|UNITED STATESSECURITIES AND EXCHANGE
      COMMISSIONWashington, D.C. 20549www.sec.gov
|--------------------------------------------------------------------------------------



|FORM 10-QSB
|-----------

[X]
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934

Amended
Quarterly Report for the Quarterly Period Ended

September 30, 2004



|Commission File Number:
000-50411
|---------------------------------



|[CARTOON LOGO]
|--------------

CARTOONACQUISITION, INC.



|(Exact Name of Registrant asSpecified in its
    Charter)
|---------------------------------------------------------

Delaware
    
    20-0269287(State of Incorporation)
    
    (I.R.S. Employer Identification
      Number)




|Suite 90014 Franklin StreetRochester, New York
      14604(Address of Principal Executive Offices)( 585 )
      495-6907(Registrant'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 (2)X No ( 1)X

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS

Check
whether the registrant filed all documents and reports required to be filed by
Section12, 13 or15(d) of the Exchange Act after the distribution of securities
under a plan confirmed by a court. Yes___ No ___



|APPLICABLE ONLY TO CORPORATE
  ISSUERS
|--------------------------------------

State the
number of shares outstanding of each of the issuers classes of common equity,
as of the latest practicable date: Common Stock, par value $ 0.0001 per share, 1
Share

Transitional
Small Business Disclosure Format (Check one): Yes No X

---

APPLICABLE DISCLOSURES AND DISCLAIMERS.

This Report is an Amended Quarterly Report for the
Quarterly Period Ended September 30, 2004 and filed with the U. S. Securities
and Exchange Commission (the "Commission") on Form 10-QSB/A (this "Report") and
contains summaries of the material terms of prospective plans of operation and
the unaudited financial condition of the Registrant, which the Registrant
believes to be accurate. Such summaries are qualified in their entirety by
reference to any such documents. The Registrant has stated all of the material
facts necessary for the Commission and the public to make an informed decision
pertinent to the matters subject and to the disclosures herein by amendment
made.

NOTICE
OF EVENTS TO BE REPORTED AND TIME FOR FILING OF REPORT.

This Report contains information on the Registrant
as of the date and for the period ended on the cover hereof, as
amended.

MATERIALS INCORPORATED BY REFERENCE.

Prior to the filing of this Report by the
Registrant, the Registrant filed certain information with the Commission under
the cover of Form 10-QSB, for the quarterly period ended September 30, 2004
(which was filed on October 31, 2005), the information in which is the subject
of this Report, as amended. The Registrant incorporates all of the information
contained in said Form 10-QSB herein by reference thereto.



|FURTHER UNDERTAKINGS.
|---------------------

The Registrant, for the events that occurred
during the period described herein, further agrees (a) to timely file an
amendment or amendments that reflect a change or changes in the facts or events
that, individually or collectively, represent a fundamental change in the
information contained in this Report on Form 10-QSB/A for the period in
question, and (b) to include any other information that may be pertinent to the
events described in this Report and obtained by the Registrant on a date beyond
the date of this Report.

2

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|PART I  FINANCIAL
INFORMATION
|------------------------------

Certain statements contained in this Amended
Quarterly Report for the Period Ended September 30, 2004 on Form 10-QSB/A (the
"Report"), including, without limitation, statements containing the words
"anticipates", "expects", "hopeful", and words of similar import, constitute
"forward-looking" statements. The Registrant cautions readers to not place undue
reliance on these forward-looking statements. The Registrant's actual results
could differ materially from those statements from those anticipated in these
forward-looking statements for many reasons, including certain risks associated
with the Registrant, its securities, and its prospective or future business
purpose or plan of operations, and that are described or set forth in this
Report, and in other documents the Registrant files with the Securities and
Exchange Commission (the "Commission"), which includes this Report, and all
amendments hereof.



|Item
      1. Financial Statements.
|-----------------------------------

The accompanying unaudited financial statements
have been prepared in accordance with the instructions on Form 10-QSB
(applicable to non-asset-backed, small business issuers), and, therefore, do not
include all of the information and footnotes that may be necessary for a
complete presentation and evaluation of the Registrant's financial position,
results of operations, cash flows and stockholders' deficit, in conformity with
generally accepted accounting principles. In the opinion of the Registrant's
senior executive management, all adjustments considered necessary for a fair
presentation of the results of operation and financial position of the
Registrant have been included and all such adjustments are of a normal recurring
nature. The operating results for the three months ended September 30, 2004 are
not necessarily indicative of the results that can be expected for the year
ending December 31, 2004.

