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 September 30, 2009
 
 [  ]
              TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934
 
 Commission
File Number: 000-52692
 
 DON
MARCOS TRADING CO.
 (Exact
name of registrant as specified in its charter)
 
 Florida
                  (State
      or other jurisdiction of
                  incorporation
      or organization)
                
                65-0921319
                  (IRS
      Employer
                  Identification
      No.)
 
 1535 Southeast
17thStreet, Suite 107, Ft.
Lauderdale, FL  33316
 (Address
of principal executive offices)
 
 (954)
356-8111
 (Registrant’s
telephone number)
 
 N/A
 (Former
name, former address and former fiscal year, if changed since last
report)
 
 Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 þ No  ̈
  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
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
  Large
      accelerated filer  ̈
                    Accelerated
      filer  ̈Non-accelerated
      filer  ̈
                    Smaller
      reporting company þ(Do
      not check if a smaller reporting company)
 
 Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).  Yes  ̈ No þ
  As of
October 28, 2009, the number of shares of common stock outstanding was
48,300,000.
  
  INDEX
 
 Page
                                NumberPART
      I - FINANCIAL INFORMATIONItem
      1.
                              Financial
      Statements (Unaudited)
                              1Condensed
      Balance Sheets–
      September 30, 2009 and 2008
                              1Condensed
      Statement of Operations – For the three and nine months ended September
      30, 2009 and 2008
                              2Condensed
      Statements of Cash Flows –  For the nine months ended September
      30, 2009 and 2008
                              3Condensed
      Notes to Financial Statements
                              5Item
      2.
                              Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
                              8Item
      3.
                              Quantitative
      and Qualitative Disclosures About Market Risk
                              12Item
      4.
                              Controls
      and Procedures
                              12Item
      4T.
                              Controls
      and Procedures
                              12PART
      II - OTHER INFORMATIONItem
      1.
                              Legal
      Proceedings
                              13Item
      1A.
                              Risk
      Factors
                              13Item
      2.
                              Unregistered
      Sales of Equity Securities and Use of Proceeds
                              13Item
      3.
                              Defaults
      Upon Senior Securities
                              13Item
      4.
                              Submission
      of Matters to a Vote of Security Holders
                              13Item
      5.
                              Other
      Information
                              13Item
      6.
                              Exhibits
                              13SIGNATURES
                              
                              14
 
 i
 
 PART
I - FINANCIAL INFORMATION
   ITEM 1.  FINANCIAL
STATEMENTS
 
  DON
MARCOS TRADING CO.
 (A
DEVELOPMENT STAGE COMPANY)
 CONDENSED
BALANCE SHEETS
 SEPTEMBER
30, 2009 AND DECEMBER 31, 2008
  Unaudited
                                          September 30,
      2009
                                        
                                        
                                        Audited
                                            December
      31, 2008ASSETSCURRENT
      ASSETSCash
                                        
                                        $
                                        807
                                        
                                        
                                        $
                                        2,613Accounts
      receivable
                                        
                                        
                                        96
                                        
                                        
                                        
                                        -Inventory
                                        
                                        
                                        8,850
                                        
                                        
                                        
                                        8,891TOTAL
      CURRENT ASSETS
                                        
                                        $
                                        9,753
                                        
                                        
                                        $
                                        11,504LIABILITIES
      AND STOCKHOLDERS’ EQUITYCURRENT
      LIABILITIESAccounts
      payable and accrued expenses
                                        
                                        $
                                        10,591
                                        
                                        
                                        $
                                        12,176STOCKHOLDERS’
      EQUITYPreferred
      stock, no stated valueAuthorized
      10,000,000 sharesIssued
      and outstanding -0- shares
                                        
                                        
                                        -
                                        
                                        
                                        
                                        -Common
      stock, no par valueAuthorized
      100,000,000 sharesIssued
      and outstanding - 48,300,000 shares atSeptember
      30, 2009and 44,300,000 sharesat
      December 31, 2008
                                        
                                        
                                        243,454
                                        
                                        
                                        
                                        223,454Deficit
      accumulated during the development stage
                                        
                                        
                                        ( 244,292
                                        )
                                        
                                        
                                        ( 224,126
                                        )TOTAL
      STOCKHOLDERS’ EQUITY
                                        
                                        
                                        ( 838
                                        )
                                        
                                        
                                        ( 672
                                        )TOTAL
      LIABILITIES AND STOCKHOLDERS’
      EQUITY
                                        
                                        $
                                        9,753
                                        
                                        
                                        $
                                        11,504
 The
accompanying notes are an integral part of these unaudited financial
statements.
  1
  DON
MARCOS TRADING CO.
 (A
DEVELOPMENT STAGE COMPANY)
 CONDENSED
STATEMENTS OF OPERATIONS
 FOR
THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008
 AND
FOR THE PERIOD FROM MAY 11, 1999 TO SEPTEMBER 30, 2009
 (UNAUDITED)
   Three
      Month Periods Ended

