusted to reflect the full retrospective adoption of ASC 606 effective April 1, 2018.

Employee Benefit Plans

Employee Benefit Plans	9 Months Ended
	Dec. 31, 2018
Retirement Benefits [Abstract]
Employee Benefit Plans	NOTE 13 - EMPLOYEE BENEFIT PLANS The Company has a 401(k) plan for its employees to which the Company makes contributions at rates dependent on the level of each employee’s contributions. Contributions made by the Company are limited to the maximum allowable for federal income tax purposes. The amounts charged to operations for contributions to this plan and administrative costs during the three months ended December 31, 2018 and 2017 totaled approximately $18,000 and $15,000, respectively. The amounts charged to operations for contributions to this plan and administrative costs during the nine months ended December 31, 2018 and 2017 totaled approximately $51,000 and $39,000, respectively. The amounts are included as a component of general and administrative expense in the accompanying condensed consolidated statements of income. The Company does not provide any post-employment benefits to retirees.

Subsequent Events

Subsequent Events	9 Months Ended
	Dec. 31, 2018
Subsequent Events [Abstract]
Subsequent Events	NOTE 14 – SUBSEQUENT EVENTS On January 29, 2019, the Company signed a three-year worldwide licensing agreement with CBS (NYSE: CBS) for the CARPOOL KARAOKE program series. Under the terms of the Agreement, Singing Machine will be launching a range of consumer products worldwide designed for use within vehicles under the CARPOOL KARAOKE license. The license agreement began December 1, 2018 and continues through September 30, 2022. The license requires a minimum royalty guaranty of $100,000 with $50,000 payable at the execution of the contract, and a second and third payment of $25,000 payable on or before June 1, 2021 and 2022, respectively. Royalty payments will be calculated at 9% of net sales up to the first 150,000 units; and 10% of net sales 150,001 units thereafter and are payable on a quarterly basis beginning September 30, 2019.

