| Marketable Securities |
| 3. |
Marketable Securities: |
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The Company categorizes marketable securities as either trading, available-for-sale or held-to-maturity. Trading securities are carried at fair value with unrealized gains and losses included in income. Available-for-sale securities are carried at fair value measurements using quoted prices in active markets for identical assets or liabilities with unrealized gains and losses recorded as a separate component of shareholders' equity. Held-to-maturity securities are carried at amortized cost. Dividends and interest income are accrued as earned. Realized gains and losses are determined on a specific identification basis. The Company reviews marketable securities for impairment whenever circumstances and situations change such that there is an indication that the carrying amounts may not be recovered. The Company did not classify any securities as trading or held to maturity during the nine months ended April 30, 2018 and year ended July 31, 2017. |
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The Company follows GAAP which establishes a fair value hierarchy that prioritizes the valuation techniques and creates the following three broad levels, with Level 1 valuation being the highest priority: |
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Level 1 valuation inputs are quoted market prices in active markets for identical assets or liabilities that are accessible at the measurement date (e.g., equity securities traded on the New York Stock Exchange). |
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Level 2 valuation inputs are from other than quoted market prices included in Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted market prices of similar assets or liabilities in active markets, or quoted market prices for identical or similar assets or liabilities in markets that are not active). |
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Level 3 valuation inputs are unobservable (e.g., an entity’s own data) and should be used to measure fair value to the extent that observable inputs are not available. |
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| Following is a description of the valuation methodologies used for assets measured at fair value on a recurring basis. There have been no changes in the methodologies used at April 30, 2018 and July 31, 2017. |
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| Equity securities are valued at the closing price reported on the active market on which the individual securities are traded that the Company has access to. |
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| Mutual funds are valued at the daily closing price as reported by the fund. Mutual funds held by the Company are open-end mutual funds that are registered with the Securities and Exchange Commission. These funds are required to publish their daily net asset value (“NAV”) and to transact at that price. The mutual funds held by the Company are deemed to be actively traded. |
In accordance with the provisions of Fair Value Measurements, the following are the Company's financial assets measured on a recurring basis presented at fair value.
| Fair value measurements at reporting date |
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Total |
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Total |
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April 30, |
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July 31, |
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| Description |
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2018 |
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Level 1 |
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Level 2 |
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Level 3 |
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2017 |
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Level 1 |
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Level 2 |
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Level 3 |
| Assets: |
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| Marketable securities - available-for-sale |
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$ |
2,722,917 |
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$ |
2,722,917 |
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$ |
– |
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– |
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$ |
2,815,727 |
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$ |
2,815,727 |
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$ |
– |
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$ |
– |
As of April 30, 2018 and July 31, 2017, the Company's marketable securities were classified as follows:
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April 30, 2018 |
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July 31, 2017 |
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Gross |
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Gross |
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Gross |
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Gross |
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Unrealized |
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Unrealized |
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Fair |
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Unrealized |
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Unrealized |
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Fair |
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Cost |
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Gains |
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Losses |
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Value |
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Cost |
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Gains |
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Losses |
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Value |
| Noncurrent: |
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| Available-for-sale: |
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| Mutual funds |
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$ |
773,158 |
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$ |
197,217 |
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$ |
– |
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$ |
970,375 |
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$ |
716,463 |
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$ |
193,932 |
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$ |
– |
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$ |
910,395 |
| Equity securities |
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1,312,772 |
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453,562 |
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13,792 |
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1,752,542 |
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1,540,788 |
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364,544 |
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– |
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1,905,332 |
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$ |
2,085,930 |
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$ |
650,779 |
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$ |
13,792 |
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$ |
2,722,917 |
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$ |
2,257,251 |
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$ |
558,476 |
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$ |
– |
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$ |
2,815,727 |
The Company's equity securities, gross unrealized losses and fair value, aggregated by investment category and length of time that the investment securities have been in a continuous unrealized loss position are as follows:
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April 30, 2018 |
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July 31, 2017 |
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Less Than |
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Less Than |
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Fair Value |
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12 Months |
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Fair Value |
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12 Months |
| Corporate equity securities |
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$ |
120,188 |
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$ |
13,792 |
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$ |
– |
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$ |
– |
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| Investment income consists of the following: |
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Three Months Ended |
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Nine Months Ended |
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April 30 |
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April 30 |
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2018 |
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2017 |
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2018 |
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2017 |
| Gain (loss) on sale of marketable securities |
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$ |
912 |
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$ |
31,155 |
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$ |
(805 |
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$ |
23,734 |
| Interest income |
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5,737 |
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2,941 |
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12,488 |
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9,287 |
| Dividend income |
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9,260 |
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7,810 |
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78,448 |
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47,449 |
| Total |
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$ |
15,909 |
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$ |
41,906 |
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$ |
90,131 |
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$ |
80,470 |
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