**UNITED
        STATES**
 **SECURITIES
        AND EXCHANGE COMMISSION**
 Washington,
        D.C. 20549
  **FORM
        10-QSB**
  (Mark
        One)
 
 **[X]**
              **QUARTERLY
                  REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
                  ACT OF
                  1934**
 
 For
        the
        quarterly period ended March 31, 2006
 OR
 
 **[_]**
              **TRANSITION
                  REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
                  ACT OF
                  1934**
 
 For
        the
        transition period from ________ to ________
 
 *Commission
        File No. 333-104132*
  **Benacquista
        Galleries, Inc.**
 (Exact
        name of Registrant as specified in its charter)
 
 Nevada
              71-0928242(State
                  or other jurisdiction of incorporation or organization)
              (I.R.S.
                  Employer Identification Number)6477
                  Lickton PikeGoodlettsville
                  TN(858)
                  525-5695(415)
                  358-5548 Fax
              37072(Address
                  of principal executive offices)
              (Zip/Postal
                  Code)
  (858)
        525-5695
 (Telephone
        Number)
 
 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 period that
        the
        registrant was required to file such reports), and (2) has been subject to
        such
        filing requirements for the past 90 days.
 [X]
        YES
        [  ] NO
  State
        the
        number of shares outstanding of each of the Issuer's classes of common equity,
        as of the latest practicable date. There were 11,000,000 common stock shares,
        par value $0.001, as of March 31, 2006 .
  
 
  
  
 
 **TABLE
        OF CONTENTS**
 
 PART
                  I.
              FINANCIAL
                  INFORMATION
              4Item
                  1
              Financial Statements
              4Condensed
                  Balance Sheets (unaudited) as of March 31, 2006 and September 30,
                  2005
              4Condensed
                  Statements of Operations (unaudited) for the three month periods
                  ended in
                  March 31 ,2005 and March 31, 2006 and the six month periods ended
                  in March
                  31, 2005 and March 31, 2006
              5Condensed
                  Statements of Cash Flows (unaudited) for the three month periods
                  ended in
                  March 31 ,2005 and March 31, 2006 and the six month periods ended
                  in March
                  31, 2005 and March 31, 2006
              6Notes
                  to Financial Statements
              7Item
                  2
              Plan
                  of Operation
              10Item
                  3
              Controls
                  and Procedures
              12PART
                  II
              OTHER
                  INFORMATION
              13Item
                  1
              Legal
                  Proceedings
              13Item
                  2
              Changes
                  in Securities and Small Business Issuer Purchases of Equity
                  Security
              13Item
                  3
              Defaults
                  Upon Senior Securities
              13Item
                  4
              Submission
                  of Matters to a Vote of Security Holders
              13Item
                  5
              Other
                  Information
              13Item
                  6
              Exhibits
                  and Reports on Form 8-K
              13Signature
              14
 
 
 
 
 
  2
 
  FORWARD-LOOKING
        STATEMENTS
  
 In
        addition to historical information, this Report contains forward-looking
        statements. Such forward-looking statements are generally accompanied by
        words
        such as "intends," "projects," "strategies," "believes," "anticipates," "plans,"
        and similar terms that convey the uncertainty of future events or outcomes.
        The
        forward-looking statements contained herein are subject to certain risks
        and
        uncertainties that could cause actual results to differ materially from those
        reflected in the forward-looking statements. Factors that might cause such
        a
        difference include, but are not limited to, those discussed in ITEM 2 of
        this
        Report, the section entitled "MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN
        OF
        OPERATION." Readers are cautioned not to place undue reliance on these
        forward-looking statements, which reflect management's analysis only as of
        the
        date hereof and are in all cases subject to the Company's ability to cure
        its
        current liquidity problems. There is no assurance that the Company will be
        able
        to generate sufficient revenues from its current business activities to meet
        day-to-day operation liabilities or to pursue the business objectives discussed
        herein.
 
 The
        forward-looking statements contained in this Report also may be impacted
        by
        future economic conditions. Any adverse effect on general economic conditions
        and consumer confidence may adversely affect the business of the Company.
 
