UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(MARK ONE)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ____________ to ___________
Commission File No.
(Exact name of registrant as specified in its charter) |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices, zip code)
(
(Registrant’s telephone number, including area code)
___________________________________________________________
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
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Indicate by check mark whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (check one):
Large accelerated filer | ☐ | Accelerated filer | ☐ |
☒ | Smaller reporting company | ||
| Emerging growth company | ||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2 of the Exchange Act): Yes
APPLICABLE ONLY TO CORPORATE ISSUERS
As of April 11, 2023, there were
EVIL EMPIRE DESIGNS, INC.
QUARTERLY REPORT ON FORM 10-Q
FOR THE PERIOD ENDED MARCH 31, 2023
INDEX
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| Table of Contents |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q of Evil Empire Designs, Inc., a Nevada corporation (the “Company”), contains “forward-looking statements,” as defined in the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of such terms and other comparable terminology. These forward-looking statements include, without limitation, statements about our market opportunity, our strategies, competition, expected activities and expenditures as we pursue our business plan, and the adequacy of our available cash resources. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Actual results may differ materially from the predictions discussed in these forward-looking statements. The economic environment within which we operate could materially affect our actual results. Additional factors that could materially affect these forward-looking statements and/or predictions include, among other things: (i) the development and protection of our brands and other intellectual property, (ii) the need to raise capital to meet business requirements, (iii) significant fluctuations in marketing expenses, (iv) the ability to achieve and expand significant levels of revenues, or recognize net income, from the sale of our products, (v) the Company’s ability to conduct the business if there are changes in laws, regulations, or government policies related to the motorcycle or motorcycle parts industry, (vi) management’s ability to attract and maintain qualified personnel necessary for the development and commercialization of its planned products, (vii) the impact of the COVID-19 pandemic on our business, suppliers, consumers, customers, and employees or the overall economy, and (viii) other information that may be detailed from time to time in the Company’s filings with the United States Securities and Exchange Commission (“SEC”).
Our management has included projections and estimates in this Form 10-Q, which are based primarily on management’s experience in the industry, assessments of our results of operations, discussions and negotiations with third parties and a review of information filed by our competitors with the SEC or otherwise publicly available. We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
EVIL EMPIRE DESIGNS, INC
BALANCE SHEETS
(Unaudited)
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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Accounts receivable |
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Interest receivable |
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Total current assets |
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Fixed assets |
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Fixed assets, net of depreciation of $ |
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Other assets- Investment |
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Note receivable-TOL |
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Total assets |
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LIABILITIES AND STOCKHOLDERS’ DEFICIT |
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Current liabilities: |
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Bank overdraft |
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Accounts payable and accrued expenses |
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Convertible notes payable |
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Notes payable |
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Total current liabilities |
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Stockholders’ deficit: |
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Preferred stock, $ |
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Common stock, $ |
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Additional paid-in capital |
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Accumulated deficit |
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Total stockholders’ deficit |
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Total liabilities and stockholders’ deficit |
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The accompanying notes are an integral part of these unaudited financial statements.
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EVIL EMPIRE DESIGNS, INC.
STATEMENTS OF OPERATIONS
As of March 31,
(Unaudited)
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Revenue |
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Cost of goods |
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Gross Margin |
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Operating expenses: |
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General and administrative expense |
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Professional Fees |
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Depreciation and amortization |
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Total operating expenses |
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Income (loss) from operations |
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Other income (expense): |
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Other income |
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Loss on asset |
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Interest expense |
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Total other income (expense) |
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Net income (loss) |
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Net income (loss) per share, basic and diluted |
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Weighted average number of shares outstanding, basic and diluted |
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The accompanying notes are an integral part of these unaudited financial statements.
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EVIL EMPIRE DESIGNS, INC
STATEMENTS OF STOCKHOLDERS’ DEFICIT
(Unaudited)
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Balance at December 31, 2021 |
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Net loss |
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Balance at March 31, 2022 |
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Balance at December 31, 2022 |
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Net loss |
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Balance at March 31, 2023 |
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The accompanying notes are an integral part of these unaudited financial statements
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| Table of Contents |
EVIL EMPIRE DESIGNS, INC
STATEMENTS OF CASH FLOWS
FOR THREE MONTHS ENDED MARCH 31,
(Unaudited)
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Cash flows from operating activities: |
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Net (loss) |
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Adjustments to reconcile net loss to net cash used in operating activities: |
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Depreciation and amortization |
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Changes in operating assets and liabilities: |
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Other receivables |
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Accounts payable and accrued expenses |
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Net cash used in operating activities |
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Cash flows from financing activities: |
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Bank overdraft |
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Proceeds from convertible notes |
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Net cash provided by financing activities |
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Net increase (decrease) in cash |
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Cash and cash equivalents – beginning of year |
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Cash and cash equivalents – end of period |
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SUPPLEMENT DISCLOSURES: |
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Interest paid |
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Income taxes paid |
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The accompanying notes are an integral part of these unaudited financial statements.
