General form of registration statement for all companies including face-amount certificate companies

Note 6 - Intangibles

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Note 6 - Intangibles
6 Months Ended 12 Months Ended
Jun. 30, 2015
Dec. 31, 2014
Disclosure Text Block [Abstract]    
Intangible Assets Disclosure [Text Block]

Note 5:       Intangible Assets


During the six months ended June 30, 2015, in a series of unrelated transactions, the Company completed its reacquisition and termination of regional developer rights in Los Angeles County, California, San Diego, California, New Jersey, and Orange County, California in exchange for cash consideration of $1,452,500, of which $507,500 was recorded as a cash advance at December 31, 2014.  At the time of the transaction, the Company carried a deferred revenue balance of $688,750, representing license fees collected upon the execution of the regional developer agreements.  In accordance with ASC 952-605, the Company accounted for the development rights associated with the unsold or undeveloped franchises as a cancellation, and the respective deferred revenue was netted against the aggregate purchase price or recognized as revenue to the extent deferred revenue was in excess of the cash consideration paid.   During the six months ended June 30, 2015, the revenue recognized as excess deferred regional developer fees totaled $159,500. The remaining $923,250 was accounted for as consideration paid for the reacquired development rights. As the deferred revenue with respect to these regional developer rights had previously been taken into account for income tax purposes, the tax basis in the reacquired development rights is equal to the cash consideration paid.


Intangible assets which remain subject to adjustment upon receipt of final valuation information, consisted of the following:


    As of June 30, 2015
    Gross Carrying
Amount
  Accumulated
Amortization
  Net Carrying
Value
Amortized intangible assets:                        
Reacquired franchise rights   $ 890,900     $ 33,383     $ 857,517  
Customer relationships     332,600       46,829       285,771  
Reacquired development rights     923,250       45,402       877,848  
                         
Unamortized intangible assets:   $ 2,146,750     $ 125,614     $ 2,021,136  
Goodwill                     2,747,668  
Total intangible assets                   $ 4,768,804  

Amortization expense was $88,947 and $125,614 for the three and six months ended June 30, 2015, respectively. There was no amortization expense for the three and six months ended June 30, 2014.


Estimated amortization expense for 2015 and subsequent years is as follows:


2015   $ 212,733  
2016     425,464  
2017     295,485  
2018     259,164  
2019     259,164  
Thereafter     569,126  
Total   $ 2,021,136  

Note 6:      Intangibles

Intangible assets consisted of the following:

   
December 31, 2014
 
       
Reacquired franchise rights
  $ 81,000  
Customer relationships
    72,000  
Total intangible assets
  $ 153,000  

All intangible assets relate to the acquisition that occurred on December 31, 2014 and, accordingly, there is no amortization expense for the year ended December 31, 2014.

Estimated amortization expense for 2015 and subsequent years is as follows:

2015
  $ 47,571  
2016
    47,571  
2017
    11,571  
2018
    11,571  
2019
    11,571  
Thereafter
    23,143  
Total
  $ 153,000