**UNITED
        STATES**
 **SECURITIES
        AND EXCHANGE COMMISSION**
 Washington,
        D.C. 20549
 
 **FORM
        10-QSB**
 
 (Mark
        One)
 
 **[X]**
              **QUARTERLY
                  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
                  OF
                  1934**
 
 For
        the
        quarterly period ended June 30, 2007
 
 **[   ]**
              **TRANSITION
                  REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
                  ACT**
 
 For
        the
        transition period from ________ to _________.
 
 Commission
        File No. 0-51107
 
  
 
 **Benacquista
        Galleries, Inc.**
 (Name
        of
        Small Business Issuer as specified in its charter)
 
 Nevada
              71-0928242(State
                  or other Jurisdiction of
              (I.R.S.
                  EmployerIncorporation
                  or Organization)
              Identification
                  No.)6870
                  La Valle Plateada Rancho Santa Fe, California
              92067(Address
                  of Principal Executive Offices)
              (Zip
                  Code)
 
 (858)
        525-5695
 (Issuer’s
        Telephone Number, Including Area Code)
 
 Check
        whether the issuer: (1) filed all reports required to be filed by Section
        13 or
        15(d) of the Exchange Act during the past 12 months (or for such shorter
        period
        that the registrant was required to file such reports), and (2) has been
        subject
        to such filing requirements for the past 90 days. **Yes [X] No
        [   ]**
 
 Indicate
        by check mark whether the registrant is a shell company (as defined in Rule
        12b-2 of the Exchange Act). **Yes
        [   ] No [X]**
 
 As
        of
        August 14, 2007, the registrant had outstanding 1,072,713 shares of common
        stock, par value $0.001 per share, of which there is only a single
        class.
 
 Transitional
        Small Business Disclosure Format (Check one): **Yes
        [   ] No [X]**
 
 
  
  **TABLE
        OF
        CONTENTS**
 
 
 **Page**
                **Number****PART
                  I**ITEM
                  1.
              Financial
                  Statements
              F-1ITEM
                  2.
              Management’s
                  Discussion and Analysis or Plan of Operation.
              1ITEM
                  3.
              Controls
                  and Procedures.
              6**PART
                  II**ITEM
                  1.
              Legal
                  Proceedings.
              7ITEM
                  2.
              Unregistered
                  Sales of Equity Securities and Use of Proceeds.
              7ITEM
                  3.
              Default
                  Upon Senior Securities.
              7ITEM
                  4.
              Submission
                  of Matters to a Vote of Security Holders.
              7ITEM
                  5.
              Other
                  Information.
              7ITEM
                  6.
              Exhibits.
              8
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
  **PART
        I – FINANCIAL INFORMATION**
 
 **ITEM
        1. FINANCIAL STATEMENTS.**
 
 **BENACQUISTA
        GALLERIES, INC. AND SUBSIDIARY**
 **(A
        Development Stage Enterprise)**
 **CONDENSED
        CONSOLIDATED BALANCE SHEETS**
 **(UNAUDITED)**
 
 **June
                  30,**
              
              
              **September
                  30,****2007**
              
              
              **2006****ASSETS****Current
                  Assets**Cash
              
              $
              -
              
              
              $
              1,170Inventory
              
              
              -
              
              
              
              906,131Accrued
                  interest receivable
              
              
              -
              
              
              
              3,768**Total
                  Current Assets**
              
              
              -
              
              
              
              911,069**Total
                  Assets**
              
              **$**
              **-**
              
              
              **$**
              **911,069****LIABILITIES
                  AND STOCKHOLDERS' DEFICIT****Current
                  Liabilities**Accounts
                  payable
              
              $
              22,037
              
              
              $
              25,080Accrued
                  interest payable
              
              
              -
              
              
              
              65,578Unearned
                  income
              
              
              -
              
              
              
              65,461Due
                  to majority shareholder
              
              
              34,817
              
              
              
              190,938Note
                  payable to majority shareholder
              
              
              -
              
              
              
              1,012,127**Total
                  Current Liabilities**
              
              
              56,854
              
              
              
              1,359,184**Long-Term
                  Liabilities**
              
              
              -
              
              
              
              -**Total
                  Liabilities**
              
              
              56,854
              
              
              
              1,359,184**Commitments
                  and Contingencies**
              
              
              -
              
              
              
              -**Stockholders'
                  Deficit**Common
                  Stock- $0.001 par value; 5,000,000 shares authorized;1,075,113
                  and
                  1,100,113 shares issued, respectively;1,072,713 and 1,097,713 shares
                  oustanding, respectively
              
              
              1,075
              
              
              
              1,100Treasury
                  stock-at cost 2,400 and 2,400 shares, respectively
              
              
              (9,867
              )
              
              
              (9,867
              )Additional
                  paid-in-capital
              
              
              1,098,502
              
              
              
              1,105,008Stock
                  subscription receivable
              
              
              -
              
              
              
              (292,596
              )Accumulated
                  deficit
              
              
              (1,146,564
              )
              
              
              (1,251,760
              )**Total
                  Stockholders' Deficit**
              
              
              (56,854
              )
              
              
              (448,115
              )**Total
                  Liabilities and Stockholders' Deficit**
              
              **$**
              **-**
              
              
              **$**
              **911,069**
 
 
 
 The
        accompanying notes are an integral part of these unaudited condensed
        consolidated financial statements.
 
 
  F
            -
            1
  **BENACQUISTA
        GALLERIES, INC.**
 **(A
        Development Stage Enterprise)**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF OPERATIONS**
 **(UNAUDITED)**
 
 **For
                  the Three Months Ended June 30,**
              
              
              **For
                  the Nine Months Ended June 30,**
              
              
              **January
                  17, 2003 (Inception) through June 30,****2007**
              
              
              **2006**
              
              
              **2007**
              
              
              **2006**
              
              
              **2007**Revenue
              
              $
              -
              
              
              $
              -
              
              
              $
              -
              
              
              $
              -
              
              
              $
              -****
              
              
              
              ****
              
              
              
              ****
              
              
              
              ****
              
              
              
              ****Operating
                  expensesResearch
                  and development
              
              
              -
              
              
              
              -
              
              
              
              5,000
              
              
              
              -
              
              
              
              5,000General
                  and administrative
              
              
              41,492
              
              
              
              48,328
              
              
              
              131,129
              
              
              
              117,083
              
              
              
              972,885**Total
                  operating expenses**
              
              
              41,492
              
              
              
              48,328
              
              
              
              136,129
              
              
              
              117,083
              
              
              
              977,885**Loss
                  from operations**
              
              
              (41,492
              )
              
              
              (48,328
              )
              
              
              (136,129
              )
              
              
              (117,083
              )
              
              
              (977,885
              )**Other
                  income (expense)**Interest
                  income
              
              
              240
              
              
              
              9,775
              
              
              
              7,535
              
              
              
              33,939
              
              
              
              55,127Interest
                  expense
              
              
              (1,181
              )
              
              
              (12,621
              )
              
              
              (26,332
              )
              
              
              (37,855
              )
              
              
              (191,915
              )Forgiveness
                  of accounts payable
              
              
              -
              
              
              
              8,850
              
              
              
              -
              
              
              
              8,850
              
              
              
              8,850**Total
                  other income (expense)**
              
              
              (941
              )
              
              
              6,004
              
              
              
              (18,797
              )
              
              
              4,934
              
              
              
              (127,938
              )**Net
                  loss from continuing operations**
              
              
              (42,433
              )
              
              
              (42,324
              )
              
              
              (154,926
              )
              
              
              (112,149
              )
              
              
              (1,105,823
              )**Discontinued
                  operations**Gain
                  (loss) from discontinued operations
              
              
              -
              
              
              
              47,823
              
              
              
              (3,680
              )
              
              
              (100,017
              )
              
              
              (304,543
              )Gain
                  on sale of YNOT
              
              
              -
              
              
              