Concentration of Sales Risk

Concentration of Sales Risk	9 Months Ended
	Dec. 31, 2018
Risks and Uncertainties [Abstract]
Concentration of Sales Risk	NOTE 15 – CONCENTRATION OF SALES RISK The Company generates most of its revenue from retailers of products in the United States with a significant amount of sales concentrated with several large customers the loss of which could have an adverse impact on the financial position of the Company. For the nine months ended December 31, 2018, there were five customers who individually accounted for 10% or more of the company’s net sales. Revenue derived from these customers as a percentage of net sales were 37%, 14%, 13%, 12% and 10%, respectively. For the nine months ended December 31, 2017, there were three customers who individually accounted for 10% or more of the company’s net sales. Revenue derived from these customers as a percentage of net sales were 35%, 17% and 12%, respectively. In September, 2017, Toys R US (which accounted for approximately 17% of our sales for the nine months ended December 31, 2017) filed for bankruptcy protection and conversion to liquidation in April 2018. The loss of this customer had a significant impact on the financial performance of the Company during the nine months ended December 31, 2018.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Dec. 31, 2018
Accounting Policies [Abstract]
Principles of Consolidation and Basis of Presentation	PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION The condensed consolidated financial statements include the accounts of the Company and all of its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated in the condensed consolidated financial statements. The accompanying unaudited financial statements for the three and nine months ended December 31, 2018 and 2017 have been prepared in accordance with generally accepted accounting principles applicable to interim financial information and the requirements of Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission. Accordingly, they do not include all of the information and disclosures required by accounting principles generally accepted in the United States for complete consolidated financial statements. In the opinion of management, such condensed consolidated financial statements include all adjustments (consisting of normal recurring accruals) necessary for the fair presentation of the condensed consolidated financial position and the condensed consolidated results of operations. The condensed consolidated results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year. The condensed consolidated balance sheet information as of March 31, 2018 was derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2018. The interim condensed consolidated financial statements should be read in conjunction with that report.
Use of Estimates	USE OF ESTIMATES The Singing Machine makes estimates and assumptions in the ordinary course of business relating to sales returns and allowances, warranty reserves, inventory reserves and reserves for promotional incentives that affect the reported amounts of assets and liabilities and of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Future events and their effects cannot be determined with absolute certainty; therefore, the determination of estimates requires the exercise of judgment. Historically, past changes to these estimates have not had a material impact on the Company’s financial condition. However, circumstances could change which may alter future expectations.
Collectibility of Accounts Receivable	COLLECTIBILITY OF ACCOUNTS RECEIVABLE The Singing Machine’s allowance for doubtful accounts is based on management’s estimates of the creditworthiness of its customers, current economic conditions and historical information, and, in the opinion of management, is believed to be in an amount sufficient to respond to normal business conditions. Management sets 100% reserves for customers in bankruptcy and other reserves based upon historical collection experience. The Company is subject to chargebacks from customers for cooperative marketing programs, defective returns, return freight and handling charges that are deducted from open invoices and reduce collectability of open invoices. Should business conditions deteriorate or any major customer default on its obligations to the Company, this allowance may need to be significantly increased, which would have a negative impact on operations.
Foreign Currency Translation	FOREIGN CURRENCY TRANSLATION The functional currency of the Macau Subsidiary is the Hong Kong dollar. The financial statements of the subsidiary are translated to U.S. dollars using period-end rates of exchange for assets and liabilities, and average rates of exchange for the period for revenues, costs, and expenses. Net gains and losses resulting from foreign exchange transactions and translations were not material during the periods presented.
Concentration of Credit Risk	Concentration of Credit Risk At times, the Company maintains cash in United States bank accounts that are more than the Federal Deposit Insurance Corporation insured amounts. The Company also maintains cash balances in foreign financial institutions. The amounts at foreign financial institutions at December 31, 2018 and March 31, 2018 are approximately $1,596,000 and $54,000, respectively. Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of accounts receivable.
Inventory	INVENTORY Inventories are comprised primarily of electronic karaoke equipment, microphones and accessories, and are stated at the lower of cost or net realizable value, as determined using the first in, first out method. Inventories also include an estimate for the net realizable value of expected future inventory returns due to warranty and allowance programs (See ADOPTION OF NEW ACCOUNTING STANDARDS). As of December 31, 2018 and March 31, 2018 the estimated amounts for these future inventory returns were approximately $1,348,000 and $479,000, respectively. The Company reduces inventory on hand to its net realizable value on an item-by-item basis when it is apparent that the expected realizable value of an inventory item falls below its original cost. A charge to cost of sales results when the estimated net realizable value of specific inventory items declines below cost. Management regularly reviews the Company’s investment in inventories for such declines in value. As of December 31, 2018 and March 31, 2018 the Company had inventory reserves of approximately $223,000 and $280,000, respectively, for estimated excess and obsolete inventory.
Long-Lived Assets	LONG-LIVED ASSETS The Company reviews long-lived assets for impairment whenever circumstances and situations change such that there is an indication that the carrying amounts may not be recoverable. If the undiscounted future cash flows attributable to the related assets are less than the carrying amount, the carrying amounts are reduced to fair value and an impairment loss is recognized in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 360-10-05, “Accounting for the Impairment or Disposal of Long-Lived Assets.”
Property and Equipment	PROPERTY AND EQUIPMENT Property and equipment are stated at cost, less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred. Depreciation is provided for in amounts sufficient to relate the cost of depreciable assets to their estimated useful lives using accelerated and straight-line methods.
Fair Value of Financial Instruments	FAIR VALUE OF FINANCIAL INSTRUMENTS We follow FASB ASC 825, Financial Instruments, which requires disclosures of information about the fair value of certain financial instruments for which it is practicable to estimate that value. For purposes of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amounts of the Company’s short-term financial instruments, including accounts receivable, accounts payable, accrued expenses, refunds due to customers and due to/from related parties approximates fair value due to the relatively short period to maturity for these instruments. The carrying amounts on the bank term note payable, the subordinated debt to Starlight Marketing Development, Ltd. (related party) and capital leases approximate fair value due to the relatively short period to maturity and related interest accrued at a rate similar to market rates. The carrying amounts on the revolving line of credit approximates fair value due the relatively short period to maturity and related interest accrued at market rates.
Revenue Recognition and Reserve for Sales Returns	REVENUE RECOGNITION AND RESERVE FOR SALES RETURNS The Company recognizes revenue in accordance with FASB ASC 606, “Revenue from Contracts with Customers” (See ADOPTION OF NEW ACCOUNTING STANDARDS). The Company’s contracts with customers consist of one performance obligation (the sale of the Company’s products). Revenue is recognized when the goods are delivered and control of the goods sold is transferred to the customer. The Company’s contracts have no financing elements, payment terms are less than 120 days and have no further contract asset or liability obligations once control of goods is transferred to the customer. Revenue is recorded in the amount of consideration the Company expects to receive for the sale of these goods. Costs incurred in fulfilling contracts with customers include administrative costs associated with the procurement of goods which are included in general and administrative expenses, in-bound freight costs which are included in the cost of goods sold and accrued sales representative commissions which are included in selling expenses in the accompanying condensed consolidated statements of income. The Company disaggregates revenues by major geographic region as most of its revenue is generated by the sales of karaoke hardware and the Company has no other material business segments (See NOTE 10). The Company generally does not allow products to be returned other than return allowance programs for goods returned to the customer for various reasons and accordingly records a sales return reserve based on historic return amounts, specific events as identified and management estimates. The Company’s reserve for sales returns were approximately $2,050,000 and $726,000 as of December, 2018 and March 31, 2018, respectively.
Shipping and Handling Costs	SHIPPING AND HANDLING COSTS Shipping and handling costs are performed by both the Company and third party logistics companies. Shipping and handling activities are performed before the customer obtains control of the goods sold to them and are considered activities to fulfill the Company’s promise to transfer the goods. These expenses are classified as a component of selling expenses in the accompanying condensed consolidated statements of operations.
