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, 2008




o
            TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the transition period from
______to______.




MOONSHINE
CREATIONS, INC.


(Exact
name of registrant as specified in Charter




NEVADA
            
            333-149235
            
            26-0745273(State
      or other jurisdiction of
              incorporation
      or organization)
            
            (Commission
      File No.)
            
            (IRS
      Employee Identification No.)




160
Henry Martin Trail, Statesville, NC 28625


(Address of Principal
Executive Offices)


_______________





(704)-592-2622


(Issuer
Telephone number)


_______________




(Former
Name or Former Address if Changed Since Last Report)




Check
whether the issuer (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 issuer was required to file such reports), and (2)has been
subject to such filing requirements for the past 90 days. Yes x  No o




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company filer.
 See definition of “accelerated filer” and “large accelerated filer” in
Rule 12b-2 of the Exchange Act (Check one):




Large
      Accelerated Filer o
            Accelerated
      Filer o
            Non-Accelerated
      Filer o
            Smaller
      Reporting Company x





Indicate
by check mark whether the registrant is a shell company as defined in Rule 12b-2
of the Exchange Act. Yes x No o




State the
number of shares outstanding of each of the issuer’s classes of common equity,
as of September 10, 2008:5,635,500
shares issued and outstanding.



















MOONSHINE CREATIONS,
INC.


FORM
10-Q




July
31, 2008






INDEX








PART
I-- FINANCIAL INFORMATION




Item
      1.
            Financial
      StatementsItem
      2.
            Management’s
      Discussion and Analysis of Financial ConditionItem
      3
            Quantitative
      and Qualitative Disclosures About Market RiskItem
      4T.
            Control
      and Procedures




PART
II-- OTHER INFORMATION




Item
      1
            Legal
      ProceedingsItem
      1A
            Risk
      FactorsItem
      2.
            Unregistered
      Sales of Equity Securities and Use of ProceedsItem
      3.
            Defaults
      Upon Senior SecuritiesItem
      4.
            Submission
      of Matters to a Vote of Security HoldersItem
      5.
            Other
      InformationItem
      6.
            Exhibits
      and Reports on Form 8-K




SIGNATURE













Item
1. Financial Statements




MOONSHINE
      CREATIONS, INC.(A
      DEVELOPMENT STAGE COMPANY)BALANCE
      SHEETSAs
      of
              
              
              As
      ofASSETS
              
              July
      31,
                2008
              
              
              October
      31, 2007(Unaudited)CURRENT
      ASSETSCash
              
              $
              106
              
              
              $
              39,500Prepaid
      expense
              
              
              5,801
              
              
              
              -TOTAL
      ASSETS
              
              $
              5,907
              
              
              $
              39,500LIABILITIES
      AND STOCKHOLDERS' EQUITYCURRENT
      LIABILITIESAccounts
      payable
              
              $
              200
              
              
              $
              -Related
      party advances
              
              
              1,000
              
              
              
              1,000TOTAL
      LIABILITIES
              
              
              1,200
              
              
              
              1,000COMMITMENTS
      AND CONTINGENCIES
              
              
              -
              
              
              
              -STOCKHOLDERS'
      EQUITYPreferred
      stock, $0.00001 par value, 10,000,000 shares authorized,none
      issued and outstanding
              
              
              -
              
              
              
              -Common
      stock, $0.00001 par value, 100,000,000 shares authorized,5,635,500
      and 5,395,000 shares issued and outstanding, respectively
              
              
              56
              
              
              
              54Additional
      paid-in capital
              
              
              69,484
              
              
              
              46,136Subscriptions
      Receivable
              
              
              (50
              )
              
              
              (50
              )Accumulated
      deficit during development stage
              
              
              (64,783
              )
              
              
              (7,640
              )TOTAL
      STOCKHOLDERS' EQUITY
              
              
              4,707
              
              
              
              38,500TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
              
              $
              5,907
              
              
              $
              39,500


The
accompanying notes are an integral part of these financial
statements.