CARTOON
ACQUISITION, INC.(A Development Stage Company)Index to Financial
Statements



|
|

Financial
      Statements:
    
    PageBalance Sheets
      as of September 30, 2004(unaudited) and December 31, 2003
    
    F-2Statements of
      Operations for the threeand nine months ended September 30, 2004and for the period September 25, 2003(date of inception) to September 30, 2004(unaudited)
    
    F-3Statements of
      Cash Flows for the ninemonths ended September 30, 2004 andfor the period September 25, 2003(date of inception) to September 30, 2004(unaudited)
    
    F-4Notes to
      Financial Statements
    
    F-5


3

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CARTOON ACQUISITION,
      INC.(A Development Stage
      Company)Balance SheetsDecemberSeptember 30,
    
    
    
    31,2004
    
    
    
    2003(Unaudited)AssetsCurrent assets:Cash and cash
      equivalents
    
    $
    
    -
    
    $
    
    -Prepaid expense
    
    
    
    170
    
    
    
    -Total current
      assets
    
    
    
    170
    
    
    
    -Other assets
    
    
    
    -
    
    
    
    -Total assets
    
    $
    
    170
    
    $
    
    -Liabilities and Stockholders'
      Equity(Deficiency)Current liabilities:Accounts payable and accrued
      expenses
    
    $
    
    38
    
    $
    
    60Total current
      liabilities
    
    
    
    38
    
    
    
    60Other liabilities
    
    
    
    -
    
    
    
    -Total liabilities
    
    
    
    38
    
    
    
    60Stockholders' equity
      (deficiency):Preferred stock, $.0001 par value;
      20,000,000sharesauthorized, 0
      shares issued and outstanding
    
    
    
    -
    
    
    
    -Common stock, $.0001 par value;
      100,000,000sharesauthorized,
      issued and outstanding 200,001and 1 shares,
      respectively
    
    
    
    20
    
    
    
    -Additional paid-in
      capital
    
    
    
    399
    
    
    
    124


4

---

Deficit accumulated during the
      developmentstage
    
    
    
    (287)
    
    
    
    (184)Total
      stockholders' equity (deficiency)
    
    
    
    132
    
    
    
    (60)Total liabilities and stockholders'
      equity(deficiency)
    
    $
    
    170
    
    $
    
    -See Notes to Financial
      Statements.


5

---

CARTOON ACQUISITION,
      INC.(A Development Stage
      Company)Statements of
      Operations(Unaudited)CumulativeDuring theThreeNine Months
    
    
    
    Months
    
    
    
    DevelopmentEnded
    
    
    
    Ended
    
    
    
    StageSeptember
    
    
    
    September30,
    
    
    
    30,
    
    
    
    (September 25, 2003to September
      30,2004
    
    
    
    2004
    
    
    
    2004)Revenues
    
    $
    
    -
    
    $
    
    -
    
    $
    
    -Expenses:General and
      administrative
    
    
    
    103
    
    
    
    28
    
    
    
    287Total
      expenses
    
    
    
    103
    
    
    
    28
    
    
    
    287Net loss
    
    $
    
    (103)
    
    $
    
    (28)
    
    $
    
    (287)Net loss per share, basic and
      diluted
    
    $
    
    (0.00)
    
    $
    
    (0.00)Weighted average number of commonshares outstanding, basic and
      diluted
    
    
    
    100,001
    
    
    
    200,001


6

---

CARTOON
      ACQUISITION, INC.(A
      Development Stage Company)Statements of
      Cash Flows(Unaudited)Nine Months
    
    
    
    Cumulative Duringthe DevelopmentEnded
    
    
    
    StageSeptember
    
    
    
    (September 25, 200330,
    
    
    
    to2004
    
    
    
    September 30,
      2004)Cash flows from operating
      activities:Net loss
    
    $
    
    (103)
    
    $
    
    (287)Services rendered for common
      stock
    
    
    
    20
    
    
    
    144Changes in operating assets and
      liabilities:Prepaid
      expense
    
    
    
    (170)
    
    
    
    (170)Accounts
      payable and accrued expenses
    
    
    
    (22)
    
    
    
    38Net cash provided by (used in)
      operating activities
    
    
    
    (275)
    
    
    
    (275)Cash flows from investing
      activities
    
    
    
    -
    
    
    
    -Cash flows from financing
      activities:Company expenditure paid
      byCompany
      attorney
    
    
    
    275
    
    
    
    275Net cash provided by (used
      in)financing
      activities
    
    
    
    275
    
    
    
    275Net increase (decrease) in cash
    
    
    
    -
    
    
    
    -Cash and cash equivalents, beginning of
      period
    
    
    
    -
    
    
    
    -Cash and cash equivalents, end of
      period
    
    $
    
    -
    
    $
    
    -Supplemental disclosures of cash flow
      information:Interest paid
    
    $
    
    -
    
    $
    
    -Income taxes paid
    
    $
    
    -
    
    $
    
    -


7

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|See Notes to Financial
      Statements.
|----------------------------------------

CARTOON ACQUISITION,
INC.

