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, 2021 are not necessarily indicative of the results that can be expected for the
full year ended December 31, 2021.
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, 2021
(Unaudited)
Note A - Basis of Presentation, Background and
Description of Business
Basis of presentation
The accompanying unaudited condensed financial
statements of SMSA Crane Acquisition Corp. have been prepared in accordance with the rules and regulations of the Securities and Exchange
Commission, or the SEC, including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally
included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America
have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all
the information and notes necessary for comprehensive financial statements and should be read in conjunction with our audited financial
statements for the year ended December 31, 2020, included in our Annual Report on Form 10-K for the year ended December 31, 2020.
In the opinion of the management of the Company,
all adjustments, which are of a normal recurring nature, necessary for a fair statement of the results for the three month period have
been made. Results for the interim period presented are not necessarily indicative of the results that might be expected for the entire
fiscal year. When used in these notes, the terms "Company, "we," "us" or "our" mean SMSA Crane
Acquisition Corp.
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 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 – 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 three months ended March 31, 2021 and 2020, amounted to $1,334 and $13,281, respectively, and working
capital deficits were $108,400 and $107,066 at March 31, 2021 and December 31, 2020, 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 C - Summary of Significant
Accounting Policies
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 Condensed Financial Statements
March 31, 2021
(Unaudited)
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 follows ASC 740-10 "Accounting
for Uncertain Income Tax Positions," which 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. To date, the Company doesn’t have any uncertain income tax positions and has not incurred 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, 2021 and December 31,
2020, the Company had no outstanding stock warrants, options or convertible securities that could be considered dilutive for purposes
of the loss per share calculation.
Recently Adopted 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 D - Fair Value of Financial Instruments
and Fair Value Measurements
The carrying amounts of cash, accounts payable
and accrued expenses and due to stockholder, approximate 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:
·
|
Level 1:
|
Observable inputs such as quoted prices in active markets;
|
|
|
|
·
|
Level 2:
|
Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
|
|
|
|
·
|
Level 3:
|
Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
|
SMSA Crane Acquisition Corp.
Notes to Condensed Financial Statements
March 31, 2021
(Unaudited)
Note E - Related Party Transactions
Due to Shareholder
As of March
31, 2021 and December 31, 2020, 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 F - 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, 2021.
Note G - 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 H- 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, 2021.
There were no preferred shares issued
and outstanding at March 31, 2021 and December 31, 2020. There were 10,047,495 shares of common stock with a par value $0.001 issued and
outstanding as of March 31, 2021 and December 31, 2020.
Note I- 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.