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EVIL EMPIRE DESIGNS, INC
NOTES TO FINANCIAL STATEMENTS
AS OF MARCH 31, 2023
(Unaudited)
NOTE 1 - NATURE OF BUSINESS
Evil Empire Designs, Inc., (formerly Jaycor Resources Inc.) (Jaycor) was organized on December 23, 2009 under the name US Terra Energy Corp in the State of Nevada. The Company was organized to explore investment opportunities in the energy business. In June 2016, the Company changed its business model to making and selling accessories to the motorcycle market.
The Company authorized
On April 24, 2012, the Company filed a Certificate of Amendment amending the Articles of Incorporation changing the name of the Corporation to Jaycor Resources, Inc.
On September 12, 2016, the Company filed a Certificate of Amendment amending the Articles of Incorporation changing the name of the Corporation to Evil Empire Designs, Inc.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation
These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for financial information and reflect all adjustments which, in the opinion of management, are necessary for a fair presentation.
The unaudited interim financial statements of the Company for the three ended March 31, 2023 and 2022 have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. In the opinion of management, the unaudited financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position and the results of operations for the interim periods presented herein. The results of operations for the interim periods are not necessarily indicative of the results to be expected for any subsequent quarters or for an entire year.
Use of Estimates
The 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 reported amounts of assets and liabilities at the date of the balance sheet. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of March 31, 2023 the Company did not have any cash equivalents.
Accounts receivable
Accounts receivable are carried at face value less any provisions for uncollectible accounts considered necessary. Accounts receivable include receivables from customers that have received their product order. Bad debt expense is a recognition of uncollectable receivables based on past years’ experience and management’s estimate of likely losses for the year. No allowance for bad debt was considered necessary as of March 31, 2023 and 2022 respectively due to no receivables listed.
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Inventory
Inventories are stated at the lower or cost of market using the first-in; first-out (FIFO) cost method of accounting. The inventory consists of raw materials used to make various products for sale.
Revenue recognition
Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.
Property and Equipment
Property and equipment is recorded at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the expected useful life of the asset (
Impairment of long-lived assets
The Company reviews the carrying value of its long-lived assets annually or whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. Fair value is estimated based upon either discounted cash flow analysis or estimated salvage value. As of June 30, 2021 no impairment losses have been recognized.
Income Taxes
Deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized.
The Company accounts for income taxes under the provisions of Financial Accounting Standards Board) Accounting Standards Codification 740, Accounting for Income Taxes. It prescribes a recognition threshold and measurement attributes for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. As a result, the Company has applied a more-likely-than-not recognition threshold for all tax uncertainties. The guidance only allows the recognition of those tax benefits that have a greater than 50% likelihood of being sustained upon examination by the various taxing authorities.
The Company classifies penalties and interest related to unrecognized tax benefits as income tax expense in the Statements of Operations.
Basic and diluted net loss per share
Basic and diluted net loss per share calculations are calculated on the basis of the weighted average number of common shares outstanding during the year. Diluted loss per share calculations includes the dilutive effect of common stock. Basic and diluted net loss per share is the same due to the absence of common stock equivalents.
Fair Value of Financial Instruments
The Company’s financial instruments consist of cash and cash equivalents, accounts payable and accrued expenses and shareholder loans. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.
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Financial assets and liabilities recorded at fair value in our condensed consolidated balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels:
Level 1 — Quoted market prices in active markets for identical assets or liabilities at the measurement date.
Level 2 — Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable and can be corroborated by observable market data.
Level 3 — Inputs reflecting management’s best estimates and assumptions of what market participants would use in pricing assets or liabilities at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments.
A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
Related Parties
A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.
Recent Accounting Pronouncements
Because the Company has been recently reorganized and has not yet transacted any business, the new accounting standards have no significant impact on the financial statements and related disclosures. As new accounting pronouncements are issued, the Company will adopt those that are applicable under the circumstances.
NOTE 3 - GOING CONCERN
The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company, as shown in the accompanying balance sheets, has an accumulated deficit of $
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| Table of Contents |
NOTE 4 - PROPERTY AND EQUIPMENT
Fixed assets including molds, printing equipment and a motorcycle for use in making products it sells. The value of the assets when acquired were $
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Property and equipment |
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Net property and equipment |
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Depreciation expense totaled $
NOTE 5 - RELATED PARTY TRANSACTIONS
During the three months ended March 31, 2023 and 2022 the Company paid compensation to a related party of $
NOTE 6 - CONVERTIBLE NOTES
During the three months ended March 31, 2022, the Company issued one-year convertible notes to 0985358 BC Ltd for $
During the three months ended March 31, 2023, the Company issued $
As of March 31, 2023 the Company had $
The Company determined the convertible note does not meet the requirements for derivative liability accounting as described in ASC 815. As the shares of the Company do not have a value other than par, are not readily convertible to cash at the date of issuance and are not registered to be traded. Additionally, there is no beneficial conversion feature described in ASC 470 on the date of issuance.
NOTE 7 – INVESTMENTS
On December 12, 2019, the Company signed a memorandum of understanding with Top of the Line Design, LLC whereas the Company will purchase
NOTE 8 - SUBSEQUENT EVENTS
The Company has evaluated subsequent events to determine events occurring after March 31, 2023 through the filing of this report that would have a material impact on the Company’s financial results or require disclosure and have determined none exist.