(A Development Stage
Company)

Notes to Financial
Statements

For the Three and Nine
Months

Ended September 30,
2004

and For the Period
September 25, 2003 (Inception) to September 30, 2004 (Unaudited)

NOTE 1  INTERIM FINANCIAL
STATEMENTS

The unaudited financial
statements as of September 30, 2004 and for the three and nine months ended
September 30, 2004 and for the period September 25, 2003 (inception) to
September 30, 2004 have been prepared in accordance with accounting principles
generally accepted in the United States for interim financial information and
with instructions to Form 10-QSB. In the opinion of management, the unaudited
financial statements have been prepared on the same basis as the annual
financial statements and reflect all adjustments, which include only normal
recurring adjustments, necessary to present fairly the financial position as of
September 30, 2004 and the results of operations and cash flows for the three
month and nine month periods ended September 30, 2004. The financial data and
other information disclosed in these notes to the interim financial statements
related to these periods are unaudited. The results for the three month and nine
month period ended September 30, 2004 are not necessarily indicative of the
results to be expected for any subsequent quarter of the entire year ending
December 31, 2004. The balance sheet at December 31, 2003 has been derived from
the audited financial statements at that date.

Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States
have been condensed or omitted pursuant to the Securities and Exchange
Commissions rules and regulations. These unaudited financial statements should
be read in conjunction with our audited financial statements and notes thereto
for the period September 25, 2003 (inception) to December 31, 2003 as included
in our report on Form 10-KSB.

NOTE 2 
ORGANIZATION

Cartoon Acquisition, Inc.
(the Company) was incorporated in the State of Delaware on September 25, 2003.
The Company has no products or services; the Company is seeking a business to
merge with or acquire.

On May 4, 2004, the Company
effected a reverse stock split of 1 share for each 1,240,000 shares held,
thereby decreasing the number of issued and outstanding common shares from
1,240,000 to

1. All references to shares
and per share amounts in the accompanying financial statements have been
presented to retroactively reflect this reverse split.

8

---



|NOTE 3  BASIS OF
      PRESENTATION
|------------------------------------

The Company has been
presented as a development stage enterprise in accordance with Statement of
Financial Accounting Standards (SFAS) No.7, Accounting and Reporting by
Development Stage Enterprises. Since inception, the Companys activities have
been limited to organizational efforts and filing a Registration Statement on
Form 10-SB with the Securities and Exchange Commission (SEC).

At September 30, 2004, the
Company had working capital and stockholders equity of $132. For the period
September 25, 2003 (inception) to September 30, 2004, the Company incurred net
losses of $287. Further, the Company failed to timely file periodic reports with
the SEC subsequent to its filing of its Registration Statement on Form 10-SB on
October 3, 2003. These factors create uncertainty as to the Companys ability to
continue as a going concern. The Company is making efforts to acquire a business
with assets and operations. However, there is no assurance that the Company will
be successful in accomplishing this objective. The financial statements do not
include any adjustments that might be necessary should the Company be unable to
continue as a going concern.



|NOTE 4  STOCKHOLDERS
      EQUITY
|-----------------------------------

In September 2003, the
Company issued 1 share of its common stock to its sole officer and director for
services valued at $124.

In March 2004, the Companys
attorney paid a $275 expenditure on behalf of the Company. The Company has
reflected this expenditure as an increase in additional paid-in
capital.

On May 14, 2004, the
Companys sole stockholder, officer and director resigned as officer and
director and the Companys attorney was elected sole officer and director. Also,
on May 14, 2004, the Companys new sole officer and director acquired 200,000
shares of common stock from the Company for services valued at $20.



|NOTE 5  INCOME
      TAXES
|---------------------------

No provision for income taxes
has been recorded since the Company has incurred net losses since
inception.

|At September 30, 2004, deferred tax assets
      consist of: |  |  
|------------------------------------------------------------ |  | -
|Net operating loss
      carryforward                        |  | $
|Less valuation
      allowance                               |  |  
|Net                                                          |  | $

Based on managements present
assessment, the Company has not yet determined it to be more likely than not
that a deferred tax asset of $98 attributable to the future utilization of the
$287 net operating loss carryforward as of September 30, 2004 will be realized.
Accordingly, the

9

---

Company has provided a 100%
allowance against the deferred tax asset in the financial statements at
September 30, 2004. The Company will continue to review this valuation allowance
and make adjustments as appropriate. The net operating loss carryforward expires
in years 2023 and 2024 in the amounts of $184 and $103, respectively.

