UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549 
  FORM 10-Q 
  x

   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
  For the quarterly period ended July 31, 2013   ̈

   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
  For the transition period from ____________, to ____________  Commission File Number000-30800 
  THE MOVIE STUDIO, INC. (Exact Name of Registrant as Specified in Charter) 
  Delaware

   

   65-0494581(State or Other Jurisdiction of

   Incorporation or Organization)

   

   (I.R.S. Employer

   Identification Number)
  530 North Federal Highway, Ft. Lauderdale, Florida 33301 (Address of Principal Executive Offices)  (954) 332-6600 (Registrant’s Telephone Number) 
  Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 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      No  X  Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes      No  X  Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “accelerated filer, large accelerated filer and smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):  Large accelerated filer

    ̈

   Accelerated filer

    ̈Non-accelerated filer

    ̈

   Smaller reporting company

   x
       1




Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    YesoNox  There were 131,182,473 shares of the Registrant’s $0.0001 par value common stock outstanding as of June 12, 2013.          2




The Movie Studio, Inc.  Contents  Part I – Financial InformationItem 1.

   Consolidated Financial Statements

   4 - 16Item 2.

   Management’s Discussion and Analysis of Financial Condition and Results of Operation

   18Item 3.

   Quantitative and Qualitative Disclosures About Market Risk

   19Item 4.

   Controls and Procedures

   19Part II – Other InformationItem 1.

   Legal Proceedings

   20Item 2.

   Unregistered Sales of Equity Securities and Use of Proceeds

   20Item 3.

   Defaults Upon Senior Securities

   20Item 4.

   Mine Safety Disclosures

   20Item 5.

   Other Information

   20Item 6.

   Exhibits

   20Signatures

   22
                     3


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PART I — FINANCIAL INFORMATION  Statements in this Form 10-Q Quarterly Report may be “forward-looking statements.” Forward-looking statements include, but are not limited to, statements that express our intentions, beliefs, expectations, strategies, predictions or any other statements relating to our future activities or other future events or conditions. These statements are based on our current expectations, estimates and projections about our business based, in part, on assumptions made by our management. These assumptions are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in the forward-looking statements due to numerous factors, including those risks discussed in this Form 10-Q Quarterly Report, under “Management’s Discussion and Analysis of Financial Condition or Plan of Operation” and in other documents which we file with the Securities and Exchange Commission.  In addition, such statements could be affected by risks and uncertainties related to our financial condition, factors that affect our industry, market and customer acceptance, changes in technology, fluctuations in our quarterly results, our ability to continue and manage our growth, liquidity and other capital resource issues, competition, fulfillment of contractual obligations by other parties and general economic conditions. Any forward-looking statements speak only as of the date on which they are made, and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this Form 10-Q Quarterly Report, except as required by law.  Item 1.     Financial Statements  THE MOVIE STUDIO, INC.  Table of Contents PAGE  Consolidated Balance Sheets                                                             5  Consolidated Statements of Operations                                             6  Consolidated Statements of Cash Flows                                            7  Notes to Financial Statements                                                                        8 - 18        4




THE MOVIE STUDIO, INC.(FORMERLY DESTINATION TELEVISION, INC.)Consolidated Balance SheetsJuly 31,

   

   October 31,2013

   

   2012AssetsCurrent assetsCash

   

   

   

   $ 7,267

   

   $ 19Total current assets

   

   7,267

   

   19Property and equipment, net

   

   2,438

   

   4,019Acquired amortizable intangible assets

   

   355

   

   580Total assets

   

   $ 10,060

   

   $ 4,618Liabilities and stockholders' deficiencyCurrent liabilitiesPayroll taxes payable

   

   $ 400,199

   

   $ 372,851Loans payable - related party

   

   2,199,118

   

   2,081,325Total current liabilities

   

   2,599,317

   

   2,454,176Long-term debt, net of current portion

   -

   

   -Total liabilities

   

   2,599,317

   

   2,454,176Stockholders' deficiencyPreferred stock, Series B convertible, $.0001 par value;5,750,000 authorized, issued and outstaning at July 31, 2013and October 31, 2012, respectively

   

   206,000

   

   206,000Common stock, $.0001 par value; 200,000,000 sharesauthorized, 105,855,260 and 102,355,260 shares issued and outstandingat July 31, 2013 and October 31, 2012, respectively

   45,236

   

   10,236Additional paid In capital

   

   6,616,641

   

   6,616,641Accumulated deficit

   

   

   (9,457,134)

   

   (9,282,435)Total stockholders' deficiency

   (2,589,257)

   

   (2,449,558)Total liabilities and stockholders' deficiency

   $ 10,060

   

   $ 4,618The accompanying footnotes are an integral part of these financial statements.


