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Management Plans - Capital Resources
6 Months Ended
Jun. 30, 2021
Basis of Presentation  
Note 2. Management Plans - Capital Resources

Note 2. Management Plans - Capital Resources

 

The Company reported net losses of $568,730 and $78,887 for the six months ended June 30, 2021 and 2020, respectively, and stockholders’ deficiencies of $3,491,277 and $3,105,770 at June 30, 2021 and December 31, 2020, respectively. The Company has a working capital deficit of approximately $2.4 million at June 30, 2021. These factors raise substantial doubt about the ability to continue as a going concern. The Company has previously modified a significant amount of the short-term liabilities and plans to restructure certain remaining short-term debt, is exploring additional sources of financing, including debt and equity, and anticipates significant growth of business. These plans, in management’s opinion, will allow the Company to meet its obligations for at least the twelve-month period from the date the financial statements are available to be issued and alleviate the substantial doubt.

 

The Company's goal is to increase sales and generate cash flow from operations on a consistent basis. The Company uses a formal financial review and budgeting process as a tool for improvement that has aided expense reduction and internal performance. The Company’s business plans require improving the results of its operations in future periods.

 

The Company believes the capital resources available under its factoring line of credit, cash from additional related party and third-party loans and cash generated by improving the results of its operations provide sources to fund its ongoing operations and to support the internal growth of the Company. Although the Company has no assurances, the Company believes that related parties, who have previously provided working capital, and third parties will continue to provide working capital loans on similar terms, as in the past, as may be necessary to fund its on-going operations for at least the next 12 months. If the Company experiences significant growth in its sales, the Company believes that this may require it to increase its financing line, finance additional accounts receivable, or obtain additional working capital from other sources to support its sales growth.