1




MOONSHINE CREATIONS, INC.(A
      DEVELOPMENT STAGE COMPANY)STATEMENT
      OF OPERATIONS(Unaudited)For
      The three
              
              
              For
      the period
              
              
              For
      The Nine
              
              
              For
      The PeriodMonths
              
              
              April
      10, 2007
              
              
              Months
              
              
              April
      10, 2007Ended
              
              
              (Inception)
              
              
              Ended
              
              
              (Inception)July
      31, 2008
              
              
              to
      July 31, 2007
              
              
              July
      31, 2008
              
              
              to
      July 31, 2008REVENUES
              
              $
              -
              
              
              $
              -
              
              
              $
              -
              
              
              $
              -EXPENSESGeneral
      and administrative
              
              
              15,271
              
              
              
              1,000
              
              
              
              47,843
              
              
              
              48,843Salary
      Expense
              
              
              2,500
              
              
              
              -
              
              
              
              7,500
              
              
              
              13,033Rent
              
              
              600
              
              
              
              -
              
              
              
              1,800
              
              
              
              2,907Total
      Expenses
              
              
              18,371
              
              
              
              1,000
              
              
              
              57,143
              
              
              
              64,783LOSS
      FROM OPERATIONS (BEFORE TAXES)
              
              
              (18,371
              )
              
              
              (1,000
              )
              
              
              (57,143
              )
              
              
              (64,783
              )INCOME
      TAX EXPENSE
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -NET
      LOSS
              
              $
              (18,371
              )
              
              $
              (1,000
              )
              
              $
              (57,143
              )
              
              $
              (64,783
              )NET
      LOSS PER SHARE,BASIC
      AND DILUTED
              
              $
              (0.00
              )
              
              $
              (0.00
              )
              
              $
              (0.01
              )WEIGHTED
      AVERAGE NUMBER OFCOMMON
      SHARES OUTSTANDING,BASIC
      AND DILUTED
              
              
              5,635,500
              
              
              
              5,000,000
              
              
              
              5,395,000





The
accompanying notes are an integral part of these financial
statements.


2




MOONSHINE
      CREATIONS, INC.(A
      DEVELOPMENT STAGE COMPANY)STATEMENT
      OF STOCKHOLDERS' EQUITYFrom
      APRIL 10, 2007 (INCEPTION) TO JULY 31, 2008(Unaudited)AccumulatedDeficit
              
              
              TotalSubscription
              
              
              Additional
              
              
              During
              
              
              Stockholders'Preferred
      Stock
              
              
              Common
      Stock
              
              
              Receivable
              
              
              Paid-in
              
              
              Development
              
              
              EquityBalance,
      April 10 2007 (Inception)
              
              
              -
              
              
              $
              -
              
              
              
              -
              
              
              $
              -
              
              
              $
              
              
              
              $
              -
              
              
              $
              -
              
              
              $
              -Shares
      issued to founders at $0.00001 per share
              
              
              -
              
              
              
              -
              
              
              
              5,000,000
              
              
              
              50
              
              
              
              (50
              )
              
              
              -
              
              
              
              -
              
              
              
              -Stock
      issued for cash at $0.10 per share
              
              
              -
              
              
              
              -
              
              
              
              395,000
              
              
              
              4
              
              
              
              
              
              
              
              39,496
              
              
              
              -
              
              
              
              39,500In
      kind contribution of services
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              5,533
              
              
              
              -
              
              
              
              5,533In
      kind contribution of office expenses
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              1,107
              
              
              
              
              
              
              
              1,107Net
      profit (loss) for the period Inception to October 31, 2007
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              -
              
              
              
              (7,640
              )
              
              
              (7,640
              )Balance,
      October 31, 2007
              
              
              -
              
              
              $
              -
              
              
              
              5,395,000
              
              
              $
              54
              
              
              $
              (50
              )
              
              $
              46,136
              
              
              $
              (7,640
              )
              
              $
              38,500Shares
      issued to founders at $0.00001 per share
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -Stock
      issued for cash at $0.10 per share
              
              
              -
              
              
              
              -
              
              
              
              240,500
              
              
              
              2
              
              
              
              
              
              
              
              14,048
              
              
              
              -
              
              
              