 Benacquista
        Galleries, Inc. undertakes no obligation to publicly revise these
        forward-looking statements to reflect events or circumstances that arise
        after
        the date hereof. Readers should carefully review the risk factors described
        in
        other documents the Company files from time to time with the Securities and
        Exchange Commission, including without limitation those identified in the
        "Risk
        Factors" section of the Company's Registration Statement filed with the
        Securities and Exchange Commission (the "SEC") on May 14, 2003 on Form SB-2/A.
 
 
 
 
 
 
 
 
 
  
 
 
 
 
  3
  **Part
        I - Financial Information**
 
 **Item
        1. Financial Statements**
 
 **BENACQUISTA
        GALLERIES, INC.**
 **CONDENSED
        BALANCE SHEETS**
 **(UNAUDITED)**
 
 **March
                  31,**
              
              **September
                  30,****2006**
              
              **2005****ASSETS****Current
                  Assets**Cash
              
              $
              40,457
              
              $
              507Accounts
                  Receivable
              
              
              387,670
              
              
              -Inventory
              
              
              906,131
              
              
              841,377Accrued
                  Interest Receivable
              
              
              4,983
              
              
              -**Total
                  Current Assets**
              
              
              1,339,241
              
              
              841,884**Total
                  Assets**
              
              $
              1,339,241
              
              $
              841,884**LIABILITIES
                  AND STOCKHOLDERS' EQUITY (DEFICIT)****Current
                  Liabilities**Accounts
                  payable
              
              $
              88,211
              
              $
              26,385Accrued
                  Interest
              
              
              40,183
              
              
              114,971Unearned
                  Income
              
              
              465
              
              
              -Due
                  to Shareholder
              
              
              117,785
              
              
              -Note
                  payable to related party
              
              
              1,012,127
              
              
              1,012,127**Total
                  Current Liabilities**
              
              
              1,258,771
              
              
              1,153,483**Long-Term
                  Liabilities**
              
              
              -
              
              
              -**Total
                  Liabilities**
              
              $
              1,258,771
              
              $
              1,153,483**Stockholders'
                  Equity (Deficit)**Common
                  Stock- $0.001 par value; 50,000,000 shares auhorized;11,000,000
                  shares issued and oustanding respectively
              
              
              11,000
              
              
              10,000Additional
                  paid-in-capital
              
              
              1,095,108
              
              
              93,058Stock
                  Subscriptions Receivable
              
              
              (788,258
              )
              
              -Retained
                  (Deficit)
              
              
              (237,380
              )
              
              (414,657
              )**Total
                  Stockholders' Equity (Deficit)**
              
              
              80,470
              
              
              (311,599
              )**Total
                  Liabilities and Stockholders' Equity (Deficit)**
              
              $
              1,339,241
              
              $
              841,884
 
   
 The
        accompanying notes are an integral part of these unaudited condensed financial
        statements.
 
  4
 
 **BENACQUISTA
        GALLERIES, INC.**
 **CONDENSED
        STATEMENTS OF OPERATIONS**
 **(UNAUDITED)**
 
 **For
                  the Three Months Ended**
              
              **For
                  the Six Months Ended****March
                  31, 2006**
              
              **March
                  31, 2005**
              
              **March
                  31, 2006**
              
              **March
                  31, 2005****Revenue**
              
              $
              422,275
              
              $
              -
              
              $
              422,275
              
              $
              -**Cost
                  of Goods Sold**
              
              
              (154,982
              )
              
              -
              
              
              (154,982
              )
              
              -**Gross
                  Margin**
              
              
              267,293
              
              
              -
              
              
              267,293
              
              
              -**General
                  and adminstrative Expense**
              
              
              (75,494
              )
              
              (24,074
              )
              
              (88,715
              )
              
              (33,867
              )**Income
                  (Loss) From Operations**
              
              
              191,799
              
              
              (24,074
              )
              
              178,578
              
              
              (33,867
              )**Other
                  Income and Expense:****Interest
                  Expense**
              
              
              (25,212
              )
              
              (10,777
              )
              
              (38,206
              )
              
              (21,554
              )**Interest-Notes
                  Receivable**
              
              
              10,691
              
              
              -
              
              
              10,691
              
              
              -**Total
                  Other Income and Expense**
              
              
              (14,521
              )
              