Current tax laws limit the
amount of loss available to be offset against future taxable income when a
substantial change in ownership occurs. Therefore, the amount available to
offset future taxable income may be limited.



|NOTE 6  SUBSEQUENT
      EVENTS
|--------------------------------

On January 25, 2005, the
Companys sole officer and director resigned as officer and director and sold
185,000 of the 200,000 shares of Company common stock owned by him to an
unrelated third party for a promissory note in the amount of $100,000. This
promissory note does not bear interest, is due on or before August 24, 2005, and
is secured by the 185,000 shares of Company common stock.

10

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Item
2. Managements Discussion and Analysis or Plan of Operations.

Some of the statements made in Part I, Item 2 of
this Report may be deemed to be "forward-looking" statements, as that term is
defined in Section 27A of the Securities Act of 1933 (15 U.S.C. 77z-2) and in
Section 21E of the Securities Exchange Act of 1934 (15 U.S.C. 78u-5), which are
referred to as "statutory safe harbor" provisions. Forward-looking statements
are not historical facts; rather, forward-looking statements are based upon the
opinions and estimates of the Company's management at the time such statements
are made. Every forward-looking statement is subject to inherent risks and
uncertainties that could cause the actual results to differ materially from the
plans, projections, or expectations expressed or implied by such statement at
the time the statement was made. The Company cautions the public not to place
undue influence on these forward-looking statements, which speak only as of the
date they were made and may not have been updated in further filings, schedules,
or reports required to be filed with the Commission, or with any other body
government.

Certain statements contained in this section of
this Report may infer an impression of optimism about the Company's beliefs and
expectations, expressed through words such as "expects", "anticipates",
"intends", "plans", "believes", "seeks", "estimates", "contemplates",
"prospective", "attempt", "proposed", and similar expressions or terms identify
forward looking statements.

The Company was formed to identify and effect a
business combination with a qualified entity. A combination will normally take
the form of a merger, stock-for-stock exchange, or stock-for-assets exchange
(the "business combination"). Historically, in most instances the target company
will wish to structure the business combination to be within the definition of a
tax-free reorganization under Section 351 or Section 368 of the Internal Revenue
Code of 1986, as amended. No assurances can be given that the Company will be
successful in locating or negotiating with any target business.

The Company has not restricted its search for any
specific kind of businesses, and it may acquire a business which is in its
preliminary or development stage, which is already in operation, or in
essentially any stage of its business life. It is impossible to predict the
status of any business in which the Company may become engaged, in that such
business may need to seek additional capital, may desire to have its shares
publicly traded, or may seek other perceived advantages which the Company may
offer.

In implementing a structure for a particular
business acquisition, the Company may become a party to a merger, consolidation,
reorganization, joint venture, or licensing agreement with another corporation
or entity.

It is anticipated that any securities issued in
any such business combination would be issued in reliance upon exemption from
registration under applicable Federal and state securities laws. In some
circumstances, however, as a negotiated element of its transaction, the Company
may agree to register all or a part of such securities as part of the business
combination or at specified times thereafter.

Negotiations with a target company will likely
focus on the percentage of the Company which the target company shareholders
would acquire in exchange for their shareholdings. Although the terms of such
agreements cannot be predicted, generally such agreements will require certain
representations and warranties of the parties thereto, will specify certain
events of default, will detail the terms of closing and the conditions which
must be satisfied by the parties prior to and after such closing and will
include miscellaneous other terms. Any merger or acquisition effected by the
Company can be expected to have a significant dilutive effect on the percentage
of shares held by the Company's shareholders at such time. Moreover, any
acquisition by a qualified business combination, or otherwise, would require the
Company to enter into one or more material agreements, and, more likely that
not, would impose significant fiscal

11

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and
performance obligations on the Company, all of which would be required to be
reported by the Company to the Commission.



|Item
      3. Controls and Procedures.
|--------------------------------------

Some of the statements made in Part I, Item 3 of
this Report may be deemed to be "forward-looking" statements, as that term is
defined in Section 27A of the Securities Act of 1933 (15 U.S.C. 77z-2) and in
Section 21E of the Securities Exchange Act of 1934 (15 U.S.C. 78u-5), which are
referred to as "statutory safe harbor" provisions. Forward-looking statements
are not historical facts; rather, forward-looking statements are based upon the
opinions and estimates of the Company's management at the time such statements
are made. Every forward-looking statement is subject to inherent risks and
uncertainties that could cause the actual results to differ materially from the
plans, projections, or expectations expressed or implied by such statement at
the time the statement was made. The Company cautions the public not to place
undue influence on these forward-looking statements, which speak only as of the
date they were made and may not have been updated in further filings, schedules,
or reports required to be filed with the Commission, or with any other body
government.