Stock Based Compensation	STOCK BASED COMPENSATION The Company follows the provisions of the FASB ASC 718-20, “Compensation – Stock Compensation Awards Classified as Equity”. ASC 718-20 requires all share-based payments to employees including grants of employee stock options, be measured at fair value and expensed in the condensed consolidated statements of income over the service period (generally the vesting period). The Company uses the Black-Scholes option valuation model to value stock options.
Advertising	ADVERTISING Costs incurred for producing and publishing advertising of the Company are charged to operations the first time the advertising takes place. The Company has entered into cooperative advertising agreements with its major customers that specifically indicated that the customer must spend the cooperative advertising fund upon the occurrence of mutually agreed events. The percentage of the cooperative advertising allowance ranges from 1% to 13% of the purchase. The customers must advertise the Company’s products in the customer’s catalog, local newspaper and other advertising media. The customer must submit the proof of the performance (such as a copy of the advertising showing the Company’s products) to the Company to request for the allowance. The customer does not have the ability to spend the allowance at their discretion. The Company believes that the identifiable benefit from the cooperative advertising program and the fair value of the advertising benefit is equal or greater than the cooperative advertising expense. Advertising expense for the three months ended December 31, 2018 and 2017 was approximately $1,328,000 and $1,026,000, respectively. Advertising expense for the nine months ended December 31, 2018 and 2017 was approximately $2,877,000 and $2,650,000, respectively. As of December 31, 2018 and March 31, 2018, there was an accrual for cooperative advertising allowances of approximately $1,019,000 and $207,000, respectively. These amounts were a component of accrued expenses in the condensed consolidated balance sheets.
Research and Development Costs	RESEARCH AND DEVELOPMENT COSTS Research and development costs are charged to results of operations as incurred. These expenses are shown as a component of selling, general and administrative expenses in the condensed consolidated statements of income. For the three months ended December 31, 2018 and 2017, these amounts totaled approximately $27,000 and $40,000, respectively. For the nine months ended December 31, 2018 and 2017, these amounts totaled approximately $64,000 and $138,000, respectively.
Income Taxes	INCOME TAXES The Company follows the provisions of FASB ASC 740 “Accounting for Income Taxes.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributed to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax base. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. If it is more likely than not that some portion of a deferred tax asset will not be realized, a valuation allowance is recognized. The Company analyzes its deferred tax assets and liabilities at the end of each interim period and, based on management’s best estimate of its full year effective tax rate, recognizes cumulative adjustments to its deferred tax assets and liabilities. On December 22, 2017 the Tax Act was enacted which reduced the U.S. federal corporate tax rate from 35% to 21% effective January 1, 2018. As a result of the Tax Act we have estimated that our effective tax rate for the fiscal year ending March 31, 2019 will be approximately 22% The effective tax rate for the full year ended March 31, 2018 was approximately 28%. As of December 31, 2018 and March 31, 2018, The Singing Machine had gross deferred tax assets of approximately $515,000 and $937,000, respectively. The Company recorded an income tax provision of approximately $367,000 and $1,080,000 for the three months ended December 31, 2018 and 2017, respectively. The Company recorded an income tax provision of approximately $422,000 and $1,221,000 for the nine months ended December 31, 2018 and 2017, respectively. The Company recognizes a liability for uncertain tax positions. An uncertain tax position is defined as a position in a previously filed tax return or a position expected to be taken in a future tax return that is not based on clear and unambiguous tax law and which is reflected in measuring current or deferred income tax assets and liabilities for interim or annual periods. The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The Company measures the tax benefits recognized based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. As of December 31, 2018, there were no uncertain tax positions that resulted in any adjustment to the Company’s provision for income taxes. The Company recognizes interest and penalties related to unrecognized tax benefits in its provision for income taxes. The Company currently has no liabilities recorded for accrued interest or penalties related to uncertain tax provisions. As of December 31, 2018, the Company is subject to U.S. Federal income tax examinations for the tax years ended March 31, 2016 and subsequent years.
Computation of Earnings Per Share	COMPUTATION OF EARNINGS PER SHARE Income per common share is computed by dividing net income by the weighted average of common shares outstanding during the period. As of December 31, 2018 and 2017 total potential dilutive shares from common stock options amounted to approximately 2,350,000 and 2,450,000 shares, respectively. These shares were included in the computation of diluted earnings per share for the three and nine months ended December 31, 2018 and 2017.
Adoption of New Accounting Standards	ADOPTION OF NEW ACCOUNTING STANDARDS In May 2014, the FASB issued ASU 2014-09, Topic 606, “Revenue from Contracts with Customers”, (“ASC 606”) which outlines a single comprehensive model for companies to use when accounting for revenue arising from contracts with customers. The core principle of the revenue recognition model is that an entity recognizes revenue to depict the transfer of goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted ASC 606 on April 1, 2018 using the full retrospective approach with the application of the standard reflected in the prior year reporting period. After examining the Company’s performance obligations in its contracts, it was determined that there was no effect to the company’s retained earnings or net income during the periods reported. Management determined that most of the Company’s customers (other than distributors) have “customer acceptance rights” in that customers are allowed to return defective goods within a specified period after shipment (generally between 6 and 9 months) after goods have been shipped. Prior to adoption of ASC 606, the Company recognized a liability for the estimated net amount of sales less the estimated net realizable value of expected returned goods at the time of sale. The liability for estimated return goods was approximately $247,000 at March 31, 2018 and was reported in warranty provisions on the consolidated balance sheet. The adoption of ASC 606 required that the net realizable value of estimated return goods be disaggregated from estimated sales return reserves and reported as a current asset and the amount of estimated sales amount to be credited to customers be recognized in current liabilities on the consolidated balance sheet. As a result of the adoption of ASC 606 the net realizable value of estimated returned goods of approximately $479,000 was reclassified to inventory on April 1, 2018 on the condensed consolidated balance sheet. Estimated sales amounts to be credited to customers due to inventory warranty and allowance programs of approximately $726,000 was reported in reserve for sales returns on the consolidated balance sheet on April 1, 2018. (Refer to Note 4 - INVENTORY and Note 12 - RESERVE FOR SALES RETURNS) The following table shows the financial line items that were affected by the adoption of ASC 606: As reported at ASC 606 Under ASC 606 March 31, 2018 Adjustment April 1, 2018 CONSOLIDATED BALANCE SHEET - MARCH 31, 2018 Assets Current Assets Inventories, net $ 8,057,774 $ 479,160 $ 8,536,934 Liabilities Current Liabilities Reserve for sales returns $ - $ 726,000 $ 726,000 Warranty provisions $ 246,840 $ (246,840 ) $ - As reported at ASC 606 Under ASC 606 December 31, 2017 Adjustment December 31, 2017 CONSOLIDATED STATEMENT OF CASH FLOWS - DECEMBER 31, 2017 Cash flows from operating activities: Inventories $ (1,758,501 ) $ (1,841,357 ) $ (3,599,858 ) Reserve for sales returns $ - $ 2,987,357 $ 2,987,357 Warranty provisions $ 1,146,000 $ (1,146,000 ) $ -
Recent Accounting Pronouncements	RECENT ACCOUNTING PRONOUNCEMENTS In February 2016, the FASB issued ASU 2016-02, Topic 842, as amended, “Leases” . The new standard is effective for us on April 1, 2019 with early adoption permitted. We expect to adopt the new standard on its effective date. A modified retrospective approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. We expect that this statement will have a material effect on our financial statements. While we continue to assess all of the effects of adoption, we currently believe the most significant affects relate to the recognition of new ROU assets and lease liabilities on our balance sheet for our operating leases and providing significant new disclosures about our leasing activities.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Dec. 31, 2018
Accounting Policies [Abstract]
Schedule of Changes in Consolidated Balance Sheet and Cash Flow Statement for Adoption of New Accounting Standards	The following table shows the financial line items that were affected by the adoption of ASC 606: As reported at ASC 606 Under ASC 606 March 31, 2018 Adjustment April 1, 2018 CONSOLIDATED BALANCE SHEET - MARCH 31, 2018 Assets Current Assets Inventories, net $ 8,057,774 $ 479,160 $ 8,536,934 Liabilities Current Liabilities Reserve for sales returns $ - $ 726,000 $ 726,000 Warranty provisions $ 246,840 $ (246,840 ) $ - As reported at ASC 606 Under ASC 606 December 31, 2017 Adjustment December 31, 2017 CONSOLIDATED STATEMENT OF CASH FLOWS - DECEMBER 31, 2017 Cash flows from operating activities: Inventories $ (1,758,501 ) $ (1,841,357 ) $ (3,599,858 ) Reserve for sales returns $ - $ 2,987,357 $ 2,987,357 Warranty provisions $ 1,146,000 $ (1,146,000 ) $ -

