NewMarket Technology (fka NWMT)

[my02cents]

NMKT's Furniture and Fixtures

Forget about the depreciated book value. How much does NMKT really have in property and equipment (hard assets)?

This is very complicated. When assets are purchased, they start to depreciate, as accounted for in a growing depreciation account. At the moment that the item is fully depreciated, the full asset amount is dropped from both the asset and the depreciation account. So, if you buy a piece of equipment for $10,000, it is carried as an asset for the full $10,000 the entire three years. But the depreciation account starts to grow over that three year period, from $0 to $10,000. When the depreciation account reaches $10,000 at the end of the three years, both the asset and the depreciation account is decreased by the dropped $10,000 asset. If that were the only asset, then both accounts would be at zero at the end of the depreciation period.

The solution is to look at the asset account, and adjust our total when fully depreciated items drop out of the balance sheet.

---------------------------
Funiture and Fixtures
---------------------------

This is the easiest of the assets to track. So I will focus on this one now and then focus on the harder ones at a later time.

This will illustrate the reason one can't just look at the net value carried on any given 10-Q/K to know the actual amount spent for assets.

IPVoice, pre-VergeTech, had furniture and fixtures at $47,740. Post-VergeTech acquistion, in June of 2002, Furniture and Fixtures jumped to $91,892. Then, in the 4Q02, Furniture and Fixtures were recorded at $7,366, where it stay all of 2003. Starting with 2004, the Furniture and Fixtures were fully depreciated and no longer carried as a line item on the balance sheet.

In summary, it appears that NMKT has about $91,892 worth of furniture and fixtures. It doesn't matter that they are fully depreciated and no longer carried on the books. That doesn't mean that NMKT threw out their chairs and tables in 2004 and are now sitting on the floor.

I have a dining room set of table and chairs I have had for over 25 years. They are "fully depreciated" but I still use them!
- - - - - - -

Furniture and Fixtures, by Quarter:

1Q02: $47,740
2Q02: $47,740
3Q02: $91,892 (Up following acquisition of VergeTech and move to Dallas)
4Q02: $7,366

1Q03: $7,366
2Q03: $7,366
3Q03: $7,366
4Q03: $7,366

1Q04: (no mention)