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| Table of Contents |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following information should be read in conjunction with (i) the financial statements of Evil Empire Designs, Inc., a Nevada corporation (the “Company”), and the notes thereto appearing elsewhere in this Form 10-Q together with (ii) the more detailed business information and the December 31, 2022 audited financial statements and related notes included in the Company’s Form 10-K (File No. 000-56212; the “Form 10-K”), as filed with the Securities and Exchange Commission on April 17, 2023. Statements in this section and elsewhere in this Form 10-Q that are not statements of historical or current fact constitute “forward-looking” statements.
OVERVIEW
The Company was incorporated in the State of Nevada on December 23, 2009, and has established a fiscal year end of December 31.
The Company’s authorized capital stock amounts to 125,000,000 shares, consisting of 100,000,000 of common stock with a par value of $0.001 per share, and 25,000,000 shares of preferred stock with a par value of $0.001 per share.
Going Concern
To date the Company has had operations and revenues of a developing business, and consequently has incurred recurring losses from operations. No substantial revenues are anticipated until we complete the financing we endeavor to obtain, as described in the Form 10-K, and implement our initial business plan. The ability of the Company to continue as a going concern is dependent on raising capital to fund our business plan and ultimately to attain profitable operations. Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern.
Our activities have been financed from related-party loans and the proceeds of share subscriptions.
The Company plans to raise additional funds through debt or equity offerings. There is no guarantee that the Company will be able to raise any capital through this or any other offerings.
PLAN OF OPERATION
We are an operating motorcycle parts design, manufacturing, marketing and sales business and have generated revenues of $1,608 for the three months ended March 31, 2023. During the 12 months following the date of filing of this Quarterly Report on Form 10-Q, we will be focused on attempting to raise $750,000 of funds to expand our business. We have no assurance that future financing will materialize. If that financing is not available, we may be unable to continue. Management believes that if we are successful in raising $750,000, we will be able to generate sales revenue within the following twelve months thereof. However, if such public financing is not available, we could fail to satisfy our future cash requirements. We have no assurance that future financing will materialize. If that financing is not available we may be unable to continue. Management believes that if subsequent private placements are successful, we will be able to generate sales revenue within the following twelve months thereof. However, additional equity financing may not be available to us on acceptable terms or at all, and thus we could fail to satisfy our future cash requirements.
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If we are unsuccessful in raising the additional proceeds through a private placement offering we will then have to seek additional funds through debt financing, which would be highly difficult for an early-stage company to secure. Therefore, the Company is highly dependent upon the success of the anticipated private placement offering and failure thereof would result in the Company having to seek capital from other sources such as debt financing, which may not even be available to the Company. However, if such financing were available, because we are an early stage company, it would likely have to pay additional costs associated with high risk loans and be subject to an above market interest rate. At such time these funds are required, management would evaluate the terms of such debt financing and determine whether the business could sustain operations and growth and manage the debt load. If we cannot raise additional proceeds via a private placement of its common stock or secure debt financing it would be required to cease business operations. As a result, investors in our common stock would lose all of their investment.
With new investors joining, the Company will increase its current efforts on marketing and selling its already created variety of products.
RESULTS OF OPERATIONS
Comparison of the three months ended March 31, 2023 and 2022
The Company recorded revenue of $1,608 and $10,474 during the three months ended March 31, 2023 and 2022, respectively.
Operating expenses for the three-month periods ended March 31, 2023 and 2022, were $27,026 and $6,480, respectively, consisting of a general and administrative expense of $3,221, professional fees of $23,000 and depreciation and amortization of $805 for the three months ended March 31, 2023, and consisting of a general and administrative expense of $4,583 and depreciation and amortization of $1,897 for the three months ended March 31, 2022
For the three-month periods ended March 31, 2023 and 2022, we had net losses of $35,895 and $19,290.
Liquidity and Capital Resources
There are no agreements or understandings about future loans by or with the officers, directors, principals, affiliates, or shareholders of the Company. The Company will continue to raise outside capital through loans, equity sales and possible licensing agreements. These factors raise substantial doubt about the company’s ability to continue as a going concern
At March 31, 2023, the Company had negative working capital of 734,800, and total current assets were $25,917. Current liabilities as of March 31, 2023, were $760,716, consisting of convertible debt of $401,425, outstanding notes of $158,959, and accounts payable and accrued liabilities $200,332.
Net cash used in operating activities in the three-month periods ended March 31, 2023 and 2022 was $23,665 and $5,188, respectively. The variance between the same periods relates mainly to the increase in net loss and increase in other receivables.
Net cash provided by financing activities for the three-month periods ended March 31, 2023 was $26,000, compared to $15,911 in the same period in 2022. Cash provided was a result of proceeds from the offer and sale of convertible notes in the principal amounts of $26,000 for the period ended March 31, 2023 and $15,929 offset by bank overdraft of $18 for the period ended March 31, 2022.
