MIME-Version: 1.0 X-Document-Type: Workbook Content-Type: multipart/related; boundary="----=_NextPart_173aad65_a115_44d2_8fec_0ef578911662" This document is a Single File Web Page, also known as a Web Archive file. If you are seeing this message, your browser or editor doesn't support Web Archive files. Please download a browser that supports Web Archive, such as Microsoft Internet Explorer. ------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Workbook.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"

This page should be opened with Microsoft Excel XP or newer.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet01.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
DOCUMENT AND ENTITY INFORMATION
3 Months Ended
Oct. 31, 2018
Dec. 06, 2018
Document And Entity Information [Abstract]
Entity Registrant Name MAYS J W INC
Entity Central Index Key 0000054187
Current Fiscal Year End Date --07-31
Entity Filer Category Non-accelerated Filer
Entity Small Business true
Entity Emerging Growth Company false
Trading Symbol mays
Entity Common Stock, Shares Outstanding 2,015,780
Document Type 10-Q
Amendment Flag false
Document Period End Date Oct 31, 2018
Document Fiscal Period Focus Q1
Document Fiscal Year Focus 2019
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet02.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)
Oct. 31, 2018
Jul. 31, 2018
ASSETS
Property and Equipment - Net (Notes 5 and 6) $ 51,148,862 $ 50,792,984
Current Assets:
Cash and cash equivalents (Notes 4 and 9) 6,147,991 5,255,073
Receivables (Note 4) 200,594 252,304
Income taxes refundable 21,840 8,792
Restricted cash 100,789 100,789
Prepaid expenses 1,114,217 1,951,132
Total current assets 7,585,431 7,568,090
Other Assets:
Deferred charges 3,532,414 3,228,162
Less: accumulated amortization 1,450,727 1,369,445
Net 2,081,687 1,858,717
Restricted cash 1,531,278 1,523,761
Unbilled receivables (Notes 4 and 7) 1,683,954 1,677,093
Marketable securities (Notes 3 and 4) 3,123,857 3,141,828
Total other assets 8,420,776 8,201,399
TOTAL ASSETS 67,155,069 66,562,473
Long-Term Liabilities:
Mortgage payable (Note 5) 5,227,314 5,264,285
Security deposits payable 1,251,535 1,242,382
Deferred Income Taxes (Note 1) 4,509,000 4,506,000
Total long-term liabilities 10,987,849 11,012,667
Current Liabilities:
Accounts payable 58,000 74,205
Payroll and other accrued liabilities 2,818,583 2,104,359
Other taxes payable 5,300 8,240
Current portion of mortgage payable (Note 5) 170,030 168,501
Current portion of security deposits payable 101,289 101,289
Total current liabilities 3,153,202 2,456,594
TOTAL LIABILITIES 14,141,051 13,469,261
Shareholders' Equity:
Common stock, par value $1 each share (shares - 5,000,000 authorized; 2,178,297 issued) 2,178,297 2,178,297
Additional paid in capital 3,346,245 3,346,245
Unrealized gain on marketable securities - net of deferred taxes of $313,000 at July 31, 2018    487,136
Retained earnings 48,777,328 48,369,386
Stockholders' Equity before Treasury Stock 54,301,870 54,381,064
Less common stock held in treasury, at cost - 162,517 shares at October 31, 2018 and at July 31, 2018 (Note 10) 1,287,852 1,287,852
Total shareholders' equity 53,014,018 53,093,212
Contingencies (Note 12)      
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 67,155,069 $ 66,562,473
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet03.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
Oct. 31, 2018
Jul. 31, 2018
Common stock, par value $ 1 $ 1
Common stock, shares authorized 5,000,000 5,000,000
Common stock, shares issued 2,178,297 2,178,297
Treasury stock, shares 162,517 162,517
Unrealized Gain on Available-for-sale Securities - Net of Deferred Taxes [Member]
Unrealized gain (loss) on available-for-sale securities, deferred taxes (benefit)    $ 313,000
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet04.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS (Unaudited) (USD $)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Revenues
Rental income (Notes 1, 4 and 7) $ 4,996,584 $ 4,785,026
Total revenues 4,996,584 4,785,026
Expenses
Real estate operating expenses 2,812,056 2,537,875
Administrative and general expenses 1,742,936 1,129,966
Depreciation (Note 6) 466,297 432,141
Total expenses 5,021,289 4,099,982
Income (loss) from operations before investment income, interest expense and income taxes (24,705) 685,044
Investment income and interest expense:
Investment income (Note 3) 22,435 13,329
Change in fair value of marketable securities (Notes 1 and 3) (34,059)   
Interest expense (Notes 5 and 9) (39,865) (92,978)
Total investment income and interest expense (51,489) (79,649)
Income (loss) from operations before income taxes (76,194) 605,395
Income taxes provided 3,000 210,000
Net income (loss) (79,194) 395,395
Retained earnings, beginning of period 48,369,386 45,395,245
Reclassification of unrealized gain on investments to retained earnings (Note 1) 487,136   
Retained earnings, end of period $ 48,777,328 $ 45,790,640
Income (loss) per common share (Note 2) $ (0.04) $ 0.2
Dividends per share      
Average common shares outstanding 2,015,780 2,015,780
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet05.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (USD $)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Statement of Comprehensive Income [Abstract]
Net income (loss) $ (79,194) $ 395,395
Unrealized gain (loss) on marketable securities:
Unrealized gains arising during the period, net of taxes of $35,000    68,608
Comprehensive income (loss) $ (79,194) $ 464,003
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet06.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (Parenthetical) (USD $)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Statement of Comprehensive Income [Abstract]
Unrealized holding gains arising during the period, tax    $ 35,000
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet07.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Cash Flows From Operating Activities:
Net income (loss) $ (79,194) $ 395,395
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation 466,297 432,141
Amortization of deferred charges 81,282 74,200
Deferred finance costs included in interest expense 5,719 5,718
Net realized and unrealized loss on sale of marketable securities 34,059 6
Other assets - unbilled receivables (6,861) 72,434
Deferred income taxes 3,000 205,000
Deferred expenses (304,252)   
Changes in:
Receivables 51,710 (17,412)
Income taxes refundable (13,048) (24,190)
Prepaid expenses 836,915 668,609
Accounts payable (16,205) (26,469)
Payroll and other accrued liabilities 714,224 (412,981)
Other taxes payable (2,940) (3,035)
Cash provided by operating activities 1,770,706 1,369,416
Cash Flows From Investing Activities:
Acquisition of property and equipment (822,175) (1,025,229)
Marketable securities:
Receipts from sales    62
Payments for purchases (16,088) (16,039)
Cash (used) by investing activities (838,263) (1,041,206)
Cash Flows From Financing Activities:
Increase - security deposits payable 9,153 40,853
Mortgage and other debt payments (41,161) (39,685)
Cash provided (used) by financing activities (32,008) 1,168
Increase in cash and cash equivalents 900,435 329,378
Cash and cash equivalents at beginning of period 6,879,623 6,676,929
Cash and cash equivalents at end of period (Note 9) $ 7,780,058 $ 7,006,307
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet08.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Accounting Records and Use of Estimates
3 Months Ended
Oct. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accounting Records and Use of Estimates
1. Accounting Records and Use of Estimates:
          

The accounting records are maintained in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of the Company’s financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses during the reporting period. The estimates that we make include allowance for doubtful accounts, depreciation, income tax assets and liabilities, fair value of marketable securities and revenue recognition. Estimates are based on historical experience where applicable or other assumptions that management believes are reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results may differ from those estimates under different assumptions or conditions.