              -
              
              
              
              263,802
              
              
              
              -
              
              
              
              263,802**Income
                  (loss) from discontinued operations**
              
              
              -
              
              
              
              47,823
              
              
              
              260,122
              
              
              
              (100,017
              )
              
              
              (40,741
              )**Net
                  (loss) income**
              
              $
              (42,433
              )
              
              $
              5,499
              
              
              $
              105,196
              
              
              $
              (212,166
              )
              
              $
              (1,146,564
              )**Basic
                  and diluted (loss) income per share from:**Continuing
                  operations
              
              $
              (0.04
              )
              
              $
              (0.03
              )
              
              $
              (0.14
              )
              
              $
              (0.10
              )Discontinued
                  operations
              
              $
              -
              
              
              $
              0.04
              
              
              $
              0.24
              
              
              $
              (0.09
              )**Net
                  (loss) income per share**
              
              $
              (0.04
              )
              
              $
              0.01
              
              
              $
              0.10
              
              
              $
              (0.19
              )**Weighted
                  average number of shares outstanding**
              
              
              1,074,361
              
              
              
              1,099,591
              
              
              
              1,089,929
              
              
              
              1,099,939
 
 
 
 The
        accompanying notes are an integral part of these unaudited condensed
        consolidated financial statements.
 
 
 
  F
            -
            2
  **BENACQUISTA
        GALLERIES, INC.**
 **(A
        Development Stage Enterprise)**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF CASHFLOWS**
 **(UNAUDITED)**
 
 **For
                  the Nine Months Ended June 30,**
              
              
              **January
                  17, 2003 (Inception)through**
                **June
                  30,****2007**
              
              
              **2006**
              
              
              **2007****Cash
                  Flows From Operating Activities**Net
                  income (loss)
              
              $
              105,196
              
              
              $
              (212,166
              )
              
              $
              (1,146,564
              )Adjustments
                  to reconcile net income (loss) tonet
                  cash from operating activities:Gain
                  on sale of stock of subsidiary
              
              
              (263,802
              )
              
              
              -
              
              
              
              (263,802
              )Services
                  received for notes receivable
              
              
              -
              
              
              
              -
              
              
              
              453,861Forgiveness
                  of accounts payable
              
              
              -
              
              
              
              (8,850
              )
              
              
              (8,850
              )Write
                  off of bad debt
              
              
              -
              
              
              
              -
              
              
              
              20,150Advertising
                  expense - web content purchase
              
              
              -
              
              
              
              -
              
              
              
              150,000Changes
                  in operating assets and liabilitiesAccounts
                  receivable
              
              
              -
              
              
              
              (20,150
              )
              
              
              (20,150
              )Inventory
              
              
              -
              
              
              
              (64,754
              )
              
              
              (44,004
              )Accrued
                  interest receivable
              
              
              (7,535
              )
              
              
              (13,332
              )
              
              
              (11,303
              )Accounts
                  payable
              
              
              (2,545
              )
              
              
              54,641
              
              
              
              31,385Accrued
                  interest
              
              
              26,332
              
              
              
              (62,149
              )
              
              
              91,910Unearned
                  income
              
              
              36,665
              
              
              
              2,889
              
              
              
              102,126**Net
                  Cash From Operating Activities**
              
              
              (105,689
              )
              
              
              (323,871
              )
              
              
              (645,241
              )**Cash
                  Flows From Investing Activities**
              
              
              -
              
              
              
              -
              
              
              
              -**Cash
                  Flows From Financing Activities**Principal
                  payments from stock subscription notes receivable
              
              
              -
              
              
              
              253,544
              
              
              
              253,543Advances
                  from majority shareholder
              
              
              134,519
              
              
              
              183,615
              
              
              
              485,457Payments
                  to majority shareholder
              
              
              (30,000
              )
              
              
              (100,000
              )
              
              
              (190,000
              )Capital
                  contribution from majority shareholder
              
              
              -
              
              
              
              3,050
              
              
              
              96,108Purchase
                  of treasury stock
              
              
              -
              
              
              
              (7,817
              )
              
              
              (9,867
              )Sale
                  of common stock
              
              
              -
              
              
              
              -
              
              
              
              10,000**Net
                  Cash From Financing Activities**
              
              
              104,519
              
              
              
              332,392
              
              
              
              645,241**Net
                  Change in Cash**
              
              
              (1,170
              )
              
              
              8,521
              
              
              
              -**Cash
                  at Beginning of Period**
              
              
              1,170
              
              
              
              507
              
              
              
              -**Cash
                  at End of Period**
              
              $
              -
              
              
              $
              9,028
              
              
              $
              -Cash
                  paid for interest
              
              $
              -
              
              
              $
              100,000
              
              
              $
              100,000Cash
                  paid for income taxes
              
              
              -
              
              
              
              -
              
              
              
              -**Non-Cash
                  Investing and Financing Activities**Spin
                  out of YNOT for note payable
              
              $
              263,802
              
              
              $
              -
              
              
              $
              263,802Exchange
                  of Monarch stock subscription note receivable for stock
              
              
              303,899
              
              
              
              -
              
              
              
              303,899Exchange
                  of art inventory for note payable and accrued interest
              
              
              1,203,499
              
              
              
              -
              
              
              
              1,203,499Shares
                  underlying warrants issued in exchange for notes
                  receivable
              
              
              -
              
              
              
              -
              
              
              
              1,000,000Acquistion
                  of web content by issuance of note to majority shareholder
              
              $
              -
              
              
              $
              -
              
              
              $
              150,000
 
 
 The
        accompanying notes are an integral part of these unaudited condensed
        consolidated financial statements.
 
  F
            -
            3
  **BENACQUISTA
        GALLERIES, INC.**
 **(A
        Development Stage Enterprise)**
 **NOTES
        TO UNAUDITED, CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **June
        30, 2007**
 
 **NOTE
        1 - NATURE OF BUSINESS**
 
 ***Organization
        and Nature of Operations —*** On January 17, 2003, Benacquista
        Galleries, Inc. (“the Company”) was organized under the laws of the State of
        Nevada. On October 10, 2005 the Company formed a wholly owned subsidiary
        named
        YNOT Eduk8, Inc. for the purpose of pursuing the business opportunities related
        to the acquisition of the website content of www.ynoteduk8.com from YNOT
        Education, Inc. in September, 2005 as described in Note 9. YNOT Eduk8, Inc.
        (“YNOT”) has no business operations activity since inception. The Company is
        considered a development stage enterprise and is in the process of developing
        markets for its products and raising capital to fund operations. As such,
        the
        Company has since inception spent most of its efforts in developing its business
        plan, acquiring inventory, and in raising capital to fund its operations.
        The
        Company has relied principally upon cash flows from equity issuances and
        capital
        contributions from its major shareholder to sustain operations. The planned
        operations of the Company consist of selling art work through the internet
        and
        in September 2005 obtained the exclusive publishing rights to the “Farmacist
        Desk Reference” (“FDR”). On March 27, 2007 the Company transferred certain
        contracts related to the FDR and related liabilities to YNOT and subsequently
        sold its interest in YNOT as described more fully in Note 9. On April 10,
        2007
        the Company transferred its inventory, consisting of works of art to Mr.
        James
        Price in exchange for certain obligations as described more fully in Note
        9. As
        a result of these transactions, the Company has treated these operations
        as
        discontinued in the accompanying statements of operations for the three and
        nine
        months ended June 30, 2007 and for the period from January 17, 2003 (inception)
        to June 30, 2007 as more fully described in Note 10. The Company has restated
        its historic statement of operations to conform to such presentation. The
        majority shareholder of the Company is Mr. James Price, our Chief Executive
        Officer and Chairman of the Board, who owns approximately 85.5% of the
        outstanding common stock of the Company as of June 30, 2007.
 