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5     Three months ended July 31,

   

   Nine months ended July 31,2013

   

   2012

   

   2013

   

   2012Sales

   

   

   

   $ -

   

   $ -

   

   $ -

   

   $ -Expenses:Selling, general and administrative expenses

   

   47,814

   

   33,964

   

   147,351

   

   101,891Interest expense

   

   9,116

   

   9,116

   

   27,348

   

   27,348Total expenses

   

   56,930

   

   43,080

   

   174,699

   

   129,239Net loss before income taxes

   

   (56,930)

   

   (43,080)

   

   (174,699)

   

   (129,239)Income taxes

   

   -

   

   -

   

   -

   

   -Net income (loss)

   

   $ (56,930)

   

   $ (43,080)

   

   $ (174,699)

   

   $ (129,239)Basic and diluted loss per share:Basic and diluted loss per share:

   

   $ -

   

   $ -

   

   $ -

   

   $ -Weighted average number of commonshares outstanding, basic and fully diluted

   

   105,855,260

   

   102,355,260

   

   105,082,366

   

   102,355,260The accompanying footnotes are an integral part of these financial statements.




6




Cash flows from operating activities:Net loss

   $ (174,699)

   

   $ (129,239)Adjustment to reconcile net loss to netnet cash used by operating activities:Depreciation and amortization

   1,806

   

   2,141Changes in operating assets and liabilities:Increase in payroll taxes payable

   27,348

   

   27,348Net cash used in operating activities

   (145,545)

   

   (99,750)Cash flows from investing activities-

   

   -Cash flows from financing activitiesProceeds from issuance of common stock

   35,000

   

   -Proceeds from related party loan to the company

   117,793

   

   99,750Net cash provided by investing activities

   152,793

   

   99,750Net incresase(decrease) in cash

   7,248

   

   -Cash, beginning of period

   19

   

   19Cash, end of period

   $ 7,267

   

   $ 19The accompanying footnotes are an integral part of these financial statements.




7




THE MOVIE STUDIO, INC. (FORMERLY DESTINATION TELEVISION, INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2013   Note 1 – Description of Business  Destination Television, Inc. (the "Company") is a Delaware corporation formed in 1961 under the name Magic Fingers, Inc. By amendment of its certificate of incorporation, the Company's name was changed in 1999 to Magicinc.com and in April 2002 to Magic Media Networks, Inc. and in February 2007 to its current title. Through the period ended January 31, 2010, the Company devoted substantially all its efforts to reorganizing its financial affairs and settling its debt obligations. During the fiscal years ended October 31, 2000 and October 31, 2001, the Company was engaged primarily in the planning and development of an interactive network to provide entertainment via the Internet. Subsequent to October 31, 2001, the Company redirected its business focus to the development of a private television network, in high traffic locations such as bars and nightclubs. During the development process, the Company received incidental revenue from the sale of advertising and the production of commercials.  Note 2 – Summary of significant Accounting Policies  Basis of Presentation  The accompanying unaudited consolidated quarterly financial statements have been prepared on a basis consistent with generally accepted accounting principles in the United States (“GAAP”) for interim financial information and pursuant to the rules of the Securities and Exchange Commission (“SEC”). In the opinion of management, the accompanying unaudited financial statements reflect all adjustments, consisting of only normal and recurring adjustments, necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented.  The results of operations for the periods are not necessarily indicative of the results expected for the full year or any future period.  These statements should be read in conjunction with the Entity’s Annual Report on Form 10-K for the year ended October 31, 2012 as filed with the SEC on July 29, 2013 (the “2012 Annual Report”)  The consolidated financial statements include the accounts of The Movie Studio, Inc. (Formerly Destination Television, Inc.), a Delaware corporation, and its wholly owned subsidiary Destination Television, Inc., a Florida corporation. All significant inter-company account balances and transactions between the Company and its subsidiary have been eliminated in consolidation.  Long-Lived Assets  In accordance with Financial Accounting Standard Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 360Property, Plant, and Equipment,the Company records impairment losses on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets’ carrying amounts. There were no impairment charges during the nine months ended July 31, 2013 and the year ended October 31, 2012. Fair Value of Financial Instruments The fair values of the Company’s assets and liabilities that qualify as financial instruments under FASB ASC Topic 825,Financial Instruments,approximate their carrying amounts presented in the accompanying consolidated statements of financial condition atJuly 31, 2013 and October 31, 2012. Revenue recognition In accordance with the FASB ASC Topic 605,Revenue Recognition,the Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, and collectability is reasonably assured.   8




