Many people when they view company financial statement with assumption Accumulated deficit ($ 15,379,41 ) is overhanging debt
OVER HANGING DEBT THAT STATEMENT CAN SCARE MANY PEOPLE AWAY.
That presentation is inaccurate, misleading to others. Matter of fact they are about to finish their last note conversion and become DEBT FREE. Everyone needs to fully understand that. Let me repeat it again they are about to become DEBT=FREE.
Accumulated deficit ($ 15,379,41 ) this is extremely considered a GREAT NEWS.
First, let me explain what is Accumulated deficit?
When a business generated more net losses than profits over the life of the business, it has negative retained earnings, which it reports as an accumulated deficit. It may be called accumulated losses, retained losses or retained earnings. Retained earnings are reported in the shareholders' equity section of the corporation's balance sheet.
Accumulated deficit is tax benefit that allows them to deduct tax on future profits. (tax write-off.) and that can carry forward the fiscal year to the next fiscal year by using the SAP standard carry forward.
Accumulated deficit ($ 15,379,410 ) where this amount is coming from?
1 - An accumulated deficit that is accumulated from the Company received forgiveness of stock payable of $3,390,000 and amounts due to former CEO.
From 10-Q
NOTE 3 – RELATED PARTY TRANSACTIONS
"In connection with the acquisition of Viva Entertainment and the resignation of our former officers and directors, the Company received forgiveness of stock payable of $3,390,000 and amounts due to former CEO of $132,854. These amounts were written off prior to closing and have therefore not been included in Equity. However, the former CEO funded an additional $30,000 to the Company for working capital during the year ended October 31, 2016.
1- Forgiveness payable of $3,390,000
2 - Future paid retained earning (WAGE) $8,887,291
3 - Accrued Salary and Wages $ 329,840
4 - Accounts Payable and Accrued Liabilities 263,549
5 - Total other expense (1,130,256 )
6 - General and administrative $576,085
7 - Consulting services $ 576,085
And a few more items consider the business expense. As you see the biggest amount is future WAGE and forgiveness all these are Condensed Statements of Operations. Now is become TAX WRITE OFF.
It's nothing for you to concerns or worries. Retaining earnings by a company increases the company's shareholder equity, which increases the value of each shareholder's shareholding.