The interim financial statements are prepared pursuant to the requirements for reporting on Form 10-Q. The July 31, 2018 condensed consolidated balance sheet was derived from audited financial statements but does not include all disclosures required by GAAP. The interim financial statements and notes thereto should be read in conjunction with the financial statements and notes included in the Company's latest Form 10-K Annual Report for the fiscal year ended July 31, 2018. In the opinion of management, the interim financial statements reflect all adjustments of a normal recurring nature necessary for a fair statement of the results for interim periods. The results of operations for the current period are not necessarily indicative of the results for the entire fiscal year ending July 31, 2019.

The computation of the annual expected effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected operating income for the year and future periods, projections of the proportion of income (or loss), and permanent and temporary differences. The accounting estimates used to compute the provision for income taxes may change as new events occur, more experience is acquired, or as additional information is obtained. To the extent the estimated annual effective tax rate changes during a quarter, see below, the effect of the change on prior quarters is included in tax expense for the current quarter.

Revenue Recognition

All of the real estate owned by the Company is held for leasing to tenants except for a small portion used for Company offices. Rent is recognized from tenants under executed leases no later than on an established date or on an earlier date if the tenant should commence conducting business. Unbilled receivables represent the excess of scheduled rental income recognized on a straight-line basis over rental income as it becomes receivable according to the provisions of the lease. Contingent rental income is recorded when earned and is not based on tenant revenue. The effect of lease modifications that result in rent relief or other credits to tenants, including any retroactive effects relating to prior periods, is recognized in the period when the lease modification is signed. At the time of the lease modification, we assess the realizability of any accrued but unpaid rent and amounts that had been recognized as revenue in prior periods. lf the amounts are not determined to be realizable, the accrued but unpaid rent is written off. Accounts receivable are recognized in accordance with lease agreements at its net realizable value. Rental payments received in advance are deferred until earned.

Taxes

On December 22, 2017, the United States government (“U.S.”) enacted significant changes to the U.S. tax law following the passage and signing of H.R.1, “An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018” (the “Tax Act”) (previously known as “The Tax Cuts and Jobs Act”). The Tax Act included significant changes to existing tax law, including a permanent reduction to the U.S. federal corporate income tax rate from 34% to 21%, a one-time repatriation tax on deferred foreign income, deductions, credits and business related exclusions. The permanent reduction to the U.S. federal corporate income tax rate from 34% to 21% was effective January 1, 2018 (the “Effective Date”). On December 22, 2017, the SEC issued Staff Accounting Bulletin 118 (“SAB 118”). SAB 118 expresses views of the SEC regarding ASC Topic 740, Income Taxes (“ASC 740”), in the reporting period that includes the enactment date of the Tax Act. The SEC staff issuing SAB 118 (the “Staff’) recognized that a registrant’s review of certain income tax effects of the Tax Act may be incomplete at the time financial statements are issued for the reporting period that includes the enactment date, including interim periods therein. If a company does not have the necessary information available, prepared or analyzed for certain income tax effects of the Tax Act, SAB 118 allows a company to report provisional numbers and adjust those amounts during the measurement period not to extend beyond one year. The Company has recorded all known and estimable impacts of the Tax Act that are effective for the fiscal year ended July 31, 2018. Future adjustments to the provisional numbers will be recorded as discrete adjustments to income tax expense in the period in which those adjustments become estimable and/or are finalized.


The Company has a federal net operating loss carryforward approximating $4,078,000 as of July 31, 2018 available to offset future taxable income. As of July 31, 2018, the Company had unused state and city net operating loss carryforwards of approximately $10,107,000 for state and $8,274,000 for city, available to offset future state and city taxable income. The net operating loss carryforwards will begin to expire, if not used, in 2035.

          

New York State and New York City taxes are calculated using the higher of taxes based on income or the respective capital-based franchise taxes. Beginning with the Company’s tax year ended July 31, 2016, changes in the law required the state capital-based tax will be phased out over a 7-year period. During the quarter ended July 31, 2018, the Company recorded a state deferred tax asset, deferred tax liability and deferred taxes on unrealized gain on marketable securities in the amounts of $790,000, $1,430,000 and $53,000, respectively, resulting in a state deferred tax expense of $587,000. New York City taxes will be based on capital for the foreseeable future. Capital-based franchise taxes are recorded to administrative and general expense. State tax amounts in excess of the capital-based franchise taxes are recorded to income tax expense. Due to both the application of the capital-based tax and due to the possible absence of city taxable income, the Company does not record city deferred taxes.

The decrease in the effective tax rate for the three months ended October 31, 2018 as compared with the three months ended October 31, 2017 was primarily attributable to the permanent reduction in federal tax rates from 34% to 21%, partially offset by New York State taxes.

Recently adopted accounting standards:

In May 2014, the Financial Accounting Standards Board (“FASB”), issued Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” (“ASU 2014-09”) establishing ASC Topic 606 Revenue from Contracts with Customers. ASU 2014-09 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. ASU 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. ASU 2014-09 is effective for interim and annual reporting in fiscal years that begin after December 15, 2016. ASU 2015-14 extended the implementation date for fiscal years beginning after December 31, 2017.

Subsequent to the issuance of ASU 2014-09, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)”, ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing”, ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, and ASU No. 2016-20, "Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers." The additional ASU's clarified certain provisions of ASU 2014-09 in response to recommendations from the Transition Resource Group established by the FASB and have the same effective date and transition requirements as ASU 2014-09. We adopted these standards effective August 1, 2018 using the modified retrospective approach, which allows us to apply the new standard to all existing contracts not yet completed as of the effective date and record a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption, however there was no cumulative-effect required to be recognized in our retained earnings as the date of adoption. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.


