Plastic2Oil Inc (PTOI)

[scion]

11. Refer to our prior comment 16. Please tell us why you believe that label “services contributed by shareholder” for all components of the $1,679,224 presented in your cash flow statement is appropriate. For example, you describe the $1 million loss in your response to comment 20 as being necessary because you “determined that the MEDIA CREDITS had no value and show be written off.” Tell us why the $1 Million portion of the referenced total reconciling item is not labeled as relating to a non-cash charge for the write-off of MEDIA CREDITS in your cash flow statements.

The amount of $1,679,224 in the statement of cash flows relates to “Common shares issued for services”, and not “Services contributed by a shareholder” as referred to in the inquiry. Please note that the Company filed a Form 10Q/A for the period ended September 30, 2009 on November 17, 2010 which does not include the original $1 million valuation of the MEDIA CREDITS. Because the asset was not in place at 9/30/2009, the Company’s 10K/A does not include an impairment of the asset. Therefore, the statement of cash flows does not include a non-cash charge for the write-off of the MEDIA CREDITS. The statement of cash flows does reflect a non-cash charge to operations for $1 million, which under ASC 230-10-45-28 (b), should be classified as an adjustment to reconcile net income (loss) to net cash from operating activities. JBI issued 1 million shares to Domark for MEDIA CREDITS. The company used the trading price of the stock on date of issuance as a measure of the fair value of the MEDIA CREDITS because it was a more readily determinable value than what the CREDITS were worth. JBI also concluded that there could be no certainty that these MEDIA CREDITS would provide any real future benefit so they were expensed. The charge to expense the MEDIA CREDITS is included in operating expenses on the statement of operations.

Form CORRESP - Correspondence
Filing Date 2010-11-29
Accepted 2010-11-29 16:32:00
http://www.sec.gov/Archives/edgar/data/1381105/000121390010005070/filename1.htm

16. We note that in fiscal 2009 the “operating activities” section of this statement indicates you recorded $1,679,224 for “services contributed by shareholder”. Please tell us where and how the values of these services are presented in your consolidated statement of changes in stockholder’s equity.

The value for services contributed by shareholders of $1,679,224 is made up of a $1,000,000 loss on the MEDIA CREDITS purchased and $679,224 is made up of the $129,766 paid for interest and commissions and the $549,458 is detailed in question 19. The MEDIA credit transaction is listed in the consolidated financial statement as “Shares issued in connection with acquisition of Javaco and MEDIA credits” for a total of 3,500,000. 1,000,000 was for the MEDIA CREDITS and 2,500,000 was for the acquisition of Javaco. The $679,224 is listed in the consolidated financial statements as part of “Shares issued primarily to settle Pak-It acquisition indebtedness and acquisition fees, $0.80 per share” which totals 3,548,750 shares.

Form CORRESP - Correspondence
Filing Date 2010-10-20
Accepted 2010-10-20 16:05:20
http://www.sec.gov/Archives/edgar/data/1381105/000121390010004271/filename1.htm