As of March 31, 2023, the Company had total assets of $25,917 and total liabilities of $760,716. Our accumulated deficit as of March 31, 2023 was $676,562.
Inflation
We believe that inflation has not had a significant impact on our operations since inception.
Off-Balance Sheet Arrangements
We had no off-balance sheet arrangements or guarantees of third-party obligations at March 31, 2023.
| 13 |
| Table of Contents |
Subsequent Events
None through date of this filing.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.
ITEM 4. CONTROLS AND PROCEDURES.
Evaluation of disclosure controls and procedures
Our management, with the participation of our President and Chief Executive Officer, evaluated the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) under the Exchange Act as of the end of the period covered by this Quarterly Report on Form 10-Q. In designing and evaluating the disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
Based on that evaluation, our President and Chief Executive Officer concluded that, as of March 31, 2023, our disclosure controls and procedures were not effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC rules, regulations and forms, and (ii) that such information is accumulated and communicated to our management, including our President and Chief Executive Officer, as appropriate, to allow timely decisions regarding required disclosure.
Changes in internal control over financial reporting
Our management, with the participation of the President and Chief Executive Officer, has concluded there were no significant changes in our internal controls over financial reporting that occurred during this quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
| 14 |
| Table of Contents |
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
The Company is not currently subject to any legal proceedings. From time to time, the Company may become subject to litigation or proceedings in connection with its business, as either a plaintiff or defendant. There are no such pending legal proceedings to which the Company is a party that, in the opinion of management, is likely to have a material adverse effect on the Company’s business, financial condition or results of operations.
ITEM 1A. RISK FACTORS
As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
ITEM 5. OTHER INFORMATION.
None.
| 15 |
| Table of Contents |
ITEM 6. EXHIBITS.
(a) The following Exhibits, as required by Item 601 of Regulation SK, are attached or incorporated by reference, as stated below.
Number | Description | |
101.INS |
| Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document). |
101.SCH |
| Inline XBRL Taxonomy Extension Schema Document. |
101.CAL |
| Inline XBRL Taxonomy Extension Calculation Linkbase Document. |
101.DEF |
| Inline XBRL Taxonomy Extension Definition Linkbase Document. |
101.LAB |
| Inline XBRL Taxonomy Extension Labels Linkbase Document. |
101.PRE |
| Inline XBRL Taxonomy Extension Presentation Linkbase Document. |
104 |
| Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
_______________
*Furnished, not filed.
| 16 |
| Table of Contents |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
EVIL EMPIRE DESIGNS, INC. | |||
Date: May 22, 2023 | By: | /s/ Sheila Cunningham | |
Name: | Sheila Cunningham | ||
Title: | President and Chief Executive Officer (principal executive officer, principal accounting officer and principal financial officer) | ||
| 17 |
EXHIBIT 31.1
SECTION 302 CERTIFICATION OF
PRINCIPAL EXECUTIVE OFFICER OF EVIL EMPIRE DESIGNS, INC.
I, Sheila Cunningham, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Evil Empire Designs, Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: May 22, 2023 |
| /s/ Sheila Cunningham |
|
|
| Sheila Cunningham |
| |
|
| President and Chief Executive Officer |
| |
|
| (principal executive officer, principal accounting officer and principal financial officer) |
|
EXHIBIT 31.2
SECTION 302 CERTIFICATION OF
PRINCIPAL FINANCIAL OFFICER OF EVIL EMPIRE DESIGNS, INC.
I, Sheila Cunningham, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Evil Empire Designs, Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: May 22, 2023 |
| /s/ Sheila Cunningham |
|
|
| Sheila Cunningham |
| |
|
| President and Chief Executive Officer |
| |
|
| (principal executive officer, principal accounting officer and principal financial officer) |
|
EXHIBIT 32.1
SECTION 906 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER
AND PRINCIPAL FINANCIAL OFFICER OF
EVIL EMPIRE DESIGNS, INC.
In connection with the accompanying Quarterly Report on Form 10-Q of Evil Empire Designs, Inc. for the quarter ended March 31, 2023, the undersigned, Sheila Cunningham, President and Chief Executive Officer of Evil Empire Designs, Inc., does hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) such Quarterly Report on Form 10-Q for the quarter ended March 31, 2023 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
(2) the information contained in such Quarterly Report on Form 10-Q for the quarter ended March 31, 2023 fairly presents, in all material respects, the financial condition and results of operations of Evil Empire Designs, Inc.