Inventories, Net (Tables)

Inventories, Net (Tables)	9 Months Ended
	Dec. 31, 2018
Inventory Disclosure [Abstract]
Schedule of Inventory	Inventories are comprised of the following components: December 31, March 31, 2018 2018 Finished Goods $ 4,935,458 $ 8,238,227 Estimated Return Goods 1,347,507 479,160 Inventory in Transit 58,824 99,547 Less: Inventory Reserve 223,220 280,000 Inventories, net $ 6,118,569 $ 8,536,934

Property and Equipment, Net (Ta

Property and Equipment, Net (Tables)	9 Months Ended
	Dec. 31, 2018
Property, Plant and Equipment [Abstract]
Summary of Property and Equipment	A summary of property and equipment is as follows: USEFUL December 31, March 31, LIFE 2018 2018 Computer and office equipment 5 years $ 286,928 $ 286,928 Furniture and fixtures 7 years 98,410 98,410 Warehouse equipment 7 years 209,419 238,471 Molds and tooling 3-5 years 3,077,646 2,788,905 3,672,403 3,412,714 Accumulated depreciation (3,089,969 ) (2,962,409 ) Property and equipment, net $ 582,434 $ 450,305

Commitments and Contingencies (

Commitments and Contingencies (Tables)	9 Months Ended
	Dec. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Schedule of Future Minimum Rental Payments for Operating Leases	Future minimum lease payments under property and equipment leases with terms exceeding one year as of December 31, 2018 are as follows: Operating Leases For period ending December 31, 2019 $ 650,000 2020 451,000 2021 119,000 2022 116,000 2023 and beyond 181,000 $ 1,517,000

Stock Options (Tables)

Stock Options (Tables)	9 Months Ended
	Dec. 31, 2018
Equity [Abstract]
Summary of Stock Option Activity	A summary of stock option activity for the nine months ended December 31, 2018 is summarized below: December 31, 2018 Number of Options Weighted Average Exercise Price Stock Options: Balance at beginning of period 2,330,000 $ 0.22 Granted 100,000 $ 0.55 Exercised (80,000 ) $ 0.08 Forfeited - - Balance at end of period 2,350,000 $ 0.24 Options exercisable at end of period 2,250,000 $ 0.23
Schedule of Employee Stock Options Outstanding	The following table summarizes information about employee stock options outstanding at December 31, 2018: Range of Exercise Price Number Outstanding at December 31, 2018 Weighted Average Remaining Contractural Life Weighted Average Exercise Price Number Exercisable at December 31, 2018 Weighted Average Exercise Price $.03 - $.33 1,770,000 4.0 $ 0.15 1,770,000 $ 0.15 $.45 - $.93 580,000 8.4 $ 0.48 480,000 $ 0.49 2,350,000 2,250,000

Geographical Information (Table

Geographical Information (Tables)	9 Months Ended
	Dec. 31, 2018
Segment Reporting [Abstract]
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas	Sales to customers outside of the United States for the three and nine months ended December 31, 2018 and 2017 were primarily made by the Macau Subsidiary. Sales by geographic region for the periods presented are as follows: FOR THE THREE MONTHS ENDED FOR THE NINE MONTHS ENDED December 31, December 31, 2018 2017 2018 2017 North America $ 18,627,982 $ 20,534,288 $ 41,704,128 $ 54,163,819 Europe 679,499 927,547 3,657,429 3,943,299 Australia 100,768 - 179,923 - South Africa 44,201 - 46,701 96,613 Others - - 5,725 - $ 19,452,450 $ 21,461,835 $ 45,593,906 $ 58,203,731

Reserves for Sales Returns (Tab

Reserves for Sales Returns (Tables)	9 Months Ended
	Dec. 31, 2018
Reserve For Sales Returns
Schedule of Valuation and Qualifying Accounts	Changes in the Company’s reserve for sales returns are presented in the following table: Nine Months Ended December 31, December 31, 2018 2017 Reserve for sales returns at beginning of the fiscal year $ 726,000 $ 600,000 * Provision for estimated sales returns 3,235,305 4,751,858 Sales returns received (1,910,819 ) (1,764,501 ) Reserve for sales returns at end of the period $ 2,050,486 $ 3,587,357 * The reserve for sales returns at the beginning of the period ended December 30,2017 has been adjusted to reflect the full retrospective adoption of ASC 606 effective April 1, 2018.