              14,050In
      kind contribution of services
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              2,500
              
              
              
              -
              
              
              
              2,500In
      kind contribution of office expenses
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              600
              
              
              
              
              
              
              
              600Net
      profit (loss) for the period November 1, 2007 to January 31,
      2008
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              -
              
              
              
              (3,131
              )
              
              
              (3,131
              )Balance,
      January 31, 2008
              
              
              -
              
              
              $
              -
              
              
              
              5,635,500
              
              
              $
              56
              
              
              $
              (50
              )
              
              $
              63,284
              
              
              $
              (10,771
              )
              
              $
              52,519In
      kind contribution of services
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              2,500
              
              
              
              -
              
              
              
              2,500In
      kind contribution of office expenses
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              600
              
              
              
              
              
              
              
              600Net
      profit (loss) for the period February 1, 2008 to April 30,
      2008
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              -
              
              
              
              (35,641
              )
              
              
              (35,641
              )Balance,
      April 30, 2008
              
              
              -
              
              
              $
              -
              
              
              
              5,635,500
              
              
              $
              56
              
              
              $
              (50
              )
              
              $
              66,384
              
              
              $
              (46,412
              )
              
              $
              19,978In
      kind contribution of services
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              2,500
              
              
              
              -
              
              
              
              2,500In
      kind contribution of office expenses
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              600
              
              
              
              
              
              
              
              600Net
      profit (loss) for the period May 1, 2008 to July 31, 2008
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              
              
              
              
              -
              
              
              
              (18,371
              )
              
              
              (18,371
              )Balance,
      July 31, 2008
              
              
              -
              
              
              $
              -
              
              
              
              5,635,500
              
              
              $
              56
              
              
              $
              (50
              )
              
              $
              69,484
              
              
              $
              (64,783
              )
              
              $
              4,707


The
accompanying notes are an integral part of these financial
statements.


3




MOONSHINE
      CREATIONS, INC.(A
      DEVELOPMENT STAGE COMPANY)STATEMENT
      OF CASH FLOWS(Unaudited)For
      The
              
              
              For
      The Period
              
              
              For
      The PeriodNine
      Monthsended
              
              
              April
      10, 2007 (Inception)
              
              
              April
      10, 2007 (Inception)July
      31, 2008
              
              
              to
      July 31, 2007
              
              
              to
      July 31, 2008CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
              
              $
              (57,143
              )
              
              $
              (1,000
              )
              
              $
              (64,783
              )Adjustments
      to reconcile net loss to net cash used in operating
      activities:In-kind
      contribution of office expenses
              
              
              1,800
              
              
              
              -
              
              
              
              2,907In-kind
      contribution of services
              
              
              7,500
              
              
              
              -
              
              
              
              13,033Changes
      in Assets and LiabilitiesIncrease
      (Decrease) in prepaid expense
              
              
              (5,801
              )
              
              
              -
              
              
              
              (5,801
              )Increase
      (Decrease) in accounts payable
              
              
              200
              
              
              
              -
              
              
              
              200Increase
      (Decrease) in related party advances
              
              
              -
              
              
              
              1,000
              
              
              
              1,000Net
      cash used in operating activities
              
              
              (53,444
              )
              
              
              -
              
              
              
              (53,444
              )CASH
      FLOWS FROM INVESTING ACTIVITIES:
              
              
              -
              
              
              
              -
              
              
              
              -CASH
      FLOWS FROM FINANCING ACTIVITIES:Proceeds
      from issuance of common stock
              
              
              14,050
              
              
              
              -
              
              
              
              53,550Net
      cash provided by financing activities
              
              
              14,050
              
              
              
              -
              
              
              
              53,550NET
      INCREASE (DECREASE) IN CASH
              
              
              (39,394
              )
              
              
              -
              
              
              
              106CASH,
      BEGINNING OF PERIOD
              
              
              39,500
              
              
              
              -
              
              
              
              -CASH,
      END OF PERIOD
              
              $
              106
              
              
              $
              -
              
              
              $
              106SUPPLEMENTAL
      CASH FLOW INFORMATION:Interest
      paid
              
              $
              -
              
              
              $
              -
              
              
              $
              -Income
      taxes paid
              
              $
              -
              
              
              $
              -
              
              
              $
              -




The
accompanying notes are an integral part of these financial
statements.