 ***Interim
        Financial Information***  ***—*** The
        accompanying unaudited condensed consolidated financial statements have been
        prepared in accordance with accounting principles generally accepted in the
        United States of America for interim financial information and pursuant to
        the
        rules and regulations of the Securities and Exchange Commission. Accordingly,
        they do not include all of the information and notes required by accounting
        principles generally accepted in the United States of America for complete
        financial statements. In the opinion of management, all adjustments and
        reclassifications considered necessary for a fair and comparable presentation
        have been included and are of normal recurring nature. Operating results
        for the
        nine-month period ended June 30, 2007 are not necessarily indicative of the
        results that may be expected for the year ending September 30, 2007. The
        accompanying financial statements should be read in conjunction with the
        Company’s annual financial statements as filed on Form 10-KSB as of September
        30, 2006.
 
 **NOTE
        2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
 
 ***Consolidation
        —***The consolidated financial statements contain the accounts
        of
        the Company for all periods presented and the accounts of its wholly owned
        subsidiary, YNOT Eduk8, Inc. since its inception on October 10, 2005 until
        the
        sale of the Company’s interest in YNOT on March 27, 2007 as more fully described
        in Note 9. All intercompany accounts and transactions have been eliminated
        in
        consolidation.
 
 ***Cash*** 
        ***—*** Cash consists of a deposit with a bank. There
        are no
        amounts in excess of federally insured limits as of June 30, 2007 and September
        30, 2006.
 
 ***Inventory***—
        Inventory is stated at the lower of cost or market.
 
 ***Revenue
        Recognition***— Revenues are recognized by the Company based on the
        various types of transactions generating the revenue. The Company recognizes
        art
        revenue when persuasive evidence of an arrangement exists; services have
        been
        rendered or products have been delivered; the price to the buyer is fixed
        and
        determinable; and collectibility is reasonably assured.
 
  F
            -
            4
  Revenue
        for published products distributed through wholesale and retail channels
        and
        through resellers is recognized upon verification of final sell-through to
        end
        users, after consideration of rights of return and price protection. Typically,
        the right of return on such products has expired when the end user purchases
        the
        product from the retail outlet. Once the end user opens the package, it is
        not
        returnable unless the medium is defective.
 
 ***Advertising
        Expense***— Advertising costs are expensed as incurred. Advertising
        expense for the nine months ended June 30, 2007 and 2006 was $5,841 and $50,019,
        respectively.
 
 ***Income
        Taxes***— The Company recognizes an asset or liability for the
        deferred tax consequences of all temporary differences between the tax basis
        of
        assets or liabilities and their reported amounts in the consolidated financial
        statements that will result in taxable or deductible amounts in future years
        when the reported amounts of the asset or liabilities are recovered or settled.
        Deferred tax assets or liabilities are measured using the enacted tax rates
        that
        will be in effect when the differences are expected to reverse. Deferred
        tax
        assets are reviewed periodically for recoverability and valuation allowances
        are
        provided as necessary.
 
 ***Use
        of Estimates —*** The preparation of financial statements in
        conformity with accounting principles generally accepted in the United States
        of
        America requires management to make estimates and assumptions that affect
        certain reported amounts of assets and liabilities and disclosure of contingent
        assets and liabilities at the date of the financial statements and the reported
        amounts of revenues and expenses during the reporting period. Actual results
        could differ from those estimates.
 
 ***Fair
        Value of Financial Instruments***— The carrying amounts reported in
        the accompanying consolidated financial statements for current assets
        approximate fair values because of the immediate or short-term maturities
        of
        these financial instruments.
 
 ***Net
        Income (Loss) Per Share-Basic and Diluted***— Basic income (loss) per
        common share is computed on the basis of the weighted-average number of common
        shares outstanding during the period. Diluted income per share is computed
        on
        the basis of the weighted-average number of common shares and all potentially
        issuable common shares outstanding during the year. There are no potentially
        dilutive securities as of June 30, 2007 and 2006.
 
 ***Recently
        Issued Accounting Pronouncements***— In September 2006, the FASB
        issued Statement of Financial Accounting Standards No. 157, "Fair Value
        Measurements" (SFAS 157), which defines fair value, establishes a framework
        for
        measuring fair value in generally accepted accounting principles and requires
        additional disclosures about fair value measurements. SFAS 157 aims to improve
        the consistency and comparability of fair value measurements by creating
        a
        single definition of fair value. The Statement emphasizes that fair value
        is not
        entity-specific, but instead is a market-based measurement of an asset or
        liability. SFAS 157 upholds the requirements of previously issued pronouncements
        concerning fair value measurements and expands the required disclosures.
        This
        Statement is effective for financial statements issued for fiscal years
        beginning after November 15, 2007, however earlier application is permitted
        provided the reporting entity has not yet issued financial statements for
        that
        fiscal year. The Company does not believe that the adoption of SFAS 157 will
        have a material effect on its consolidated financial statements.
 
 In
        September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined
        Benefit Pension and Other Post-Retirement Plans, amending SFAS No. 87,
        Employers’ Accounting for Pensions, SFAS No. 88, Employers’ Accounting for
        Settlements and Curtailments of Defined Benefit Pension Plans and for
        Termination Benefits, SFAS No. 106,   Employers’ Accounting for
        Postretirement Benefits Other than Pensions”, and SFAS No. 132(R), “Employers’
Disclosures about Pensions and Other Postretirement Benefits” *.* SFAS
        No. 158 requires recognition of the overfunded or underfunded status of a
        defined benefit postretirement plan (other than a multiemployer plan) as
        an
        asset or liability in a reporting entity’s statement of financial position and
        to recognize changes in that funded status in the year in which the changes
        occur through comprehensive income. It also requires an employer to measure
        the
        funded status of a plan as of the date of its year-end statement of financial
        position. The statement is effective as of the end of the fiscal year ending
        after December 15, 2006. The adoption of SFAS No. 158 is not expected to
        have a
        material impact on the Company’s condensed consolidated financial
        statements.
 
  F
            -
            5
  In
        September 2006, the Securities and Exchange Commission issued Staff Accounting
        Bulletin (“SAB”) 108, “Considering the Effects of Prior year Misstatements When
        Quantifying Misstatements in Current Year Financial Statements.” SAB 108
        clarifies the staff’s position regarding the process of quantifying financial
        statement misstatements. More specifically, the staff noted that certain
        registrants do not consider the effects of prior year errors on current year
        financial statements, thereby allowing improper assets or liabilities to
        remain
        unadjusted. The staff believes this approach is not in the best interests
        of the
        users of the financial statements. SAB 108 is effective for fiscal years
        ending
        on or after November 15, 2006, with earlier adoption encouraged. At present,
        the
        Company is evaluating the impact, if any, that the adoption of SAB 108 will
        have
        on the condensed consolidated financial statements.
  In
        February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for
        Financial Assets and Financial Liabilities", including an amendment of FASB
        Statement No. 115 SFAS 159. This pronouncement permits entities to choose
        to
        measure many financial instruments and certain other items at fair value
        that
        are not currently required to be measured at fair value. SFAS 159 is effective
        as of the beginning of an entity's first fiscal year that begins after November
        15, 2007. The impact of adopting SFAS 159 on the Company's consolidated
        financial statements, if any, has not yet been determined.
 
 **NOTE
        3**  **-**  **GOING
        CONCERN**
 
 ***Business
        Condition***— The Company has a limited operating history. It has not
        yet been able to fully execute its business plan. The accompanying consolidated
        financial statements have been prepared in conformity with generally accepted
        accounting principles which contemplate continuation of the Company as a
        going
        concern. During the nine months ended June 30, 2007, the Company had a net
        loss
        from continuing operations of $154,926 and it had negative cash flows from
        operations of $105,689. In addition, the Company had a deficit accumulated
        in
        the development stage of $1,146,564 as of June 30, 2007. This situation raises
        substantial doubt about its ability to continue as a going concern.
 