Liquidity (Details Narrative)

Liquidity (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended	9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2018	Dec. 31, 2017
Net income	$ 1,290,013	$ 1,154,830		$ 1,473,291	$ 1,412,096
Sales, description				Lost sales from Toys R Us of approximately $9,986,000 and a decrease in sales to one major customer of approximately $3,419,000 due to the elimination of one promotional product accounted for most of the decrease in sales for the nine months ended December 31, 2018.
One Customer [Member]
Net sales decreased				$ 3,419,000
Lost sales				9,986,000
Toys R Us bankruptcy's [Member]
Net sales decreased	$ 19,452,000	$ 21,462,000		$ 45,594,000	$ 58,204,000
Monthly service and development fees			$ 99,000

Summary of Significant Accoun_4

Summary of Significant Accounting Policies (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Mar. 31, 2018	Mar. 31, 2017	[1]
Accounting Policies [Line Items]
Percentage of reserves for customers			100.00%
Foreign financial institutions actual deposits	$ 1,596,000		$ 1,596,000		$ 54,000
Future inventory returns	1,348,000		1,348,000		479,000
Inventory reserves	223,220		223,220		280,000
Reserve for sales returns	2,050,486	$ 3,587,357	2,050,486	$ 3,587,357	726,000	$ 600,000
Advertising expense	1,328,000	1,026,000	2,877,000	2,650,000
Accrued cooperative advertising allowances	1,019,000		1,019,000		$ 207,000
Selling, general and administrative expenses	27,000	40,000	$ 64,000	138,000
Income tax, description			On December 22, 2017 the Tax Act was enacted which reduced the U.S. federal corporate tax rate from 35% to 21% effective January 1, 2018.
Federal income tax rate, percent			21.00%
Effective income tax rate					28.00%
Deferred tax assets, gross	515,000		$ 515,000		$ 937,000
Income tax benefit	367,255	$ 1,080,142	$ 422,000	$ 1,220,511
Percentage of tax benefits recognized likelihood of being realized			greater than 50%
Uncertain tax positions
Potential dilutive shares amounted			2,350,000	2,450,000
Liability for return of goods					247,000
Realizable value of estimated return of goods	$ 479,000		$ 479,000
Estimated sales amounts to be credited to customers due to inventory warranty and allowance programs					$ 726,000
March 31, 2019 [Member]
Accounting Policies [Line Items]
Effective income tax rate			22.00%
Minimum [Member]
Accounting Policies [Line Items]
Cooperative advertising allowance, percentage			1.00%
Maximum [Member]
Accounting Policies [Line Items]
Cooperative advertising allowance, percentage			13.00%
[1]	The reserve for sales returns at the beginning of the period ended December 30,2017 has been adjusted to reflect the full retrospective adoption of ASC 606 effective April 1, 2018.

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Schedule of Changes in Consolidated Balance Sheet and Cash Flow Statement for Adoption of New Accounting Standards (Details) - USD ($)	9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Mar. 31, 2018	Mar. 31, 2017	[1]
Inventories, net	$ 6,118,569		$ 8,536,934
Reserve for sales returns	2,050,486	$ 3,587,357	726,000	$ 600,000
Warranty provisions
Inventories	2,475,145	(3,599,858)
Reserve for sales returns	$ 1,324,486	2,987,357
Warranty provisions
Previously Reported [Member]
Inventories, net			8,057,774
Reserve for sales returns
Warranty provisions			246,840
Inventories		(1,758,501)
Reserve for sales returns
Warranty provisions		1,146,000
Restatement Adjustment [Member]
Inventories, net			479,160
Reserve for sales returns			726,000
Warranty provisions			$ (246,840)
Inventories		(1,841,357)
Reserve for sales returns		2,987,357
Warranty provisions		$ (1,146,000)
[1]	The reserve for sales returns at the beginning of the period ended December 30,2017 has been adjusted to reflect the full retrospective adoption of ASC 606 effective April 1, 2018.

Inventories, Net - Schedule of

Inventories, Net - Schedule of Inventory (Details) - USD ($)	Dec. 31, 2018	Mar. 31, 2018
Inventory Disclosure [Abstract]
Finished Goods	$ 4,935,458	$ 8,238,227
Estimated Return Goods	1,347,507	479,160
Inventory in Transit	58,824	99,547
Less: Inventory Reserve	223,220	280,000
Inventories, net	$ 6,118,569	$ 8,536,934

Property and Equipment, Net (De

Property and Equipment, Net (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 64,000	$ 67,000	$ 200,138	$ 153,225

