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Acquisition of GameIQ | 3 Months Ended
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Mar. 31, 2022
Business Combination and Asset Acquisition [Abstract] |
Acquisition of GameIQ | 3. Acquisition of GameIQ On January 31, 2022, the Company, through its newly formed Delaware subsidiary, GameIQ Acquisition Corp., Inc., entered into an Agreement and Plan of Merger (the “Merger Agreement”) with GameIQ, a California corporation, that is a developer of consumer gamification technologies for retail businesses. Under the terms of the Merger Agreement, the Company agreed to issue 600,000 restricted shares of its common stock with a fair value of $300,000 and issued promissory notes to Balazs Wellisch, President and co-founder, and Quentin Blackford, Director, of GameIQ, in the principal amounts of $78,813 and $62,101, respectively, bearing interest at 1% per annum, to repay loans by Mr. Wellisch and Mr. Blackford to GameIQ. Each note requires repayment in six equal biannual installments, with the first installment due on the six-month anniversary of the Closing Date as that term is defined in the Merger Agreement. The Merger Agreement closed on February 28, 2022. The closing price of the Company’s common stock was $0.50 per share on both January 31, 2022 and February 28, 2022. The Company accounted for the acquisition as a business combination in accordance with ASC 805, Business Combinations. The Company has also determined that the acquisition does not qualify as significant acquisition under the guidance of SEC S-X Rules 3-05 and 1-02. The following is a provisional allocation of the purchase price. The following table summarizes the assets acquired, liabilities assumed and provisional purchase price allocation: Schedule of Fair Value of Assets Acquired and Liabilities Assumed
|  | Fair Value |
Consideration paid: |  |  |  |
Notes payable |  | $ | 140,914 |
Government assistance note payable and accrued interest (EIDL) |  |  | 15,400 |
Common stock (600,000 shares of common stock at $0.50 per share) |  |  | 300,000 |
Total consideration paid |  | $ | 456,314 |
Provisional Purchase price allocation |  |  |  |
Acquired assets (cash) |  | $ | 12,805 |
Goodwill |  |  | 146,361 |
Intangible assets |  |  | 297,148 |
Total purchase price |  | $ | 456,314 |
The Company estimated that the recorded intangible assets totaled $297,148 and have a two-year estimate life and are subject to amortization. Schedule of Finite-Lived Intangible Assets
|  | Assigned Life |  | March 31, 2022 |
Intangible Assets |  |  |  |  |  |
Customer relationships |  | 24 months |  | $ | 141,935 |
Intellectual property |  | 24 months |  |  | 155,213 |
Intangible assets, gross |  |  |  |  | 297,148 |
Accumulated amortization |  |  |  |  | (18,480 | )
Total Intangible Assets, net of amortization |  |  |  | $ | 278,668 |
During the three months ended March 31, 2022, the company recorded amortization expense of $18,480. The following table summarizes the amortization expense to be recorded in future periods for intangible assets that are subject to amortization: Schedule of Future Amortization Expense
Year Ending |  | Amortization |
2022 (remaining) |  | $ | 105,332 |
2023 |  |  | 139,574 |
2024 |  |  | 33,762 |
Total |  | $ | 278,668 |
The following unaudited pro forma statements of operations present the Company’s pro forma results of operations after giving effect to the purchase of GameIQ based on the historical financial statements of the Company and GameIQ. The unaudited pro forma statements of operations for the three months ended March 31, 2022 and 2021 give effect to the transaction as if they had occurred on January 1, 2021. Schedule of Pro Forma Statements of Operations
|  | 2022 |  |  | 2021 |
|  | Three Month Ended March 31, |
|  | 2022 |  |  | 2021 |
|  | (Proforma, unaudited) |  |  | (Proforma, unaudited) |
Revenues |  | $ | 764,351 |  |  | $ | 816,179 |
Operating expenses |  |  |  |  |  |  |  |
Direct cost of revenues |  |  | 101,462 |  |  |  | 114,408 |
Selling, general and administrative expenses |  |  | 1,454,061 |  |  |  | 2,326,994 |
Amortization of intangible assets |  |  | 37,069 |  |  |  | 229,069 |
Total operating expenses |  |  | 1,592,592 |  |  |  | 2,670,471 |
Loss from operations |  |  | (828,241 | ) |  |  | (1,854,292 | )
Other income |  |  |  |  |  |  |  |
Other income |  |  | 1,067,941 |  |  |  | 619,081 |
Total Other income |  |  | 1,067,941 |  |  |  | 619,081 |
Net income (loss) |  | $ | 239,700 |  |  | $ | (1,235,211 | )
Pursuant to the provisions of ASC 805, the following results of operations of GameIQ subsequent to the acquisitions are as follows: Schedule of Provisions of Operations Subsequent Acquisitions
|  | March 1, 2022 to March 31, 2022 |
Revenues |  | $ | 3,410 |
Direct cost of revenues |  |  | 393 |
Selling, general and administrative expense |  |  | 4,172 |
Net loss |  | $ | (1,155 | )
These amounts were included in the accompany Consolidated Statement of Operations.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI https://asc.fasb.org/topic&trid=2303972 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 20 -Section 50 -Paragraph 5 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=128092470&loc=d3e4946-128472 + Details
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