THE MOVIE STUDIO, INC. (FORMERLY DESTINATION TELEVISION, INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2013   Note 2 – Summary of significant Accounting Policies (continued)  Income Taxes  The Company accounts for income taxes in accordance with FASB ASC Topic 740,Income Taxes,which requires accounting for deferred income taxes under the asset and liability method.Deferred income tax asset and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on the enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income.  Valuation allowances are established, when necessary, to reduce the deferred income tax assets to the amount expected to be realized.  In accordance with GAAP, the Company is required to determine whether a tax position of the Company is more likely than not to be sustained upon examination by the applicable taxing authority, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The Company files an income tax return in the U.S. federal jurisdiction, and may file income tax returns in various U.S. state and local jurisdictions.  Generally the Company is no longer subject to income tax examinations by major taxing authorities for years before 2005. The tax benefit to be recognized is measured as the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement.  De-recognition of a tax benefit previously recognized could result in the Company recording a tax liability that would reduce net assets. This policy also provides guidance on thresholds, measurement, de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition that is intended to provide better financial statement comparability among different entities.  It must be applied to all existing tax positions upon initial adoption and the cumulative effect, if any, is to be reported as an adjustment to stockholder’s equity as of January 1, 2009.  Based on its analysis, the Company has determined that the adoption of this policy did not have a material impact on the Company’s financial statements upon adoption. However, management’s conclusions regarding this policy may be subject to review and adjustment at a later date based on factors including, but not limited to, on-going analyses of and changes to tax laws, regulations and interpretations thereof.  Comprehensive Income  The Company complies with FASB ASC Topic 220,Comprehensive Income,which establishes rules for the reporting and display of comprehensive income (loss) and its components.  FASB ASC Topic 220 requires the Company’s change in foreign currency translation adjustments to be included in other comprehensive loss, and is reflected as a separate component of stockholders’ equity.         9




THE MOVIE STUDIO, INC. (FORMERLY DESTINATION TELEVISION, INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2013  Note 2 – Summary of significant Accounting Policies (continued)  Stock-Based Compensation  The Company complies with FASB ASC Topic 718Compensation – Stock Compensation,which establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services.  It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of those equity instruments. FASB ASC Topic 718 focuses primarily on accounting for transactions in which an entity obtains employee services in share-based payment transactions.  FASB ASC Topic 718 requires an entity to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions).  That cost will be recognized over the period during which an employee is required to provide service in exchange for the award (usually the vesting period).  No compensation costs are recognized for equity instruments for which employees do not render the requisite service.  The grant-date fair value of employee share options and similar instruments will be estimated using option-pricing models adjusted for the unique characteristics of those instruments (unless observable market prices for the same or similar instruments are available).  If an equity award is modified after the grant date, incremental compensation cost will be recognized in an amount equal to the excess of the fair value of the modified award over the fair value of the original award immediately before the modification.  No employee stock options or stock awards vested during 2013 or 2012 under FASB ASC 718.  Nonemployee awards  The fair value of equity instruments issued to a nonemployee is measured by using the stock price and other measurement assumptions as of the date of either: (i) a commitment for performance by the nonemployee has been reached; or (ii) the counterparty’s performance is complete.  Expenses related to nonemployee awards are generally recognized in the same period as the Company incurs the related liability for goods and services received.  The Company recorded stock compensation of approximately    $-0- and $-0- during the nine months ended July 31, 2013 and 2012, respectively, related to consulting services.  Recently Adopted Accounting Pronouncements  The Company has adopted the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 105-10,Generally Accepted Accounting Principles – Overall(“ASC 105-10”), which was formerly known as SFAS 168. ASC 105-10 establishes the FASB Accounting Standards Codification (the “Codification”) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with U.S. GAAP. Rules and interpretive releases of the Securities and Exchange Commission (the "SEC") under authority of federal securities laws are also sources of authoritative U.S. GAAP for SEC registrants.  All guidance contained in the Codification carries an equal level of authority.  The Codification superseded all existing non-SEC accounting and reporting standards and all other non-grandfathered, non-SEC accounting literature not included in the Positions or Emerging Issues Task Force Abstracts.  Instead, it will issue Accounting Standards Updates (“ASUs”). The FASB will not consider ASUs as authoritative in their own right.  ASUs will serve only to update the Codification, provide background information about the guidance and provide the basis of conclusions on the change(s) in the Codification. References made to FASB guidance throughout this document have been updated for the Codification.      10