| Date: May 22, 2023 |
| /s/ Sheila Cunningham |
|
|
| Sheila Cunningham |
| |
|
| President and Chief Executive Officer |
| |
|
| (principal executive officer, principal accounting officer and principal financial officer) |
|
BALANCE SHEETS (Parenthetical) - USD ($) |
Mar. 31, 2023 |
Dec. 31, 2022 |
|---|---|---|
| BALANCE SHEETS | ||
| Fixed assets, Depreciation | $ 40,771 | $ 39,089 |
| Preferred stock, shares par value | $ 0.001 | $ 0.001 |
| Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
| Preferred stock, shares issued | 0 | 0 |
| Preferred stock, shares outstanding | 0 | 0 |
| Common stock, shares par value | $ 0.001 | $ 0.001 |
| Common stock, shares authorized | 100,000,000 | 100,000,000 |
| Common stock, shares issued | 8,797,750 | 8,797,750 |
| Common stock, shares outstanding | 8,797,750 | 8,797,750 |
STATEMENTS OF OPERATIONS (Unaudited) - USD ($) |
3 Months Ended | |
|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
| STATEMENTS OF OPERATIONS (Unaudited) | ||
| Revenue | $ 1,608 | $ 10,474 |
| Cost of goods | 220 | 13,980 |
| Gross Margin | 1,388 | (3,506) |
| Operating expenses: | ||
| General and administrative expense | 3,221 | 4,583 |
| Professional Fees | 23,000 | 0 |
| Depreciation and amortization | 805 | 1,897 |
| Total operating expenses | 27,026 | 6,480 |
| Income (loss) from operations | (25,638) | (9,986) |
| Other income (expense): | ||
| Other income | 3,400 | 3,000 |
| Loss on asset | ||
| Interest expense | (13,657) | (12,304) |
| Total other income (expense) | (10,257) | (9,304) |
| Net income (loss) | $ (35,895) | $ (19,290) |
| Net income (loss) per share, basic and diluted | $ (0.00) | $ (0.00) |
| Weighted average number of shares outstanding, basic and diluted | 8,797,625 | 8,057,750 |
STATEMENTS OF STOCKHOLDERS DEFICIT (Unaudited) - USD ($) |
Total |
Common Stock |
Additional Paid-In Capital |
Retained Earnings (Accumulated Deficit) |
|---|---|---|---|---|
| Balance, shares at Dec. 31, 2021 | 8,057,500 | |||
| Balance, amount at Dec. 31, 2021 | $ (358,883) | $ 8,058 | $ 222,757 | $ (589,698) |
| Net loss | (19,290) | $ 0 | 0 | (19,290) |
| Balance, shares at Mar. 31, 2022 | 8,057,500 | |||
| Balance, amount at Mar. 31, 2022 | (378,173) | $ 8,058 | 222,757 | (608,988) |
| Balance, shares at Dec. 31, 2022 | 8,797,500 | |||
| Balance, amount at Dec. 31, 2022 | (406,153) | $ 8,797 | 225,717 | (640,668) |
| Net loss | (35,895) | $ 0 | 0 | (35,895) |
| Balance, shares at Mar. 31, 2023 | 8,797,500 | |||
| Balance, amount at Mar. 31, 2023 | $ (442,048) | $ 8,797 | $ 225,717 | $ (676,563) |
STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) |
3 Months Ended | |
|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
| Cash flows from operating activities: | ||
| Net (loss) | $ (35,895) | $ (19,290) |
| Adjustments to reconcile net loss to net cash used in operating activities: | ||
| Depreciation and amortization | 805 | 1,897 |
| Changes in operating assets and liabilities: | ||
| Other receivables | (3,000) | 0 |
| Accounts payable and accrued expenses | 14,425 | 12,205 |
| Net cash used in operating activities | (23,665) | (5,188) |
| Cash flows from financing activities: | ||
| Bank overdraft | 0 | (18) |
| Proceeds from convertible notes | 26,000 | 15,929 |
| Net cash provided by financing activities | 26,000 | 15,911 |
| Net increase (decrease) in cash | 2,335 | 10,723 |
| Cash and cash equivalents - beginning of year | 227 | 0 |
| Cash and cash equivalents - end of period | 2,561 | 10,723 |
| SUPPLEMENT DISCLOSURES: | ||
| Interest paid | 0 | 0 |
| Income taxes paid | $ 0 | $ 0 |
NATURE OF BUSINESS |
3 Months Ended |
|---|---|
Mar. 31, 2023 | |
| NATURE OF BUSINESS | |
| NATURE OF BUSINESS | NOTE 1 - NATURE OF BUSINESS
Evil Empire Designs, Inc., (formerly Jaycor Resources Inc.) (Jaycor) was organized on December 23, 2009 under the name US Terra Energy Corp in the State of Nevada. The Company was organized to explore investment opportunities in the energy business. In June 2016, the Company changed its business model to making and selling accessories to the motorcycle market.
The Company authorized 125,000,000 shares consisting of 100,000,000 of common stock with a par value of $0.001 per share and 25,000,000 shares of preferred stock with a par value of $0.001 per share.
On April 24, 2012, the Company filed a Certificate of Amendment amending the Articles of Incorporation changing the name of the Corporation to Jaycor Resources, Inc.
On September 12, 2016, the Company filed a Certificate of Amendment amending the Articles of Incorporation changing the name of the Corporation to Evil Empire Designs, Inc. |
SIGNIFICANT ACCOUNTING POLICIES |
3 Months Ended |
|---|---|
Mar. 31, 2023 | |
| SIGNIFICANT ACCOUNTING POLICIES | |
| SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation
These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for financial information and reflect all adjustments which, in the opinion of management, are necessary for a fair presentation.