 As
        a
        result of the Company being unable to fully execute its business plan, on
        March
        27, 2007 the Company sold its interest in YNOT as more fully described in
        Note
        9. In addition, the Company transferred its inventory to Mr. James Price
        in
        exchange for certain obligations payable to Mr. Price as more fully described
        in
        Note 9. The Company is currently evaluating potential new lines of business,
        but
        has not decided on any definite course of action for its future as yet. Our
        president has indicated that he will loan sufficient funds to cover operating
        needs for the next twelve months. However, there is no guarantee that these
        loans will be made. The financial statements do not include any adjustments
        relating to the recoverability and classification of asset carrying amounts
        or
        the amount and classification of liabilities that might result should the
        Company be unable to continue as a going concern.
 
 **NOTE
        4**  **-** 
**INVENTORY**
 
 ***Value***—
        Inventories are stated at the lower of cost or market. When there is evidence
        that the inventory value is less than the original cost, the inventory is
        reduced to market value. The Company determines market value from periodic
        professional appraisals.
 
 ***Composition***—
        Art inventory as of September 30, 2006 is composed of 293 pieces of art
        consisting of oil-on-canvas, lithograph and pastel paintings, bronze and
        ceramic
        sculptures and other miscellaneous items.
 
 **NOTE
        5 - INVESTMENT**
 
 On
        December 18, 2006, the Company entered into a Stock Purchase Agreement with
        Whole In One Products, Inc. (“Whole In One”), a Nevada corporation, for the
        purchase of 4,900,000 shares of Whole In One’s restricted voting common stock in
        consideration of $10,000, representing a 49% interest in Whole in One. The
        Company paid $8,000 in legal fees on behalf of Whole In One in conjunction
        with
        the transaction which has been reflected as “General and Administrative expense”
in the accompanying condensed consolidated statement of operations for the
        nine
        months ended June 30, 2007. Whole In One had no operations and no gains or
        losses were recognized by the Company. On February 2, 2007 the Company and
        Whole
        in One cancelled the agreement and the Company reversed the obligation. The
        Company recovered the legal fees of $8,000 paid on behalf of Whole In One
        and
        has reduced general and administrative expenses for this recovery in the
        accompanying Statements of Operations for the nine months ended June 30,
        2007.
 
  F
            -
            6
  **NOTE
        6**  **-**  **UNEARNED
        REVENUE**
 
 Unearned
        revenue as of June 30, 2007 and September 30, 2006 of $0 and $65,461
        respectively, represents prepayments received on book orders that have not
        been
        shipped to the customer. This obligation was assumed by the buyer of YNOT
        as of
        March 27, 2007 as more fully described in Note 9.
 
 **NOTE
        7**  **-**  **STOCKHOLDERS’
EQUITY**
 
 On
        November 21, 2006, the Board of Directors approved a reverse stock split
        of
        Benacquista Galleries, Inc. common shares, par value $0.001, at a ratio of
        one
        post-reverse split share for every 10 pre-split shares to be effective as
        of
        January 8, 2007. All share and per share amounts have been retroactively
        restated to reflect this reverse stock split. In addition, in accordance
        with
        the laws of the state of Nevada, the authorized number of common shares was
        reduced at the same ratio and accordingly, the authorized shares were reduced
        from 50,000,000 to 5,000,000.
 
 ***Common
        Stock***— In January 2003, the Company issued 1,000,113 shares of
        common stock to various individuals, including officers of the Company, for
        cash
        proceeds of $10,000 or $0.001 per share. In August and September, 2005 the
        Company issued 100,000 shares of common stock upon the exercise of
        warrants.
 
 ***Additional
        Paid-in Capital***— The majority shareholder has made a total of
        $96,108 cash contributions for the period January 17, 2003 (date of inception)
        through June 30, 2007.  In addition, the excess of certain obligations
        due to the majority shareholder over the recorded value of the inventory
        transferred was recorded as additional paid in capital as a contribution
        from
        the majority shareholder in the amount of $297,368 as more fully described
        in
        Note 9.
 
 ***Stock
        Subscription Receivable***— Stock subscription receivable as
        September 30, 2006, respectively, is comprised of a note receivable from
        Monarch
        Consulting. The note bore interest at 5% and was originally due January 2008
        with no interim principal or interest payments required. The note is the
        consideration received upon the exercise of a warrant and the resultant issuance
        of common stock. As such, the outstanding principal balance of $292,596 is
        recorded as an offset to equity as stock subscription receivable in the
        accompanying balance sheet as of September 30, 2006.
  In
        April
        2007, the Company entered into a settlement and release agreement with Monarch
        Consulting pursuant to which the Company released Monarch from its remaining
        obligations of $292,596 plus accrued interest of $11,303 under the terms
        of the
        Note in exchange for the return and cancellation of 25,000 shares of the
        Company’s common stock acquired by Monarch upon exercise of the
        Warrant.
  **NOTE
        8 - WEB SITE PURCHASE**
  On
        November 17, 2006 the Company acquired the website name and related content
        for
“faceyourmate.com”, an interactive dating service from Physiognomy Interface
        Technologies, Inc., (“Physiognomy”) a Nevada Corporation, a Company formerly
        named YNOT Education, Inc. At the time of the purchase, Don Tolman was a
        director of the Company and the sole shareholder of Physiognomy. As a result,
        this is considered a related party transaction. The Company paid cash of
        $5,000
        in exchange for the site and the content which has been recorded as research
        and
        development and expensed at the time of the transaction.
 
 **NOTE
        9 - RELATED PARTY TRANSACTIONS**
 
 In
        January 2003, the majority shareholder sold certain of his works of art to
        the
        Company for $862,127 represented by an unsecured note payable. The note bears
        interest at 5% per annum and was due in full June 30, 2005 with no periodic
        payments required. The purchase price represents the shareholder’s original cost
        in the art, which was originally acquired for cash. On April 10, 2007, the
        Company and Mr. Price entered into a settlement and release agreement pursuant
        to which the Company transferred all of its rights, title and interest in
        its
        inventory recorded at $906,131 as of that date in settlement of all its
        obligations to Mr. Price as of that date of $1,203,499, comprised of a Note
        payable to majority shareholder in the amount of $862,127, accrued interest
        payable in the amount of $80,732 and all non interest bearing advances recorded
        as “Due to majority shareholder” in the amount of $260,640.  The
        excess of the obligations over the recorded value of the inventory was recorded
        as additional paid in capital as a contribution from the majority shareholder
        in
        the amount of $297,368.
 
  F
            -
            7
  In
        September 2005, the company acquired the website www.ynoteduk8.com for
        $150,000 represented by an unsecured note payable. The note bears interest
        at 5%
        per annum and is payable on demand with no periodic payments required. Along
        with the website acquisition, the company obtained exclusive publishing rights
        to the “Farmacist Desk Reference” (FDR) from the president of YNOT Education,
        Inc.
  Concurrently
        with the purchase of the website content, the Company entered into a Royalty
        Agreement with Don Tolman, a director of the Company and the shareholder
        and
        president of YNOT Education, Inc. for the exclusive publishing rights to
        the
“Farmacist Desk Reference” (“FDR”) and other works created or controlled by YNOT
        Education, Inc. The license agreement calls for the payment of royalties
        of $1
        per book sold or 5% of all proceeds collected for other YNOT Education, Inc.
        works. The license is for a two year term which expires September 28, 2007
        which
        will automatically extend for an additional two year term if royalties of
        $250,000 are achieved during the initial term. There are no guaranteed minimum
        royalties, but YNOT Education, Inc. will have the right to cancel the Royalty
        Agreement after the initial two year term if sales are not sufficient to
        generate $250,000 in royalties.
  In
        October of 2005, the Company incorporated a wholly owned subsidiary called
        YNOTeduk8, Inc. (YNOT). On March 9, 2007 the Company executed a series of
        agreements with Don Tolman, YNOT Education, Inc., James Price and YNOT by
        which
        the Company assigned its rights and obligations related to the above mentioned
        Royalty Agreement, the above mentioned website and all improvements, and
        certain
        intellectual property and trademarks to its subsidiary, YNOT.
 
