These financial statements have been prepared
in accordance with accounting principles generally accepted in the United States of America for interim financial information and the
SEC instructions to Form 10-Q. In the opinion of management, all adjustments considered necessary for a fair presentation have been included.
Operating results for the interim period ended March 31, 2020 are not necessarily indicative of the results that can be expected for the
full year.
The accompanying notes are an integral part of
these unaudited financial statements
The accompanying notes are an integral part of
these unaudited financial statements
The accompanying notes are an integral part of
these unaudited financial statements
Notes to Condensed
Financial Statements
March 31, 2020
(Unaudited)
Note A - Basis of Presentation, Background and
Description of Business
Background and
Description of Business
SMSA Crane Acquisition Corp. was organized
on September 9, 2009 as a Nevada corporation to effect the reincorporation of Senior Management Services of Crane, Inc., a Texas corporation.
The Company's business plan is now to
pursue a business combination through the acquisition of, or merger with, an existing company seeking the perceived advantages of being
a publicly traded corporation. The Company is not restricting its potential target companies to any specific business, industry or geographical
location. No assurances can be given that the Company will be successful in locating or negotiating with any target company.
Note B - Change of Control
Coqui, the principal shareholder of the
Company, entered into a Stock Purchase Agreement, effective as of the 26th day of June, 2017, with Irwin Eskanos (“Buyer”).
Coqui agreed to sell to the Buyer, and the Buyer agreed to purchase from Coqui, a total of 9,947,490 shares of common stock of the Company
for a total purchase price of $250,000. These purchased shares represented approximately 99% of the Company’s issued and outstanding
shares of Common Stock. Concurrent with the sale of controlling interest, Coqui (“Indemnitor”) entered into an Indemnity Agreement
with SMSA Crane Acquisition Corp (“Indemnitee”). Coqui agreed to paid $133,572 of the Company’s outstanding debts at
or prior to the closing of Stock Sale. The Company recorded Coqui’s forgiveness of debt of $133,572 under Additional paid in capital,
for the year ended December 31, 2017.
On June 26, 2017, the board of directors
appointed Irwin Eskanos as our new sole Director, President, Secretary, Treasurer, CEO, and CFO. Following these appointments, the board
accepted the resignation of Carmen I. Bigles as our former sole officer and director.
Note C – Going Concern
We have incurred recurring losses since
inception and expect to continue to incur losses as a result of legal and professional fees and our corporate general and
administrative expenses. Our net losses incurred for the years three months ended March 31, 2020 and 2019, amounted to approximately
$13,281 and $2,638 respectively, and working capital (deficits) were $89,682 and $76,401 at March
31, 2020 and December 31, 2019, respectively. As a result, there is substantial doubt about
our ability to continue as a going concern. In the event that we are unable to generate sufficient cash from our operating
activities or raise additional funds, we may be required to delay, reduce or severely curtail our operations or otherwise impede our
on-going business efforts, which could have a material adverse effect on our business, operating results, financial condition and
long-term prospects. The Company expects to seek to obtain additional funding through future equity issuances. There can be no
assurance as to the availability or terms upon which such financing and capital might be available.
Note D - Summary of Significant
Accounting Policies and Recent Accounting Pronouncements
Use of Estimates
The preparation of financial statements
in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates include
the valuation of deferred tax assets. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all cash on hand
and in banks, certificates of deposit and other highly-liquid investments with maturities of three months or less, when purchased, to
be cash and cash equivalents.
SMSA Crane Acquisition Corp.
Notes to Financial Statements
March 31, 2020
Income Taxes
The Company files income tax returns in
the United States of America and various states, as appropriate and applicable.
The Company accounts for income taxes
using the asset and liability method in accordance with ASC 740 “Income Taxes.” The asset and liability method provides that
deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial
reporting and tax basis of assets and liabilities, and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities
are measured using the currently enacted tax rates and laws. The Company records a valuation allowance to reduce deferred tax assets to
the amount that is believed more likely than not to be realized.
