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BUSINESS SEGMENTS | 6 Months Ended
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Aug. 31, 2025
Segment Reporting [Abstract] |
Segment Reporting Disclosure [Text Block] | Note 11 – BUSINESS SEGMENTS We have two reportable segments: PaperPie and Publishing. These reportable segments are business units that offer different methods of distribution to different types of customers. They are managed separately based on the fundamental differences in their operations. Our PaperPie segment markets its products through a network of independent Brand Partners using a combination of internet sales, direct sales, home shows, and book fairs. Our Publishing segment markets its products to retail accounts, which include book, school supply, toy and gift stores, museums, trade and specialty wholesalers, through commissioned sales representatives, and our internal tele-sales group. See Note 7 for the impact of our updated Usborne distribution agreement on the Publishing segment. The accounting policies for the segments are the same as those for the rest of the Company. We evaluate segment performance based on earnings before income taxes of the segments, which is defined as segment net revenues reduced by cost of sales and direct expenses. Direct expenses are composed of payroll, commissions, general and administrative, and operating and selling expenses. Corporate expenses, depreciation, interest expense, other income, and income taxes are not allocated to the segments but are listed in the “Other” row below. Corporate expenses include the executive department, accounting department, information services department, general office management, warehouse operations and building facilities management. Our assets and liabilities are not allocated on a segment basis. Separate financial information is regularly evaluated by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources. For the Company, the Chief Executive Officer is the CODM. Information by reporting segment for the six-month periods ended August 31, 2025 and 2024, are as follows:
NET REVENUES
|  | Three Months Ended August 31, |  |  | Six Months Ended August 31, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
PaperPie |  | $ | 3,731,200 |  |  | $ | 5,440,300 |  |  | $ | 9,791,500 |  |  | $ | 14,340,600 |
Publishing |  |  | 889,900 |  |  |  | 1,068,900 |  |  |  | 1,936,000 |  |  |  | 2,162,000 |
Total |  | $ | 4,621,100 |  |  | $ | 6,509,200 |  |  | $ | 11,727,500 |  |  | $ | 16,502,600 |
EARNINGS (LOSS) BEFORE INCOME TAXES
|  | Three Months Ended August 31, |  |  | Six Months Ended August 31, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
PaperPie |  | $ | (14,700 | ) |  | $ | (470,700 | ) |  | $ | 447,000 |  |  | $ | 300,400 |
Publishing |  |  | 205,700 |  |  |  | 255,200 |  |  |  | 413,500 |  |  |  | 486,800 |
Other |  |  | (1,941,200 | ) |  |  | (2,250,600 | ) |  |  | (4,060,000 | ) |  |  | (5,000,300 | )
Total |  | $ | (1,750,200 | ) |  | $ | (2,466,100 | ) |  | $ | (3,199,500 | ) |  | $ | (4,213,100 | )
PAPERPIE OPERATING RESULTS The following table summarizes the operating results of the PaperPie segment for the three and six months ended August 31, 2025 and 2024:
|  | Three Months Ended August 31, |  |  | Six Months Ended August 31, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Net revenues |  | $ | 3,731,200 |  |  | $ | 5,440,300 |  |  | $ | 9,791,500 |  |  | $ | 14,340,600 |
Cost of goods sold |  |  | 1,569,400 |  |  |  | 2,440,100 |  |  |  | 4,038,700 |  |  |  | 5,526,500 |
Gross margin |  |  | 2,161,800 |  |  |  | 3,000,200 |  |  |  | 5,752,800 |  |  |  | 8,814,100 |
Operating expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Operating and selling |  |  | 554,500 |  |  |  | 1,180,100 |  |  |  | 1,294,100 |  |  |  | 2,672,900 |