 On
        March
        13, 2007, the Company’s Board of Directors declared a dividend and distributed
        1,100,103 shares of YNOT common stock.. The stock dividend was paid at the
        rate
        of one share of YNOT stock for each share of the Company common stock owned.
        Subsequent to the dividend, the Company owned 8,902,287 shares of YNOT
        comprising approximately 89% of the outstanding shares of YNOT as of that
        date.
 
 On
        March
        27, 2007 the Company entered into an agreement with Don Tolman by which Mr.
        Tolman assumed the $150,000 unsecured note payable referred to above and
        all
        related accrued interest in exchange for the Company’s 8,902,287 remaining
        shares of YNOT common stock. As a result of the above transactions, the Company
        has recognized a gain on the sale of the discontinued operations in the
        aggregate amount of $263,802 included under the caption “Gain on sale of YNOT”
in the accompanying statement of operations for the nine months ended June
        30,
        2007 and f or the period from January 17, 2003 (date of inception) to June
        30,
        2007 as more fully described in Note 10.
 
 As
        discussed in Note 8 above, On November 17, 2006 the Company purchased the
        web
        site www.faceyourmate.com and the related content from Physiognomy, a company
        controlled by then director Don Tolman.
 
 Effective
        November 21, 2006, Don Tolman resigned from our board of directors in order
        to
        pursue his other business ventures. Our board currently consists of our sole
        officer and director James Price who continues to serve as the President
        of
        YNOT.
 
 During
        the nine months ending June 30, 2007 the majority shareholder loaned the
        company
        cash of $134,519 for operating expenses and was repaid a total of
        $30,000.
 
 
 
 
 
  F
            -
            8
  **NOTE
        10 - DISCONTINUED OPERATIONS**
 
 As
        discussed in Note 9, in March, 2007 the Company entered into an agreement
        with
        Don Tolman by which Mr. Tolman assumed the $150,000 unsecured note payable
        and
        all related accrued interest in exchange for the Company’s 8,902,287 shares of
        common stock in YNOT.
 
 Also
        as
        discussed in Note 9, the Company and Mr. Price entered into a settlement
        and
        release agreement pursuant to which the Company transferred all of its rights,
        title and interest in its inventory in settlement of all its obligations
        to Mr.
        Price as of April 6, 2007.
 
 As
        a
        result of these two transactions, the Company has treated the operations
        of its
        Art and Publishing segments as discontinued.
 A
        summary
        of the results from discontinued operations for the three and nine months
        ended
        June 30, 2007 and 2006 and for the period from January 17, 2003 (inception)
        to
        June 30, 2007 are as follows:
 
 **For
                  the Three Months Ended June 30,**
              
              
              **For
                  the Nine Months Ended June 30,**
              
              
              **January
                  17, 2003 (Inception) through June 30,****2007**
              
              
              **2006**
              
              
              **2007**
              
              
              **2006**
              
              
              **2007**Revenues
              
              $
              847
              
              
              $
              50,318
              
              
              $
              2,161
              
              
              $
              105,073
              
              
              $
              243,683Cost
                  of revenue
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              154,981
              
              
              
              281,731**Gross
                  margin**
              
              
              847
              
              
              
              50,318
              
              
              
              2,161
              
              
              
              (49,908
              )
              
              
              (38,048
              )Operating
                  ExpensesAdvertising
                  and marketing
              
              
              1,895
              
              
              
              2,495
              
              
              
              5,841
              
              
              
              50,109
              
              
              
              266,495**Loss
                  from discontinued operations**
              
              
              (1,048
              )
              
              
              47,823
              
              
              
              (3,680
              )
              
              
              (100,017
              )
              
              
              (304,543
              )**Gain
                  on sale of YNOT**
              
              
              263,802
              
              
              
              -
              
              
              
              263,802
              
              
              
              -
              
              
              
              263,802**Total
                  income (loss) from discontinued operations**
              
              $
              262,754
              
              
              $
              47,823
              
              
              $
              260,122
              
              
              $
              (100,017
              )
              
              $
              (40,741
              )
 
 
 The
        Company has recognized a gain on the sales of the stock of YNOT under the
        caption “Gain on sale of discontinued operations” in the accompanying unaudited
        condensed consolidated statement of operations as follows:
 
 **Liabilities
                  of YNOT assumed in purchase**Royalty
                  payable
              
              $
              498Deferred
                  revenue
              
              
              102,126**Liabilities
                  assumed by Don Tolman:**Note
                  Payable to majority shareholder
              
              
              150,000Accrued
                  interest
              
              
              11,178Gain
                  on sale of YNOT Stock
              
              **$**
              **263,802**
 
  F
            -
            9
  **ITEM
        2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF
        OPERATION.**
 
 **SPECIAL
        NOTE REGARDING FORWARD LOOKING STATEMENTS**
 
 This
        quarterly report on Form 10-QSB, press releases and certain information provided
        periodically in writing or verbally by our officers or our agents contain
        statements which constitute forward-looking statements. The words “may”,
“would”, “could”, “will”, “expect”, “estimate”, “anticipate”, “believe”,
“intend”, “plan”, “goal”, and similar expressions and variations thereof are
        intended to specifically identify forward-looking statements. These statements
        appear in a number of places in this Form 10-QSB and include all statements
        that
        are not statements of historical fact regarding the intent, belief or current
        expectations of us, our directors or our officers, with respect to, among
        other
        things: (i) our liquidity and capital resources; (ii) our financing
        opportunities and plans; (iii) our ability to generate revenues; (iv)
        competition in our business segments; (v) market and other trends affecting
        our
        future financial condition or results of operations; (vi) our growth strategy
        and operating strategy; and (vii) the declaration and/or payment of
        dividends.
 
 Investors
        and prospective investors are cautioned that any such forward-looking statements
        are not guarantees of future performance and involve risks and uncertainties,
        and that actual results may differ materially from those projected in the
        forward-looking statements as a result of various factors. The factors that
        might cause such differences include, among others, those set forth in Part
        I,
        Item 2 of this quarterly report on Form 10-QSB, entitled “Management’s
        Discussion and Analysis or Plan of Operation”, and including without limitation
        the “Risk Factors” contained in our annual report on Form 10-KSB for the fiscal
        year ended September 30, 2006. Except as required by law, we undertake no
        obligation to update any of the forward-looking statements in this Form 10-QSB
        after the date of this report.
 
 The
        following discussion and analysis of our financial condition, results of
        operations and liquidity should be read in conjunction with our unaudited
        condensed consolidated financial statements for the three and nine months
        ended
        June 30, 2007 the notes thereto included in Part I, Item 1 of this quarterly
        report on Form 10-QSB, and our audited financial statements and the notes
        thereto and Management’s Discussion and Analysis or Plan of Operations contained
        in our annual report on Form 10-KSB for the fiscal years ended September
        30,
        2006 and 2005. Our condensed, consolidated financial statements have been
        prepared in accordance with generally accepted accounting principles,
        contemplate that we will continue as a going concern, and do not contain
        any
        adjustments that might result if we were unable to continue as a going concern,
        however, our independent registered public accounting firm, Hansen, Barnett
        and
        Maxwell, P.C., has added raised substantial doubt about our ability to continue
        as a going concern in their opinion on our financial statements for the fiscal
        years ended September 30, 2006 and 2005.
 
 **CRITICAL
        ACCOUNTING POLICIES**
 
 Our
        critical accounting policies, including the assumptions and judgments underlying
        those policies, are more fully described in the notes to our consolidated
        financial statements. We have consistently applied these policies in all
        material respects. Investors are cautioned, however, that these policies
        are not
        guarantees of future performance and involve risks and uncertainties, and
        that
        actual results may differ materially. Set forth below are the accounting
        policies that we believe most critical to an understanding of our financial
        condition, results of operations and liquidity.
 