In January 2016, the FASB issued ASU No. 2016-01 "Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities." ASU 2016-01 amends certain aspects of recognition, measurement, presentation and disclosure of financial instruments, including the requirement to measure certain equity investments at fair value with changes in fair value recognized in net income. ASU No. 2016-01 is effective for interim and annual periods beginning after December 15, 2017. We adopted this standard effective August 1, 2018 and recorded a cumulative effect adjustment to increase opening retained earnings at August 1, 2018 by $487,136 as required for equity investments recorded at fair value, formerly available-for-sale securities.

          

In November 2016, the FASB issued ASU 2016-18, “Restricted Cash”. ASU 2016-18 requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning of period and end of period balances on the statement of cash flows upon adoption of this standard. ASU 2016-18 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. We adopted this standard effective August 1, 2018 with retrospective application to our consolidated financial statements.

In February 2018, the FASB issued ASU No. 2018-02, “Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income”, to address a specific consequence of the Tax Act by allowing a reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Act’s reduction of the U.S. federal corporate income tax rate. The standard is effective for all entities for annual periods beginning after December 15, 2018, with early adoption permitted, and is to be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act is recognized. The Company early adopted this ASU effective August 1, 2018 and applied this new guidance in the period of adoption. As a result, $92,000 of income taxes stranded in accumulated other comprehensive income (loss) was classified to retained earnings. The ASU also requires the Company to disclose its policy on accounting for income tax effects in accumulated other comprehensive income (loss). In general, the Company applies the individual item approach with respect to marketable securities.

Recently issued accounting standards not yet adopted:

In February 2016, the FASB issued ASU 2016-02, “Leases.” ASU 2016-02 is intended to increase transparency and comparability among organizations in accounting for leasing arrangements. This guidance establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Lessor accounting remains similar to the current model, but updated to align with certain changes to the lessee model and the new revenue recognition standard (ASU 2014-09). ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. Entities will be required to recognize and measure leases as of the earliest period presented using a modified retrospective approach.

In July 2018, the FASB issued ASU No. 2018-10, “Codification Improvements to Topic 842”, which provides amendments and clarification to ASU 2016-12 based on the FASB’s interaction with stakeholders. In July 2018, the FASB issued ASU No. 2018-11 “Leases (Topic 842): Targeted Improvements”, which amends Leases (Topic 842) to (i) add an optional transition method that would permit entities to apply the new requirements by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the year of adoption, and (ii) provide a practical expedient for lessors regarding the separation of the lease and non-lease components of a contract. The standards are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The new standards will be effective for the Company for the fiscal year beginning August 1, 2019, with early adoption permitted, and the Company expects to use the cumulative-effect adjustment approach in the year of adoption. The adoption of this guidance is expected to result in an increase in assets and liabilities on the Company’s balance sheet, with no material impact on the statement of operations. However, the ultimate impact of adopting this ASU will depend on the Company’s lease portfolio as of the adoption date.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet09.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Income Per Share of Common Stock
3 Months Ended
Oct. 31, 2018
Earnings Per Share [Abstract]
Income Per Share of Common Stock
2. Income Per Share of Common Stock:
 
          

Income per share has been computed by dividing the net income for the periods by the weighted average number of shares of common stock outstanding during the periods, adjusted for the purchase of treasury stock. Shares used in computing income per share were 2,015,780 for the three months ended October 31, 2018 and October 31, 2017.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet10.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Marketable Securities
3 Months Ended
Oct. 31, 2018
Investments, Debt and Equity Securities [Abstract]
Marketable Securities
3.

Marketable Securities:

 
 

The Company’s marketable securities consist of investments in equity securities. 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. Prior to August 1, 2018, unrealized gains and losses resulting from changes in the fair value of these securities were included in “other comprehensive income”. Effective August 1, 2018, the changes in the fair value of these securities are recognized in current period earnings in accordance with ASC 825.

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:

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).

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).

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.

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 October 31, 2018 and July 31, 2018.

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.

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

    Total                 Total            
October 31, July 31,
Description 2018 Level 1 Level 2 Level 3 2018 Level 1 Level 2 Level 3
Assets:
Marketable securities $     3,123,857 $     3,123,857 $     $     $     3,141,828 $     3,141,828 $     $    

As of October 31, 2018 and July 31, 2018, the Company's marketable securities were classified as follows:

   October 31, 2018 July 31, 2018
Gross Gross Gross Gross
Unrealized Unrealized Fair Unrealized Unrealized Fair
Cost Gains Losses Value    Cost    Gains    Losses    Value
Noncurrent:            
Mutual funds $ 776,305 $ 199,088 $ $ 975,393 $ 774,602 $ 237,149 $ $ 1,011,751
Equity securities 1,581,475 574,239 7,250 2,148,464 1,567,089 562,988 2,130,077
$     2,357,780 $     773,327 $     7,250 $     3,123,857 $     2,341,691 $     800,137 $     $     3,141,828

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:

      October 31, 2018       July 31, 2018
Less Than        Less Than
Fair Value 12 Months Fair Value   12 Months
Corporate equity securities $ 113,578 $ 7,250 $     $    
 
Investment income consists of the following:
Three Months Ended
October 31
2018       2017
(Loss) on sale of marketable securities $ $ (6 )
Interest income 13,561 3,726
Dividend income 8,874 9,609
Total $     22,435 $     13,329
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet11.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Financial Instruments and Credit Risk Concentrations
3 Months Ended
Oct. 31, 2018
Fair Value Disclosures [Abstract]
Financial Instruments and Credit Risk Concentrations
4. Financial Instruments and Credit Risk Concentrations:
          

Financial instruments that are potentially subject to concentrations of credit risk consist principally of marketable securities, cash and cash equivalents and receivables. Marketable securities and cash and cash equivalents are placed with multiple financial institutions and multiple instruments to minimize risk. No assurance can be made that such financial institutions and instruments will minimize all such risk.

