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Acquisitions (Tables)

6 Months Ended

Jun. 30, 2020

Schedule of Fair Values of the Assets Acquired and Liabilities Assumed

The following table summarizes the allocation of the purchase price to the fair values of the assets acquired and the liabilities assumed as of the transaction date:

Consideration paid	$	1,356,908

Tangible assets acquired:
Cash		65,037
Accounts receivable, net		80,289
Vehicle		58,693
Total tangible assets	$	204,019

Assumed liabilities:
Line of credit		33,705
Accrued expenses		117,742
Loan payable		50,896
Other liabilities		1,128
Total assumed liabilities		203.471

Net assets acquired		548

Goodwill (a.)(b.)	$	1,356,360

a. Goodwill is the excess of the purchase price over the fair value of the underlying net tangible and identifiable intangible assets. In accordance with applicable accounting standards, goodwill is not amortized but instead is tested for impairment at least annually or more frequently if certain indicators are present. Goodwill and intangibles are not deductible for tax purposes.

b. Goodwill represents expected synergies from the merger of operations and intangible assets that do not qualify for separate recognition. Cerberus and Techville are both cybersecurity service providers. The acquisition of Techville provided Cerberus potential sales synergies resulting from Cerberus’ access to Techville’s current client-base to offer additional services. Goodwill also represents Techville’s customer list as well as Mr. Yelm’s two-year non-compete clause, which the Company is currently unable to assign a fair value. These items will be assigned a fair value upon the completion of the third-party valuation.