 **Use
        of Estimates**
 
 The
        preparation of our unaudited condensed consolidated financial statements
        in
        conformity with generally accepted accounting principles requires management
        to
        make certain estimates and assumptions that affect the amounts of assets,
        liabilities, revenues and expenses reported in our unaudited condensed
        consolidated financial statements and the accompanying notes. We evaluate
        our
        estimates on an ongoing basis, and make our estimates and assumptions based
        on
        actual historical experience which we believe to be reasonable under the
        circumstances at that time. Actual results may differ materially from our
        current estimates.
 
 **Inventory**
 
 Inventory
        is recorded at the lower of cost or market value.
 
  1
  **Revenue
        Recognition**
 
 We
        derive
        revenues from direct and consignment sales of collectible, investment grade
        works of art, and from individual and corporate-oriented publishing
        services.
 
 We
        recognize revenues based on the various types of transactions generating
        the
        revenue. We recognize art revenue when persuasive evidence of an arrangement
        exists, services have been rendered or products have been delivered, the
        price
        to the buyer is fixed and determinable, and collectibility is reasonably
        assured.
 
 We
        recognize revenues for published products distributed through wholesale and
        retail channels and through resellers upon verification of final sell-through
        to
        end users, after consideration of rights of return and price protection.
        Typically, the right of return on such products has expired when the end
        user
        purchases the product from the retail outlet. Once the end user opens the
        package, it is not returnable unless the medium is defective.
 
 **Income
        Taxes**
 
 We
        account for income taxes using an asset and liability approach. We recognize
        an
        asset or liability for the deferred tax consequences of all temporary
        differences between the tax basis of assets or liabilities and their reported
        amounts in the consolidated financial statements that will result in taxable
        or
        deductible amounts in future years when the reported amounts of the asset
        or
        liabilities are recovered or settled. Deferred tax assets or liabilities
        are
        measured using the enacted tax rates that will be in effect when the differences
        are expected to reverse. Deferred tax assets are reviewed periodically for
        recoverability, and valuation allowances are provided as necessary.
 
 **OVERVIEW**
 
 We
        are a
        development stage company. We have historically conducted our operations
        through
        two primary divisions: Benacquista Fine Art and Benacquista
        Publishing.
 
 ·      Benacquista
        Fine Art offers direct and consignment sales of collectible, investment grade
        works of art, including limited edition prints, and original paintings and
        sculptures, through our website www.benacquistafineart.com.
 
 ·      Benacquista
        Publishing offers individual publishing services as well as a suite of corporate
        visibility, public relations and corporate financing services.
 
 We
        were
        originally incorporated on January 17, 2003 in accordance with the laws of
        the
        State of Nevada as Benacquista Galleries, Inc. On July 28, 2005 our common
        shares commenced trading on the OTC Bulletin Board (owned and operated by
        the
        Nasdaq Stock Market, Inc.) and are currently quoted under the symbol
“BAQU”.
 
 On
        September 29, 2005 we entered into an agreement with YNOT Education, Inc.
        a
        Nevada corporation, to acquire the website www.ynoteduk8.com in exchange
        for a
        $150,000 unsecured promissory note bearing interest at a rate of five percent
        (5%) per annum.
 
 On
        September 29, 2005 we also entered into an exclusive publishing and royalty
        agreement with our director, Don Tolman, to publish certain of his health
        and
        educational related books and materials, including the *Farmacist Desk
        Reference* (the “FDR TM”).
 
 On
        October 10, 2005 we incorporated YNOT Eduk8 Inc., as a wholly owned subsidiary,
        under the laws of the State of Nevada, in order to pursue certain business
        opportunities related to our acquisition of the website www.ynoteduk8.com,
        and
        any opportunities related to future creative works of Don Tolman, should
        such
        opportunities arise.
 
 In
        February 2006 we initiated a share buyback program, with the intention of
        repurchasing 200,000 shares of our common stock over a period of nine to
        twelve
        months at then current bid prices as reported on the OTC Bulletin Board.
        As of
        the date of this quarterly report on Form 10-QSB for the nine months ended
        June
        30, 2007 we have repurchased 2,400 shares of our common stock at an average
        price per share of $4.11.
 
  2
  On
        November 17, 2006 we entered into an asset purchase agreement (the “Asset
        Purchase Agreement”) with Physiognomy Interface Technologies, Inc., a
        privately-held Nevada corporation (“Physiognomy”), of which our director, Don
        Tolman, is President. Under the terms of the Asset Purchase Agreement we
        acquired Physiognomy’s web-based interactive dating service, including the
        website www.faceyourmate.com and all intellectual property and content related
        thereto, in exchange for a $5,000 lump sum payment.
 
 On
        January 8, 2007, we consolidated our authorized common shares on a one-for-ten
        basis, with a corresponding reduction in our common shares issued and
        outstanding as of that date. Unless otherwise noted, all references to the
        number of common shares included in this quarterly report on Form 10-QSB
        for the
        three month period ended June 30, 2007 are stated on a post-consolidated
        basis
        for all periods presented. Per share amounts have also been restated for
        the
        share consolidation.
 
 On
        March
        13, 2007, the Company’s Board of Directors declared a dividend of the common
        stock of YNOT, its subsidiary. The stock dividend was paid at the rate of
        one
        share of YNOT stock for each share of the Company common stock owned. YNOT
        issued an aggregate of 1,100,103 shares of its common stock and as a result,
        the
        Company owned an aggregate of 8,902,287 shares comprising approximately 89%
        of
        the outstanding shares of YNOT as of that date.
 
 On
        March
        27, 2007 we sold our interest of 8,902,287 shares in our YNOT subsidiary
        pursuant to a series of agreements to Don Tolman for aggregate consideration
        comprised of the assumption of certain liabilities totaling
        $263,802.
 
 On
        April
        10, 2007, the Company and Mr. Price entered into a settlement and release
        agreement pursuant to which the Company transferred all of its right, title
        and
        interest in its inventory recorded at $906,131 as of that date in settlement
        of
        any and all of its remaining obligations as of that date payable to Mr. Price
        comprised of the Note payable to majority shareholder in the principal amount
        of
        $862,127 plus all related accrued interest payable thereon, as well as all
        non
        interest bearing advances recorded as “Due to majority shareholder” in the
        accompanying balance sheet made by Mr. Price as of that date.
 
 As
        a
        result of the March 27, 2007 and April 10, 2007 transactions described in
        the
        previous paragraphs, the Benacquista Fine Art and Benacquista Publishing
        divisions have been discontinued.
 
 Therefore,
        our sole remaining business consists of the Physiognomy technology and
        www.faceyourmate.com web domain. No development has occurred of this technology
        since its purchase. We are currently in the process of evaluating the commercial
        potential of the Physiognomy technology as well as exploring other potential
        business opportunities.
 
 
 **RESULTS
        OF OPERATIONS FOR THE THREE MONTHS ENDED JUNE 30, 2007 AND
        2006**
 
 **Revenues**
 
 There
        were no revenues for the quarters ended June 30, 2007 and 2006.
 
 **General
        and Administrative Expenses**
 
 General
        and administrative expenses principally include salary expenses, professional
        fees, investor relations fees, rent and general corporate
        overheads.  General and administrative expenses for the three months
        ended June 30, 2007 decreased $6,836 to $41,492 from $48,328 for the three
        months ended June 30, 2006.  The decrease is due to decreased salaries
        and general corporate overheads partially offset by increases in professional
        fees.
 
 
 
  3
  **Other
        Income (expense)**
 
 Other
        income and expense principally include interest expenses, interest income
        and
        forgiveness of accounts payable.
 Interest
        expense for the period is comprised of interest on the Notes Payable to our
        majority shareholder, James Price.  Interest expense decreased $11,440
        to $1,181 for the three months ended June 30, 2007 as compared to $12,621
        for
        the three months ended June 30, 2006.  The decrease is due to the
        assumption in the YNOT transaction of the $150,000 note to Mr. Price and
        the
        settlement agreement with Mr. Price for the $862,127 Note.
 