The Company has adopted the provisions
of ASC 740-10 "Accounting for Uncertain Income Tax Positions." The Codification Topic requires the recognition of potential
liabilities as a result of management's acceptance of potentially uncertain positions for income tax treatment on a "more-likely-than-not"
probability of an assessment upon examination by a respective taxing authority. As a result of the implementation of Codification's Income
Tax Topic, the Company did not incur any liability for unrecognized tax benefits.
Income (Loss) Per Share
Basic earnings (loss) per share is computed
by dividing the net income (loss) available to common stockholders by the weighted-average number of common shares outstanding during
the respective period presented in our accompanying financial statements.
Fully diluted earnings (loss) per share
is computed similar to basic income (loss) per share except that the denominator is increased to include the number of common stock equivalents.
Common stock equivalents represent the
dilutive effect of the assumed exercise of outstanding stock warrants, options or convertible securities, using the if-converted method,
and only if the common stock equivalents are considered dilutive based upon the Company's net income (loss) position.
As of March 31, 2020 and December 31,
2019, the Company had no outstanding stock warrants, options or convertible securities which could be considered dilutive for purposes
of the loss per share calculation.
Recent Accounting Pronouncements
Management does not believe that any recently
issued, but not yet effective, accounting standards if currently adopted would have a material effect on the accompanying financial statements.
Note E - Fair Value of Financial Instruments
and Fair Value Measurements
The carrying amount of cash, accounts
payable and accrued expenses and due to shareholder, approximates fair value due to the short term nature of these items and/or the current
interest rates payable in relation to current market conditions.
ASC Topic 820, "Fair Value Measurements
and Disclosures," requires disclosure of the fair value of financial instruments held by the Company. ASC Topic 825, "Financial
Instruments," defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that
enhances disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for receivables and current
liabilities each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time
between the origination of such instruments and their expected realization and their current market rate of interest. The three levels
of valuation hierarchy are defined as follows:
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Level 1:
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Observable inputs such as quoted prices in active markets;
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Level 2:
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Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
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Level 3:
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Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
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SMSA Crane Acquisition Corp.
Notes to Financial Statements
March 31, 2020
Note F - Related Party Transactions
Due to Shareholder
As of March
31, 2020 and December 31, 2019, the Company owes $81,615 and $81,615, respectively, to Mr. Irwin Eskanos, the principal shareholder of
the Company, for the funding of its current operating expenses. The amount owing is unsecured, non-interest bearing, and due on demand.
Note G - Concentration of Credit Risk
At times cash deposited with financial
institutions may exceed federally insured limits. The Company has not experienced any losses in such accounts through March 31, 2020.
Note H - Contingencies
The Company's business plan is now to
pursue a business combination through the acquisition of, or merger with, an existing company seeking the perceived advantages of being
a publicly traded corporation. No assurances can be given that the Company will be successful in pursuing a business combination in the
near future or at all.
Note I- Stockholders' Deficit
Pursuant to our Articles of Incorporation,
our board has the authority, without further stockholder approval, to provide for the issuance of up to 10,000,000 shares of our preferred
stock in one or more series and to determine the dividend rights, conversion rights, voting rights, rights in terms of redemption, liquidation
preferences, the number of shares constituting any such series and the designation of such series. Our board has the power to afford preferences,
powers and rights (including voting rights) to the holders of any preferred stock preferences, such rights and preferences being senior
to the rights of holders of common stock.
There
were no common shares issued or cancelled during the three months ended March 31, 2020 or 2019.
There were no preferred shares issued
and outstanding at March 31, 2020 or December 31, 2019. There were 10,047,495 shares of common stock with a par value $0.001 issued and
outstanding as of March 31, 2020 and December 31,2019.
Note J – Subsequent Events
In accordance with ASC 855-10, Company
management reviewed all material events through the date of the issuance of these financial statements and determined that there are no
additional material subsequent events to report, except as noted.
During May 2021, the Company received a loan of
$20,000 from a third party for the funding of its current operating expenses. The amount owing is unsecured, non-interest bearing, and
due on demand.