Annual report pursuant to Section 13 and 15(d)

CONCENTRATIONS

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CONCENTRATIONS
12 Months Ended
Dec. 31, 2021
Risks and Uncertainties [Abstract]  
CONCENTRATIONS
NOTE 11: CONCENTRATIONS
 
Concentration of Purchase Order Financing
 
The Company used a third-party financing company for the years ended December 31, 2021 and 2020, which provided letters of credit to vendors for a fee against the purchase orders received by the Company for sale of products to its customers. The letters of credit were issued to the vendors to manufacture Company’s products pursuant to the purchase orders received by the Company.

Concentration of Customers
 
The Company sold its products to two customers that account for approximately 53% (15% and 38%) of the total revenues for the year ended December 31, 2021.The Company sold its products to four customers that accounted for approximately 70% (15%, 18%, 26%, and 11%) of the   total revenues for the years ended December 31, 2020.Two and four customers accounted for 45% and 68% of the total accounts receivable balance due to the Company at December 31, 2021 and 2020, respectively.
 
Concentration of Suppliers
 
The Company purchased products from four vendors for the year ended December 31, 2021 that accounted for approximately 51% (32% and 19%) of its total cost of   goods sold.
 
The Company purchased products from four vendors for the year ended December 31, 2020 that accounted for approximately 71% (23%, 18%, 16%, and 14%) of its total cost of goods sold.
 
Concentration of Credit Risk
 
The Company maintains its cash in bank and financial institution deposits that at times may exceed federally insured limits. The Company has not experienced any losses in such accounts through December 31, 2021. The Company’s bank balances exceeded FDIC insured amounts at times during the years ended December 31, 2021 and 2020, respectively. At December 31, 2021 and 2020, the Company’s bank balance exceeded the FDIC insured amounts by $7,222,224 and $1,944,850 respectively.
 
Geographic Concentration
 
Geographical distribution of net revenue consisted of the following for the years ended December 31, 2021 and 20
2
0, respectively, as follows:
 
 
 
For the Year Ended
December 31,
 
 
 
2021
 
 
2020
 
Australia     - %     5 %
Canada     4 %     5 %
Europe     11 %     8 %
USA     82 %     78 %
Other     3 %     4 %