THE MOVIE STUDIO, INC. (FORMERLY DESTINATION TELEVISION, INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2012  Note 2 – Summary of significant Accounting Policies (continued)  Recently Adopted Accounting Pronouncements (continued)  ASU 2011-04. In May 2011, the FASB issued Accounting Standards Update 2011-14,Fair Value Measurement(Topic 820). This Update will improve the comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with US GAAP and International Financial Reporting Standards (“IFRS”). The amendments in this Update result in common fair value measurement and disclosure requirements in U.S. GAAP and IFRSs and they explain how to measure fair value and they do not require additional fair value measurements and are not intended to establish valuation standards or affect valuation practices outside of financial reporting. The amendments in this Update apply to all reporting entities that are required or permitted to measure or disclose the fair value of an asset, a liability, or an instrument classified in a reporting entity’s shareholders’ equity in the financial statements.  The amendments in this update are to be applied prospectively. For public entities, the amendments are effective during interim and annual periods beginning after December 15, 2011. Early application by public entities is not permitted. The adoption of ASU 2011-04 is not expected to have any material impact on our financial position, results of operations or cash flows.  ASC 480, In March of 2012, the FASB issued Accounting Standards Update,Distinguishing Liabilities from Equity; primarily originated from FAS 150 and related interpretations. This subtopic establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity. The guidance applies to freestanding financial instruments, thus reinforcing the importance of this determination.  The Company has reviewed all other recently issued, but not yet adopted, accounting standards in order to determine their effects, if any, on its results of operation, financial position or cash flows.  Based on that review, the Company believes that none of these pronouncements will have a significant effect on its consolidated financial statements.  Loss Per Common Share  The Company complies with the accounting and disclosure requirements of FASB ASC 260,Earnings Per Share.Basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period.  Diluted loss per common share incorporates the dilutive effect of common stock equivalents on an average basis during the period.              11




THE MOVIE STUDIO, INC. (FORMERLY DESTINATION TELEVISION, INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2013  Note 3 – Going Concern  The accompany financial statements have been prepared on the basis of accounting principles applicable to a going concern, which assume that Destination Television, Inc. will continue in operation for a least one year and realize its assets and discharge its liabilities in the normal course of operations.  Several conditions cast doubt about the Company’s ability to continue as a going concern.   The Company has an accumulated deficit of approximately $9.4 million as of July 31, 2013, has limited cash available for payment of operating expenses, no source of revenue, and requires additional financing in order to finance its business activities on ongoing basis. The Company’s future capital requirements will depend on numerous factors, including but not limited to continued progress in the pursuit of business opportunities.  The Company is actively pursuing alternative financing and has discussions with various third parties, although no firm commitments have been obtained.  In the interim, the principal shareholder has committed to meeting any operating expenses incurred by the Company. The Company believes that actions it is presently taking to revise its operating and financial requirements provide it with the opportunity to continue as a going concern.  The accompanying financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate continuation of the Company as a going concern.  While we believe that the actions already taken or planned, will mitigate the adverse conditions and events which raise doubt about the validity of going concern assumption used in preparing these financial statements, there can be no assurance that these actions will be successful.  If the Company were unable to continue as a going concern, then substantial adjustments would be necessary to the carrying values of the reported liabilities.  Note 4 - Acquired Amortizable Intangible Assets  As of October 31, 2006, the Company invested $3,280 in establishing trademarks associated with its Bar TV concept. The Company amortizes the costs of these intangibles over their estimated useful lives unless such lives are deemed indefinite. Amortizable intangible assets are also tested for impairment based on undiscounted cash flows and, if impaired, written down to fair value based on either discounted cash flows or appraised values. Intangible assets with indefinite lives are tested for impairment, at least annually, and written down to fair value as required.  Expected annual amortization expense related to amortizable intangible assets is as follows:  As of October 31,2013