              (10,777
              )
              
              (27,515
              )
              
              (21,554
              )**Net
                  Income (Loss)**
              
              
              177,278
              
              
              (34,851
              )
              
              151,063
              
              
              (55,421
              )**Basic
                  and Diluted Loss per Share**
              
              $
              0.02
              
              $
              (0.00
              )
              $
              0.01
              
              $
              (0.01
              )**Weighted
                  average number of shares oustanding**
              
              
              10,933,333
              
              
              10,000,000
              
              
              10,461,538
              
              
              10,000,000
 
 
 
 
 The
        accompanying notes are an integral part of these unaudited condensed financial
        statements.
 
  5
  
 **BENACQUISTA
        GALLERIES, INC.**
 **STATEMENTS
        OF CASH FLOWS**
 **(UNAUDITED)**
 
 **For
                  the**
              
              **For
                  the****Six
                  Months Ended**
              
              **Six
                  Months Ended****March
                  31, 2006**
              
              **March
                  31, 2005****Cash
                  Flows From Operating Activities**Net
                  Income (Loss)
              
              $
              177,277
              
              $
              (55,421
              )Changes
                  in operating assets and liabilities:Accounts
                  Receivable
              
              
              (387,670
              )Inventory
              
              
              (64,754
              )
              
              -Accrued
                  interest receivable
              
              
              (4,983
              )Accounts
                  payable
              
              
              61,826
              
              
              (713
              )Payable
                  to related party
              
              
              
              
              
              500Unearned
                  Income
              
              
              465Accrued
                  interest
              
              
              (74,788
              )
              
              21,554**Net
                  Cash From Operating Activities**
              
              
              (292,627
              )
              
              (34,080
              )**Cash
                  Flows From Investing Activities**
              
              
              -
              
              
              -**Cash
                  Flows From Financing Activities**Cash
                  for common stock
              
              
              211,742
              
              
              3,778Loan
                  from majority shareholder
              
              
              117,785
              
              
              -Additional
                  Paid-in-Capital
              
              
              3,050
              
              
              -**Net
                  Cash From Financing Activities**
              
              
              332,577
              
              
              3,778**Net
                  Change in Cash**
              
              
              39,950
              
              
              (30,302
              )**Cash
                  at Beginning of Period**
              
              
              507
              
              
              30,302**Cash
                  at End of Period**
              
              $
              40,457
              
              $
              -**Non-Cash
                  Financing Activities**Stock
                  Subscriptions Receviable
              
              $
              1,000,000
              
              $
              -
 
   
 The
        accompanying notes are an integral part of these unaudited condensed financial
        statements.
  6
  
 **BENACQUISTA
        GALLERIES, INC.**
 **NOTES
        TO UNAUDITED CONDENSED FINANCIAL STATEMENTS**
 **MARCH
        31, 2006**
 
 
 **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. In prior reporting periods, the Company
        was considered a development stage enterprise in the process of raising capital
        to fund operations. As such, the Company had spent most of its efforts in
        developing its business plan, acquiring inventory, and in raising capital
        to
        fund its operations. The Company relied 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 artwork through the
        Internet and in September 2005 obtained the exclusive publishing rights to
        the
“Farmacist Desk Reference”. The Company’s fiscal year end is September
        30.
 
  ***Interim
        Financial Information*** **** - ***The
        accompanying un-audited condensed 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 disclosures 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 a normal recurring nature. Year-to-date results for the six-month
        period ended March 31, 2006 are not necessarily indicative of the results
        that
        may be expected for the year ending September 30, 2006. The accompanying
        financial statements should be read in conjunction with the Company’s annual
        financial statements as of September 30, 2005 filed with form
        10-KSB.***
  
 **NOTE
        2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
 
 ***Business
        Condition*** —
The
        Company is a new company with limited operating history. This situation raises
        substantial doubt about its ability to continue as a going concern. The Company
        plans to fund its operations with revenues from the sale of art inventory
        on its
        interim website and publication and wholesale sales of the “Farmacist Desk
        Reference”. The Company’s 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.
 