 In
        January 2003, we issued a warrant to purchase up to 100,000 shares of our
        common
        stock at a price of $10.00 per share. During the period of August 17, 2005
        through September 7, 2005 the warrant was exercised and we received
        consideration in the form of certain promissory notes bearing interest at
        a rate
        of five percent (5%) per annum and payable in full on or before January 31,
        2008
        (the “Notes”). Our interest income from the Notes decreased $9,535, to $240 for
        the three months ended June 30, 2007 compared to $9,775 for the three months
        ended June 30, 2006. The decrease is attributable to the settlement of the
        promissory note with Monarch Consulting in April, 2007.
 
 Forgiveness
        of debt was $8,850 for the three months ended June 30, 2006 is attributable
        to a
        one-time settlement arrangement reached with a certain vendor for payment
        of
        invoices at amounts less than originally presented.  There is no
        amount for the three months ended June 30, 2007.
 
 
 **PLAN
        OF AND RESULTS OF OPERATIONS FOR THE NINE MONTH PERIOD ENDED JUNE 30, 2007
        AND
        2006**
 
 **Revenues**
 
 There
        were no revenues for the nine months ended June 30, 2007 and 2006.
 
 **Research
        and Development Expenses**
 
 Research
        and development expenses were $5,000 for the nine months ended June 30, 2007,
        due to a lump sum payment made to Physiognomy Interface Technologies, Inc.,
        in
        exchange for Physiognomy’s interactive dating website, www.faceyourmate.com, and
        all intellectual property and content related thereto. There was no amount
        for
        the nine months ended June 30, 2006.
 
 **General
        and Administrative Expenses**
 
 General
        and administrative expenses principally include salary expenses, professional
        fees, investor relations fees, rent and general corporate overheads. General
        and
        administrative expenses increased $14,046 to $131,129 for the nine months
        ended
        June 30, 2007 from $117,083 for the nine months ended June 30, 2006. This
        increase is primarily attributable to an increase in professional service
        fees
        related to regulatory and reporting obligations associated with our being
        a
        public company.
 
 **Other
        Income (expense)**
 
 Other
        income and expenses principally include interest expenses, interest income
        and
        forgiveness of accounts payable.
 
 Interest
        expense for the period is comprised of interest on the Notes Payable to our
        majority shareholder, James Price.  Interest expense decreased $11,523
        to $26,332 for the nine months ended June 30, 2007 as compared to $37,855
        for
        the nine months ended June 30, 2006.  The decrease is due to the
        assumption in the YNOT transaction of the $150,000 note to Mr. Price and
        the
        settlement agreement with Mr. Price for the $862,127 Note.
 
  4
  In
        January 2003, we issued a warrant to purchase up to 100,000 shares of our
        common
        stock at a price of $10.00 per share. During the period of August 17, 2005
        through September 7, 2005 the warrant was exercised and we received
        consideration in the form of certain promissory notes bearing interest at
        a rate
        of five percent (5%) per annum and payable in full on or before January 31,
        2008
        (the “Notes”). Our interest income from the Notes decreased $26,404 to $7,535
        for the nine months ended June 30, 2007 compared to $33,939 for the nine
        months
        ended June 30, 2006. The decrease is attributable to decreasing average
        outstanding balances of the notes and the settlement of the promissory note
        with
        Monarch Consulting in April, 2007.
 
 Forgiveness
        of debt was $8,850 for the nine months ended June 30, 2006 is attributable
        to a
        one-time settlement arrangement reached with a certain vendor for payment
        of
        invoices at amounts less than originally presented.  There is no
        amount for the nine months ended June 30, 2007.
 
 
 **Liquidity
        and Capital Resources**
 
 As
        of
        June 30, 2007 we had no cash on hand. Historically, we have funded our
        operations primarily through advances from our Chief Executive Officer and
        majority shareholder, James Price, proceeds from the exercise of warrants,
        and
        sales of our collectible, investment grade works of art and the *Farmacist’s
        Desk Reference*.
 
 For
        the
        nine months ended June 30, 2007 we received net cash advances from our Chief
        Executive Officer and majority shareholder totaling $104,519.
 
 We
        do not
        believe that our current financial resources are sufficient to meet our working
        capital needs over the next twelve months and, accordingly, we will need
        to
        secure additional external financing to continue our operations. We may seek
        to
        raise additional capital though private equity or debt financings and further
        shareholder loans. As of the date of this quarterly report on Form 10-QSB
        for
        the nine months ended June 30, 2007, we have obtained verbal commitments
        from
        our Chief Executive Officer and majority shareholder to make further capital
        advances to fund our operations; however, there can be no assurance that
        those
        further capital advances, if and when made, will be sufficient to sustain
        our
        level of operations. Moreover, there can be no assurance that we will be
        able to
        secure additional external financing, or, if we are able to secure such external
        financing, that it will be on terms favorable, or even acceptable, to us.
        If
        necessary, we may explore strategic alternatives, including a merger, asset
        sale, joint venture or other comparable transactions. Any inability to achieve
        or sustain profitability or otherwise secure external financing or locate
        a
        strategic partner would have a material adverse effect on our business,
        financial condition, and results of operations, raising substantial doubts
        as to
        our ability to continue as a going concern, and we may ultimately be forced
        to
        seek protection from creditors under the bankruptcy laws or cease
        operations.
 
 Our
        short-term prospects are challenging considering our lack of financial
        resources. In the absence of additional financing or locating a strategic
        partner willing to finance further product development, our short-term and
        long-term prospects for growth are minimal.
 
 **Recently
        Issued Accounting Pronouncements**
 
 In
        September 2006, the Financial Accounting Standards Board (“FASB”) issued
        Statements of Financial Accounting Standard (“SFAS”) No. 157, “Fair Value
        Measurements.” SFAS No. 157 defines fair value, establishes a framework for
        measuring fair value, and expands disclosures about fair value measurements.
        This statement applies under other accounting pronouncements that require
        or
        permit fair value measurements. However, it does not apply to SFAS No. 123(R),
        “Share-Based Payment.” This statement shall be effective for financial
        statements issued for fiscal years beginning after November 15, 2007, and
        interim periods within those fiscal years. Earlier application is encouraged,
        provided that the reporting entity has not issued financial statements for
        that
        fiscal year, including any financial statements for an interim period within
        that fiscal year. The provisions of this statement should be applied
        prospectively as of the beginning of the fiscal year in which this Statement
        is
        initially applied, except in some circumstances where impact, if any, that
        the
        adoption of SFAS No. 157 will have on our condensed consolidated financial
        statements.
 
  5
  In
        September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined
        Benefit Pension and Other Post-Retirement Plans, amending SFAS No. 87,
        Employers’ Accounting for Pensions, SFAS No. 88, Employers’ Accounting for
        Settlements and Curtailments of Defined Benefit Pension Plans and for
        Termination Benefits, SFAS No. 106,Employers’ Accounting for
        Postretirement Benefits Other than Pensions,” and SFAS No. 132(R), “Employers’
Disclosures about Pensions and Other Postretirement Benefits.” SFAS No. 158
        requires recognition of the overfunded or underfunded status of a defined
        benefit postretirement plan (other than a multiemployer plan) as an asset
        or
        liability in a reporting entity’s statement of financial position and to
        recognize changes in that funded status in the year in which the changes
        occur
        through comprehensive income. It also requires an employer to measure the
        funded
        status of a plan as of the date of its year-end statement of financial position.
        The statement is effective as of the end of the fiscal year ending after
        December 15, 2006. The adoption of SFAS No. 158 is not expected to have a
        material impact on our condensed consolidated financial statements.
 
