501 CANADA INC.
FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 2005
(STATED IN UNITED STATES DOLLARS)
UNAUDITED
CONTENTS
Balance Sheet 2
Statements of Operations and Comprehensive Income (Loss) 3
Notes to Financial Statements 4
501 CANADA INC.
Balance Sheet
September 30, 2005.
(Stated in United States Dollars)
Unaudited
September
30, 2005
ASSETS
Current
Cash $ 11,552
Short-term investments 58,010
Prepaid and sundry assets 239,937
-----------
Total Current Assets 309,499
-----------
Revenue Producing Real Estate (note 1) 6,765,334
Equipment (note 2) 21,889
Deferred Finance Charges 90,587
Advances to Related Companies 230,062
-----------
Total Long-term Assets 7,107,872
-----------
Total Assets $ 7,417,371
===========
LIABILITIES
Current
Bank indebtedness $ 86,989
Accounts payable and accrued charges 376,101
Current portion of mortgage payable 53,374
Advances from shareholder (note 4) 514,970
Income taxes payable 5,165
-----------
Total Current Liabilities 1,036,599
-----------
Mortgage Payable (note 3) 7,223,831
Future Income Taxes 6,147
-----------
Total Long-Term Debt 7,229,978
-----------
Total Liabilities 8,266,577
-----------
STOCKHOLDER'S DEFICIT
Capital Stock 67
Accumulated Other Comprehensive Loss (71,785)
Deficit (777,488)
-----------
Total Stockholders' Deficit (849,206)
-----------
Total Liabilities and Stock Holder's Deficit $ 7,417,371
===========
(The accompanying notes are an integral part of these financial statements)
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501 CANADA INC.
Statements of Operations and Comprehensive Income (Loss)
Nine Months Ended September 30, 2005
(Stated in United States Dollars)
Unaudited
September
30, 2005
Revenue
Rent $ 466,032
Other Income 41
-----------
466,073
-----------
Expenses
Mortgage interest 296,562
Utilities 170,587
Property taxes 138,427
Commissions 102,084
Repairs and maintenance 96,483
Professional fees 49,922
Insurance 35,892
Vehicle 16,114
Bank charges and interest 7,221
Office and general 5,305
Salaries and wages 2,448
Amortization 99,956
-----------
1,021,001
-----------
(Loss) Income Before Income Taxes (554,928)
Current income taxes 1,719
Future income taxes -
-----------
Net (Loss) Income (556,647)
Foreign currency translation adjustment (4)
-----------
Comprehensive (Loss) Income $ (556,651)
===========
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501 CANADA INC.
Notes to Financial Statements
Nine Months Ended September 30, 2005
(Stated in United States Dollars)
Unaudited
1. Revenue producing properties
The revenue properties are recorded at cost. Amortization of the buildings
has been provided at an annual rate of 2.5% on straight line basis as
follows:
Accumulated Net book value
Cost amortization 2005 2004
---------------------------------------------------
Land (Alliance) $ 1,067,190 $ $ 1,067,190 $ 1,067,190
Buildings (Alliance) 3,482,223 351,003 3,131,220 2,642,898
Buildings (Kennedy) 2,605,148 38,223 2,566,924 0
---------------------------------------------------
$ 7,154,561 $ 389,226 $ 6,765,334 $ 3,710,088
===================================================
2. Fixed Assets
The fixed assets are recorded at cost and amortization is provided as
follows:
Accumulated Net book value
Cost amortization 2005 2004
--------------------------------------------------
Furniture and equipment $ 25,280 $ 3,391 $ 21,889 $ 3,171
==================================================
3. Mortgages Payable
For Alliance property: 2005 2004
------------------------
First mortgage payable
Due September 30, 2008 repayable by monthly
installments of $28,117 on account of
principal and interest at an annual of
7.25%, secured by the revenue producing
real estate $ 3,806,248 $ 3,859,907
Second mortgage payable
Due 30 May, 2007 interest payable only at
an annual of 12%, secured by the revenue
producing real estate. $ 1,707,504 $ 0
For Kennedy property:
First mortgage payable
Due May 6, 2025 repayable by monthly
installments of $11,845 on account of
principal and interest at an annual of
Prime rate plus 1%, secured by the revenue
producing real estate $ 1,550,015 $ 0
Second mortgage payable
Due 19 May, 2007 interest payable only at
an annual of 9%, secured by the revenue
producing real estate. $ 213,438 $ 0
4. Shareholders' Advances
These advances are interest free with no fixed terms of repayment.
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