XML 20 R7.htm IDEA: XBRL DOCUMENT v2.4.0.6
Related Party Transactions
 9 Months Ended
Sep. 30, 2012
Related Party Transactions [Text Block]

2. Related Party Transactions

The Company jointly owns with Marathon Gold USA (MUSA) and acts as the operator of the Golden Chest LLC (GC LLC). Accounts receivable are a part of normal operations which include operating costs, payroll, and drilling. As of September 30, 2012, a related party account receivable existed with MUSA and GC LLC for $4,789 for services rendered. In addition, income, expense, and equity in loss items for the three and nine month periods ended September 30, 2012 related to MUSA and GC LLC were as follows:

          Three month     Nine Month  
 
  •  
 Drilling and exploration contract income   $     $   769,084  
 
  •  
 Joint Venture Management fees income     2,049     43,074  
 
  •  
 Drilling and exploration contract expense     318     348,078  
 
  •  
 Equity in loss of Golden Chest LLC     40,647     755,439  

Engineering services income includes engineering services provided to United Silver Corp. (USC). USC holds the noncontrolling interest in the Company's New Jersey Mill Joint Venture. Engineering services to USC in the nine month period ended September 30, 2012 was $68,700, no engineering services were provided in the third quarter. As of September 30, 2012, a related party account receivable existed with the New Jersey Mill Joint Venture (Mill JV) and USC for $60,901. As of September 30, 2012, $4,255 was recorded as an account payable to Mine Fabrication and Machine, which is a wholly owned subsidiary of USC.

$1,500 is payable quarterly by the Company to Mine Systems Design (MSD), a company controlled by our CEO, for office rent. The third quarter's office rent to MSD was recorded as a related party account payable on September 30, 2012. In August the Company was extended a note to purchase property by MSD for $223,807 at 12% interest to be paid in 48 monthly payments. At September 30, 2012 the remaining amount due was $223,199 and $2,238 has been paid in interest.