Sales commissions |  |  | 1,245,300 |  |  |  | 1,827,100 |  |  |  | 3,226,800 |  |  |  | 4,860,900 |
General and administrative |  |  | 376,700 |  |  |  | 463,700 |  |  |  | 784,900 |  |  |  | 979,900 |
Total operating expenses |  |  | 2,176,500 |  |  |  | 3,470,900 |  |  |  | 5,305,800 |  |  |  | 8,513,700 |
Operating income (loss) |  | $ | (14,700 | ) |  | $ | (470,700 | ) |  | $ | 447,000 |  |  | $ | 300,400 |
PUBLISHING OPERATING RESULTS The following table summarizes the operating results of the Publishing segment for the three and six months ended August 31, 2025 and 2024:
|  | Three Months Ended August 31, |  |  | Six Months Ended August 31, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Net revenues |  | $ | 889,900 |  |  | $ | 1,068,900 |  |  | $ | 1,936,000 |  |  | $ | 2,162,000 |
Cost of goods sold |  |  | 363,600 |  |  |  | 422,400 |  |  |  | 863,600 |  |  |  | 870,000 |
Gross margin |  |  | 526,300 |  |  |  | 646,500 |  |  |  | 1,072,400 |  |  |  | 1,292,000 |
Operating expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Operating and selling |  |  | 69,900 |  |  |  | 123,700 |  |  |  | 152,200 |  |  |  | 269,900 |
Sales commissions |  |  | 23,700 |  |  |  | 23,700 |  |  |  | 54,200 |  |  |  | 48,900 |
General and administrative |  |  | 227,000 |  |  |  | 243,900 |  |  |  | 452,500 |  |  |  | 486,400 |
Total operating expenses |  |  | 320,600 |  |  |  | 391,300 |  |  |  | 658,900 |  |  |  | 805,200 |
Operating income |  | $ | 205,700 |  |  | $ | 255,200 |  |  | $ | 413,500 |  |  | $ | 486,800 |
Information for the Other segment above for the three and six months ended August 31, 2025 and 2024 is set forth below: OTHER NON-SEGMENT LOSS BEFORE INCOME TAXES
|  | Three Months Ended August 31, |  |  | Six Months Ended August 31, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Operating and selling: |  | $ |  |  |  | $ |  |  |  | $ |  |  |  | $ |  |
Freight |  |  | 74,200 |  |  |  | 82,700 |  |  |  | 223,900 |  |  |  | 286,100 |
Computer support |  |  | 40,900 |  |  |  | (700 | ) |  |  | 63,900 |  |  |  | 36,900 |
Total operating and selling expenses |  |  | 115,100 |  |  |  | 82,000 |  |  |  | 287,800 |  |  |  | 323,000 |
General and administrative: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Payroll |  |  | 949,900 |  |  |  | 1,066,100 |  |  |  | 1,913,100 |  |  |  | 2,381,600 |
Depreciation |  |  | 274,600 |  |  |  | 393,500 |  |  |  | 551,400 |  |  |  | 786,000 |
Building and warehouse rents |  |  | 216,300 |  |  |  | 170,900 |  |  |  | 454,000 |  |  |  | 342,600 |
Outside services |  |  | 100,200 |  |  |  | 107,400 |  |  |  | 251,800 |  |  |  | 221,500 |
Property taxes |  |  | 41,300 |  |  |  | 92,700 |  |  |  | 155,300 |  |  |  | 185,400 |
Property insurance |  |  | 34,600 |  |  |  | 50,800 |  |  |  | 109,400 |  |  |  | 120,500 |
Professional service fees |  |  | 56,700 |  |  |  | 59,700 |  |  |  | 116,400 |  |  |  | 118,600 |
Dues and subscriptions |  |  | 54,600 |  |  |  | 59,000 |  |  |  | 108,100 |  |  |  | 129,400 |
Other |  |  | 171,200 |  |  |  | 197,900 |  |  |  | 301,200 |  |  |  | 353,100 |
Total general and administrative expenses |  |  | 1,899,400 |  |  |  | 2,198,000 |  |  |  | 3,960,700 |  |  |  | 4,638,700 |
Interest expense |  |  | 603,200 |  |  |  | 545,700 |  |  |  | 1,107,500 |  |  |  | 1,122,400 |
Other income |  |  | (676,500 | ) |  |  | (575,100 | ) |  |  | (1,296,000 | ) |  |  | (1,083,800 | )
Total other non-segment loss before income taxes |  | $ | 1,941,200 |  |  | $ | 2,250,600 |  |  | $ | 4,060,000 |  |  | $ | 5,000,300 |

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- Definition The entire disclosure for reporting segments including data and tables. 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