The unaudited interim financial statements of the Company for the three ended March 31, 2023 and 2022 have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. In the opinion of management, the unaudited financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position and the results of operations for the interim periods presented herein. The results of operations for the interim periods are not necessarily indicative of the results to be expected for any subsequent quarters or for an entire year.
Use of Estimates
The 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 reported amounts of assets and liabilities at the date of the balance sheet. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of March 31, 2023 the Company did not have any cash equivalents.
Accounts receivable
Accounts receivable are carried at face value less any provisions for uncollectible accounts considered necessary. Accounts receivable include receivables from customers that have received their product order. Bad debt expense is a recognition of uncollectable receivables based on past years’ experience and management’s estimate of likely losses for the year. No allowance for bad debt was considered necessary as of March 31, 2023 and 2022 respectively due to no receivables listed. Inventory
Inventories are stated at the lower or cost of market using the first-in; first-out (FIFO) cost method of accounting. The inventory consists of raw materials used to make various products for sale.
Revenue recognition
Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.
Property and Equipment
Property and equipment is recorded at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the expected useful life of the asset (3 to 5 years), beginning when the asset is available and ready for use. Expenditures associated with upgrades and enhancements that improve, add functionality, or otherwise extend the life of property and equipment are capitalized, while expenditures that do not, such as repairs and maintenance, are expensed as incurred. For the three months ended March 31, 2023 and depreciation and amortization expense totaled $805 and $1,897.
Impairment of long-lived assets
The Company reviews the carrying value of its long-lived assets annually or whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. Fair value is estimated based upon either discounted cash flow analysis or estimated salvage value. As of June 30, 2021 no impairment losses have been recognized.
Income Taxes
Deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized.
The Company accounts for income taxes under the provisions of Financial Accounting Standards Board) Accounting Standards Codification 740, Accounting for Income Taxes. It prescribes a recognition threshold and measurement attributes for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. As a result, the Company has applied a more-likely-than-not recognition threshold for all tax uncertainties. The guidance only allows the recognition of those tax benefits that have a greater than 50% likelihood of being sustained upon examination by the various taxing authorities.
The Company classifies penalties and interest related to unrecognized tax benefits as income tax expense in the Statements of Operations.
Basic and diluted net loss per share
Basic and diluted net loss per share calculations are calculated on the basis of the weighted average number of common shares outstanding during the year. Diluted loss per share calculations includes the dilutive effect of common stock. Basic and diluted net loss per share is the same due to the absence of common stock equivalents.
Fair Value of Financial Instruments
The Company’s financial instruments consist of cash and cash equivalents, accounts payable and accrued expenses and shareholder loans. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements. Financial assets and liabilities recorded at fair value in our condensed consolidated balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels:
Level 1 — Quoted market prices in active markets for identical assets or liabilities at the measurement date.
Level 2 — Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable and can be corroborated by observable market data.
Level 3 — Inputs reflecting management’s best estimates and assumptions of what market participants would use in pricing assets or liabilities at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments.
A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
Related Parties
A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.
Recent Accounting Pronouncements
Because the Company has been recently reorganized and has not yet transacted any business, the new accounting standards have no significant impact on the financial statements and related disclosures. As new accounting pronouncements are issued, the Company will adopt those that are applicable under the circumstances. |
GOING CONCERN |
3 Months Ended |
|---|---|
Mar. 31, 2023 | |
| GOING CONCERN | |
| GOING CONCERN | NOTE 3 - GOING CONCERN
The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company, as shown in the accompanying balance sheets, has an accumulated deficit of $676,562 as of March 31, 2023 and $640,668 as of December 31, 2022. The Company is establishing nominal source of revenue to cover its operating costs. These factors raise substantial doubt as to the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. The Company will engage in very limited activities that must be satisfied in cash until a source of funding is secured. The Company will offer noncash consideration and seek equity lines as a means of financing its operations. If the Company is unable to obtain revenue producing contracts or financing or if the revenue or financing it does obtain is insufficient to cover any operating losses it may incur, it may substantially curtail or terminate its operations or seek other business opportunities through strategic alliances, acquisitions or other arrangements that may dilute the interests of existing stockholders. |
PROPERTY AND EQUIPMENT |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||
| PROPERTY AND EQUIPMENT | ||||||||||||||||||||||||||||||||||||||||||||||
| PROPERTY AND EQUIPMENT | NOTE 4 - PROPERTY AND EQUIPMENT
Fixed assets including molds, printing equipment and a motorcycle for use in making products it sells. The value of the assets when acquired were $48,212. The assets are being depreciated over a 5 year life. Property and equipment consisted of the following at March 31, 2023 and December 31, 2022:
Depreciation expense totaled $805 and $1,897 for the three months periods ended March 31, 2023 and 2022, respectively |
|||||||||||||||||||||||||||||||||||||||||||||
RELATED PARTY TRANSACTIONS |
3 Months Ended |
|---|---|
Mar. 31, 2023 | |
| RELATED PARTY TRANSACTIONS | |
| RELATED PARTY TRANSACTIONS | NOTE 5 - RELATED PARTY TRANSACTIONS
During the three months ended March 31, 2023 and 2022 the Company paid compensation to a related party of $3,000 and $6,750 respectively. |
CONVERTIBLE NOTES |
3 Months Ended |
|---|---|
Mar. 31, 2023 | |
| CONVERTIBLE NOTES | |
| CONVERTIBLE NOTES | NOTE 6 - CONVERTIBLE NOTES
During the three months ended March 31, 2022, the Company issued one-year convertible notes to 0985358 BC Ltd for $22,000. The notes bear interest of 13% per annum and are convertible into common stock at $0.005 per share.