The Company derives rental income from approximately fifty tenants, of which one tenant accounted for 16.16%, another tenant accounted for 13.81% and a third tenant accounted for 11.95% of rental income during the three months ended October 31, 2018. The three months ended October 31, 2017 had one tenant account for 17.78%, another tenant account for 14.61% and a third tenant account for 12.99% of rental income. No other tenant accounted for more than 10% of rental income during the same periods.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet12.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Long-Term Debt - Mortgage
3 Months Ended
Oct. 31, 2018
Debt Disclosure [Abstract]
Long-Term Debt - Mortgage
5. Long-Term Debt – Mortgage:
          
                  October 31, 2018 July 31, 2018
Current                  
Annual Final Due Due Due Due
Interest Payment Within After Within After
Rate Date One Year One Year One Year One Year
Bond St. building, Brooklyn, NY 3.54% 2/1/2020 $ 170,030 $ 5,255,920 $ 168,501 $ 5,298,610
Less: Deferred financing costs 28,606 34,325
Total $     170,030 $     5,227,314 $     168,501 $     5,264,285

On January 9, 2015, the Company refinanced its loan with a bank for $6,000,000, which included the outstanding balance as of January 2015 in the amount of $5,347,726 and an additional borrowing of $652,274. The loan is for a period of five years with a payment based on a twenty-five year amortization period. The interest rate for this period is fixed at 3.54% per annum. The mortgage loan is secured by the Bond Street building in Brooklyn, New York.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet13.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Property and Equipment - at cost
3 Months Ended
Oct. 31, 2018
Property, Plant and Equipment [Abstract]
Property and Equipment - at cost
 
6. Property and Equipment – at cost:
          
      October 31       July 31
2018 2018
Property:
Buildings and improvements $ 83,913,422 $ 82,728,826
Improvements to leased property 1,478,012 1,478,012
Land 6,067,805 6,067,805
Construction in progress 1,398,732 1,786,980
92,857,971 92,061,623
Less accumulated depreciation 41,839,959 41,382,962
Property - net 51,018,012 50,678,661
 
Fixtures and equipment and other:
Fixtures and equipment 144,545 144,545
Other fixed assets 207,357 205,619
351,902 350,164
Less accumulated depreciation 221,052 235,841
Fixtures and equipment and other - net 130,850 114,323
 
Property and equipment - net $ 51,148,862 $ 50,792,984
 
Construction in progress includes:
October 31 July 31
2018 2018
Building improvements at 9 Bond Street in Brooklyn, NY $ 279,420 $ 102,640
Building improvements at 25 Elm Place in Brooklyn, NY 156,115 153,010
Building improvements at Jamaica, NY building 110,011 779,399
Building improvements at Fishkill, NY building 853,186 751,931
$     1,398,732 $     1,786,980
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet14.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Unbilled Receivables and Rental Income
3 Months Ended
Oct. 31, 2018
Unbilled Receivables And Rental Income
Unbilled Receivables and Rental Income
7. Unbilled Receivables and Rental Income:
          
 

Unbilled receivables represent the excess of scheduled rental income recognized on a straight-line basis over rental income as it becomes receivable according to the provisions of each lease.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet15.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Employees' Retirement Plan
3 Months Ended
Oct. 31, 2018
Retirement Benefits [Abstract]
Employees' Retirement Plan
8.

Employees' Retirement Plan:

 

The Company sponsors a noncontributory Money Purchase Plan covering substantially all of its non-union employees. Operations were charged $106,460 and $104,432 as contributions to the Plan for the three months ended October 31, 2018 and 2017, respectively.

Multi-employer plan:

The Company contributes to a union sponsored multi-employer pension plan covering its union employees. The Company contributions to the pension plan were $13,946 and $15,599 for the three months ended October 31, 2018 and 2017, respectively. Contributions and costs are determined in accordance with the provisions of negotiated labor contracts or terms of the plans. The Company also contributes to union sponsored health benefit plans.

Contingent Liability for Pension Plan:

Information as to the Company’s portion of accumulated plan benefits and plan assets is not reported separately by the pension plan. Under the Employee Retirement Income Security Act, upon withdrawal from a multi-employer benefit plan, an employer is required to continue to pay its proportionate share of the plan’s unfunded vested benefits, if any. Any liability under this provision cannot be determined: however, the Company has not made a decision to withdraw from the plan.

Information for contributing employer’s participation in the multi-employer plan:


  Legal name of Plan:   United Food and Commercial  
    Workers Local 888 Pension Fund  
  Employer identification number:   13-6367793  
  Plan number:   001  
  Date of most recent Form 5500:   December 31, 2017  
  Certified zone status:   Critical and declining status  
  Status determination date:   January 1, 2018  
  Plan used extended amortization provisions in status calculation:   Yes  
  Minimum required contribution:   Yes  
  Employer contributing greater than 5% of Plan contributions for year ended December 31, 2017:   Yes  
  Rehabilitation plan implemented:   Yes  
  Employer subject to surcharge:   Yes  
  Contract expiration date:   November 30, 2019  
          

For the plan years 2017-2019, under the pension fund’s rehabilitation plan, the Company agreed to pay a minimum contribution rate equal to 9.1% of the prior year total contribution rate. The Company has 29 employees and has a contract, expiring November 30, 2019, with a union covering rates of pay, hours of employment and other conditions of employment for approximately 24% of its employees. The Company considers that its labor relations with its employees and union are good.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet16.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Cash Flow Information
3 Months Ended
Oct. 31, 2018
Supplemental Cash Flow Elements [Abstract]
Cash Flow Information
9. Cash Flow Information:
          

For purposes of reporting cash flows, the Company considers cash equivalents to consist of short-term highly liquid investments with maturities of three (3) months or less, which are readily convertible into cash. The following is a reconciliation of the Company’s cash and cash equivalents and restricted cash to the total presented on the consolidated statement of cash flows:


Cash and cash equivalents       $ 6,147,991       $ 5,707,685
Restricted cash, tenant security deposits 1,340,188 1,026,050
Restricted cash, escrow 258,399 258,232
Restricted cash, other 33,480 14,340
$     7,780,058 $     7,006,307

          

Amounts in restricted cash primarily consist of cash held in bank accounts for tenant security deposits, amounts set aside in accordance with certain loan agreements, and security deposits with landlords and utility companies.


Supplemental disclosure:       Three Months Ended
October 31
2018       2017
Interest paid, net of capitalized interest of $15,067 (2018) and $11,549 (2017) $ 34,272 $ 87,381
Income taxes paid $     $     78,867
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet17.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Common Stock
3 Months Ended
Oct. 31, 2018
Stockholders' Equity Note [Abstract]
Common Stock
10.

Common Stock:

          

The Company has one class of common stock with identical voting rights and rights to liquidation.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet18.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Accumulated Other Comprehensive Income
3 Months Ended
Oct. 31, 2018
Accumulated Other Comprehensive Income [Abstract]
Accumulated Other Comprehensive Income
11. Accumulated Other Comprehensive Income:
   
          

The only component of accumulated other comprehensive income is unrealized gain (loss) on marketable securities.

