Quarterly report pursuant to sections 13 or 15(d)

Note 11: Creation of Limited Liability Company

Note 11: Creation of Limited Liability Company
6 Months Ended
Jun. 30, 2011
Business Combination Disclosure [Text Block]
Note 11:  Creation of Limited Liability Company

On September 20, 2010, the Company entered into a joint venture agreement between the Company and Dr. Shulamit Ritblatt to form Circle of Education, LLC (COE), a California limited liability company, for the purpose of creation and distribution of a curriculum to promote school readiness for children ages 0-5 years.  The Company obtained an initial voting and economic interest of seventy-five percent of the outstanding units of the newly formed company in exchange for the contribution of all intellectual property rights the Company had in the Circle of Education program.  Circle of Education, LLC was formed on September 24, 2010.

The Company has consolidated the results for the six month period ended June 30, 2011 with the results of COE.  COE is currently developing products which have an estimated introduction for sale in the third quarter of 2012, resulting in no sales or cost of sales in the six month period ended June 30,2011.  COE had general and administrative costs of $15,840, including legal costs related to the creation of the agreements and registration of the entity in the aggregate of $13,906, sales and marketing costs of $1,180 and product development costs of $244, for a total loss of $17,683.  As the Company has an economic interest of 75% of the total subsidiary, the Company recognized 100 percent of the loss and recorded 25 percent of the loss, or $4,421, as Noncontrolling Interest on the financial statements for the six months ended June 30, 2011.  There were no sales or expenses in the fiscal year ended December 31, 2010.