Scarc Inc

“Scarc is recognized by the internal revenue service as a nonprofit organizations under internal revenue code section 501(c)(3) and is thereby exempt from federal income taxes on related income pursuant to section 501 (a) of the code. Scarc is also exempt under title 15 of the state of new jersey corporations and associations not for profit act. Accordingly, no provision for federal or state income taxes has been presented in the accompanying financial statements. Scarc follows the provisions of fasb asc, income taxes. The standard prescribes a minimum recognition threshold and measurement methodology that a tax position taken or expected to be taken in a tax return is required to meet before being recognized in the financial statements. It also provides guidance for derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition as they relate to those positions. In assessing the realizability of tax benefits, management considers whether it is more likely than not that some portion or all of any tax position will not be realized. The ultimate realization of such tax positions is dependent upon the generation of future income. Management considers projected future income, and tax planning strategies in making this assessment. Scarc does not expect a significant increase or decrease to the total amounts of unrecognized tax positions during the fiscal year ended june 30, 2020. However, scarc is subject to regular audit by tax authorities, including a review of its nonprofit status, which management believes would be upheld upon examination. Scarc also believes that it has appropriate support for the positions taken on its tax returns. Nonetheless, the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. As required by law, scarc files informational returns with both federal and new jersey state authorities on an annual basis. These returns are subject to examination by these authorities within certain statutorily defined periods for federal and for new jersey state.”

“Rental expense 34,859. Cost of goods sold - dove 122,336.”

“Rental expense 34,859. Cost of goods sold - dove 122,336.”