v3.23.3
DISCONTINUED OPERATIONS
 3 Months Ended
Mar. 31, 2023
Discontinued Operations and Disposal Groups [Abstract]  
DISCONTINUED OPERATIONS

NOTE 15 - DISCONTINUED OPERATIONS

 

Rotmans closed its showroom on December 14, 2022. The Company has accounted for the closing as discontinued operations in accordance with ASC No. 205-20, Discontinued Operations. The results of operations are reported as discontinued operations in 2023 and 2022. The assets and liabilities have been reported in the condensed consolidated balance sheets as assets and liabilities of discontinued operations.

 

 

The loss from discontinued operations for the three months ended March 31, 2023 and 2022 are as follows:

 

   2023   2022 
         
Revenue  $107,479   $3,715,738 
           
Cost of revenue   122,650    1,622,049 
           
Gross profit (loss)   (15,171)   2,093,689 
           
Operating expenses:          
Salaries, wages and benefits   264,671    849,144 
Agent fees   -    418,179 
Professional fees   98,593    56,590 
Advertising   67,280    287,254 
Rent   179,782    175,334 
Service charges   20,600    105,403 
Depreciation and amortization   5,184    115,461 
Other operating   526,505    453,328 
           
Total operating expenses   1,162,615    2,460,693 
           
Loss from operations   (1,177,786)   (367,004)
           
Other income (expense):          
Interest expense   (83,702)   (94,594)
Gain on settlement of debt, net   39,770    - 
Other income   5,696    33,952 
           
Total other expense, net   (38,236)   (60,642)
           
Net loss from discontinued operations  $(1,216,022)  $(427,646)

 

 

Details of the balance sheet items for discontinued operations as are as follows:

 

   March 31,   December 31, 
   2023   2022 
         
Current assets:          
Cash  $267,573   $123,325 
Accounts receivable   229,434    1,853,972 
Other receivables   444,680    684,775 
Property held for sale   365,707    - 
Inventories   -    76,379 
Prepaid expenses and other   30,122    288,520 
           
Total current assets  $1,337,516   $3,026,971 
           
Non-current assets:          
Property and equipment, net  $119,529   $490,420 
Operating lease right-of-use assets, net   6,818,716    7,008,276 
Other assets   5,274    5,274 
           
Total non-current assets  $6,943,519   $7,503,970 
           
Current liabilities:          
Accounts payable  $321,293   $339,426 
Accrued expenses   209,298    726,410 
Operating lease liabilities - current maturities   761,000    737,000 
Finance lease liabilities - current maturities   150,000    119,000 
Related party debt - current maturities   197,218    406,753 
           
Total current liabilities  $1,638,809   $2,328,589 
           
Non-current liabilities:          
Operating lease liabilities, net of current maturities  $4,999,176   $5,189,140 
Finance lease liabilities, net of current maturities   293,527    324,527 
           
Total non-current liabilities  $5,292,703   $5,513,667 

 

The consolidated statements of cash flows do not present the cash flows from discontinued operations separately from cash flows from continuing operations. Included in adjustments to reconcile net loss to net cash provided by operating activities for the three months ended March 31, 2023 and 2022 are the following discontinued operations items:

 

   2023   2022 
         
Depreciation  $5,184   $53,378 
Bad debts   9,804    3,158 
Amortization of intangible assets   -    62,083 
Noncash lease expense   38,701    78,488 
(Gain)on settlement of debt, net   (39,770)   -