   

   

   75Thereafter

   

   

   280Total expected annual amortization expense

   $

   355




12     THE MOVIE STUDIO, INC. (FORMERLY DESTINATION TELEVISION, INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2013  Note 5 - Income Taxes The Company has approximately $9.4 million in net operating loss carryovers available to reduce future income taxes. These carryovers expire at various dates through the year 2029. The Company has adopted FASB ASC Topic 740,Income Taxes,which provides for the recognition of a deferred tax asset based upon the value the loss carry-forwards will have to reduce future income taxes and management's estimate of the probability of the realization of these tax benefits. The Company's management determined that it was more likely than not that the Company's net operating loss carry-forwards would not be utilized; therefore, a valuation allowance against the related deferred tax asset has been established.  A summary of the deferred tax asset presented on the accompanying balance sheets is as follows: 2013

   

   

   2012Deferred tax asset:Net operating loss carryforwards

   $

   4,945,146

   

   $

   4,770,447Deferred tax asset

   

   4,945,146

   

   

   4,770,447Less: Valuation allowance

   

   (4,945,146)

   

   

   (4,770,447)Net deferred tax asset

   $

   -

   

   $

   -
  Valuation allowance

   38

   

   

   38-

   %

   

   -

   %
  Note 6 - Commitments Facilities The Company leases from a stockholder, Dr. H. K. Terry, pursuant to an oral agreement on a month-to-month basis, an 8,500 square foot building in Fort Lauderdale, Florida, which serves as its administrative offices and computer operations center. The rent is $4,500 per month and the Company is responsible for utilities. Rent expense was $13,500 and $13,500 for the nine months ended July 31, 2013 and 2012, respectively. Employment Agreements




Gordon Scott Venters is employed as the Company's president and chief executive officer, pursuant to an employment agreement, effective November 1, 2004.  The agreement was for an initial period of three years, with automatic renewals of one year.  The employment agreement, which extended a previous agreement, provides for an annual salary of $161,662; annual increases of a minimum of 5%; and participation in incentive or bonus plans at the discretion of the board of directors. The agreement additionally provides for certain confidentiality and non-competition provisions and a minimum payment of 18 months salary in the event of a change of control or termination (without cause), or if the employee terminates for good reason. The balance due Mr. Ventors a July 31, 2013 and October 31, 2012 for unpaid wages was approximately $780,347 and $680,597, respectively. 13     THE MOVIE STUDIO, INC. (FORMERLY DESTINATION TELEVISION, INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2013  Note 7 - Payroll Taxes Payable  The Company has been delinquent in its payment of payroll taxes. As of July 31, 2009, the total of payroll taxes payable, including estimated interest and penalties, was $261,710. In August, October and November 2007, the Internal Revenue Service filed tax liens against the Company in the total amount of $198,351. In August 2007, the Company made a lump-sum payment of $48,000 and in November 2007, an additional lump sum payment of $18,600. These payments were made in connection with the Company's submission of an Offer in Compromise to settle its payroll tax obligations. The Offer in Compromise was rejected and the Company appealed the initial determination which also was rejected in June 2009. The IRS has determined that the debt is uncollectible from the Company, and has begun pursuing the president for the trust portion of the tax. There is no assurance that an acceptable settlement will be reached. Payroll tax obligations for the calendar years 2007, 2008, 2009, 2010 and 2011 have been paid as required.  The balance due the Internal Revenue Service at July 31, 2013 and October 31, 2012 was approximately $400,199 and $372,851, respectively.  Note 8 - Stockholders' Deficiency  Common Stock  Stock Issued for Cash  During period ended July 31, 2013, the Company issued to accredited investors a total of 3,500,000 shares of common stock for $35,000, all of which were issued at $0.0001 per share. None of the above shares have been registered under the Securities Act of 1933, as amended, and therefore, may not be transferred in the absence of an exemption from registration under such laws and will be considered "restricted securities" as that term is defined in Rule 144 adopted under the Securities Act, and may be sold only in compliance with the resale provisions set forth therein.  During the fiscal year ended October 31, 2012, the Company did not issue any shares of stock.  Stock Issued for Services  In During period ended July 31, 2013, the Company did not issue any shares of common stock.  In During period ended October 31, 2012, the Company did not issue any shares of common stock.  Preferred Stock  Series B Preferred Stock