Property and Equipment, Net - S

Property and Equipment, Net - Summary of Property and Equipment (Details) - USD ($)	9 Months Ended
	Dec. 31, 2018	Mar. 31, 2018
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 3,672,403	$ 3,412,714
Accumulated depreciation	(3,089,969)	(2,962,409)
Property and equipment, net	$ 582,434	450,305
Computer and Office Equipment [Member]
Property, Plant and Equipment [Line Items]
Average useful life (in years)	5 years
Property and equipment, gross	$ 286,928	286,928
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Average useful life (in years)	7 years
Property and equipment, gross	$ 98,410	98,410
Warehouse Equipment [Member]
Property, Plant and Equipment [Line Items]
Average useful life (in years)	7 years
Property and equipment, gross	$ 209,419	238,471
Molds and Tooling [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 3,077,646	$ 2,788,905
Molds and Tooling [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Average useful life (in years)	3 years
Molds and Tooling [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Average useful life (in years)	5 years

Bank Financing (Details Narrati

Bank Financing (Details Narrative) - USD ($)	Dec. 31, 2018	Sep. 30, 2018	Aug. 02, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 22, 2017	Jun. 30, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Jun. 22, 2018
Line of Credit Facility [Line Items]
Revolving line of credit	$ 2,931,118									$ 2,931,118		$ 2,931,118
First priority security ownership interest percentage	100.00%									100.00%		100.00%
Line of credit facility, collateral amount	$ 815,000									$ 815,000		$ 815,000
Proceeds from lines of credit												$ 2,931,118	$ 3,465,332
Term Note [Member]
Line of Credit Facility [Line Items]
Line of credit facility, interest rate during period												1.75%
Incurred interest expense										3,000	$ 10,000	$ 20,000	17,000
Line of credit facility, periodic payment												$ 125,000
Line of credit, frequency of payments												quarterly installments
Outstanding balance	$ 250,000				625,000					250,000		$ 250,000
Subordinated Debt [Member]
Line of Credit Facility [Line Items]
Line of credit facility, maximum amount outstanding during period												815,000
Line of credit facility, interest rate during period							6.00%
Incurred interest expense										$ 4,000	12,000	20,000	26,000
Repayments of lines of credit							$ 123,000					815,000
Line of credit facility, periodic payment												$ 123,000
Line of credit, frequency of payments												quarterly installments
Maximum [Member]
Line of Credit Facility [Line Items]
First priority lien percentage	65.00%									65.00%		65.00%
LIBOR Rate [Member] | Term Note [Member]
Line of Credit Facility [Line Items]
Line of credit facility, LIBOR Rate plus rate	3.75%									3.75%		3.75%
Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Debt instrument, term								3 years
Line of credit facility, expiration date								Jul. 15, 2020
Revolving line of credit	$ 2,931,000				0					$ 2,931,000		$ 2,931,000
Line of credit, available borrowing amount during the period	4,435,000									4,435,000		$ 4,435,000
Line of credit facility, description												Usage under the Revolving Credit Facility shall not exceed the sum of the following (the "Borrowing Base"): 1. Up to 85% of the company's eligible domestic and Canadian accounts receivable and up to 90% of eligible foreign credit insured accounts aged less than 60 days past due (not to exceed 90 days from invoice date, cross aged on the basis of 50% or more past due with certain specific accounts qualifying for up to 120 days from invoice date not to exceed 30 days from the due date; plus 2. Up to the lesser of (a) 60% of the cost of eligible inventory or (b) 85% of net orderly liquidation value percentage of eligible inventory (annual inventory appraisals required); minus 3. Applicable reserves including a dilution reserve equal to 100% of the Company's advertising and return accrual reserves. Dilution reserve not to exceed availability generated from eligible accounts receivable.
Line of credit facility sub limits description												The Revolving Credit Facility includes the following sub-limits: 1. Letters of Credit to be issued limited to $3,000,000. 2. Inventory availability limited to $5,000,000. 3. $500,000 eligible in-transit inventory sublimit within the $5,000,000 total inventory. 4. Mandatory pay-down to $1,000,000 (excluding letters of credit) for any 30 consecutive days between February 1 and April 30
Line of credit facility, covenant terms												The Revolving Credit Facility must comply with the following quarterly financial covenants to avoid default: 1. Fixed charge coverage ratio test of 1.1:1 times measured on a rolling four quarter basis, defined as EBITDA less non-financed capital expenditures, cash dividends and distributions paid and cash taxes paid divided by the sum of interest and principal on all indebtedness. 2. Capital expenditures limited to $375,000 per year.
Line of credit facility, interest rate during period												0.75%
Line of credit facility default rate												2.00%
Line of credit facility, unused capacity, commitment fee percentage												0.375%
Line of credit facility, number of days elapsed for unused facility												360 days
Line of credit facility, unused capacity, frequency of payment												Payable quarterly in arrears
Incurred interest expense										100,000	114,000	$ 155,000	188,000
Facility fee										8,000	6,000	23,000	20,000
Renewal of revolving credit facility	$ 40,000									40,000		40,000
Amortization expense related to renewal of line of credit										$ 3,000	$ 3,000	$ 10,000	$ 28,000
Revolving Credit Facility [Member] | Term Note [Member]
Line of Credit Facility [Line Items]
Debt instrument, term									2 years
Proceeds from lines of credit									$ 1,000,000
Repayments of lines of credit									$ 1,924,000
Revolving Credit Facility [Member] | LIBOR Rate [Member]
Line of Credit Facility [Line Items]
Line of credit facility, LIBOR Rate plus rate	2.75%									2.75%		2.75%
Revolving Credit Facility [Member] | Third Amendment [Member]
Line of Credit Facility [Line Items]
Line of credit facility, description			PNC issued a third amendment and waiver ("third amendment") to the Revolving Credit Facility, the Security Agreement in effect for fiscal 2019. The third amendment waived existing violations of the fixed charge coverage ratio of 1.1:1 and increased maximum capital expenditures from $300,000 to $375,000 per fiscal year. The Company incurred an amendment fee of $10,000 upon execution of the agreement.
Revolving Credit Facility [Member] | Peak Selling Season Between August 1 And December 31 [Member]
Line of Credit Facility [Line Items]
Line of credit facility, maximum amount outstanding during period								$ 15,000,000
Revolving line of credit														$ 5,000,000
Revolving Credit Facility [Member] | Peak Selling Season Between January 1 And July 31 [Member]
Line of Credit Facility [Line Items]
Line of credit facility, maximum amount outstanding during period								$ 7,500,000
Revolving Credit Facility [Member] | Prior 30 Days [Member]
Line of Credit Facility [Line Items]
Incurred interest expense												$ 1,000,000
Revolving Credit Facility [Member] | 30 Days or More Past Due [Member]
Line of Credit Facility [Line Items]
Incurred interest expense												$ 1,000,000
Toys R Us bankruptcy's [Member] | Subordinated Debt [Member]
Line of Credit Facility [Line Items]
Line of credit facility, periodic payment	$ 123,000	$ 123,000		$ 123,000	$ 123,000	$ 123,000