4


MOONSHINE
CREATIONS, INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
 (UNAUDITED)
 AS OF JULY 31,
2008
  NOTE 1 SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES AND ORGANIZATION
  (A) Basis of
Presentation
  The
accompanying unaudited financial statements have been prepared in accordance
with accounting principles generally accepted in The United States of America
and the rules and regulations of the Securities and Exchange Commission for
interim financial information.  Accordingly, they do not include all
the information necessary for a comprehensive presentation of financial position
and results of operations.
  It is
management's opinion, however that all material adjustments (consisting of
normal recurring adjustments) have been made which are necessary for a fair
financial statements presentation.  The results for the interim period
are not necessarily indicative of the results to be expected for the
year.
 
 (B)
Organization
 
 Moonshine
Creations, Inc. (a development stage company) (the “Company”) was incorporated
under the laws of the State of Nevada on April 10, 2007. The Company was
organized to create an online craft store focusing on one of a kind and unique
craft items made in the southeastern United States. Activities during the
development stage include developing the business plan and raising
capital.
 
 (C) Use of
Estimates
 
 In
preparing financial statements in conformity with generally accepted accounting
principles, management is required to make estimates and assumptions that affect
the reported amounts of assets and liabilities and the disclosure of contingent
assets and liabilities at the date of the financial statements and revenues and
expenses during the reported period. Actual results could differ from those
estimates.
 
 (D) Cash and Cash
Equivalents
 
 For
purposes of the cash flow statements, the Company considers all highly liquid
investments with original maturities of three months or less at the time of
purchase to be cash equivalents.
 
   5
 MOONSHINE
CREATIONS, INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
 (UNAUDITED)
 AS OF JULY 31,
2008
  (E) Income
Taxes
 
 The
Company accounts for income taxes under the Statement of Financial Accounting
Standards No. 109, “Accounting for Income Taxes” (“Statement 109”). Under
Statement 109, deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. Under Statement 109, the
effect on deferred tax assets and liabilities of a change in tax rates is
recognized in income in the period that includes the enactment
date.
 
 (F) Loss Per
Share
 
 Basic and
diluted net loss per common share is computed based upon the weighted average
common shares outstanding as defined by Financial Accounting Standards No. 128,
“Earnings Per Share.” As of July 31, 2008 and 2007, there were no common share
equivalents outstanding.
 
 (G) Business
Segments
 
 The
Company operates in one segment and therefore segment information is not
presented.
 
 (H) Revenue
Recognition
 
 Revenue
from support services is recognized when earned and realizable, which is when
persuasive evidence of an arrangement exists, services, if requested by the
customers, have been rendered and are determinable, and collectability is
reasonably assured. Revenue from telephone support service contracts is
recognized as the services are provided, determined on an hourly
basis.
   