The Series B preferred stock is identical in all aspects to the common stock, including the right to receive dividends, except that each share of Series B preferred stock has voting rights equivalent to four times the number of shares of common stock into which it could be converted. As of July 31, 2013 there were 5,750,000 shares of Series B preferred stock outstanding and on October 31, 2012 there were 5,750,000 shares outstanding. Each share of Series B preferred stock is convertible into one share of common stock.    14       THE MOVIE STUDIO, INC. (FORMERLY DESTINATION TELEVISION, INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JULY 31, 2013  Note 9- Common Stock Options  No options or warrants were outstanding at July 31, 2013 and October 31, 2012.  Note 10 – Litigation  During the month of November 2012, the Company became involved in litigation regarding the ownership of equipment left in the building by a previous tenant.  The building serves as the corporate headquarters for the Company.  The Company was ordered by the court to preserve the equipment until ownership can be established by the court.  The Company has made no claim of ownership of the equipment and expects to be dismissed from the litigation  Note 11 -  Related Party Transactions  Gordon Scott Venters  Effective November 2007, Gordon Scott Venters, entered into a three-year employment agreement with the Company, which is described above inNote 5-Commitments-Employment Agreements. In November 2007, Mr. Venters, acquired from the Company 2,000,000 shares of its Series B Preferred Stock as payment of $56,000 of accrued unpaid salary. The shares were valued at $56,000, or $0.028 per share, which represented the approximate value, at the date of issuance, of the common stock into which the Series B Preferred Stock may be converted. Also, in September and October 2008, Mr. Venters, acquired a total 15,000,000 shares of common stock from the Company at an average price of approximately $0.0051 as payment for accrued but unpaid salary of $76,000. The shares of Series B Preferred Stock and the common shares have not been registered under the Securities Act of 1933, as amended, and therefore, may not be transferred in the absence of an exemption from registration under such laws and will be considered "restricted securities" as that term is defined in Rule 144 adopted under the Securities Act, and may be sold only in compliance with the resale provisions set forth therein.  In August 2006 and February 2007, Mr. Venters made non-interest bearing unsecured loans to the Company in the amounts of $25,000 and $5,000, respectively. In April 2007, the Company repaid the $5,000 loan ; in addition to the repayment of the $5,000 loan, the Company also issued 500,000 of its $0.0001 par value common stock in exchange for the $25,000 loan and accrued wages.  These shares were valued at $0.052 per share. Additionally, in August 2007, he acquired 1,000,000 shares of common stock, which were valued at $0.04 per share, in exchange for $40,000 of accrued unpaid salary. The balance due Mr. Venters for unpaid wages as of July 31, 2013 and October 31, 2012 was$780,347 and $680,597, respectively.