Commitments and Contingencies_2

Commitments and Contingencies (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Commitments and Contingencies Disclosure [Abstract]
Rent expense	$ 180,000	$ 177,000	$ 530,000	$ 500,000

Commitments and Contingencies -

Commitments and Contingencies - Schedule of Future Minimum Rental Payments for Operating Leases (Details)	Dec. 31, 2018USD ($)
Commitments and Contingencies Disclosure [Abstract]
2,019	$ 650,000
2,020	451,000
2,021	119,000
2,022	116,000
2023 and beyond	181,000
Total	$ 1,517,000

Stock Options - Summary of Stoc

Stock Options - Summary of Stock Option Activity (Details)	9 Months Ended
	Dec. 31, 2018$ / sharesshares
Equity [Abstract]
Number of Options, Balance at Beginning of Period | shares	2,330,000
Number of Options Granted | shares	100,000
Number of Options Exercised | shares	(80,000)
Number of Options Forfeited | shares
Number of Options, End of Period | shares	2,350,000
Number of Options Exercisable at End of Period | shares	2,250,000
Weighted Average Exercise Price, Balance at Beginning of Period | $ / shares	$ 0.22
Weighted Average Exercise Price Granted | $ / shares	0.55
Weighted Average Exercise Price Exercised | $ / shares	0.08
Weighted Average Exercise Price Forfeited | $ / shares
Weighted Average Exercise Price, End of Period | $ / shares	0.24
Weighted Average Exercise Price, Options Exercisable at End of Period | $ / shares	$ 0.23

Stock Options - Schedule of Emp

Stock Options - Schedule of Employee Stock Options Outstanding (Details)	9 Months Ended
	Dec. 31, 2018$ / sharesshares
Stock Options Number Outstanding | shares	2,350,000
Stock Option Outstanding Number Exercisable | shares	2,250,000
Exercise Price Range One [Member]
Stock Options Outstanding Exercise Price, Lower Range Limit	$ 0.03
Stock Options Outstanding Exercise Price, Upper Range Limit	$ 0.33
Stock Options Number Outstanding | shares	1,770,000
Stock Option Outstanding Weighted Average Remaining Contractual Life	4 years
Stock Option Outstanding Weighted Average Exercise Price	$ .15
Stock Option Outstanding Number Exercisable | shares	1,770,000
Stock Option Outstanding Weighted Average Exercise Price	$ 0.15
Exercise Price Range Two [Member]
Stock Options Outstanding Exercise Price, Lower Range Limit	0.45
Stock Options Outstanding Exercise Price, Upper Range Limit	$ 0.93
Stock Options Number Outstanding | shares	580,000
Stock Option Outstanding Weighted Average Remaining Contractual Life	8 years 4 months 24 days
Stock Option Outstanding Weighted Average Exercise Price	$ 0.48
Stock Option Outstanding Number Exercisable | shares	480,000
Stock Option Outstanding Weighted Average Exercise Price	$ 0.49

Common Stock Issuances (Details

Common Stock Issuances (Details Narrative) - USD ($)	Aug. 03, 2018	Aug. 02, 2018	Dec. 31, 2018	Dec. 31, 2018
Number of options exercised				80,000
Board of Directors [Member]
Number of stock issued		22,725
Shares issued price per share		$ 0.55
Officers compensation			$ 0	$ 12,500
Former Director [Member]
Number of stock issued	80,000
Number of options exercised	80,000
Option exercise price	$ 0.08
Value of stock issued	$ 6,400

Geographical Information - Sche

Geographical Information - Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas (Details) - USD ($)	3 Months Ended		9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Segment Reporting Information [Line Items]
Net Sales	$ 19,452,450	$ 21,461,835	$ 45,593,906	$ 58,203,731
North America [Member]
Segment Reporting Information [Line Items]
Net Sales	18,627,982	20,534,288	41,704,128	54,163,819
Europe [Member]
Segment Reporting Information [Line Items]
Net Sales	679,499	927,547	3,657,429	3,943,299
Australia [Member]
Segment Reporting Information [Line Items]
Net Sales	100,768		179,923
South Africa [Member]
Segment Reporting Information [Line Items]
Net Sales	44,201		46,701	96,613
Others [Member]
Segment Reporting Information [Line Items]
Net Sales			$ 5,725

