Note 4.

Segment Information

We operate in two different segments: household products and skin and hair care products. Our products are sold nationally and internationally (primarily Canada), directly through our sales force and indirectly through independent brokers and manufacturer’s representatives, to mass merchandisers, drugstores, supermarkets, hardware stores, e-commerce retailers, and other retail outlets and to wholesale distributors. We have chosen to organize our business around these segments based on differences in the products sold.

Accounting policies for our segments are the same as those described in Note 1. We evaluate segment performance based on segment income or loss before income taxes.

The following provides information on our segments for the three and nine months ended September 30:

	Three Months Ended September 30,
	2017					2016
	Household Products		Skin and Hair Care Products			Household Products			Skin and Hair Care Products
Net sales	$	1,409,000	$	8,931,600		$	1,453,400		$	8,483,500
Operating costs and expenses:
Cost of sales		661,600		4,758,400			690,000			5,140,600
Advertising expenses		37,700		72,100			10,300			81,400
Selling expenses		332,000		1,251,400			276,800			1,440,500
General and administrative expenses		367,200		695,500			328,900			889,900
Total operating costs and expenses		1,398,500		6,777,400			1,306,000			7,552,400
Income from operations		10,500		2,154,200			147,400			931,100
Other (expense) income		-		-			(1,100	)		2,100
Interest expense		-		(26,400	)		-			(60,400	)
Income before income taxes	$	10,500	$	2,127,800		$	146,300		$	872,800

	Nine Months Ended September 30,
	2017						2016
	Household Products			Skin and Hair Care Products			Household Products			Skin and Hair Care Products
Net sales	$	4,189,400		$	26,467,600		$	4,490,300		$	19,784,500
Operating costs and expenses:
Cost of sales		2,010,600			14,638,400			2,148,500			11,306,100
Advertising expenses		353,900			177,200			889,100			537,500
Selling expenses		977,000			3,901,600			1,118,400			3,065,900
General and administrative expenses		1,046,400			2,119,900			1,136,900			2,296,100
Total operating costs and expenses		4,387,900			20,837,100			5,292,900			17,205,600
(Loss) income from operations		(198,500	)		5,630,500			(802,600	)		2,578,900
Other income		-			-			2,300			10,300
Interest expense		-			(101,500	)		(3,500	)		(74,000	)
(Loss) income before income taxes	$	(198,500	)	$	5,529,000		$	(803,800	)	$	2,515,200

The following is a reconciliation of segment information to consolidated information:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016
Net sales	$	10,340,600	$	9,936,900	$	30,657,000	$	24,274,800
Consolidated income before income taxes	$	2,138,300	$	1,019,100	$	5,330,500	$	1,711,400

	September 30, 2017		December 31, 2016
Assets:
Household Products	$	2,133,600	$	1,850,000
Skin and Haircare Products		21,883,700		18,371,500
Corporate		665,200		1,611,800
Consolidated	$	24,682,500	$	21,833,300

Corporate assets noted above are comprised primarily of our deferred tax assets and property and equipment not directly associated with our manufacturing, warehousing, shipping and receiving activities.