 ***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.
 
 
  7
 
 
 **NOTE
        3** - **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 of its art work
        from periodic professional appraisals. Appraisals are performed annually
        or more
        often as deemed appropriate. On September 30, 2005, Ted Robertson, appraiser,
        appraised the works of art and provided a current market value of $1,227,500.
 
 An
        order
        was placed in December to have 5,000 Farmacist Desk References printed @$25.90
        per book; shipment was received in March 2006 and the total of $129,500 has
        been
        paid to the printer. Book sale orders have been filled and invoiced for 5,000
        books @$75 per book; balance of $367,520 is reflected as part of Accounts
        Receivable. A royalty payment of $1.00 per book for each book sold was paid
        to
        the author per the agreement.
 
 ***Composition*** —
Art
        inventory 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
        4- UNEARNED REVENUE**
 
 Unearned
        revenue represents prepayments received on books not yet sent to the customer.
 
 **NOTE
        5** - **STOCKHOLDERS’
        EQUITY AND WARRANTS**
 
 ***Common
        Stock*** —
In
        January 2003, the Company issued 10,000,000 shares of common stock to various
        individuals, including officers of the Company, for cash proceeds of $10,000
        or
        $0.001 per share. On January 7, 2006 1,000,000 warrants were converted @$1.00
        per share to common stock and reflects as an increase to Capital Stock of
        $1,000
        or $0.001 per share. The stock acquired on January 7, 2006 has only been
        partially paid for. The unpaid portion is shown as stock subscriptions
        receivable in the equity section as of March 31, 2006.
 
 ***Additional
        Paid-in Capital*** —
The
        majority shareholder made $3,050 cash contributions for the six months ended
        March 31, 2006 for a total of $96,108 during the period January 17, 2003
        (date
        of inception) through March 31, 2006. On January 7, 2006 1,000,000 warrants
        were
        converted @$1.00 to common stock of which $999,000 (Excess of par value)
        reflects as additional paid in capital.
 
 ***Warrant*** —
In
        January 2003, the Company issued a warrant to purchase up to 1,000,000 shares
        of
        common stock to an unaffiliated company. The following summarizes the
        outstanding warrant at September 30, 2005 and December 31, 2005:
 
 **Weighted-Average**
              
              **Weighted-Average****Exercise**
              
              **Remaining****Fixed
                  Warrants**
              
              **Warrants**
              
              **Price**
              
              **Contractual
                  Life**Outstanding
                  at September 30, 2005
              
              1,000,000
              
              1.00
              
              .34
                  yearsIssuances
              
              -
              
              -Outstanding
                  at December 31, 2005
              
              1,000,000
              
              $
                  1.00
              
              .08
                  years
 
 During
        January 2006, warrant holders exercised their rights and purchased 1,000,000
        shares of common stock at $1 per share by entering into note receivable
        agreements to pay the company $1,000,000. The notes bear interest at 5% and
        are
        due by January 2008 with no interim principal or interest payments required.
        As
        the notes are the result of issuing common stock, the $1,000,000, less amounts
        received, is recorded as an offset to equity. During the quarter ended March
        31,
        2006, payments received were applied to accrued interest and principal thus
        reducing the principal balance to $788,258 as of March 31, 2006.
 
  8
  
 **NOTE
        6 - RELATED PARTY TRANSACTIONS**
 
 In
        January 2003, the major 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. The balance of the note
        plus
        accrued interest is currently unpaid and will remain on the books as a demand
        note continuing to bear the 5% per annum interest.
 
 In
        September 2005, the company acquired the website www.ynoteduk8.com for
        $150,000 represented by an unsecured note payable to the major shareholder.
        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.
 
 During
        the six months ending March 31, 2006 the majority shareholder loaned the
        company
        $117,784 to acquire additional artwork and to pay certain operating expenses
        by
        issuance of a demand note with no periodic payments required. On March 16,
        2006
        a partial accrued interest payment of $100,000 was made to the majority
        shareholder.
 