   6
 MOONSHINE
CREATIONS, INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
 (UNAUDITED)
 AS OF JULY 31,
2008
   (I)
Recent Accounting Pronouncements
  In
December 2007, the Financial Accounting Standards Board (FASB) issued SFAS No.
160, “Noncontrolling Interests
in Consolidated Financial Statements – an amendment of ARB No. 51”. This
statement improves the relevance, comparability, and transparency of the
financial information that a reporting entity provides in its consolidated
financial statements by establishing accounting and reporting standards that
require; the ownership interests in subsidiaries held by parties other than the
parent and the amount of consolidated net income attributable to the parent and
to the noncontrolling interest be clearly identified and presented on the face
of the consolidated statement of income, changes in a parent’s ownership
interest while the parent retains its controlling financial interest in its
subsidiary be accounted for consistently, when a subsidiary is deconsolidated,
any retained noncontrolling equity investment in the former subsidiary be
initially measured at fair value, entities provide sufficient disclosures that
clearly identify and distinguish between the interests of the parent and the
interests of the noncontrolling owners. SFAS No. 160 affects those entities that
have an outstanding noncontrolling interest in one or more subsidiaries or that
deconsolidate a subsidiary. SFAS No. 160 is effective for fiscal years, and
interim periods within those fiscal years, beginning on or after December 15,
2008. Early adoption is prohibited. The adoption of this statement is not
expected to have a material effect on the Company's financial
statements.
  In March
2008, the FASB issued SFAS No. 161, “Disclosures about Derivative
Instruments and Hedging Activities, an amendment of FASB Statement No. 133”
(SFAS 161). This statement is intended to improve transparency in financial
reporting by requiring enhanced disclosures of an entity’s derivative
instruments and hedging activities and their effects on the entity’s financial
position, financial performance, and cash flows. SFAS 161 applies to all
derivative instruments within the scope of SFAS 133, “Accounting for Derivative
Instruments and Hedging Activities” (SFAS 133) as well as related hedged items,
bifurcated derivatives, and nonderivative instruments that are designated and
qualify as hedging instruments. Entities with instruments subject to SFAS 161
must provide more robust qualitative disclosures and expanded quantitative
disclosures. SFAS 161 is effective prospectively for financial statements issued
for fiscal years and interim periods beginning after November 15, 2008,
with early application permitted. We are currently evaluating the disclosure
implications of this statement.
 
 In May
2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles.” SFAS No. 162 identifies the sources of accounting
principles and provides entities with a framework for selecting the principles
used in preparation of financial statements that are presented in conformity
with GAAP. The current GAAP hierarchy has been criticized because it is directed
to the auditor rather than the entity, it is complex, and it ranks FASB
Statements of Financial Accounting Concepts, which are subject to the same level
of due process as FASB Statements of Financial Accounting Standards, below
industry practices that are widely recognized as generally accepted but that are
not subject to due process. The Board believes the GAAP hierarchy should be
directed to entities because it is the entity (not its auditors) that is
responsible for selecting accounting principles for financial statements that
are presented in conformity with GAAP. SFAS 162 is effective 60 days following
the SEC’s approval of PCAOB Auditing Standard No. 6, Evaluating Consistency
of Financial Statements (AS/6). The adoption of FASB 162 is not expected to have
a material impact on the Company’s financial position.
  In
May 2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee
Insurance Contracts-an interpretation of FASB Statement No. 60.” Diversity
exists in practice in accounting for financial guarantee insurance contracts by
insurance enterprises under FASB Statement No. 60, Accounting and Reporting by
Insurance Enterprises. This results in inconsistencies in the recognition and
measurement of claim liabilities. This Statement requires that an insurance
enterprise recognize a claim liability prior to an event of default (insured
event) when there is evidence that credit deterioration has occurred in an
insured financial obligation. This Statement requires expanded disclosures about
financial guarantee insurance contracts. The accounting and disclosure
requirements of the Statement will improve the quality of information provided
to users of financial statements.  SFAS 163 is effective for financial
statements issued for fiscal years beginning after December 15, 2008, and
interim periods within those fiscal years. The adoption of FASB 163 is not
expected to have a material impact on the Company’s financial
position.
  NOTE 2 GOING
CONCERN
 
 As
reflected in the accompanying financial statements, the Company is in the
development stage with no revenue, used cash in operations of $53,444, and has a
net loss from operations of $64,783 from Inception. This raises substantial
doubt about its ability to continue as a going concern. The ability of the
Company to continue as a going concern is dependent on the Company’s ability to
raise additional capital and implement its business plan. The financial
statements do not include any adjustments that might be necessary if the Company
is unable to continue as a going concern.
 
  7
 MOONSHINE
CREATIONS, INC.
 (A
DEVELOPMENT STAGE COMPANY)
 NOTES
TO FINANCIAL STATEMENTS
 (UNAUDITED)
 AS OF JULY 31,
2008
  NOTE
3 RELATED
PARTY ADVANCE
  During
2007, a related party of the Company paid $1,000 of operating expenses on behalf
of the Company.
 NOTE 4 STOCKHOLDERS’
EQUITY
  (A) Common Stock Issued for
Cash
 
 On July
25, 2007, the Company issued 5,000,000 shares of common stock to its founder for
cash of $50 ($0.00001 per share).
 