Ventures Capital Partners, LLC  In April 2011, Ventures Capital Partners, LLC. (VCP) purchased a total debt of $1,353,420 from a related party shareholder for an equity.  VCP is owned by the president of the Company.   15      Item 2. Management’s Discussion and Analysis of Financial Conditions and Results of Operations  THIS FILING CONTAINS FORWARD-LOOKING STATEMENTS. THE WORDS “ANTICIPATED,” “BELIEVE,” “EXPECT,” “PLAN,” “INTEND,” “SEEK,” “ESTIMATE,” “PROJECT,” “WILL,” “COULD,” “MAY,” AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. THESE STATEMENTS INCLUDE, AMONG OTHERS, INFORMATION REGARDING FUTURE OPERATIONS, FUTURE CAPITAL EXPENDITURES, AND FUTURE NET CASH FLOW. SUCH STATEMENTS REFLECT THE COMPANY’S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND FINANCIAL PERFORMANCE AND INVOLVE RISKS AND UNCERTAINTIES, INCLUDING, WITHOUT LIMITATION, GENERAL ECONOMIC AND BUSINESS CONDITIONS, CHANGES IN FOREIGN, POLITICAL, SOCIAL, AND ECONOMIC CONDITIONS, REGULATORY INITIATIVES AND COMPLIANCE WITH GOVERNMENTAL REGULATIONS, THE ABILITY TO ACHIEVE FURTHER MARKET PENETRATION AND ADDITIONAL CUSTOMERS, AND VARIOUS OTHER MATTERS, MANY OF WHICH ARE BEYOND THE COMPANY’S CONTROL. SHOULD ONE OR MORE OF THESE RISKS OR UNCERTAINTIES OCCUR, OR SHOULD UNDERLYING ASSUMPTIONS PROVE TO BE INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY AND ADVERSELY FROM THOSE ANTICIPATED, BELIEVED, ESTIMATED, OR OTHERWISE INDICATED. CONSEQUENTLY, ALL OF THE FORWARD-LOOKING STATEMENTS MADE IN THIS FILING ARE QUALIFIED BY THESE CAUTIONARY STATEMENTS AND THERE CAN BE NO ASSURANCE OF THE ACTUAL RESULTS OR DEVELOPMENTS.  The following discussion and analysis of our financial condition and plan of operations should be read in conjunction with our financial statements and related notes appearing elsewhere herein. This discussion and analysis contains forward-looking statements including information about possible or assumed results of our financial conditions, operations, plans, objectives and performance that involve risk, uncertainties and assumptions. The actual results may differ materially from those anticipated in such forward-looking statements. For example, when we indicate that we expect to increase our product sales and potentially establish additional license relationships, these are forward-looking statements. The words expect, anticipate, estimate or similar expressions are also used to indicate forward-looking statements.  Plan of Operation  The Movie Studio, Inc. F/K/A Destination Television, Inc. (the "Company" or the "Registrant") was incorporated in the State of Delaware in 1961 under the name Magic Fingers, Inc. By amendment of its certificate of incorporation, the Company's name was changed in 1999 to Magicinc.com and in April 2002 to Magic Media Networks, Inc. and in February 2007 to Destination Television, Inc.  In November of 2012 the Company filed an amendment to change its name to The Movie Studio, Inc. Through the period ended October 31, 1999, the Company devoted substantially all its efforts to reorganizing its financial affairs and settling its debt obligations. During the fiscal years ended October 31, 2000 and October 31, 2001, the Company was engaged primarily in the planning and development of an interactive network to provide entertainment via the Internet. Subsequent to October 31, 2001, the Company redirected its business focus to the development of a private television network, in high traffic locations such as bars and nightclubs.


During the development process, the Company received incidental revenue from the sale of advertising and the production of commercials.




16      Results of Operation  Three Months Ended July 31, 2013 Compared to Three months Ended July 31, 2012  Revenue  The Company had no revenues for the three months ended July 31, 2013 and 2012.  Expenses  For the three month period ended July 31, 2013 and 2012 selling snd administrative expenses increased $13,850 from $33,964 to $47,814, respectively.  These increases were primarily due to the Company’s increase in payroll costs.  Other  For the three months ended July 31, 2013 and 2012, the Company reported interest expense of $9,116 and $9,116, respectively.  Nine months Ended July 31, 2013 Compared to Nine Months Ended July 31, 2011  Revenue  The Company had no revenues for the nine months ended July 31, 2013 and 2012.  Expenses  Selling, general and administrative expenses increased $45,460 from $101,891 to $147,351 for the nine months ended July 31, 2013, as compared to the same period in 2012. These increases were primarily due to the Company’s increasing payroll costs.  Other  For the nine months ended July 31, 2013 and 2012, the Company reported interest expense of $27,348 and $27,348, respectively.  Liquidity and Capital Resources  As of July, 2013 the Company had assets of $10,060 as against total liabilities of $2,599,317.The Company has an accumulated deficit of approximately $9.4 million as of July 31, 2013, has limited cash available for payment of operating expenses, no source of revenue, and requires additional financing in order to finance its business activities on ongoing basis. The Company’s future capital requirements will depend on numerous factors, including but not limited to continued progress in the pursuit of business opportunities.




