Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2019

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

– The preparation of financial statements 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. Actual results could differ from those estimates.

Cash and Cash Equivalents, Policy [Policy Text Block]

Cash

– For financial statement presentation purposes, the Company considers all short-term, highly liquid investments with original maturities of three months or less to be cash and cash equivalents. There were no cash equivalents at March 31, 2019 or December 31, 2018. The Company maintains its cash in bank deposit accounts, which at times may exceed federally-insured limits. The Company believes it is not exposed to any significant credit risk as a result of any non-performance by the financial institution.

Receivables, Policy [Policy Text Block]

Accounts Receivable

– Credit is granted to substantially all customers. The Company carries its accounts receivable at invoice amount less any allowance for doubtful accounts.

Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block]

Allowance For Doubtful Accounts

– As of March 31, 2019 and December 31, 2018 there are no anticipated bad debts. Therefore, an allowance for doubtful accounts was not recorded.

Inventory, Policy [Policy Text Block]

Inventory

– Inventory consists of unassembled parts and is stated at the lower of cost or net realizable value. The Company capitalizes applicable direct and indirect costs incurred in inventory production. Obsolete inventory is reserved for and there was no reserve at March 31, 2019 or December 31, 2018.

Property, Plant and Equipment, Policy [Policy Text Block]

Property and Equipment

– Property and equipment consists of software and equipment. Depreciation is recorded on a straight-line basis over periods considered by management to be the assets' useful lives. Expenditures for repairs, minor items and maintenance are charged to operations as incurred. Any gain or loss upon sale or retirement due to obsolescence is recorded in operating results in the period it takes place. Software is being depreciated over three years and equipment is being depreciated over five years.

Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block]

Impairment of Long-Lived Assets

– Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net discounted cash flows expected to be generated by the asset, including its ultimate disposition. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of an asset exceeds the fair value of the asset. Fair value is determined based on discounted cash flows or appraised values, depending on the nature of the asset. There was no impairment considered necessary for the period ended March 31, 2019 or for the year ended December 31, 2018.

Fair Value of Financial Instruments, Policy [Policy Text Block]

Fair Value of Financial Instruments

– The carrying value of cash, prepaid expenses, accounts payable, loan payable and accrued expenses are reasonable estimates of their fair value due to their short maturity. The fair value of the loan from the principal shareholder is expected to be less than the carrying value due to the lack of interest being charged and uncertainty regarding timing of repayment. The fair value is further dependent on the Company’s ability to generate cash.

Revenue Recognition, Policy [Policy Text Block]

Revenue Recognition

– Beginning January 1, 2018 the Company adopted Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), or ASU 606. This guidance requires us to recognize revenue when we transfer promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additionally, the new guidance requires enhanced disclosures, including revenue recognition policies to identify performance obligations to customers and significant judgements in measurements and recognition. The new guidance did not have an impact on the historical or current financial statements based on the lack of revenue. This new standard will be considered in the future as contracts are entered into.

Advertising Costs, Policy [Policy Text Block]

Advertising Costs

– Advertising costs are expensed when incurred. Advertising costs were $1,651 and $3,563 for the period ended March 31, 2019 and March 31, 2018, respectively.

Research and Development Expense, Policy [Policy Text Block]

Research and Development Costs

– All costs of research and development are charged to operations as incurred. Research and development costs consist of expenses for inventing and testing turbine prototypes, including the materials and other direct costs of constructing prototype turbines, as well as related equipment employed in research and development activity.

Income Tax, Policy [Policy Text Block]

Income Taxes

– The Company accounts for income taxes in accordance with FASB ASC 740. Deferred taxes are provided using the “asset and liability approach." That requires recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. This method uses statutory tax rates in effect for the year in which the temporary differences are expected to reverse and gives immediate effect to changes in income tax rates upon enactment. Deferred assets are recognized, net of any valuation allowance, for temporary differences and net operating loss and tax credit carryforwards. Deferred income tax expense/benefit for a year is the net change in that year's deferred tax asset and liability balances.

The Company has deferred tax assets of its net operating loss and tax credit carryforwards. However, due to the uncertainty of future profits to absorb the carryforwards, an offsetting valuation allowance was recorded to reduce all the deferred tax assets to zero.

Earnings Per Share, Policy [Policy Text Block]

Basic and Diluted Loss per Share

– Basic earnings or loss per share reflect the weighted average of shares issued and outstanding during the period. Diluted earnings per share are computed including the additional shares that would have been outstanding if dilutive potential shares (option or warrant shares, for example) were issued. No dilutive potential shares exist.

New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Pronouncements

– In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842). The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. ASU 2016-02 is effective for public companies for annual reporting periods beginning after December 15, 2018, and interim periods within those fiscal years. The guidance was effective January 1, 2019 and did not have an impact on the financial statements.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force) and the United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

Sky Wolf Wind Turbine Corp 10-Q