Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2020

Summary of Significant Accounting Policies

Note B – Summary of Significant Accounting Policies

Fair Value of Financial Instruments

The Company accounts for fair value measurements in accordance with accounting standard ASC 820-10-50, “Fair Value Measurements.” This guidance defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. The three levels are defined as follows:

Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3 inputs to valuation methodology are unobservable and significant to the fair measurement.

The carrying amount of the Company’s current assets and liabilities approximates fair value because of the short-term nature of these items. The carrying amount of convertible notes payable approximates fair value as the individual borrowings bear interest at market interest rates and are also short-term in nature.

Use of Estimates

Preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates, and such differences may be material to the financial statements.

Concentration of Credit Risk

From time to time our cash balances, held at major financial institutions, exceed the federally insured limits of $250,000. Our management believes that the financial institutions are financially sound, and the risk of loss is low. Our cash balances did not exceed federally insured limits at June 30, 2020 or December 31, 2019.

Cash and Cash Equivalents

For the statement of cash flows, any liquid investments with a maturity of three months or less at the time of acquisition are considered to be cash equivalents. The Company had no cash equivalents at June 30, 2020 or December 31, 2019.

Revenue Recognition

The Company recognizes revenue from the sale of products and services in accordance with ASC 606, “Revenue from Contracts with Customers” following the five steps procedure:

Step 1: Identify the contract(s) with customers

Step 2: Identify the performance obligations in the contract

Step 3: Determine the transaction price

Step 4: Allocate the transaction price to performance obligations

Step 5: Recognize revenue when the entity satisfies a performance obligation

Prior to April 1, 2020, the Company generated revenue from online directory and digital signage components of its ongoing licensing services it provides to third parties. Revenue from online directory services is recognized over the life of the agreement ranging from one to twelve months. Revenue from digital signage control boxes is recognized at the time of sale and renewal fees are amortized over the term of the renewal, ranging from one to twelve months. The Company recognized $0 and $218 in online listing sales during the three months ended June 30, 2020 and 2019, respectively. The Company recognized $2,373 and $218 in online listing sales during the six months ended June 30, 2020 and 2019, respectively. The Company recognized $0 and $20,848 in digital signage sales during the three months ended June 30, 2020 and 2019, respectively. The Company recognized $3,400 and $29,173 in digital signage sales during the six months ended June 30, 2020 and 2019, respectively. Cost of goods sold for the three and six months ended June 20, 2019 totaled $15,272 and $26,110, respectively. There was no cost of goods sold for the three and six months ended June 30, 2020.

Stock Based Compensation

We measure stock-based compensation cost at the estimated fair value of the awards on the grant date. We recognize the cost over the requisite service period, which is typically the vesting period.

Income (Loss) Per Share

The computation of basic earnings (loss) per common share is based on the net income (loss) divided by the weighted average number of shares outstanding during each period.

The computation of diluted earnings (loss) per common share is based on the weighted average number of shares outstanding during the period plus the common stock equivalents as detailed in the following chart. During the three and six months ended June, 2020 and 2019, the inclusion of these common stock equivalents on the consolidated statements of operations would have resulted in a diluted weighted average shares number that was anti-dilutive, and as such they are excluded.

Fully diluted shares for the three and six months ended June 30, 2020 and 2019 are as follows:

	June 30, 2020		June 30, 2019		June 30, 2020		June 30, 2019
	Three Months Ended				Six Months Ended
	June 30, 2020		June 30, 2019		June 30, 2020		June 30, 2019
Basic weighted average shares outstanding		783,029,648		17,077,371		755,379,563		16,896,102
Convertible debt		31,426,621,900		13,577,043		30,611,980,800		6,974,085
Series B preferred stock		10,909		10,909		10,909		10,909
Series A preferred stock		980,000		-		980,000		-
Fully diluted weighted average shares outstanding		32,210,642,457		30,665,323		31,368,351,272		23,881,096

Income Taxes

Income taxes are accounted for under the liability method. Under the liability method, future tax liabilities and assets are recognized for the estimated future tax consequences attributable to differences between the amounts reported in the financial statements and their respective tax bases. Future tax assets and liabilities are measured using enacted or substantially enacted income tax rates expected to apply when the asset is realized, or the liability settled.

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax law and rates on the date of enactment.

Effect of New Accounting Pronouncements

There are no recent accounting pronouncements that are expected to have a material impact on our financial position, results of operations or cash flows.