Certain statements contained in this section of
this Report may infer an impression of optimism about the Company's beliefs and
expectations, expressed through words such as "expects", "anticipates",
"intends", "plans", "believes", "seeks", "estimates", "contemplates",
"prospective", "attempt", "proposed", and similar expressions or terms identify
forward looking statements.

The Company (or the "Registrant") has one class of
securities registered under the Securities Exchange Act of 1934 (the "Exchange
Act"); namely, the Company's common stock, par value $0.0001 per share. The
Company is not an "asset-backed" issuer, as that term is defined in 17 CFR
229.1101. Also, the Company does not have any securities registered, nor any
offering pending or contemplated, under the Securities Act of 1933 or the
Investment Company Act of 1940 with the Commission.

Prior to the actual filing date hereof, the
Registrant did fail to timely file all of its reports to the Commission, which
were required to be filed by the Registrant pursuant to section 13(a) or section
15(d) of the Exchange Act. The Registrant attributes its delinquency in that
regard to (a) extreme limitations on its fiscal capabilities due to its lack of
development and engagement in an ongoing business enterprise (and, further in
that extent, because the Registrant was incapable of securing capital or credit
accommodations to permit it to conduct its operations), (b) unpredictability
with regard to its senior executive management's capability to have performed
its duties on a full-time or part-time basis in order to properly have
administered its affairs (to include the Company's incapability to hire and
retain qualified support and technical personnel), and (c) the Registrant's
inability to effectively (without undue effort and/or unreasonable expense)
gather, assemble, prepare, and disseminate the required information.

On or about January 25, 2005, with the principal
objective of aggressively pursuing the Company's development, Randolph S. Hudson
purchased approximately 92.5% of the Registrant's common voting equity
securities from James W. Margulies under a private securities transaction.
Although Mr. Hudson's administration of the Company has been plagued by many of
the same obstacles and circumstances as were experienced by the Company's prior
management and shareholders (surrounding the Company's delinquent reporting and
tardy development), it was and remains Mr. Hudson's principal objectives to (a)
timely remedy the Registrant's delinquent filings with the Commission and (b)
immediately undertake his aggressive pursuit to develop the Company.

In addition to the Company's dilemmas, from the
date the Company was required to file its initial reports, the Federal
legislature has adopted, revised, or amended certain Federal securities laws,
which the Commission is actively enforcing in order to prevent acts of frauds
that were demonstrated by some of

12

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this
nation's largest companies, which, in turn, caused great harm and financial loss
the investing public. Some of these laws contained in the Code of Federal
Regulations, include the Sarbanes-Oxley Act of 2002, Regulation S-X (which
governs accounting issues applicable to reporting companies), the strict rules
applicable to the Public Company Accounting Oversight Board (the "PCAOB", which
governs the Company's non-certifying and certifying accountants), and a host of
other changes to those laws and to the U. S. Code applicable to securities and
commodities markets. All of the government's actions, and, of primary concern -
all of the more stringent and more actively policies of the Commission, have
created significant new reporting impositions on public companies to improve
financial accounting, corporate reporting, and personal accountability by a
public company's senior executive officers.

Consequently, prior to Mr. Hudson's purchase of
that certain percentage of the Company's stock (as was briefly described
hereinabove, and which was previously reported by Mr. Hudson on this Schedule
13D filing), and, for the other reasons set forth hereinabove, the Company did
not have adequate, or had minimal, disclosure controls and procedures in place.
Historically, in times past, a Company's system of "checks and balances" would
have been routinely handles by its certifying accountant; however, because the
Company was not actively engaged in its operations, and for the other reasons
mentioned hereinabove, the Company's then certifying accountant was neither
reviewing nor preparing the Company's statements of financial
conditions.

Fortunately, because the Company has been dormant,
in the opinion of the Company's present Chief Executive Officer (who is also the
Company's Chief Financial Officer) the Company's lack or exercise of disclosure
controls and procedures did not cause any material effect on any information,
which was either prepared then or that is being prepared and submitted on this
date.