Related Party Transactions (Det

Related Party Transactions (Details Narrative) - USD ($)	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Related Party Transaction [Line Items]
Due from related parties, current	$ 1,673,000			$ 1,157,000			$ 1,673,000		$ 1,673,000
Due to related parties	707,000			414,000			707,000		707,000
Proceeds from line of credit									2,931,118	$ 3,465,332
Subordinated debt, current				690,000
Subordinated debt, long term				125,000
Warehouse Facility [Member]
Related Party Transaction [Line Items]
Revenue from related parties							16,000	$ 210,000	655,000	533,000
Subordinate Debt [Member]
Related Party Transaction [Line Items]
Repayments of lines of credit						$ 924,000
Line of credit facility interest rate						6.00%
Line of credit facility, periodic payment						$ 123,000
Line of credit facility, maximum amount outstanding during period									815,000
Subordinated Debt [Member]
Related Party Transaction [Line Items]
Repayments of lines of credit						$ 123,000			815,000
Line of credit facility interest rate						6.00%
Line of credit facility, periodic payment									123,000
Line of credit facility, maximum amount outstanding during period									815,000
Incurred interest expense							4,000	12,000	$ 20,000	26,000
Revolving Credit Facility [Member]
Related Party Transaction [Line Items]
Line of credit facility interest rate									0.75%
Incurred interest expense							100,000	114,000	$ 155,000	188,000
Revenue from related parties							33,000	0
Revolving Credit Facility [Member] | Two Year Term Note [Member]
Related Party Transaction [Line Items]
Proceeds from line of credit									1,000,000
Revolving Credit Facility [Member] | Subordinate Debt [Member]
Related Party Transaction [Line Items]
Incurred interest expense							4,000	$ 12,000	20,000	26,000
Toys R Us bankruptcy's [Member] | Subordinated Debt [Member]
Related Party Transaction [Line Items]
Line of credit facility, periodic payment	123,000	$ 123,000	$ 123,000	$ 123,000	$ 123,000
Starlight Marketing Development, Ltd [Member]
Related Party Transaction [Line Items]
Due to related parties	$ 1,924,000						$ 1,924,000		1,924,000
Winglight Pacific Ltd [Member]
Related Party Transaction [Line Items]
Revenue from related parties									$ 1,183,000	$ 1,462,000
Related party gross margin percentage							23.10%		30.00%	21.80%
Starlight Consumer Electronics Co., Ltd [Member]
Related Party Transaction [Line Items]
Service expense							$ 87,000	$ 131,000	$ 268,000	$ 270,000
Merrygain Holding Co Ltd [Member]
Related Party Transaction [Line Items]
Service expense							$ 0	$ 39,000	$ 38,000	$ 115,000

Reserve for Sales Returns (Deta

Reserve for Sales Returns (Details Narrative)	9 Months Ended
	Dec. 31, 2018
Reserve For Sales Returns Details Narrative Abstract
Reserve for sales return, description	Customers are either allowed to return defective goods within a specified period of time after shipment (between 6 and 9 months) or granted a “defective allowance” consisting of a fixed percentage (between 1% and 5%) off of invoice price in lieu of returning defective products.

Reserve for Sales Returns - Sch

Reserve for Sales Returns - Schedule of Valuation and Qualifying Accounts (Details) - USD ($)	9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Reserve For Sales Returns
Reserve for sales returns at beginning of the fiscal year	$ 726,000	$ 600,000	[1]
Provision for estimated sales returns	3,235,305	4,751,858
Sales returns received	(1,910,819)	(1,764,501)
Reserve for sales returns at end of the period	$ 2,050,486	$ 3,587,357
[1]	The reserve for sales returns at the beginning of the period ended December 30,2017 has been adjusted to reflect the full retrospective adoption of ASC 606 effective April 1, 2018.

Employee Benefit Plans (Details

Employee Benefit Plans (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Retirement Benefits [Abstract]
Defined contribution plan, administrative expenses	$ 18,000	$ 15,000	$ 51,000	$ 39,000

Subsequent Events (Details Narr

Subsequent Events (Details Narrative) - Subsequent Event [Member] - CARPOOL KARAOKE [Member]	Jan. 29, 2019USD ($)Unit
Licensing agreement, term	3 years
Licensing Agreement, expiration date	Sep. 30, 2022
Minimum royalty guaranty	$ 100,000
Licensing agreement, contract amount	$ 50,000
Royalty payments, payment description	Payable on a quarterly basis beginning September 30, 2019
Upto 150,000 Units [Member]
Percentage of royalty payments	9.00%
Number of units of net sales | Unit	150,000
150,001 Units Thereafter [Member]
Percentage of royalty payments	10.00%
Number of units of net sales | Unit	150,001
June 1, 2021 [Member]
Licensing agreement, contract amount	$ 25,000
June 1, 2022 [Member]
Licensing agreement, contract amount	$ 25,000

Concentration of Sales Risk (De

Concentration of Sales Risk (Details Narrative) - Customer	9 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Number of customers	5	3
Conversion to liquidation date	2018-04
Sales Revenue [Member] | Customer Concentration Risk [Member] | Toys R Us [Member]
Concentration of sales risk, percentage		17.00%
Sales Revenue [Member] | Customer Concentration Risk [Member] | Customer One [Member]
Concentration of sales risk, percentage	37.00%	35.00%
Sales Revenue [Member] | Customer Concentration Risk [Member] | Customer Two [Member]
Concentration of sales risk, percentage	14.00%	17.00%
Sales Revenue [Member] | Customer Concentration Risk [Member] | Customer Three [Member]
Concentration of sales risk, percentage	13.00%	12.00%
Sales Revenue [Member] | Customer Concentration Risk [Member] | Customer Four [Member]
Concentration of sales risk, percentage	12.00%
Sales Revenue [Member] | Customer Concentration Risk [Member] | Customer Five [Member]
Concentration of sales risk, percentage	10.00%