U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED: June 30, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER: 333-4066
KAYENTA KREATIONS, INC.
(Exact name of registrant as specified in its charter)
NEVADA 87-0554463
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1020 Belmont Avenue
Salt Lake City, Utah 84105
(Address of principal executive offices)
(801) 521-4128
(Registrant's telephone number, including area code)
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such report(s), and (2) has been subject to such filing
requirements for the past 90 days.
YES [X] NO [ ]
The number of $.001 par value common shares outstanding at June 30, 2000:
1,018,900
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
See attached.
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KAYENTA KREATIONS, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
SIX MONTHS ENDED JUNE 30, 2000
(UNAUDITED)
AND
YEAR ENDED DECEMBER 31, 1999
WITH
INDEPENDENT ACCOUNTANT'S REVIEW REPORT
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INDEPENDENT ACCOUNTANT'S REVIEW REPORT
Board of Directors and Shareholders
KAYENTA KREATIONS, INC.
Salt Lake City, Utah
I have reviewed the accompanying balance sheet of Kayenta Kreations,
Inc. as of June 30, 2000, and the related statements of operations, and
cash flows for the three and six months ended June 30, 2000 and 1999.
These financial statements are the responsibility of the management of
Kayenta Kreations, Inc.
I conducted my review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial statements consist principally of applying analytical
procedures to financial data and making inquiries of persons responsible
for financial and accounting matters. It is substantially less in scope
than an audit in accordance with generally accepted auditing standards,
the objective of which is the expression of an opinion regarding the
financial statements taken as a whole. Accordingly, I do not express
such an opinion.
Based on my review, I am not aware of any material modifications that
should be made to the accompanying financial statements in order for
them to be in conformity with generally accepted accounting principles.
Salt Lake City, Utah
August 8, 2000
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<TABLE>
<S> <C> <C><C>
KAYENTA KREATIONS, INC.
(A Development Stage Company)
BALANCE SHEETS
ASSETS
June 30, December 31,
2000 1999
(Unaudited)
___________ ___________
CURRENT ASSETS
Cash in bank $0 $0
Accounts receivable 0 28
Prepaid expenses 0 255
Inventory 682 965
______________________
Total Current Assets 682 1,248
______________________
EQUIPMENT
Office equipment and displays, less depreciation 5,904 7,148
of $5,419 and $5,589
______________________
TOTAL ASSETS $6,586 $8,396
______________________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Cash overdraft $7 $123
Accounts payable and accrued liabilities 1,614 349
Stockholders' advances 7,100 3,300
State franchise tax payable 0 100
______________________
Total Current Liabilities 8,721 3,872
DEFERRED TAXES PAYABLE 132 132
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock; $.001 par value, 5,000,000 shares
authorized, no shares issued and outstanding 0 0
Common stock; $.001 par value, 50,000,000 shares
authorized, 1,018,900 and 1,018,900 shares 1,019 1,019
issued and outstanding respectively
Capital in excess of par value 47,193 47,193
Earnings(deficit) accumulated during the development (50,479) (43,820)
stage
______________________
Total Stockholders' Equity (Deficit) (2,267) 4,392
______________________
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $6,586 $8,396
______________________
</TABLE>
See accompanying notes and independent accountant's review report.
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<TABLE>
<S> <C> <C><C> <C><C> <C><C><C><C>
KAYENTA KREATIONS, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
(Unaudited)
For the Three For the Six Cumulative
Months Ended Months Ended During the
June 30, June 30, Development
2000 1999 2000 1999 Stage
________________________________________
SALES
Sales - net $0 $0 $377 $183 $2,814
Less cost of Sales 0 0 (210) (81) (1,444)
________________________________________
Gross Margin 0 0 167 102 1,370
________________________________________
SELLING, GENERAL AND ADMINISTRATIVE
Accounting and legal 3,117 300 3,117 1,450 13,115
Amortization 0 50 0 100 602
General and administrative 911 1,145 1,604 2,312 30,578
Depreciation 585 642 1,239 1,284 7,000
________________________________________
Total Selling, General and 4,613 2,137 5,960 5,146 51,295
Administration
________________________________________
NET INCOME FROM OPERATIONS (4,613)(2,137) (5,793)(5,044) (49,925)
OTHER INCOME (EXPENSE)
Interest income 0 7 0 31 900
Loss on asset disposal (591) 0 (591) 0 (591)
Interest expense (269) (7) (275) (9) (333)
________________________________________
NET INCOME BEFORE TAXES (5,473)(2,137) (6,659)(5,022) (49,949)
Income tax (provision) benefit 0 0 0 0 (132)
________________________________________
NET INCOME (LOSS( BEFORECUMULATIVE
EFFECT OF ACCOUNTING CHANGE (5,473)(2,137) (6,659)(5,022) (50,081)
Cumulative effect of accounting
change for organization costs 0 0 0 0 (398)
________________________________________
NET INCOME (LOSS) $(5,473)$(2,137) $(6,659)$(5,022) $(50,479)
________________________________________
EARNINGS (LOSS) PER SHARE BEFORE
ACCOUNTING CHANGE $0.00 $0.00 $0.00 $0.00 $0.04
________________________________________
CUMULATIVE EFFECT OF
ACCOUNTING CHANGE $0.00 $0.00 $0.00 $0.00 $0.00
________________________________________
EARNINGS (LOSS) PER SHARE $0.00 $0.00 $0.00 $0.00 $0.04
________________________________________
</TABLE>
See accompanying notes and independent accountant's review report.
