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Going Concern
6 Months Ended
Jun. 30, 2011
Going Concern

2. GOING CONCERN

 

The Company has incurred and continues to incur, losses from operations. For the periods ended June 30, 2011 and December 31, 2010, the Company incurred net losses of $351,364 and $513,353, respectively. In addition, certain notes payable have come due and the note holders are demanding payment.

 

Management is very actively working to cure these situations. It has implemented major plans to for the future growth and development of the Company. Management is in the process of renegotiating more favorable repayment terms on the notes payable and the Company anticipates that these negotiations will result in extended payment plans. In addition, during 2011 and 2010, the Company implemented marketing and information strategies to increase public awareness of its products and thereby sales. It has established new international markets which it believes will be the source for sales growth in the very near future. It also was able to reduce the per-unit cost of manufacturing its products. Additionally, the Company has increased the efficiency of its processes and focused its development efforts on products that appear to have greater sales potential.

 

Historically, the Company has financed its operations primarily through private financing; however, sales revenue during 2011 and 2010 and decreases in expenses during 2011 and 2010 made a significant contribution to working capital. It is management’s intention to finance operations during the remainder of 2011 primarily through increased sales although there will still be a need for additional equity financing. In addition, management is actively seeking out mergers and acquisitions which would be beneficial to the future growth of the Company. There can be no assurance, however, that this financing will be successful and the Company may be required to further reduce expenses and scale back operations.