During the three months ended March 31, 2023, the Company issued $26,000 of convertible notes consisting of one note of $22,000 from 0985358 BC, Ltd and $4,000 from Black Ridge Holdings. The note bear interest of 13% and are convertible to common stock at $0.005 per share.
As of March 31, 2023 the Company had $401,425 of convertible debt plus accrued interest of $185,215 for total of $586,640.
The Company determined the convertible note does not meet the requirements for derivative liability accounting as described in ASC 815. As the shares of the Company do not have a value other than par, are not readily convertible to cash at the date of issuance and are not registered to be traded. Additionally, there is no beneficial conversion feature described in ASC 470 on the date of issuance. |
INVESTMENTS |
3 Months Ended |
|---|---|
Mar. 31, 2023 | |
| INVESTMENTS | |
| INVESTMENTS | NOTE 7 – INVESTMENTS
On December 12, 2019, the Company signed a memorandum of understanding with Top of the Line Design, LLC whereas the Company will purchase 100 % of Top of the Line for $250,000 and advance Top of the Line $350,000 in working capital as further expanded in a definitive agreement. The Company made a good faith deposit to Top of the Line (TOL) of $40,000 at the signing of the agreement and an additional $142,500 as of March 31, 2022 for a total of $182,500. The agreement is effective for 90 days and if terminate by both parties the deposits were to be terminated. As of March 31, 2022 the agreement was still in effect. The Company loaned TOL an additional $100,000 on demand with an interest rate of 12% per annum. |
SUBSEQUENT EVENTS |
3 Months Ended |
|---|---|
Mar. 31, 2023 | |
| SUBSEQUENT EVENTS | |
| SUBSEQUENT EVENTS | NOTE 8 - SUBSEQUENT EVENTS
The Company has evaluated subsequent events to determine events occurring after March 31, 2023 through the filing of this report that would have a material impact on the Company’s financial results or require disclosure and have determined none exist. |
SIGNIFICANT ACCOUNTING POLICIES (Policies) |
3 Months Ended |
|---|---|
Mar. 31, 2023 | |
| SIGNIFICANT ACCOUNTING POLICIES | |
| Basis of presentation | These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for financial information and reflect all adjustments which, in the opinion of management, are necessary for a fair presentation.
The unaudited interim financial statements of the Company for the three ended March 31, 2023 and 2022 have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. In the opinion of management, the unaudited financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position and the results of operations for the interim periods presented herein. The results of operations for the interim periods are not necessarily indicative of the results to be expected for any subsequent quarters or for an entire year. |
| Use of Estimates | The 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 reported amounts of assets and liabilities at the date of the balance sheet. Actual results could differ from those estimates. |
| Cash and Cash Equivalents | The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of March 31, 2023 the Company did not have any cash equivalents. |
| Account Receivable | Accounts receivable are carried at face value less any provisions for uncollectible accounts considered necessary. Accounts receivable include receivables from customers that have received their product order. Bad debt expense is a recognition of uncollectable receivables based on past years’ experience and management’s estimate of likely losses for the year. No allowance for bad debt was considered necessary as of March 31, 2023 and 2022 respectively due to no receivables listed. |
| Inventory | Inventories are stated at the lower or cost of market using the first-in; first-out (FIFO) cost method of accounting. The inventory consists of raw materials used to make various products for sale. |
| Revenue recognition | Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. |
| Property and Equipment | Property and equipment is recorded at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the expected useful life of the asset (3 to 5 years), beginning when the asset is available and ready for use. Expenditures associated with upgrades and enhancements that improve, add functionality, or otherwise extend the life of property and equipment are capitalized, while expenditures that do not, such as repairs and maintenance, are expensed as incurred. For the three months ended March 31, 2023 and depreciation and amortization expense totaled $805 and $1,897. |
| Impairment of long-lived assets | The Company reviews the carrying value of its long-lived assets annually or whenever events or changes in circumstances indicate that the historical-cost carrying value of an asset may no longer be appropriate. The Company assesses recoverability of the asset by comparing the undiscounted future net cash flows expected to result from the asset to its carrying value. If the carrying value exceeds the undiscounted future net cash flows of the asset, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived asset. Fair value is estimated based upon either discounted cash flow analysis or estimated salvage value. As of June 30, 2021 no impairment losses have been recognized. |
| Income Taxes | Deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized.
