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EQUITY METHOD INVESTMENT | 12 Months Ended
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Sep. 30, 2020
EQUITY METHOD INVESTMENT |
EQUITY METHOD INVESTMENT | 7. EQUITY METHOD INVESTMENT: In April 2020, the Company completed a transaction with Chas. M. Sledd Company (“Sledd”), a West Virginia wholesale distributor serving the convenience store industry, to jointly own and operate Team Sledd, a limited liability company formed for the purpose of owning and operating Sledd’s wholesale distribution business. In conjunction with the transaction, Sledd contributed substantially all of its operating assets and stated liabilities to Team Sledd, while the Company contributed $10.0 million in cash, of which $6.5 million was structured as equity and $3.5 million was structured as a secured loan to Team Sledd which is subordinate to the liens of Team Sledd's existing secured lenders. The transaction was primarily funded from the Company’s revolving line of credit and profits from operations. At September 2020, AMCON owned approximately 44% of Team Sledd’s outstanding equity, with a carrying value of $6.7 million. During fiscal 2020, the Company recognized $0.2 million in equity in earnings (net of income taxes) from its investment in Team Sledd. The Company’s secured loan to Team Sledd had a carrying value of $3.5 million as of September 2020. Team Sledd’s summarized financial data for the six months ended September 2020 was as follows:
|  | For the six months ended September 2020
Sales |  | $ | 350,685,407
Gross profit |  | $ | 14,218,204
Net income (loss) before income taxes |  | $ | 551,280
Net income (loss) attributable to AMCON, net of tax |  | $ | 183,579

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section S99 -Paragraph 4 -Subparagraph (SX 210.3A-04) -URI http://asc.fasb.org/extlink&oid=116822174&loc=d3e355119-122828 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -URI http://asc.fasb.org/topic&trid=2196965 + Details
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