 During
the period from April 10, 2007 (Inception) to July 31, 2008 the Company issued
635,500 shares of common stock for cash of $63,550 ($.10 per share) and paid
offering costs of $10,000.
 
 (B) In-kind Contribution of
Services
 
 During
the period from April 10, 2007 (Inception) to July 31, 2008 the Company’s
president contributed services and office space with a fair value of $13,033 and
$2,907 respectively.
 
 NOTE
5  RELATED PARTY
TRANSACTIONS
 
 The
president of the Company received 5,000,000 shares of common stock for cash of
$50 ($0.00001 per share) (See Note 4).
 
 During
2007, a related party of the Company paid $1,000 of operating expenses on behalf
of the Company.  (See Note 3)
  During
the period from April 10, 2007 (Inception) to July 31, 2008 the Company’s
president contributed services and office space with a fair value of $13,033 and
$2,907 respectively(See Note
4).


8




ITEM 2.  MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS




Plan
of Operation




Moonshine
Creations, Inc. was incorporated in the State of Nevada on April 10,
2007.  Our plan is to create an online craft store. We will focus on
one of a kind and unique craft items made in the southeast United States.
Moonshine creations will locate and contact the artisans and explain the
opportunity of displaying their items on our website. We will receive
commissions for our website service.  We will provide the marketing,
receive payments, be responsible for the taxes and provide the customer service.
We will then notify the artisan of the sale and arrange for the shipping.
Initially, the artist will be contacted and the website will be maintained by
our President, Ms. Victoria Callanan. Ms. Callanan intends to hire additional
assistants and representatives as our client base expands.




Marketing




We plan
to utilize different channels for our marketing. We intend for our website to be
promoted by web placement services for example, Google Adwords and www.1-2-3webposition.com.
We also intend to promote our website by advertising in magazines such as
Southern Living, Cottage Living, Cottage Home, Better Homes and Gardens and
various other small regional publications. We also plan to set up booths at
craft fairs and pass out information inviting guest to visit our website. We
intend to further promote our website using a grass roots method by utilizing
Craft Blogs, www.myspace.com,
www.facebook.com, and
www.bizfriends.com.




Website




Currently
our website is being developed under the domain name moonshinecreationsinc.com.
We believe that we
need additional funds forthe development cost of our site and the cost
for hosting will be $350 per month. We intend for our website to use Flash and
High resolution photos as well as possess the capability to show short videos of
variously featured craft items.




On our
website, all of the craft items will be broken down in different categories
according to the craft medium. For example: pottery, glass, jewelry, home
accessories, stationary, wood, leather, metal, outdoor items and other
categories as well. The website will also have a shopping cart allowing
customers to purchase more than one item at a time. All items will have
descriptions and high resolution photos and certain designated items will have a
short video. In addition, we also plan to have a section featuring different
artist’s profile and their specialty items. Also, there will be a secure log-on
section where artisans can access detailed information related to their
craft.




Competition




Our
business will put us in direct competition with craft fairs, existing craft
websites, individual artisans who have websites and mega
websites.  There are many craft fairs in the southeast including but
not limited to NationalGospel & Harvest
Celebration, North Carolina Seafood Festival, Red River Revel Arts
Festival,The
Cotton Pickin’ Fair, and Gasparilla. These fairs offer a variety of exhibitors
depending on the individual fairs. Some of the existing craft websites are
craftsfaironline.com, thecountrygallery.net, craftsolutions.com and
indianchild.com. All of these websites provide a variety of services. In
addition to the existing craft websites, there are individual artisans that will
have their own websites




Results
of Operation




We did
not have any operating income from inception through July 31, 2008. For the
three months ended July 31, 2008, the company recognized a net loss of $18,371
and for the period from inception through July 31, 2008, the company recognized
net loss of $64,783. Expenses for the quarter were comprised of $15,271 in
administrative costs, $2,500 in salary, and $600 in rent.




Liquidity
and Capital Resources




As of
July 31, 2008, we had $106 in cash.