In conclusion of the aforesaid statements, prior
to January 25, 2005, in respect of the controls and procedures promulgated by 17
CFR 240.13a -15 and 17 CFR 240.15d -15:

|1. | The
      Company did not have adequate internal control over financial reporting
      (as defined in 17 CFR 240.13a-15); and                                                                                                                                                                                                                          
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. | In
      the absence of full-time senior executive management, the Company was
      unable to effectively evaluate the effectiveness by its senior executive
      management of its controls and procedures for what was to have been its
      quarterly report for this period, on the date this report was originally
      due to have been filed.
|  

Presently (the date on which this Report was
actually filed), the Company's Chief Executive Officer, Randolph S. Hudson, has
established full disclosure controls and procedures. Some of these remedies
include the purchase of professional internal accounting software that operates
with multiple systems of entry that "check and cross-check" entries and the
engagement of a PCAOB-qualified accountant to perform non-certified
compilations, prior to delivering his results to the Company's PCAOB-qualified
certifying accountant.

With specific regard to internal control over
financial reporting by the Registrant and by the Registrant's senior executive
officers pursuant to the sub-sections enumerated in 17 CFR 228.308: (a) The
Company has at all times maintained adequate financial and non-financial
records, which fairly and accurately reflect the dispositions of the assets of
the Company, (b) the Company has at all times been able to provide more than
reasonable assurances that any such financial statements were capable of being
prepared under generally accepted accounting principles and that the receipts
and expenditure of the Company were being made only in accordance with the
authorizations of the senior executive management and by the Company's Board of
Directors, and (c) the Company has at all times been able to provide reasonable
assurances regarding the prevention or timely detection of any
unauthorized

13

---

acquisition,
use, or disposition of the Company's assets, any of which could have caused a
material effect on the Company's financial statements.



|PART II -- OTHER
INFORMATION
|----------------------------



|Item
      1. Legal Proceedings.
|--------------------------------

During the
period being reported herein, the Company is not a party to any legal action or
proceeding.

Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds.

The
information required by Item 2 of Part II of Form 10-QSB/A is not applicable to
this Report.



|Item
      3. Defaults upon Senior Securities.
|----------------------------------------------

The
information required by Item 3 of Part II of Form 10-QSB/A is not applicable to
this Report.

Item 4.
Submission of Matters to a Vote of Security Holders.

On or about July 2, 2004, then the Registrant's
sole Director, James W. Margulies, adopted a corporate action by written consent
in lieu of a meeting; whereby, he caused the Registrant to engage the firm of
Liebman Goldberg & Drogin LLP as the Registrant's independent auditors,
effective July 2, 2004.

This action was necessitated by the fact that the
Registrant's previous certifying accountant, Berger, Apple & Associates Ltd.
Of Beachwood, Ohio ("Berger Apple"), were dismissed because the firm was not
registered in accordance with the Public Company Accounting Oversight Board
("PCAOB"), the registration of which is required by the Commission's rules and
regulations.



|Item
      5. Other Information
|-------------------------------

Some of the statements made in Item 8.01 of this
Report may be deemed to be "forward-looking statements", as that term is defined
in Section 27A of the Securities Act of 1933 (15 U.S.C. 77z-2) and in Section
21E of the Securities Exchange Act of 1934 (15 U.S.C. 78u-5), which are referred
to as "statutory safe harbor" provisions. Forward-looking statements are not
historical facts; rather, forward-looking statements are based upon the opinions
and estimates of the Registrant's management at the time such statements are
made. Every forward-looking statement is subject to inherent risks and
uncertainties that could cause the actual results to differ materially from the
plans, projections, or expectations expressed or implied by such statement at
the time the statement was made. The Registrant cautions the public not to place
undue influence on these forward-looking statements, which speak only as of the
date they were made and may not have been updated in further filings, schedules,
or reports required to be filed with the Commission, or with any other body
government.

Certain statements contained in this section of
this Report may infer an impression of optimism about the Registrant's beliefs
and expectations, expressed through words such as "expects", "anticipates",
"intends", "plans", "believes", "seeks", "estimates", "contemplates",
"prospective", "attempt", "proposed", and similar expressions or terms identify
forward looking statements.

|A. | FORM 10-QSB REQUIRING AMENDMENT. This Amended Quarterly
      Report for the Quarterly Period Ended September 30, 2004 was prepared
      because the Registrant did not correctly file its original Form 10-QSB for
      the Period Ended September 30, 2004. (The actual filing date of that
      certain report was October 31, 2005.)
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  

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The errors
or omissions in that certain unamended Quarterly Report are as
follows:

|1. | The
      Registrant's Principal Executive Officer failed to attach a "long form"
      certification to the subject report.   
|-- | -------------------------------------------------------------------------------------------------------------------------------
|  
|2. | The
      Registrant's Chief Executive Officer failed to attach a "short form" "906"
      certification to the subject report.
|  
|3. | The
      Registrant's Principal Financial Officer failed to attach a "long form"
      certification to the subject report.   
|  
|4. | The
      Registrant's Chief Financial Officer failed to attach a "short form" "906"
      certification to the subject report.
|  

The Registrant is filing this amended Report to
reflect the amendments to rectify the errors or omissions stated
hereinabove.