The Company accounts for income taxes under the provisions of Financial Accounting Standards Board) Accounting Standards Codification 740, Accounting for Income Taxes. It prescribes a recognition threshold and measurement attributes for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. As a result, the Company has applied a more-likely-than-not recognition threshold for all tax uncertainties. The guidance only allows the recognition of those tax benefits that have a greater than 50% likelihood of being sustained upon examination by the various taxing authorities.
The Company classifies penalties and interest related to unrecognized tax benefits as income tax expense in the Statements of Operations. |
| Basic and diluted net loss per share | Basic and diluted net loss per share calculations are calculated on the basis of the weighted average number of common shares outstanding during the year. Diluted loss per share calculations includes the dilutive effect of common stock. Basic and diluted net loss per share is the same due to the absence of common stock equivalents. |
| Fair Value of Financial Instruments | The Company’s financial instruments consist of cash and cash equivalents, accounts payable and accrued expenses and shareholder loans. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements. Financial assets and liabilities recorded at fair value in our condensed consolidated balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels:
Level 1 — Quoted market prices in active markets for identical assets or liabilities at the measurement date.
Level 2 — Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable and can be corroborated by observable market data.
Level 3 — Inputs reflecting management’s best estimates and assumptions of what market participants would use in pricing assets or liabilities at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments.
A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. |
| Related Parties | A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. |
| Recent Accounting Pronouncements | Because the Company has been recently reorganized and has not yet transacted any business, the new accounting standards have no significant impact on the financial statements and related disclosures. As new accounting pronouncements are issued, the Company will adopt those that are applicable under the circumstances. |
PROPERTY AND EQUIPMENT (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||
| PROPERTY AND EQUIPMENT | ||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of property and equipment |
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NATURE OF BUSINESS (Details Narrative) - $ / shares |
Mar. 31, 2023 |
Dec. 31, 2022 |
|---|---|---|
| NATURE OF BUSINESS | ||
| Total shares authorized | 125,000,000 | |
| Common stock, shares authorized | 100,000,000 | 100,000,000 |
| Common stock, shares par value | $ 0.001 | $ 0.001 |
| Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
| Preferred stock, shares par value | $ 0.001 | $ 0.001 |
SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) |
3 Months Ended | |
|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
| Depreciation and amortization | $ 805 | $ 1,897 |
| Estimated useful life | 5 years | |
| Maximum [Member] | Property and Equipment [Member] | ||
| Estimated useful life | 5 years | |
| Minimum [Member] | Property and Equipment [Member] | ||
| Estimated useful life | 3 years | |
GOING CONCERN (Details Narrative) - USD ($) |
Mar. 31, 2023 |
Dec. 31, 2022 |
|---|---|---|
| GOING CONCERN | ||
| Accumulated deficit | $ (676,562) | $ (640,668) |
PROPERTY AND EQUIPMENT (Details) - USD ($) |
Mar. 31, 2023 |
Dec. 31, 2022 |
|---|---|---|
| PROPERTY AND EQUIPMENT | ||
| Property and equipment | $ 48,213 | $ 48,213 |
| Less: accumulation depreciation | (40,659) | (39,089) |
| Net property and equipment | $ 7,553 | $ 9,124 |
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) |
3 Months Ended | 12 Months Ended |
|---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
| PROPERTY AND EQUIPMENT | ||
| Asset acquired value | $ 48,212 | |
| Depreciation expense | $ 805 | $ 1,897 |
| Estimated useful life | 5 years |
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) |
3 Months Ended | |
|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
| RELATED PARTY TRANSACTIONS | ||
| Compensation paid to a related party | $ 3,000 | $ 6,750 |
CONVERTIBLE NOTES (Details Narrative) - USD ($) |
3 Months Ended | ||
|---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
| Proceeds from convertible notes | $ 26,000 | $ 15,929 | |
| Accrued interest | 185,215 | ||
| Convertible notes payable | 401,425 | $ 375,425 | |
| Convertible Debt | 586,640 | ||
| 0985358 BC Ltd [Member] | |||
| Proceeds from convertible notes | 22,000 | ||
| Issuance of convertible note | $ 26,000 | ||
| Debt Instrument, Interest Rate, Stated Percentage | 13.00% | 13.00% | |
| Debt Instrument, Convertible, Conversion Price | $ 0.005 | $ 0.005 | |
| Debt Instrument, Face Amount | $ 4,000 | $ 22,000 | |
INVESTMENTS (Details Narrative) - USD ($) |
3 Months Ended | |||
|---|---|---|---|---|
Dec. 12, 2019 |
Mar. 31, 2022 |
Mar. 31, 2023 |
Dec. 31, 2022 |
|
| Note receivable-TOL | $ 100,000 | $ 100,000 | ||
| TOL [Member] | ||||
| Note receivable-TOL | $ 100,000 | |||
| Interest Rate | 12.00% | |||
| Top of the Line Design, LLC [Member] | ||||
| Purchase Percentage | 100.00% | |||
| Total Amount | $ 182,500 | |||
| Business Acquisition, Purchase Price, Payable | $ 250,000 | |||
| Working Capital | $ 350,000 | |||
| Deposit | 40,000 | |||
| Additional deposit | $ 142,500 |
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