Note 14 - Store Purchase

12 Months Ended

Feb. 29, 2012

Business Combination Disclosure [Text Block]

NOTE 14 – STORE PURCHASE

On May 16, 2010, the Company purchased a previously franchise operated Rocky Mountain Chocolate Factory store and related assets in satisfaction of $54,607 of accounts receivable.  The Company is currently operating the store and believes that the store has the potential to contribute to future operating results. The Company adopted ASC Topic 805, Business Combinations, as of March 1, 2009.  ASC Topic 805 establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any non-controlling interest in the acquiree and the goodwill acquired.  In accordance with ASC 805, the Company recorded the business acquisition using the acquisition method.  The Company recorded the value of the business acquisition at fair value and recorded a gain of $8,592 associated with the business acquisition.  The following table summarizes the allocation of fair value on the date of acquisition:

Fair value of assets acquired in business combination
Store assets consisting of equipment,furniture, and fixtures:	$	63,198

We follow the fair value measurement and disclosure provisions of ASC Topic 805, Business Combinations, which establishes specific criteria for the fair value measurements of financial and nonfinancial assets and liabilities that are already subject to fair value measurements under current accounting rules.  The Company determined the fair value of the business combination using transaction information for historical asset costs, adjusted for the age of the asset.  These inputs to the valuation methodology are unobservable and significant to the fair value measurement (Level 3 of the ASC Topic 805 value hierarchy).