We
believe we can not satisfy our cash requirements for the next twelve months with
our current cash. If we are unable to satisfy our cash requirements we may be
unable to proceed with our plan of operations. We do not anticipate the purchase
or sale of any significant equipment. We also do not expect any significant
additions to the number of employees. In the event we are not successful in
reaching our initial revenue targets, additional funds may be required, and we
may not be able to proceed with our business plan for the development and
marketing of our core services. Should this occur, we will suspend or cease
operations.




We
anticipate that depending on market conditions and our plan of operations, we
may incur operating losses in the foreseeable future. Therefore, our auditors
have raised substantial doubt about our ability to continue as a going
concern.






9




Critical Accounting
Policies




Our
financial statements and related public financial information are based on the
application of accounting principles generally accepted in the United States
(“GAAP”). GAAP requires the use of estimates; assumptions, judgments and
subjective interpretations of accounting principles that have an impact on the
assets, liabilities, revenues and expense amounts reported. These estimates can
also affect supplemental information contained in our external disclosures
including information regarding contingencies, risk and financial condition. We
believe our use if estimates and underlying accounting assumptions adhere to
GAAP and are consistently and conservatively applied. We base our estimates on
historical experience and on various other assumptions that we believe to be
reasonable under the circumstances. Actual results may differ materially from
these estimates under different assumptions or conditions. We continue to
monitor significant estimates made during the preparation of our financial
statements.




Recent
Accounting Pronouncements




In
December 2007, the Financial Accounting Standards Board (FASB) issued SFAS No.
160, “Noncontrolling Interests
in Consolidated Financial Statements – an amendment of ARB No.
51”.  This statement improves the relevance, comparability, and
transparency of the financial information that a reporting entity provides in
its consolidated financial statements by establishing accounting and reporting
standards that require; the ownership interests in subsidiaries held by parties
other than the parent and the amount of consolidated net income attributable to
the parent and to the noncontrolling interest be clearly identified and
presented on the face of the consolidated statement of income, changes in a
parent’s ownership interest while the parent retains its controlling financial
interest in its subsidiary be accounted for consistently, when a subsidiary is
deconsolidated, any retained noncontrolling equity investment in the former
subsidiary be initially measured at fair value, entities provide sufficient
disclosures that clearly identify and distinguish between the interests of the
parent and the interests of the noncontrolling owners.  SFAS No. 160
affects those entities that have an outstanding noncontrolling interest in one
or more subsidiaries or that deconsolidate a subsidiary.  SFAS No. 160
is effective for fiscal years, and interim periods within those fiscal years,
beginning on or after December 15, 2008. Early adoption is prohibited. The
adoption of this statement is not expected to have a material effect on the
Company's financial statements.




In March
2008, the FASB issued SFAS No. 161, “Disclosures about Derivative
Instruments and Hedging Activities, an amendment of FASB Statement No. 133”
(SFAS161). This statement is intended
to improve transparency in financial reporting by requiring enhanced disclosures
of an entity’s derivative instruments and hedging activities and their effects
on the entity’s financial position, financial performance, and cash flows.SFAS161 applies to all derivative
instruments within the scope of SFAS 133, “Accounting for Derivative Instruments
and Hedging Activities” (SFAS 133) as well as related hedged items, bifurcated
derivatives, and nonderivative instruments that are designated and qualify as
hedging instruments. Entities with instruments subject toSFAS161 must provide more robust
qualitative disclosures and expanded quantitative disclosures.SFAS161 is effective prospectively for
financial statements issued for fiscal years and interim periods beginning after
November 15, 2008, with early application permitted. We are currently
evaluating the disclosure implications of this statement.