 **NOTE
        7 - PENDING OR THREATENED LITIGATION**
 
 There
        is
        pending litigation against the company. The Whole Food Farmacy filed a trademark
        infringement suit against the Company in Federal Court in Tennessee on March
        18,
        2006. In management’s and legal counsel’s opinion, there is no basis in fact for
        this litigation and it is frivolous. Legal counsel is of the opinion that
        the
        maximum liability to the Company will be no more than legal fees.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  9
  
 **Item
        2. Plan of Operation**
  The
        following discussion and analysis of our financial condition and results
        of our
        operations should be read in conjunction with our financial statements and
        related notes appearing elsewhere in this report. This discussion and analysis
        contains forward-looking statements that involve risks, uncertainties and
        assumptions. The actual results may differ materially from those anticipated
        in
        these forward-looking statements.
   **Plan
        of Operation**
  The
        following discussion regarding our plan of operations for the next 12 months
        contains forward-looking statements that involve risks, uncertainties and
        assumptions. The actual results may differ materially from those anticipated
        in
        these forward-looking statements as a result of certain factors, including,
        but
        not limited to, those set forth under "Risk factors" and elsewhere in this
        prospectus.
 
 Overview
  Benacquista
        Galleries, Inc. is a Nevada Corporation formed on January 17, 2003 for the
        purpose of offering collectable artwork and accessories through a chain of
        retail galleries and a fully interactive e-commerce and auction-enabled website.
        In September, 2005, the Company added to its available products through the
        acquisition of an interactive website, www.ynoteduk8.com. This website provides
        information and materials for purchase related to art and visual education
        as
        well as other aspects of education and cognitive science. The company also
        acquired the publication rights to the Farmacist’s Desk Reference, a full-color
        guide to health and wellness written by Benacquista Director Don Tolman.
        To
        date, the company does not have any retail galleries. The Company does have
        art
        and educational products available for sale on its www.benacquista.com and
        www.ynoteduk8.com websites. The Company has printed and sold 5000 copies
        of the
        Farmacist’s Desk Reference in Australia, selling out the first printing. It is
        anticipated that the second printing will be completed and sold out by September
        30, 2006.
 
 Currently,
        although we have only two employees, we utilize several distributors, printers,
        editors and consultants to help us conduct our business. Sole officer and
        director James Price and director Don Tolman currently manage both our art
        and
        our education sales and marketing. We are currently selling art on the internet
        through our website and affiliate websites, through our ebay store and through
        the personal efforts of our CEO James Price. In addition, we are still actively
        searching for appropriate physical gallery space and we are currently in
        the
        process of hiring additional personnel to support both our new artist program
        as
        well as product development and sales for our education products.
 
 We
        have
        primary areas of our business that we intend to develop over the next six
        to
        twelve months:
  •
              Relationships
                  with several artists for exclusive artwork offerings through Benacquista
                  Galleries;
 •
              Publication
                  and Sales of the Farmacist’s Desk Reference
 •
              At
                  least one gallery opening in a strategic
                  location;
 •
              Sales
                  of additional educational products created by Don Tolman and related
                  to
                  various educational topics including art
                  education
 •
              A
                  sales and marketing capability sufficient to handle all website
                  inquiries
                  and gallery traffic.
 
 History
        and form of organization
 
 Benacquista
        Galleries, Inc. is a development stage Nevada Corporation formed on January
        17,
        2003 for the purpose of offering collectable artwork and accessories through
        a
        chain of retail galleries and a fully interactive e-commerce and auction-enabled
        website. In September, 2005, the Company added to its available products
        through
        the acquisition of an interactive website, www.ynoteduk8.com. This website
        provides information and materials for purchase related to art and visual
        education as well as other aspects of education and cognitive science. The
        company also acquired the publication rights to the Farmacist’s Desk Reference
        (FDR), a full-color guide to health and wellness written by Benacquista Director
        Don Tolman. To date, the company does not have any retail galleries. The
        Company
        does have art and educational products available for sale on its
        www.benacquista.com and www.ynoteduk8.com websites.
 
