Acquisition of TCBM Holdings, LLC

9 Months Ended

Mar. 31, 2021

Business Combinations [Abstract]

Acquisition of TCBM Holdings, LLC

NOTE D – ACQUISITION OF TCBM HOLDINGS, LLC

On November 30, 2019, the Company acquired 100% ownership of TCBM Holdings, LLC (“TCBM”) and TCBM’s two wholly owned subsidiaries, HMNRTH, LLC and 911 Help Now, LLC. The combination has been accounted for in the accompanying consolidated financial statements as an “acquisition” transaction. Accordingly, the financial position and results of operation of the Company prior to November 30, 2019 has been excluded from the accompanying consolidated financial statements. The Company acquired a 100% interest in exchange for a Convertible Promissory Note in the amount of $2,000,000.

Details regarding the book values and fair values of the net assets acquired are as follows:

	Book Value		Fair Value		Difference
		(Unaudited)		(Unaudited)		(Unaudited)
Cash	$	546,411	$	546,411	$	-
Inventory		70,580		70,580		-
Property and Equipment		36,363		36,363		-
Total	$	653,354	$	653,354	$	-

Acquisitions

Upon acquisition of a business, the Company uses the income, market or cost approach (or a combination thereof) for the valuation as appropriate. The valuation inputs in these models and analyses are based on market participant assumptions. Market participants are considered to be buyers and sellers unrelated to the Company in the principal or most advantageous market for the asset or liability.

Fair value estimates are based on a series of judgments about future events and uncertainties and rely heavily on estimates and assumptions. Management values property, plant and equipment using the cost approach supported where available by observable market data, which includes consideration of obsolescence. Management values acquired intangible assets using the relief from royalty method or excess earnings method, forms of the income approach supported by observable market data for peer companies. The significant assumptions used to estimate the value of the acquired intangible assets include discount rates and certain assumptions that form the basis of future cash flows (such as revenue growth rates, customer attrition rates, and royalty rates). Acquired inventories are marked to fair value for valuation of the total purchase price. For certain items, the carrying value is determined to be a reasonable approximation of fair value based on information available to the Company.

Assets acquired	As of November 30, 2019
Cash	$	546,411
Inventory (i)		70,580
Property, plant and equipment (ii)		36,363
		653,354
Goodwill (iii)		1,346,646
Total purchase price	$	2,000,000

(i)	Inventories acquired were sold on March 11, 2020
(ii)	Property, plant and equipment acquired includes computers, software and other office equipment.
(iii)	Goodwill is recorded when the cost of acquired businesses exceeds the fair value of the identifiable net assets acquired.

The changes in the carrying amount of goodwill for the period from November 30, 2019 through March 31, 2021 were as follows:

Balance as of November 30, 2019	$	1,346,646
Additions and adjustments		(400,000	)
Balance as of March 31, 2021	$	946,646