A summary of the changes in accumulated other comprehensive income for the three months ended October 31, 2018 and 2017 is as follows:


      Three Months Ended
October 31
2018       2017
(Unaudited) (Unaudited)
Beginning balance, net of tax effect $    487,136 $    368,476
 
Other comprehensive income, net of tax effect:
Unrealized gain on marketable securities - 103,608
Tax effect - (35,000 )
Unrealized gain on marketable securities, net of tax effect - 68,608
 
Amounts reclassified from accumulated other comprehensive income, net of tax effect:
Unrealized (gain) on marketable securities reclassified and recognized in net income - -
Tax effect - -
Amount reclassified and recognized in net income, net of tax effect - -
 
Unrealized gain on marketable securities reclassified to retained earnings (800,136 ) -
Tax effect 313,000 -
(487,136 ) -
 
Ending balance, net of tax effect $     $     437,084

          

A summary of the line items in the Condensed Consolidated Statements of Income and Retained Earnings affected by the amounts reclassified from accumulated other comprehensive income is as follows:


Details about accumulated other Affected line item in the statement
comprehensive income components where net income is presented
Other comprehensive income reclassified Investment income
tax effect Income taxes provided
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet19.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Contingencies
3 Months Ended
Oct. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Contingencies
12. Contingencies:
          

On November 2, 2018 the Company settled the lawsuit relating to defective workmanship and breach of contract to replace a roof and various other work on its Fishkill, New York building. The Company agreed to pay $635,000 to the Plaintiffs, D. Owens Electric, Inc., Mid-Hudson Structural Concrete, Inc. d/b/a Recycle Depot, and BSB Construction, Inc., in settlement of the claims made against the Company. This settlement resolves the actions and disputes referred to in the Decision and Order dated October 30, 2018 of the Supreme Court of the State of New York, County of Dutchess. A charge to general and administrative expenses was accrued as of October 31, 2018 for the full settlement amount of $635,000. This amount was paid in full on November 6, 2018.

There are various other lawsuits and claims pending against the Company. It is the opinion of management that the resolution of these matters will not have a material adverse effect on the Company’s Consolidated Financial Statements.

If the Company sells, transfers, disposes of or demolishes 25 Elm Place, Brooklyn, New York, then the Company may be liable to create a condominium unit for the loading dock. The necessity of creating the condominium unit and the cost of such condominium unit cannot be determined at this time.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet20.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Accounting Records and Use of Estimates (Policies)
3 Months Ended
Oct. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accounting Records and Use of Estimates
Accounting Records and Use of Estimates:
          

The accounting records are maintained in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of the Company’s financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses during the reporting period. The estimates that we make include allowance for doubtful accounts, depreciation, income tax assets and liabilities, fair value of marketable securities and revenue recognition. Estimates are based on historical experience where applicable or other assumptions that management believes are reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results may differ from those estimates under different assumptions or conditions.

The interim financial statements are prepared pursuant to the requirements for reporting on Form 10-Q. The July 31, 2018 condensed consolidated balance sheet was derived from audited financial statements but does not include all disclosures required by GAAP. The interim financial statements and notes thereto should be read in conjunction with the financial statements and notes included in the Company's latest Form 10-K Annual Report for the fiscal year ended July 31, 2018. In the opinion of management, the interim financial statements reflect all adjustments of a normal recurring nature necessary for a fair statement of the results for interim periods. The results of operations for the current period are not necessarily indicative of the results for the entire fiscal year ending July 31, 2019.

The computation of the annual expected effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected operating income for the year and future periods, projections of the proportion of income (or loss), and permanent and temporary differences. The accounting estimates used to compute the provision for income taxes may change as new events occur, more experience is acquired, or as additional information is obtained. To the extent the estimated annual effective tax rate changes during a quarter, see below, the effect of the change on prior quarters is included in tax expense for the current quarter.

Revenue Recognition

Revenue Recognition

All of the real estate owned by the Company is held for leasing to tenants except for a small portion used for Company offices. Rent is recognized from tenants under executed leases no later than on an established date or on an earlier date if the tenant should commence conducting business. Unbilled receivables represent the excess of scheduled rental income recognized on a straight-line basis over rental income as it becomes receivable according to the provisions of the lease. Contingent rental income is recorded when earned and is not based on tenant revenue. The effect of lease modifications that result in rent relief or other credits to tenants, including any retroactive effects relating to prior periods, is recognized in the period when the lease modification is signed. At the time of the lease modification, we assess the realizability of any accrued but unpaid rent and amounts that had been recognized as revenue in prior periods. lf the amounts are not determined to be realizable, the accrued but unpaid rent is written off. Accounts receivable are recognized in accordance with lease agreements at its net realizable value. Rental payments received in advance are deferred until earned.

Taxes

Taxes

On December 22, 2017, the United States government (“U.S.”) enacted significant changes to the U.S. tax law following the passage and signing of H.R.1, “An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018” (the “Tax Act”) (previously known as “The Tax Cuts and Jobs Act”). The Tax Act included significant changes to existing tax law, including a permanent reduction to the U.S. federal corporate income tax rate from 34% to 21%, a one-time repatriation tax on deferred foreign income, deductions, credits and business related exclusions. The permanent reduction to the U.S. federal corporate income tax rate from 34% to 21% was effective January 1, 2018 (the “Effective Date”). On December 22, 2017, the SEC issued Staff Accounting Bulletin 118 (“SAB 118”). SAB 118 expresses views of the SEC regarding ASC Topic 740, Income Taxes (“ASC 740”), in the reporting period that includes the enactment date of the Tax Act. The SEC staff issuing SAB 118 (the “Staff’) recognized that a registrant’s review of certain income tax effects of the Tax Act may be incomplete at the time financial statements are issued for the reporting period that includes the enactment date, including interim periods therein. If a company does not have the necessary information available, prepared or analyzed for certain income tax effects of the Tax Act, SAB 118 allows a company to report provisional numbers and adjust those amounts during the measurement period not to extend beyond one year. The Company has recorded all known and estimable impacts of the Tax Act that are effective for the fiscal year ended July 31, 2018. Future adjustments to the provisional numbers will be recorded as discrete adjustments to income tax expense in the period in which those adjustments become estimable and/or are finalized.


The Company has a federal net operating loss carryforward approximating $4,078,000 as of July 31, 2018 available to offset future taxable income. As of July 31, 2018, the Company had unused state and city net operating loss carryforwards of approximately $10,107,000 for state and $8,274,000 for city, available to offset future state and city taxable income. The net operating loss carryforwards will begin to expire, if not used, in 2035.