The Company is actively pursuing alternative financing and has discussions with various third parties, although no firm commitments have been obtained.  In the interim, the principal shareholder has committed to meeting any operating expenses incurred by the Company. The Company believes that actions it is presently taking to revise its operating and financial requirements provide it with the opportunity to continue as a going concern.  Item  3.Quantitative and Qualitative Disclosures About Market Risk  Not applicable.   17       Item 4. Controls and Procedures  (a)           Evaluation of disclosure controls and procedures.  Our management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 (Exchange Act) as a process designed by or under the supervision of, our principal executive and principal financial officers and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:  Pertain to the maintenance of records that is in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets  Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in  accordance with authorizations of our management and directors: and  Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.  Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.  Management assessed the effectiveness of the Company’s Internal Control over financial reporting as of July 31, 2013. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in this Internal Control-Integrated Framework.  Based on our assessment, we believe that, as of July 31, 2013 our internal control over financial reporting was not effective.  Evaluation of Disclosure Controls and Procedures  We maintain disclosure controls and procedures (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that are designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods


specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow




timely decisions regarding disclosure.  In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.  18       Our management, with the participation of our chief executive officer and chief financial officer, has evaluated the effectiveness of our disclosure controls and procedures as of January 31, 2013.  Based on their evaluation, our chief executive officer and chief financial officer have concluded that, as of January 31, 2013, our disclosure controls and procedures were not effective.  (b)            Changes in internal controls.  There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended January 31, 2013 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.  PART II - OTHER INFORMATION  Item 1. Legal Proceedings  During the month of November 2012, the Company became involved in litigation regarding the ownership of equipment left in the building by a previous tenant.  The building serves as the corporate headquarters for the Company.  The Company was ordered by the court to preserve the equipment until ownership can be established by the court.  The Company has made no claim of ownership of the equipment and expects to be dismissed from the litigation.  Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds  During the nine month period ended July 31, 2013, there was no modification of any instruments defining the rights of holders of the Company’s common stock and no limitation or qualification of the rights evidenced by the Company’s common stock as a result of the issuance of any other class of securities or the modification thereof.  Item 3.     Defaults upon Senior Securities  There have been no defaults in any material payments during the covered period.  Item 4.     Mine Safety Disclosures  Not applicable.  Item 5.     Other Information  The Company does not have any other material information to report with respect to the nine month period ended July 31, 2013.  Item 6.  Exhibits and Reports on Form 8-K




(a)Exhibits  33.1 Certification pursuant to Section 302 of Sarbanes Oxley Act of  2002   33.2 Certification pursuant to Section 906 of Sarbanes Oxley Act of 2002  (b)Reports on Form 8-K  No reports on Form 8-K were filed during the quarter ended July 31, 2013.  19         SIGNATURES  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.   THE MOVIE STUDIO, INC.  Date:  September 11, 2013  /s/ Gordon Scott Venters Gordon Scott Venters President, Secretary and Director




20       EXHIBIT 33.1   CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002  I, Gordon Scott Venters, certify that:  1.I have reviewed this Quarterly Report on Form 10-Q of The Movie Studio, Inc.  2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;  3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods present in this report;  4.The small business issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:  (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the small business issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d)Disclosed in this report any change in the small business issuer’s internal control over financing reporting that occurred during the small business issuer’s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report)


that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting; and




5.The small business issuer’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financialreporting, to the small business issuer’s auditors and the audit committee of the small business issuer’s board of directors (or persons performing the equivalent functions):   21        (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and (b)Any fraud, whether or not material, that involved management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.   Dated:  September 11, 2013  /s/ Gordon Scott Venters Gordon Scott Venters Chief Executive Officer Chief Accounting Officer


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22           EXHIBIT 33.2  CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002  In connection with this Quarterly Report of The Movie Studio, Inc. (the “Company”) on Form 10-Q for the period ending July 31, 2012, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gordon Scott Venters, Chief Executive Officer and Chief Accounting Officer of the Company, certifies to the best of his knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:  1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and  2.The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.  By:/s/ Gordon Scott Venters Gordon Scott Venters Chief Executive Officer Chief Accounting Officer  Dated:  September 11, 2013


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