In May
2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles.” SFAS No. 162 identifies the sources of accounting
principles and provides entities with a framework for selecting the principles
used in preparation of financial statements that are presented in conformity
with GAAP. The current GAAP hierarchy has been criticized because it is directed
to the auditor rather than the entity, it is complex, and it ranks FASB
Statements of Financial Accounting Concepts, which are subject to the same level
of due process as FASB Statements of Financial Accounting Standards, below
industry practices that are widely recognized as generally accepted but that are
not subject to due process. The Board believes the GAAP hierarchy should be
directed to entities because it is the entity (not its auditors) that is
responsible for selecting accounting principles for financial statements that
are presented in conformity with GAAP. SFAS 162 is effective 60 days following
the SEC’s approval of PCAOB Auditing Standard No. 6, Evaluating Consistency
of Financial Statements (AS/6). The adoption of FASB 162 is not expected to have
a material impact on the Company’s financial position.




In May
2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee
Insurance Contracts-an interpretation of FASB Statement No. 60.” Diversity
exists in practice in accounting for financial guarantee insurance contracts by
insurance enterprises under FASB Statement No. 60, Accounting and Reporting by
Insurance Enterprises. This results in inconsistencies in the recognition and
measurement of claim liabilities. This Statement requires that an insurance
enterprise recognize a claim liability prior to an event of default (insured
event) when there is evidence that credit deterioration has occurred in an
insured financial obligation. This Statement requires expanded disclosures about
financial guarantee insurance contracts. The accounting and disclosure
requirements of the Statement will improve the quality of information provided
to users of financial statements.  SFAS 163 is effective for financial
statements issued for fiscal years beginning after December 15, 2008, and
interim periods within those fiscal years. The adoption of FASB 163 is not
expected to have a material impact on the Company’s financial
position.




Off-Balance Sheet
Arrangements




We have
no off-balance sheet arrangements.






10






Item 3.   Quantitative
and Qualitative Disclosures about Market Risks




The
Company is subject to certain market risks including changes in interest rates.
The Company does not undertake any specific actions to limit those
exposures.




Item 4T.  Controls and
Procedures




Pursuant
to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”),
the Company carried out an evaluation, with the participation of the Company’s
management, including the Company’s Chief Executive Officer (“CEO”) and Chief
Accounting Officer (“CAO”) (the Company’s principal financial and accounting
officer), of the effectiveness of the Company’s disclosure controls and
procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the
end of the period covered by this report. Based upon that evaluation, the
Company’s CEO and CAO concluded that the Company’s disclosure controls and
procedures are effective to ensure that information required to be disclosed
by the Company in the reports that the Company files or submits 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 the Company’s management, including the
Company’s CEO and CAO, as appropriate, to allow timely decisions regarding
required disclosure.




Changes
in Internal Control over Financial Reporting
 
 During
the three months ended July 31, 2008, we implemented the following changes to
our internal controls that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting,
 
 ·
              In
      May and June 2008, we implemented new monthly closing procedures to ensure
      the accounts payable and prepaid expenses are timely recorded and properly
      classified.
 
 Other
than the matters discussed above, there were no changes in the internal
controls over financial reporting that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.




11










PART
II - OTHER INFORMATION






Item
1.  Legal Proceedings.




Currently
we are not aware of any litigation pending or threatened by or against the
Company.




Item
1A.  Risk Factors.




None.




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




None.




Item 3.Defaults Upon Senior
Securities.




None




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




None.




Item 5.Other
Information.




None




Item 6.Exhibits and Reports of Form
8-K.




(a)
            Reports
      on Form 8-K and Form 8K-ANone(b)
            ExhibitsExhibit
      Number
            Exhibit
      Title3.1
            Certificate
      of Incorporation*3.3
            By-Laws
      *31.1
            Certification
      of Victoria Callanan pursuant to 18 U.S.C. Section 1350 as adopted
      pursuant to Section 302 of the Sarbanes-Oxley Act of
  2002.32.1
            Certification
      of Victoria Callanan pursuant to 18 U.S.C. Section 1350 as adopted
      pursuant to Section 906 of the Sarbanes-Oxley Act of
  2002.*Incorporated
      by reference to our registration statement on Form S-1 filed on February
      14, 2008 (File no: 333-149235)








12








SIGNATURES






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




Moonshine
      Creations, Inc.Date:
      September 11, 2008
            By:
            /s/
      Victoria
  CallananVictoria
      CallananChief
      Executive Officer, Chief Financial
Officer







13