B. CHANGES
IN REGISTRANT'S CERTIFYING ACCOUNTANT.

MATERIALS
INCORPORATED BY REFERENCE.

The Registrant, in reliance of the accurate
information contained in that certain Form 8-K, dated July 2, 2004, incorporates
all or part of the information contained in said Form 8-K herein by reference
thereto.

CHANGES IN
REGISTRANT'S CERTIFYING ACCOUNTANT.

On or about July 2, 2005, the Registrant's
certifying accountant, Berger, Apple & Associates Ltd., of Beachwood, Ohio
("Berger Apple"), formally confirmed the Registrant's statements made in that
certain Form 8-K, dated July 2, 2004; whereby, the Registrant notified its
certifying accountant of its dismissal because the Registrant's certifying
accountant because Berger Apple was not registered with the Public Company
Accounting Oversight Board ("PCAOB"), the registration with which is a
requirement of the Commission's rules and regulations.

Berger Apple did not provide a report with respect
to the financial statements for the year ended December 31, 2003. However,
Berger Apple's report on the financial statements with respect to the period
from inception to September 30, 2003, filed with the Registrant's Registration
Statement on Form 10-SB, contained no adverse opinion or disclaimer of opinion
and were not qualified or modified as to uncertainty, audit scope, or accounting
principle. In addition, during the year ended December 31, 2003 and through July
2, 2004, there have been no disagreements with Berger Apple on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure, which disagreements if not resolved to the satisfaction of
Berger Apple, would have caused it to make reference thereto in its report on
the financial statements for such year.

Subsequently, the Registrant's sole director, by
his action by written consent in lieu of a meeting, engaged Liebman Goldberg
& Drogin LLP as the Registrant's certifying accountant, which was to have
become effective on July 2, 2004. However, from the date of the Registrant's
formation and organization in September 2003 and during the subsequent interim
period prior to the engagement of Liebman Goldberg & Drogin LLP, the
Registrant did not consult with Liebman Goldberg & Drogin LLP on any matter
related to (i) the application of accounting principles to a specified
transaction,

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either
completed or proposed, (ii) the type of audit opinion that might be rendered on
the Registrant's financial statements, or (iii) any matter that was either the
subject of a disagreement or a reportable event, and no report or advice, either
oral or written, was received by the Registrant from Liebman Goldberg &
Drogin LLP on any such matter.

SUBSEQUENT
EVENTS PRESENTING CONFLICTING INFORMATION.

On or about April 5, 2005, the Registrant's Board
of Directors approved the engagement of the accounting firm of Michael T.
Studer, C. P. A., of Freeport, New York to serve as the Registrant's certifying
accountant ("Studer"). Subsequently, the Registrant's principal shareholder
performed a corporate action, which was adopted by the written consent of the
holders of approximately 92.5% of the Registrant's common voting equity
securities; whereby, he appointed Studer to serve as the Registrant's certifying
accountant.

It was the understanding of the Registrant's
principal shareholder, who acquired approximately 92.5% of the Registrant's
common voting equity securities in a private securities transaction (which was
heretofore reported on Schedule 13D and on Form 8-K), that the firm of Liebman
Goldberg & Drogin LLP, albeit appointed to serve as the Registrant's
certifying accountant, (i) never performed any work or services for the
Registrant, (ii) was not owed money by the Registrant for the performance of any
work or services, and (iii) was never formally engaged, as would customarily be
evident by the execution and delivery by the Registrant of an engagement
letter.

Therefore, the Registrant's new principal
shareholder from January 25, 2005, Randolph S. Hudson, who also serves the
Registrant as its sole director, in reliance of his examination of the
information theretofore submitted to him for his review, did not consider the
firm of Liebman Goldberg & Drogin LLP to actually have been engaged to serve
as the Registrant's certifying accountant, as it did not perform any work or
services for the Registrant.

The Registrant has been delinquent in its
reporting obligations pursuant to section 13(a) of the Securities Exchange Act
of 1934 (the "Exchange Act"), however, in any event, as subsequent reports and
filings will demonstrate, the Registrant did not engage in any business
activities that otherwise would cause the Registrant to rely on any opinion, or
lack thereof, by Liebman Goldberg & Drogin LLP with respect to the
Registrant's statements of financial condition during the period of that firm's
alleged representation of the Registrant.