  10
  
 **Sales
        and marketing.** We
        expect sales and marketing expenses to increase sharply to between $100,000
        and
        $250,000 by June of 2006, assuming the launch of the FDR and related products
        is
        successful.
  **General
        and administrative.** General
        and administrative expenses were $75,494 during the three months ending March
        31, 2006 and $24,074 during the three months ending March 31, 2005.
  **Financial
        Condition**
  For
        the
        three-month period ended March 31, 2006 , Benacquista Galleries had net income
        of $177,278 while for the period ended March 31, 2005, the Company had a
        net
        loss of $34,851. Also, for the period ended March 31, 2006 , the Company
        had
        total stockholders equity of $80,470, while for the period ended September
        30,
        2005, the Company had a stockholders deficit of ($311,599).
  Benacquista
        Galleries's current financial condition makes it difficult to keep up with
        our
        desired rate of growth. Because of the demand for the FDR and the long lead
        time
        involved in printing, there are significant costs we must advance in order
        to
        continue to reprint the FDR. Although sales of the book are profitable, our
        lack
        of extensive cash reserves means we must grow only as we can finance printing
        of
        the book. We are currently unable to meet market demand of the FDR, but we
        anticipate that further sales will alleviate this problem.
  **Liquidity
        and capital resources**
  Net
        cash
        used in operating activities for the six-month period ended March 31, 2006
        and
        2005 was $292,627 and $34,080 respectively. As of March 31, 2006 , we had
        $40,457 in cash. Net cash used in operating activities for the period ended
        March 31, 2006 was primarily the result of an increase in accounts receivable.
        Net cash used in operating activities for the period ended March 31, 2005
        was
        primarily the result of a net loss offset by an increase in accrued interest
        payable.
  Net
        cash
        provided by financing activities was $332,577 for the six-month period ended
        March 31, 2006. Net cash provided by financing activities was $3,778 for
        the
        period ended March 31, 2005. Net cash provided by financing activities for
        the
        period ended March 31, 2006 was attributable to a loan from our major
        shareholder and sales of our common stock.
  As
        of
        March 31, 2006 our principal commitments consisted of our obligations
        outstanding under accounts payable, accrued interest and a note payable to
        our
        major shareholder. We have no material commitments for capital expenditures.
        We
        expect no significant capital expenditures or lease commitments during the
        next
        fiscal quarter.
  We
        believe that our current cash balances, including cash and cash equivalents,
        are
        insufficient to meet our working capital and capital expenditure requirements.
        We have exhausted almost all of our working capital. We will need to receive
        an
        infusion of capital from our chief executive officer, collect accounts
        receivable, receive advance payment from distributors or otherwise increase
        our
        available cash.
  We
        need
        to secure additional cash as soon as possible because the lack of cash limits
        our growth potential. We may seek to sell additional equity or debt securities
        or to obtain a credit facility; however, at the present time, we have not
        entered into any arrangements or understandings with respect to any such
        financings. The sale of additional equity or convertible debt securities
        could
        result in additional dilution to our stockholders. The incurrence of
        indebtedness would result in an increase in our fixed obligations and could
        result in operating covenants that would restrict its operations. There can
        be
        no assurance that financing will be available in amounts or on terms acceptable
        to us, if at all. If financing is not available when required or is not
        available on acceptable terms, we may be unable to grow at our desired rate
        of
        growth. In addition, we may be unable to take advantage of business
        opportunities or respond to competitive pressures. Any of these events could
        have a material and adverse effect on our business, results of operations
        and
        financial condition.
 
