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Restatement of Previously Issued Financial Statements
 6 Months Ended
Jun. 30, 2022
Restatement of Previously Issued Financial Statements [Abstract]  
RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

1A. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

 

The Company concluded it should restate its previously issued financial statements by amending its Quarterly Report on Form 10-Q for the three-month and six-month periods ended June 30, 2022, filed with the Securities and Exchange Commission (the “SEC”) on August 11, 2022, to reflect the accrual of approximately $222,000 of deferred compensation expense (consisting of earned and unused paid time off) during the first quarter of 2022. This change increases the Company’s administrative expenses and accrued expenses by approximately $222,000 with no impact on its cash position. There has been no change to previously disclosed product sales.

 

In accordance with SEC Staff Accounting Bulletin No. 99 “Materiality,” and SEC Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,” the Company evaluated the correction and has determined that the related impact was material to the previously issued financial statements that contained the error, reported in the Company’s Form 10-Q for the three-month and six-month periods ended June 30, 2022 (the “Affected Quarterly Period”). Therefore, the Company concluded that the Affected Quarterly Period should be restated to present the reclassification. As such, the Company is reporting the restatement to the period in this Form 10-Q/A.

 

   As Reported   Adjustment   As Restated 
Unaudited Balance Sheet As of June 30, 2022            
Accounts payable and accrued expenses  $1,429,797   $222,379   $1,652,176 
Total current liabilities  $2,508,885   $222,379   $2,731,264 
Total liabilities  $13,208,992   $222,379   $13,431,371 
Accumulated deficit  $(3,687,176)  $(222,379)  $(3,909,555)
Total stockholders’ equity  $32,774,857   $(222,379)  $32,552,478 

 

   As Reported    Adjustment   As Restated 
Unaudited Statement of Operations During the Six-Month Period Ended June 30, 2022            
Administrative expenses  $991,129   $222,379   $1,213,508 
Operating expenses  $4,636,571   $222,379   $4,858,950 
Net operating income (loss)  $173,980   $(222,379)  $(48,399)
Income (loss) before income taxes  $53,813   $(222,379)  $(168,566)
Net income (loss)  $51,518   $(222,379)  $(170,861)
Basic net income (loss) per share  $0.01   $(0.03)  $(0.02)
Diluted weighted average common shares outstanding   7,781,403    (38,053)   7,743,350 
Diluted net income (loss) per share  $0.01   $(0.03)  $(0.02)

 

   As Reported   Adjustment   As Restated 
Unaudited Statement of Stockholders’ Equity During the Three-Month Period Ended June 30, 2022            
Accumulated Deficit – Balance, March 31, 2022  $(3,003,028)  $(222,379)  $(3,225,407)
Accumulated Deficit – Balance, June 30, 2022  $(3,687,176)  $(222,379)  $(3,909,555)
Total Stockholders’ Equity – Balance, March 31, 2022  $33,372,539   $(222,379)  $33,150,160 
Total Stockholders’ Equity – Balance, June 30, 2022  $32,774,857   $(222,379)  $32,552,478 
                
Unaudited Statement of Stockholders’ Equity During the Six-Month Period Ended June 30, 2022               
Accumulated Deficit – Net income (loss)  $51,518   $(222,379)  $(170,861)
Accumulated Deficit – Balance, June 30, 2022  $(3,687,176)  $(222,379)  $(3,909,555)
Total Stockholders’ Equity – Net income (loss)  $51,518   $(222,379)  $(170,861)
Total Stockholders’ Equity – Balance, June 30, 2022  $32,774,857   $(222,379)  $32,552,478 

 

   As Reported   Adjustment   As Restated 
Unaudited Statement of Cash Flows During the Six-Month Period Ended June 30, 2022            
Net income (loss)  $51,518   $(222,379)  $(170,861)
Accounts payable and accrued expenses  $(199,654)  $222,379   $22,725 

 

   As Reported   Adjustment   As Restated 
Notes to Unaudited Financial Statements – (n) Net Income (Loss) Per Common Share During the Six-Month Period Ended June 30, 2022            
Net income (loss) attributable to stockholders  $51,518   $(222,379)  $(170,861)
Dilutive impact of share-based compensation awards   38,053    (38,053)   — 
Weighted average common shares outstanding - Diluted   7,781,403    (38,053)   7,743,350 
Net income (loss) per share: Basic  $0.01   $(0.03)  $(0.02)
Net income (loss) per share: Diluted  $0.01   $(0.03)  $(0.02)

 

   As Reported   Adjustment   As Restated 
Notes to Unaudited Financial Statements – 9. Accounts Payable and Accrued Expenses As of June 30, 2022            
Accrued payroll  $441,644   $222,379   $664,023 
Total  $1,429,797   $222,379   $1,652,176 

 

   As Reported   Adjustment   As Restated 
Notes to Unaudited Financial Statements – 17. Segment Information During the Six-Month Period Ended June 30, 2022            
Other – Administrative expenses  $991,129   $222,379   $1,213,508 
Other – Operating activities  $1,064,160   $222,379   $1,286,539 
Other – Net operating loss  $(1,083,037)  $(222,379)  $(1,305,416)
Total – Administrative expenses  $991,129   $222,379   $1,213,508 
Total – Operating activities  $4,636,571   $222,379   $4,858,950 
Total – Net operating income (loss)  $173,980   $(222,379)  $(48,399)

 

   As Reported   Adjustment   As Restated 
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources As of June 30, 2022            
Net working capital  $14,820   $(223)  $14,597 
Increase - Amount  $1,089   $(222)  $867 
Increase - %   8%   (2)%   6%
Stockholders’ equity  $32,775   $(223)  $32,552 
Increase (Decrease) – Amount  $198   $(222)  $(24)
Increase (Decrease) – %   1%   (1)%   0%