Globe Photos Inc (fka GBPT)

[poker_vol]

Lem:

The sales of 504's would never hit the Income statement. The accounting entry would be a credit to equity (Common Stock and Additional Paid in Capital)and a debit to the cash account. The impact to the income statement would only be felt as expenses were incurred, debit to expense and a credit to A/P and ultimately to cash. The sales of stock would not constitute revenue, just as getting a loan does not. It is simply a different way of financing the entity. However, in the financials from 12/31, all of the equity balances are in Retained Earnings, so I am not sure how it was recorded.

I personally find it interesting that the liabilities in Acocunts Payable are higher than the total expenses for year. That would indicate that their were balance sheet only entries running through AP, which can happen if there are PPE purchases, or other asset purchases, but the amount of total assets are so small that it doesn't seem plausible.

Thanks.