Property and Equipment and Assets Held for Investment

12 Months Ended

Jul. 31, 2015

Property, Plant and Equipment [Abstract]

Property and Equipment and Assets Held for Investment

Note 3 – Property and Equipment and Assets Held for Investment:

Property and Equipment

The costs and accumulated depreciation of property and equipment are summarized as follows:

	July 31,
	2015		2014
Furniture and Fixtures	$	10,954	$	13,078
Total Property and Equipment		10,954		13,078
Less: Accumulated Depreciation		8,085		7,785
Property and Equipment, Net	$	2,869	$	5,293

Depreciation expense related to property and equipment amounted to $1,726 and $10,482 for the years ended July 31, 2015 and 2014, respectively.

Assets Held for Investment, Net 

The Company did not have any assets held for investment at either July 31, 2015 or 2014, as it sold its remaining investment property in the first quarter of fiscal 2014. The Company held these properties for investment purposes and collected rental income as described directly below.

Income from Assets Held for Investment, net

In August 2013, the Company sold a property which was held for investment for gross proceeds after real estate commissions of $883,780. This property had a net book value of $694,911, resulting in an accounting gain of $188,869 which is included in income from assets held for investment, net on the consolidated statement of operations and comprehensive loss. The property was secured by a mortgage which was discharged upon the sale, as described in the last paragraph of this note below. After the discharge of the mortgage ($606,806), as well as legal fees, interest, penalties and other costs ($73,628 in aggregate) the sale resulted in net cash proceeds to the Company of $203,346.

The remaining income of $0 and $4,738 in this category in the respective fiscal years ended July 31, 2015 and 2014, pertains to rental income from properties held for investment, net of carrying and operating expenses. Gross income from rental operations was $0 and $7,847 and rental expenses were $0 and $3,109, including the depreciation expense relating to assets held for investment, for the years ended July 31, 2015 and 2014, respectively.

Prior to the August 2013 property sale, the properties held for investment had an interest only first mortgage which closed on November 30, 2012 with a principal amount $606,806, an interest rate of 9.75% compounded semi-annually and a maturity date of November 30, 2013. Upon the sale of the property, the mortgage was discharged.