          

New York State and New York City taxes are calculated using the higher of taxes based on income or the respective capital-based franchise taxes. Beginning with the Company’s tax year ended July 31, 2016, changes in the law required the state capital-based tax will be phased out over a 7-year period. During the quarter ended July 31, 2018, the Company recorded a state deferred tax asset, deferred tax liability and deferred taxes on unrealized gain on marketable securities in the amounts of $790,000, $1,430,000 and $53,000, respectively, resulting in a state deferred tax expense of $587,000. New York City taxes will be based on capital for the foreseeable future. Capital-based franchise taxes are recorded to administrative and general expense. State tax amounts in excess of the capital-based franchise taxes are recorded to income tax expense. Due to both the application of the capital-based tax and due to the possible absence of city taxable income, the Company does not record city deferred taxes.

The decrease in the effective tax rate for the three months ended October 31, 2018 as compared with the three months ended October 31, 2017 was primarily attributable to the permanent reduction in federal tax rates from 34% to 21%, partially offset by New York State taxes.

Recently adopted accounting standards

Recently adopted accounting standards:

In May 2014, the Financial Accounting Standards Board (“FASB”), issued Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” (“ASU 2014-09”) establishing ASC Topic 606 Revenue from Contracts with Customers. ASU 2014-09 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most of the existing revenue recognition guidance. ASU 2014-09 requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services and also requires certain additional disclosures. ASU 2014-09 is effective for interim and annual reporting in fiscal years that begin after December 15, 2016. ASU 2015-14 extended the implementation date for fiscal years beginning after December 31, 2017.

Subsequent to the issuance of ASU 2014-09, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)”, ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing”, ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, and ASU No. 2016-20, "Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers." The additional ASU's clarified certain provisions of ASU 2014-09 in response to recommendations from the Transition Resource Group established by the FASB and have the same effective date and transition requirements as ASU 2014-09. We adopted these standards effective August 1, 2018 using the modified retrospective approach, which allows us to apply the new standard to all existing contracts not yet completed as of the effective date and record a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption, however there was no cumulative-effect required to be recognized in our retained earnings as the date of adoption. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.


In January 2016, the FASB issued ASU No. 2016-01 "Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities." ASU 2016-01 amends certain aspects of recognition, measurement, presentation and disclosure of financial instruments, including the requirement to measure certain equity investments at fair value with changes in fair value recognized in net income. ASU No. 2016-01 is effective for interim and annual periods beginning after December 15, 2017. We adopted this standard effective August 1, 2018 and recorded a cumulative effect adjustment to increase opening retained earnings at August 1, 2018 by $487,136 as required for equity investments recorded at fair value, formerly available-for-sale securities.

          

In November 2016, the FASB issued ASU 2016-18, “Restricted Cash”. ASU 2016-18 requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning of period and end of period balances on the statement of cash flows upon adoption of this standard. ASU 2016-18 is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. We adopted this standard effective August 1, 2018 with retrospective application to our consolidated financial statements.

In February 2018, the FASB issued ASU No. 2018-02, “Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income”, to address a specific consequence of the Tax Act by allowing a reclassification from accumulated other comprehensive income (loss) to retained earnings for stranded tax effects resulting from the Tax Act’s reduction of the U.S. federal corporate income tax rate. The standard is effective for all entities for annual periods beginning after December 15, 2018, with early adoption permitted, and is to be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Act is recognized. The Company early adopted this ASU effective August 1, 2018 and applied this new guidance in the period of adoption. As a result, $92,000 of income taxes stranded in accumulated other comprehensive income (loss) was classified to retained earnings. The ASU also requires the Company to disclose its policy on accounting for income tax effects in accumulated other comprehensive income (loss). In general, the Company applies the individual item approach with respect to marketable securities.

Recently issued accounting standards not yet adopted

Recently issued accounting standards not yet adopted:

In February 2016, the FASB issued ASU 2016-02, “Leases.” ASU 2016-02 is intended to increase transparency and comparability among organizations in accounting for leasing arrangements. This guidance establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Lessor accounting remains similar to the current model, but updated to align with certain changes to the lessee model and the new revenue recognition standard (ASU 2014-09). ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. Entities will be required to recognize and measure leases as of the earliest period presented using a modified retrospective approach.

In July 2018, the FASB issued ASU No. 2018-10, “Codification Improvements to Topic 842”, which provides amendments and clarification to ASU 2016-12 based on the FASB’s interaction with stakeholders. In July 2018, the FASB issued ASU No. 2018-11 “Leases (Topic 842): Targeted Improvements”, which amends Leases (Topic 842) to (i) add an optional transition method that would permit entities to apply the new requirements by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the year of adoption, and (ii) provide a practical expedient for lessors regarding the separation of the lease and non-lease components of a contract. The standards are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The new standards will be effective for the Company for the fiscal year beginning August 1, 2019, with early adoption permitted, and the Company expects to use the cumulative-effect adjustment approach in the year of adoption. The adoption of this guidance is expected to result in an increase in assets and liabilities on the Company’s balance sheet, with no material impact on the statement of operations. However, the ultimate impact of adopting this ASU will depend on the Company’s lease portfolio as of the adoption date.

------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet21.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Marketable Securities (Tables)
3 Months Ended
Oct. 31, 2018
Investments, Debt and Equity Securities [Abstract]
Schedule of financial assets measured at fair value on recurring basis

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

    Total                 Total            
October 31, July 31,
Description 2018 Level 1 Level 2 Level 3 2018 Level 1 Level 2 Level 3
Assets:
Marketable securities $     3,123,857 $     3,123,857 $     $     $     3,141,828 $     3,141,828 $     $    
Schedule of classified marketable securities

As of October 31, 2018 and July 31, 2018, the Company's marketable securities were classified as follows:

   October 31, 2018 July 31, 2018
Gross Gross Gross Gross
Unrealized Unrealized Fair Unrealized Unrealized Fair
Cost Gains Losses Value    Cost    Gains    Losses    Value
Noncurrent:            
Mutual funds $ 776,305 $ 199,088 $ $ 975,393 $ 774,602 $ 237,149 $ $ 1,011,751
Equity securities 1,581,475 574,239 7,250 2,148,464 1,567,089 562,988 2,130,077
$     2,357,780 $     773,327 $     7,250 $     3,123,857 $     2,341,691 $     800,137 $     $     3,141,828
Schedule of debt and equity securities in a continuous unrealized loss position

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:

      October 31, 2018       July 31, 2018
Less Than        Less Than
Fair Value 12 Months Fair Value   12 Months
Corporate equity securities $ 113,578 $ 7,250 $     $    
Schedule of investment income
Investment income consists of the following:
Three Months Ended
October 31
2018       2017
(Loss) on sale of marketable securities $ $ (6 )
Interest income 13,561 3,726
Dividend income 8,874 9,609
Total $     22,435 $     13,329
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet22.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Long-Term Debt - Mortgage (Tables)
3 Months Ended
Oct. 31, 2018
Debt Disclosure [Abstract]
Schedule of long-term debt
                  October 31, 2018 July 31, 2018
Current                  
Annual Final Due Due Due Due
Interest Payment Within After Within After
Rate Date One Year One Year One Year One Year
Bond St. building, Brooklyn, NY 3.54% 2/1/2020 $ 170,030 $ 5,255,920 $ 168,501 $ 5,298,610
Less: Deferred financing costs 28,606 34,325
Total $     170,030 $     5,227,314 $     168,501 $     5,264,285
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet23.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Property and Equipment - at cost (Tables)
3 Months Ended
Oct. 31, 2018
Property, Plant and Equipment [Abstract]
Schedule of property and equipment
October 31       July 31
2018 2018
Property:
Buildings and improvements $ 83,913,422 $ 82,728,826
Improvements to leased property 1,478,012 1,478,012
Land 6,067,805 6,067,805
Construction in progress 1,398,732 1,786,980
92,857,971 92,061,623
Less accumulated depreciation 41,839,959 41,382,962
Property - net 51,018,012 50,678,661
 
Fixtures and equipment and other:
Fixtures and equipment 144,545 144,545
Other fixed assets 207,357 205,619
351,902 350,164
Less accumulated depreciation 221,052 235,841
Fixtures and equipment and other - net 130,850 114,323
 
Property and equipment - net $ 51,148,862 $ 50,792,98
Schedule of property and equipment construction in progress
Construction in progress includes:
October 31 July 31
2018 2018
Building improvements at 9 Bond Street in Brooklyn, NY $ 279,420 $ 102,640
Building improvements at 25 Elm Place in Brooklyn, NY 156,115 153,010
Building improvements at Jamaica, NY building 110,011 779,399
Building improvements at Fishkill, NY building 853,186 751,931
$     1,398,732 $     1,786,980
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet24.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Cash Flow Information (Tables)
3 Months Ended
Oct. 31, 2018
Supplemental Cash Flow Elements [Abstract]
Schedule of cash and cash equivalents and restricted cash

The following is a reconciliation of the Company’s cash and cash equivalents and restricted cash to the total presented on the consolidated statement of cash flows:


Cash and cash equivalents       $ 6,147,991       $ 5,707,685
Restricted cash, tenant security deposits 1,340,188 1,026,050
Restricted cash, escrow 258,399 258,232
Restricted cash, other 33,480 14,340
$     7,780,058 $     7,006,307
Schedule of supplemental disclosure
Supplemental disclosure:       Three Months Ended
October 31
2018       2017
Interest paid, net of capitalized interest of $15,067 (2018) and $11,549 (2017) $ 34,272 $ 87,381
Income taxes paid $     $     78,867
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet25.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Accumulated Other Comprehensive Income (Tables)
3 Months Ended
Oct. 31, 2018
Accumulated Other Comprehensive Income [Abstract]
Schedule of Accumulated Other Comprehensive Income

A summary of the changes in accumulated other comprehensive income for the three months ended October 31, 2018 and 2017 is as follows:


      Three Months Ended
October 31
2018       2017
(Unaudited) (Unaudited)
Beginning balance, net of tax effect $    487,136 $    368,476
 
Other comprehensive income, net of tax effect:
Unrealized gain on marketable securities - 103,608
Tax effect - (35,000 )
Unrealized gain on marketable securities, net of tax effect - 68,608
 
Amounts reclassified from accumulated other comprehensive income, net of tax effect:
Unrealized (gain) on marketable securities reclassified and recognized in net income - -
Tax effect - -
Amount reclassified and recognized in net income, net of tax effect - -
 
Unrealized gain on marketable securities reclassified to retained earnings (800,136 ) -
Tax effect 313,000 -
(487,136 ) -
 