 In
        September 2006, the Securities and Exchange Commission issued Staff Accounting
        Bulletin (“SAB”) 108, “Considering the Effects of Prior year Misstatements When
        Quantifying Misstatements in Current Year Financial Statements.” SAB 108
        clarifies the staff’s position regarding the process of quantifying financial
        statement misstatements. More specifically, the staff noted that certain
        registrants do not consider the effects of prior year errors on current year
        financial statements, thereby allowing improper assets or liabilities to
        remain
        unadjusted. The staff believes this approach is not in the best interests
        of the
        users of the financial statements. SAB 108 is effective for fiscal years
        ending
        on or after November 15, 2006, with earlier adoption encouraged. At present,
        we
        evaluating the impact, if any, that the adoption of SAB 108 will have on
        our
        condensed consolidated financial statements.
  In
        February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for
        Financial Assets and Financial Liabilities", including an amendment of FASB
        Statement No. 115 SFAS 159. This pronouncement permits entities to choose
        to
        measure many financial instruments and certain other items at fair value
        that
        are not currently required to be measured at fair value. SFAS 159 is effective
        as of the beginning of an entity's first fiscal year that begins after November
        15, 2007. The impact of adopting SFAS 159 on our condensed consolidated
        financial statements, if any, has not yet been determined.
 
 
 **ITEM
        3. CONTROLS AND PROCEDURES.**
 
 **DISCLOSURE
        CONTROLS AND PROCEDURES**
 
 We
        maintain disclosure controls and procedures designed to ensure that the
        information required to be disclosed in our reports filed or submitted under
        the
        Securities Exchange Act of 1934, as amended, is recorded, processed, summarized
        and reported in a timely manner as specified in the rules and forms set forth
        by
        the United States Securities and Exchange Commission. These controls and
        procedures are designed to ensure that the information required to be disclosed
        in our reports is accumulated and communicated to our management, including
        our
        Chief Executive Officer and Principal Financial Officer, or other persons
        performing similar functions, as appropriate, so as to allow timely decisions
        regarding required disclosure.
 
 An
        evaluation of the effectiveness of the design and operation of our disclosure
        controls and procedures was carried out by our Chief Executive Officer and
        Principal Financial Officer, James Price, as of the end of the fiscal quarter
        covered by this quarterly report on Form 10-QSB. Based on this evaluation,
        our
        Chief Executive Officer and Principal Financial Officer has concluded that
        our
        disclosure controls and procedures are effective and designed to ensure that
        the
        information required to be disclosed in our reports filed or submitted under
        the
        Exchange Act, is recorded, processed, summarized and reported within the
        requisite time periods.
 
 During
        the course of his evaluation our Chief Executive Officer and Principal Financial
        Officer did not discover any fraud involving management or any other personnel
        who play a significant role in our disclosure controls and procedures.
        Furthermore, because there were no significant deficiencies and/or material
        weaknesses discovered no remedial measures were necessary or taken during
        the
        period covered by this report to correct any such deficiencies.
 
 **CHANGES
        IN INTERNAL CONTROL OVER FINANCIAL REPORTING**
 
 No
        changes in our disclosure controls and procedures, internal controls over
        financial reporting or other factors have occurred during the fiscal quarter
        covered by this report that would materially affect or be reasonably likely
        to
        materially affect our disclosure controls and procedures or internal controls
        over financial reporting.
 
  6
  **PART
        II – OTHER INFORMATION**
 
 **ITEM
        1. LEGAL PROCEEDINGS.**
 
 None.
 
 **ITEM
        2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
        PROCEEDS.**
 
 There
        were no reportable events under this Item 2 during the quarterly period ended
        June 30, 2007.
 
 **ITEM
        3. DEFAULT UPON SENIOR SECURITIES.**
 
 There
        were no reportable events under this Item 3 during the quarterly period ended
        June 30, 2007.
 
 **ITEM
        4. SUBMISSION OF MATTERS TO A VOTE
        OF SECURITY HOLDERS.**
 
 There
        were no matters submitted to a vote of our stockholders, through the
        solicitation of proxies or otherwise, during the quarterly period ended June
        30,
        2007.
 
 **ITEM
        5. OTHER INFORMATION.**
 
 There
        were no reportable events under this Item 5 during the quarterly period ended
        June 30, 2007.
 
 
 
 
 
 
 
 
 
 
 
  7
  **ITEM
        6. EXHIBITS.**
 
 **No.**
              **Description
                  of Exhibit**3(i)(1)
              Articles
                  of Incorporation of Benacquista Galleries Inc., dated January 17,
                  2003,
                  incorporated by reference to Exhibit 3.1 on Form SB-2 filed March
                  31,
                  2003.3(i)(2)
              Certificate
                  of Change to Articles of Incorporation of Benacquista Galleries
                  Inc.,
                  dated December 27, 2006, incorporated by reference to Exhibit 3(i)(2)
                  on
                  Form 10-KSB filed January 16, 2007.3(ii)
              By-laws
                  of Benacquista Galleries Inc., dated January 17, 2003, incorporated
                  by
                  reference to Exhibit 3.2 on Form SB-2 filed March 31,
                  2003.10.1
              Asset
                  Acquisition Agreement between Benacquista Galleries Inc. and YNOT
                  Education, Inc., dated September 29, 2005, incorporated by reference
                  to
                  Exhibit 10.1 on Form 8-K filed September 30, 2005.10.2
              Royalty
                  Agreement between Benacquista Galleries Inc. and Don Tolman, dated
                  September 29, 2005, incorporated by reference to Exhibit 10.2 on
                  Form 8-K
                  filed September 30, 2005.10.3
              Form
                  of Co-Marketing and Exclusive Distribution Agreement between Benacquista
                  Galleries Inc. and ArtTrader.org, dated October 6, 2005, incorporated
                  by
                  reference to Exhibit 10.3 on Form 10-KSB filed January 16,
                  2007.10.4
              Form
                  of Exclusive Artist Acquisition Agreement between Benacquista Galleries
                  Inc. and ArtTrader.org, dated October 12, 2005, incorporated by
                  reference
                  to Exhibit 10.4 on Form 10-KSB filed January 16, 2007.10.5
              Asset
                  Purchase Agreement between Benacquista Galleries Inc. and Physiognomy
                  Interface Technologies, Inc., dated November 17, 2006, incorporated
                  by
                  reference to Exhibit 10.5 on Form 10-KSB filed January 16,
                  2007.10.6
              Stock
                  Purchase Agreement Benacquista Galleries Inc. and Whole In One
                  Products,
                  Inc., dated December 18, 2006, incorporated by reference to Exhibit
                  10.6
                  on Form 10-KSB filed January 16, 2007.31.1
              Certification
                  of Benacquista Galleries Inc. Chief Executive Officer, James Price,
                  required by Rule 13a-14(a) or Rule 15d-14(a). FILED
                  HEREWITH31.2
              Certification
                  of Benacquista Galleries Inc. Chief Financial Officer, James Price,
                  required by Rule 13a-14(a) or Rule 15d-14(a). FILED
                  HEREWITH32.1
              Certification
                  of Benacquista Galleries Inc. Chief Executive Officer, James Price,
                  required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of
                  Chapter
                  63 of Title 18 of the United States Code (18 U.S.C. 1350). FILED
                  HEREWITH.32.2
              Certification
                  of Benacquista Galleries Inc. Chief Financial Officer, James Price,
                  required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of
                  Chapter
                  63 of Title 18 of the United States Code (18 U.S.C. 1350). FILED
                  HEREWITH.
 
 
  8
  **Signatures**
 
 In
        accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
        this report to be signed on its behalf by the undersigned, thereunto duly
        authorized.
 
 Date:
                  August 14, 2007**BENACQUISTA
                  GALLERIES, INC.**By:
              */s/ James
                  Price*James
                  PriceChief
                  Executive
                  Officer &
                Chief
                  Financial
                  Officer


















9