  11
   Benacquista
        Galleries's short-term prospects are good, although the lack of additional
        capital is slowing our growth somewhat Management feels very confident in
        the
        Company’s ability to continue to grow without additional financing, however,
        management also believes that growth would be accelerated with additional
        financing.
  **Cash
        requirements**
  Presently,
        we anticipate that sales of the FDR, our educational products and our art
        inventory will meet our cash needs, although we would be able to grow faster
        with additional cash. We do have very limited working capital currently.
        Our
        continued operation is therefore dependent upon our ability to secure additional
        cash, loans from our chief executive officer, collect accounts receivable
        or
        receive advances from our distributors. We presently have no arrangements
        or
        understandings with any investors or potential investors with respect to
        an
        investment in Benacquista Galleries. We have not decided at what price or
        under
        what terms we will raise such additional funds. The factors that we will
        utilize
        in making such a decision include: our success in developing strategic partners
        for Benacquista Galleries, the market valuation of our competitors, the
        availability of investments generally for development stage start-up companies,
        and the feedback that we receive from potential investors. We intend to target
        potential customers and potential strategic partners as possible investors
        in
        Benacquista Galleries, though we have not received any indications of interest
        so far.
  **Research
        and development**
  We
        have a
        present intention to spend substantial resources on research or development
        over
        the next 12 months, consisting primarily in the development of our website
        and
        the development of additional products for our YNOT EduK8 line. We anticipate
        that, funding permitting, we would spend up to $250,000 on the development
        of
        our website during the next 12 months.
  **Plant
        and equipment**
  We
        currently have an office in Goodletsville, Tennesee consisting of approximately
        1800 square feet of office space owned by Director Don Tolman. We do not
        pay
        anything for this space and do not have a lease. We believe our currently
        available space will be insufficient for our operations for the next 12 months,
        but do not anticipate leasing any additional space for at least 9 months.
  **Employees**
  We
        intend
        to hire additional personnel to staff our physical galleries and assist us
        in
        the marketing of our on-line gallery. We anticipate hiring such personnel
        in
        approximately 9 months and would hire no more than 9 people.
  **ITEM
        3. Controls and Procedures**
  (a)
        The
        Company maintains controls and procedures designed to ensure that information
        required to be disclosed in the reports that the Company files or submits
        under
        the Securities Exchange Act of 1934 is recorded, processed, summarized and
        reported within the time periods specified in the rules and forms of the
        Securities and Exchange Commission. Based upon their evaluation of those
        controls and procedures performed within 90 days of the filing date of this
        report, the chief executive officer and the principal financial officer of
        the
        Company concluded that the Company's disclosure controls and procedures were
        adequate.
  (b)
        Changes in internal controls. The Company made no significant changes in
        its
        internal controls or in other factors that could significantly affect these
        controls subsequent to the date of the evaluation of those controls by the
        chief
        executive officer and principal financial officer.
    12
   **Part
        II**
 **OTHER
        INFORMATION**
 
 **Item
        1. Legal Proceedings**
 
 On
        March
        18, 2006, we were sued in Federal District Court in Tennesee by The Wholefood
        Farmacy for using trademarks allegedly belonging to The Wholefood Farmacy.
        We
        have attempted to settle this lawsuit for nuisance value, because we believe
        the
        suit has no merit and no basis in fact. The Company intends to vigorously
        defend
        this lawsuit. We have been informed by counsel that it is unlikely there
        will be
        any material financial impact of this litigation aside from legal
        costs.
 
 **Item
        2. Changes in Securities and Small Business Issuer Purchases of Equity
        Securities**
 
 **Recent
        Sales of Unregistered Securities**
 
 Not
        Applicable
 
 **Item
        3. Defaults Upon Senior Securities**
 
 Not
        Applicable
 
 **Item
        4. Submission of Matters to a Vote of Security Holders**
 
 Not
        Applicable
 
 **Item
        5. Other Information**
 
 Not
        Applicable
 
 **Item
        6. Exhibits and Reports on Form 8-K**
 
 (a)
        LIST
        OF EXHIBITS
 
 List
                  of Exhibits3.1
              Articles
                  of Incorporation of registrant as filed previously with the Commission
                  on
                  Form SB-2, dated April 12, 2002.3.2
              Bylaws
                  of registrant as filed previously with the Commission on Form SB-2,
                  dated
                  April 12, 2002.31.1
              Certification
                  of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley
                  Act
                  of 200232.1
              Certification
                  of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section
                  1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
                  Act of
                  2002
  
 (b)
        REPORTS ON FORM 8-K
 
 The
        following reports on Form 8-K were filed by the Company during the fiscal
        quarter ended March 31, 2006 :
 
 None
 
  13
  
 **SIGNATURE**
 
 In
        accordance with the requirements of the Exchange Act, the registrant caused
        this
        report to be signed on its behalf by the undersigned, thereunto duly
        authorized.
  
 Benacquista
                  Galleries, Inc.*/s/
                  James
                  Price**James
                  Price**Chief
                  Executive Officer**(Duly
                  Authorized Officer and Principal*
                *Financial
                  and Accounting Officer)*
 
 
  
  Dated:
        May 15, 2006
                       14