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<TABLE>
<S> <C> <C><C><C><C> <C><C> <C><C>
KAYENTA KREATIONS, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
For theThree For the Six Cumulative
MonthsEnded MonthsEnded During the
June 30, June 30, Development
2000 1999 2000 1999 Stage
______________________________________
CASH FLOWS FROM OPERATING ACTIVITIES
Cash from sales $0 $0 $377 $183 $2,814
Cash paid for organization costs 0 0 0 0 (1,000)
Cash from interest 0 7 0 31 900
Cash paid for interest (4) (7) (10) (9) (68)
Cash paid for supplies and (2,743)(1,489)(3,365)(4,159) (44,542)
employee services
Cash paid for taxes (100) 0 (100) (100) (100)
______________________________________
Net Cash(Used) by Operating (2,847)(1,489)(3,098)(4,054) (41,996)
Activities
______________________________________
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of equipment (586) 0 (586) 0 (13,323)
______________________________________
Net cash(Used) provided by (586) 0 (586) 0 (13,323)
Investing Activities
______________________________________
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common stock 0 0 0 0 62,725
Direct offering costs 0 0 0 0 (14,533)
Stockholder advances 2,800 3,800 7,100
Contributed capital 0 0 0 0 20
______________________________________
Net Cash Provided (Used) By 2,800 0 3,8000 0 55,312
Financing Activities
______________________________________
NET INCREASE(DECREASE) IN CASH (633)(1,489) 1160 (4,054) (7)
CASH - BEGINNING OF PERIOD 626 2,487 (123) 5,052 0
______________________________________
CASH - END OF PERIOD $(7) $998 $(7) $998 $(7)
______________________________________
RECONCILIATION OF NET INCOME TO
NET CASH PROVIDED (USED) BY
OPERATING ACTIVITIES
NET INCOME (LOSS) $(5,473)$(2,137)$(6,659)$(5,022)$(50,479)
______________________________________
Adjustments to reconcile
net income (loss) to net
cash provided (used) by
operating activities
Amortization of organization costs 0 50 0 100 602
Cumulative effect of accounting change 0 0 0 398
Loss on disposal of assets 591 0 591 419
Depreciation 585 643 1,239 1,284 7,000
Change in assets and liabilities
Organization costs 0 0 0 0 (1,000)
Accounts receivable 28 0 28 0 0
Prepaid expenses 0 0 256 0 0
Inventory 0 0 283 81 (682)
Accounts payable and accrued 1,522 55 1,264 (297) 1,614
liabilities
Franchise taxes payable (100) (100) (100) (200) 0
Deferred taxes payable 0 0 0 0 132
______________________________________
Total Adjustments 2,626 6480 3,561 9680 8,483
______________________________________
NET CASH PROVIDED(USED) BY OPERATING $(2,847)$(1,489)$(3,098)$(4,054)$(41,996)
ACTIVITIES
______________________________________
</TABLE>
See accompanying notes and independent accountant's review report.
<PAGE>
KAYENTA KREATIONS, INC.
(A Development Stage Company)
NOTES TO UNAUDITED FINANCIAL STATEMENTS
NOTE 1 - CONDENSED FINANCIAL STATEMENTS
The accompanying financial statement have been prepared by the
Company without audit. In the opinion of management, all
adjustments (which include only normal recurring adjustments)
necessary to present fairly the financial position, results of
operation and cash flows at June 30, 1999 and 1998 and for all
periods presented have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted. It
is suggested that these condensed financial statements be read in
conjunction with the financial states and notes thereto included
in the Company's December 31, 1998 audited financial statements.
The results of operations for the periods ended June 30, 1999 and
1998 are not necessarily indicative of the operating results for
the full year.
NOTE 2 - STOCKHOLDERS' ADVANCES
Advances from Stockholders to the Company are unsecured, to be
repaid upon demand or within one year and carries interest at 10%
per annum.
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION & ANALYSIS OR PLAN OF OPERATIONS
The Company was incorporated on December 26, 1995. The Company has not
yet generated significant revenues from operations and is considered a
development stage company.
The company has experienced losses of $10,933 and $10,755 in 1999 and
1998 and has experienced losses from its inception. The Company has limited
operating capital and no income producing assets and again sustained losses
during the six months ended June 30, 2000. In light of the above
circumstances, the ability of the Company to continue as a going concern is
substantially in doubt. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
Management believes their plans will provide the corporation with the
ability to continue in existence. Management's plan of operation for the next
twelve months is to maintain its filings and curtail operations and activities
to keep it in existence. This may require additional advances from
stockholders to pay accounting and legal fees associated with its filings. Its
Web page is still available for sales and marketing of its product through the
year. The Company believes sales from this site and from others who have
committed to purchase its product will cover expenses which will be curtailed
to the minimum amount possible. Management believes it has resources
currently available to maintain the entity as a going concern.
However, there is absolutely no assurance of this. If the marketing of
the coloring art books is unsuccessful, investors will have lost their money
and management will not attempt to pursue further marketing efforts with
respect to such product, and it is unlikely the Company would have the
financial ability to do so in any event. Instead management may call a
shareholders meeting to decide whether to liquidate the Company or what
direction the Company will pursue, if any. However, the Company presently has
no plans, commitments or arrangements with respect to any other potential
business venture and there is no assurance the Company could become involved
with any other business venture, especially any business venture requiring
significant capital.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
(a) None.
(b) None.
(c) See Part I, Item 1 (financial statements) and Item 2 (management's
discussion) for financial information and a discussion regarding
use of proceeds.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Kayenta Kreations, Inc.
Date: August 18, 2000 by: /s/ Michelle Barlow
Michelle Barlow, Chairman