The Registrant must inform the Commission and the
public: From the date when the Registrant's current principal shareholder,
Randolph S. Hudson, acquired approximately 92.5% of the Registrant's common
voting equity securities, Mr. Hudson's intention was and remains, among other
things, to organize the Registrant's business and affairs and to remedy the
Registrant's delinquent reporting obligations. In the process of accomplishing
his objectives (as were previously reported on Schedule 13D), which, in turn,
are the objectives of the Issuer, Mr. Hudson engaged Studer to perform the
Registrant's delinquent and current accounting reports. (This event was to have
been reported on a current report Form 8-K; however, the Registrant, as of the
date hereof, has not filed that report, but it expects to file that report
within 10 days from the date hereof.) In any case, it was Mr. Hudson's opinion
that no resignation letter was required from Liebman Goldberg & Drogin LLP,
because the firm did not actually perform any work or services for the
Registrant.

Moreover, as the result of Mr. Hudson's efforts on
behalf of the Registrant, with regard to remedying the Registrant's delinquent
reports (and subsequent to his acquisition of approximately 92.5% of the
Registrant's common stock), he was not in possession of the actual original
letter to the Registrant from Berger Apple. Consequently, Mr. Hudson requested
Berger Apple to provide the

16

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Registrant with (as it turns out, another) letter of resignation.
However, the letter (which is annexed as an exhibit hereto) states that Berger
Apple resigned as the Registrant's certifying accountant as of January 1, 2004;
thus, the information the Registration provided to the Commission on Form 8-K,
dated July 8, 2004, contradicts the new information contained in the letter that
the Registrant is providing herewith.

In conclusion, it is the opinion of the
Registrant's principal executive officer, this contradictory information is
attributable to (1) Berger Apple's not having performed any accountancy services
for the Registrant from the date of its registration statement on Form 10-SB,
(2) the Registrant's new principal executive officer did not have full and
complete original records of the Registrant from which to formulate his decision
by asking Berger Apple to deliver a copy of its original letter of resignation,
and (3) by the fact that Berger Apple - regardless of the actual date o its
resignation -perform any work or services for the Registrant from the date that
firm prepared the statements of financial condition which were delivered
together with the Registrant's Registration Statement on Form 10-SB.
Specifically, to that extent, although the Commission and the public may
perceive contradictory thoughts resulting from the irregularities associated
with the two Berger Apple letters of resignation discussed herein, from the
perspective of the principal executive officer of the Registrant, Berger Apple's
work for the Registrant was complete on September 30, 2003.

C.
NOTIFICATION OF PROSPECTIVE RISK TO SHAREHOLDERS OF THE REGISTRANT.

Due to certain administrative impediments that
were encountered by the Registrant to prepare and to have timely filed this
Report with the Commission (chiefly, that of a temporary financial hardship
endured by the Registrant), the Registrant does hereby notify its shareholders:
Depending on the Commission's view of the Registrant's late filing hereof, the
Commission may notify the Registrant of its disapproval and may notice the
Registrant, or, may impose a fine or other penalty against the Registrant or
against the Registrant's Chief Executive Officer for said late
filing.

The imposition of any fine or penalty would cause
a material adverse effect on the Registrant's current and future financial
condition; and, any formal censure would impede the Registrant's contemplated
and orderly future organization and development.



|Item
      6. Exhibits and Reports On Form 8-K(a)
Exhibits
|----------------------------------------------------------

With the single exception of the Company's Form
8-K Report disclosed and annexed as an exhibit to Item 6(b) and disclosed
hereinbelow, there are no exhibits being filed with this Report.

99.1 Form
8-K Current Report, dated July 8, 2004.

99.1(a)
Letter of Resignation by Berger, Apple



|(b)
      Reports on Form 8-K.
|------------------------------

There was one report on Form 8-K filed by the
Company during the subject period being reported on this Form 10-QSB.

In this regard, the Company must acknowledge the
facsimile of the Form 8-K that is being annexed to this Report is a
representative copy, which the Company obtained from other than its original
sources; moreover, the exhibit that accompanies the Form 8-K report is a
facsimile of an

17

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EDGAR
copy of the original document, as the Company was unable to locate the original
copy; however, the Registrant's Chief Executive Officer certifies the exhibits
to be true, correct, and complete copies of the original documents in every
respect.



|SIGNATURES
|----------

Pursuant to
the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.

By Order of
      the Board of Directors:CARTOON
      ACQUISITION, INC.Dated:
      November 2, 2005
    
    /s/Randolph
      S. HudsonRANDOLPH S.
      HUDSONChief Executive OfficerChief Financial Officer


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