Ending balance, net of tax effect $     $     437,084
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet26.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Accounting Records and Use of Estimates (Narrative) (Details) (USD $)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Jul. 31, 2018
Operating Loss Carryforwards [Line Items]
Period over which state capital-based tax will be phased out 7 years
Deferred tax liabilities $ 1,430,000
State deferred tax asset 790,000
Deferred taxes unrealized gain (loss) on available-for-sale securities 53,000
Corporate income tax 21.00% 34.00%
Deferred Income Tax 587,000
Unrealized gain on marketable securities reclassified to retained earnings, net of tax effect 487,136   
Reclassification of income taxes stranded in accumulated other comprehensive income (loss) to retained earnings 92,000
Domestic Tax Authority [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards 4,078,000
State and Local Jurisdiction [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards 10,107,000
City Jurisdiction [Member]
Operating Loss Carryforwards [Line Items]
Operating loss carryforwards $ 8,274,000
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet27.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Income Per Share of Common Stock (Details)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Leases [Abstract]
Average common shares outstanding 2,015,780 2,015,780
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet28.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Marketable Securities (Schedule of financial assets measured at fair value on recurring basis) (Details) (USD $)
Oct. 31, 2018
Jul. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities $ 3,123,857 $ 3,141,828
Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities 3,123,857 3,141,828
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities      
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities      
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet29.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Marketable Securities (Schedule of classified marketable securities) (Details) (USD $)
Oct. 31, 2018
Jul. 31, 2018
Marketable Securities [Line Items]
Fair Value $ 3,123,857 $ 3,141,828
Noncurrent [Member]
Marketable Securities [Line Items]
Fair Value 3,123,857 3,141,828
Gross Unrealized Gains 773,327 800,137
Gross Unrealized Losses 7,250   
Cost 2,357,780 2,341,691
Noncurrent [Member] | Mutual Funds [Member]
Marketable Securities [Line Items]
Fair Value 975,393 1,011,751
Gross Unrealized Gains 199,088 237,149
Gross Unrealized Losses      
Cost 776,305 774,602
Noncurrent [Member] | Corporate Equity Securities [Member]
Marketable Securities [Line Items]
Fair Value 2,148,464 2,130,077
Gross Unrealized Gains 574,239 562,988
Gross Unrealized Losses 7,250   
Cost $ 1,581,475 $ 1,567,089
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet30.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Marketable Securities (Schedule of Investment Securities In Continuous Unrealized Loss Position) (Details) (Corporate Equity Securities [Member], USD $)
Oct. 31, 2018
Jul. 31, 2018
Corporate Equity Securities [Member]
Marketable Securities [Line Items]
Investment securities, continuous unrealized loss position, Fair Value $ 113,578   
Investment securities, continuous unrealized loss position, Less Than 12 Months $ 7,250   
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet31.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Marketable Securities (Schedule of investment income) (Details) (USD $)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Investments, Debt and Equity Securities [Abstract]
(Loss) on sale of marketable securities    $ (6)
Interest income 13,561 3,726
Dividend income 8,874 9,609
Total $ 22,435 $ 13,329
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet32.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Financial Instruments and Credit Risk Concentrations (Details)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Concentration Risk [Line Items]
Number of tenants 50
Customer One [Member] | Rental Income [Member]
Concentration Risk [Line Items]
Concentration risk 16.16% 17.78%
Customer Two [Member] | Rental Income [Member]
Concentration Risk [Line Items]
Concentration risk 13.81% 14.61%
Customer Three [Member] | Rental Income [Member]
Concentration Risk [Line Items]
Concentration risk 11.95% 12.99%
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet33.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Long-Term Debt - Mortgage (Schedule of long-term debt) (Details) (USD $)
3 Months Ended
Oct. 31, 2018
Jul. 31, 2018
Jan. 09, 2015
Less: Deferred financing costs
Due After One Year, Total $ 5,227,314 $ 5,264,285
Bond St. Building Brooklyn NY Two [Member]
Mortgage:
Due Within One Year 170,030 168,501
Due After One Year 5,255,920 5,298,610
Less: Deferred financing costs
Due Within One Year      
Due After One Year 28,606 34,325
Due Within One Year, Total 170,030 168,501
Due After One Year, Total $ 5,227,314 $ 5,264,285
Current Annual Interest Rate 3.54% 3.54%
Final Payment Date Feb 1, 2020
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet34.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Long-Term Debt - Mortgage (Narrative) (Details) (Bond St. Building Brooklyn NY Two [Member], USD $)
0 Months Ended
Jan. 09, 2015
Oct. 31, 2018
Bond St. Building Brooklyn NY Two [Member]
Debt Instrument [Line Items]
Closed bank liabilities $ 6,000,000
Additional loans 652,274
Amount outstanding $ 5,347,726
Term of loan 5 years
Amortization period of loan 25 years
Interest rate, percent 3.54% 3.54%
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet35.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Property and Equipment - at cost (Details) (USD $)
Oct. 31, 2018
Jul. 31, 2018
Property, Plant and Equipment [Line Items]
Property and equipment - net $ 51,148,862 $ 50,792,984
Construction in progress 1,398,732 1,786,980
Building Improvements at 9 Bond Street in Brooklyn, NY [Member]
Property, Plant and Equipment [Line Items]
Construction in progress 279,420 102,640
Building improvements at 25 Elm Place in Brooklyn, NY [Member]
Property, Plant and Equipment [Line Items]
Construction in progress 156,115 153,010
Building improvements at Jamaica, NY building [Member]
Property, Plant and Equipment [Line Items]
Construction in progress 110,011 779,399
Building improvements at Fishkill, NY building [Member]
Property, Plant and Equipment [Line Items]
Construction in progress 853,186 751,931
Buildings and Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment 83,913,422 82,728,826
Improvements to Leased Property [Member]
Property, Plant and Equipment [Line Items]
Property and equipment 1,478,012 1,478,012
Land [Member]
Property, Plant and Equipment [Line Items]
Property and equipment 6,067,805 6,067,805
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property and equipment 1,398,732 1,786,980
Property [Member]
Property, Plant and Equipment [Line Items]
Property and equipment 92,857,971 92,061,623
Less accumulated depreciation 41,839,959 41,382,962
Property and equipment - net 51,018,012 50,678,661
Fixtures and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment 144,545 144,545
Other Fixed Assets [Member]
Property, Plant and Equipment [Line Items]
Property and equipment 207,357 205,619
Fixtures and equipment and other [Member]
Property, Plant and Equipment [Line Items]
Property and equipment 351,902 350,164
Less accumulated depreciation 221,052 235,841
Property and equipment - net $ 130,850 $ 114,323
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet36.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Employees' Retirement Plan (Details) (USD $)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Retirement Benefits [Abstract]
Pension contributions $ 106,460 $ 104,432
Employer contributions $ 13,946 $ 15,599
Minimum contribution rate 9.10%
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet37.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Cash Flow Information (Schedule of cash and cash equivalents and restricted cash) (Details) (USD $)
Oct. 31, 2018
Jul. 31, 2018
Oct. 31, 2017
Jul. 31, 2017
Supplemental Cash Flow Elements [Abstract]
Cash and cash equivalents $ 6,147,991 $ 5,255,073 $ 5,707,685
Restricted cash, tenant security deposits 1,340,188 1,026,050
Restricted cash, escrow 258,399 258,232
Restricted cash, other 33,480 14,340
Cash flow information $ 7,780,058 $ 6,879,623 $ 7,006,307 $ 6,676,929
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet38.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Cash Flow Information (Schedule of supplemental disclosure) (Details) (USD $)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Supplemental Cash Flow Elements [Abstract]
Interest paid, net of capitalized interest of $15,067 (2018) and $11,549 (2017) $ 34,272 $ 87,381
Income taxes paid    78,867
Capitalized interest $ 15,067 $ 11,549
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet39.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Accumulated Other Comprehensive Income (Details) (USD $)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Accumulated Other Comprehensive Income [Abstract]
Beginning balance, net of tax effect $ 487,136 $ 368,476
Other comprehensive income, net of tax effect:
Unrealized gain on marketable securities    103,608
Tax effect    (35,000)
Unrealized gain on marketable securities, net of tax effect    68,608
Amounts reclassified from accumulated other comprehensive income, net of tax effect:
Unrealized (gain) on marketable securities reclassified and recognized in net income      
Amount reclassified and recognized in net income, net of tax effect      
Unrealized gain on marketable securities reclassified to retained earnings (800,136)   
Tax effect 313,000   
Unrealized gain on marketable securities reclassified to retained earnings, net of tax effect (487,136)   
Ending balance, net of tax effect    $ 437,084
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/Sheet40.html Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii"
Contingencies (Details) (Settled Litigation [Member], USD $)
3 Months Ended 0 Months Ended
Oct. 31, 2018
Nov. 08, 2018
Subsequent Event [Member]
Loss Contingencies [Line Items]
Accrual for litigation settlement $ 635,000
Payment of litigation settlement $ 635,000
------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662 Content-Location: file:///C:/173aad65_a115_44d2_8fec_0ef578911662/Worksheets/filelist.xml Content-Transfer-Encoding: quoted-printable Content-Type: text/html; charset="us-ascii" ------=_NextPart_173aad65_a115_44d2_8fec_0ef578911662--