                                                                                                                                    September 30,
                                                                                                                                
                                                                                                                                
                                                                                                                                Nine
      Month Periods Ended

                                                                                                                                    September 30,
                                                                                                                                
                                                                                                                                
                                                                                                                                May
      11, 1999

                                                                                                                                  (Inception)
      To
                                                                                                                                  September
      30,2009
                                                                                                                                
                                                                                                                                
                                                                                                                                2008
                                                                                                                                
                                                                                                                                
                                                                                                                                2009
                                                                                                                                
                                                                                                                                
                                                                                                                                2008
                                                                                                                                
                                                                                                                                
                                                                                                                                2009REVENUES
                                                                                                                                
                                                                                                                                $
                                                                                                                                288
                                                                                                                                
                                                                                                                                
                                                                                                                                $
                                                                                                                                288
                                                                                                                                
                                                                                                                                
                                                                                                                                $
                                                                                                                                864
                                                                                                                                
                                                                                                                                
                                                                                                                                $
                                                                                                                                288
                                                                                                                                
                                                                                                                                
                                                                                                                                $
                                                                                                                                1,344OPERATING
      EXPENSES
                                                                                                                                
                                                                                                                                
                                                                                                                                7,527
                                                                                                                                
                                                                                                                                
                                                                                                                                
                                                                                                                                11,983
                                                                                                                                
                                                                                                                                
                                                                                                                                $
                                                                                                                                21,030
                                                                                                                                
                                                                                                                                
                                                                                                                                $
                                                                                                                                36,429
                                                                                                                                
                                                                                                                                
                                                                                                                                
                                                                                                                                245,636NET
      (LOSS)
                                                                                                                                
                                                                                                                                $
                                                                                                                                (
      7,239
                                                                                                                                )
                                                                                                                                
                                                                                                                                $
                                                                                                                                (
      11,695
                                                                                                                                )
                                                                                                                                
                                                                                                                                $
                                                                                                                                (20,166
                                                                                                                                )
                                                                                                                                
                                                                                                                                $
                                                                                                                                (36,141
                                                                                                                                )
                                                                                                                                
                                                                                                                                $
                                                                                                                                (244,292
                                                                                                                                )NET
      (LOSS) PER SHAREBasic
      and diluted
                                                                                                                                
                                                                                                                                $
                                                                                                                                (.00
                                                                                                                                )
                                                                                                                                
                                                                                                                                $
                                                                                                                                (
      .00
                                                                                                                                )
                                                                                                                                
                                                                                                                                $
                                                                                                                                (.00
                                                                                                                                )
                                                                                                                                
                                                                                                                                $
                                                                                                                                (.00
                                                                                                                                )WEIGHTED
      AVERAGE NUMBEROF
      SHARES OUTSTANDINGBasic
      and diluted
                                                                                                                                
                                                                                                                                
                                                                                                                                48,158,696
                                                                                                                                
                                                                                                                                
                                                                                                                                
                                                                                                                                42,526,087
                                                                                                                                
                                                                                                                                
                                                                                                                                
                                                                                                                                46,567,399
                                                                                                                                
                                                                                                                                
                                                                                                                                
                                                                                                                                39,718,978
  The
accompanying notes are an integral part of these unaudited financial
statements
  2
 
 DON
MARCOS TRADING CO.
 (A
DEVELOPMENT STAGE COMPANY)
 CONDENSED
STATEMENTS OF CASH FLOWS
 FOR
THE NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008
 AND
FOR THE PERIOD FROM MAY 11, 1999 (INCEPTION) TO SEPTEMBER 30, 2009
 UNAUDITED
   (May
      11, 1999Inception)To September 30,2009
                                                  
                                                  
                                                  2008
                                                  
                                                  
                                                  2009CASH
      FLOWS FROMOPERATING
      ACTIVITIES:Net
      (loss)
                                                  
                                                  $
                                                  (
      20,166
                                                  )
                                                  
                                                  $
                                                  (
      36,141
                                                  )
                                                  
                                                  $
                                                  (
      244,292
                                                  )Adjustments
      to reconcile net(loss)
      to net cash (used)by
      operating activities:Common
      stock issuedfor
      services
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  3,635Stock
      based compensation
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  45,474Changes
      in operating assets and liabilities:Accounts
      receivable
                                                  
                                                  
                                                  (
      96
                                                  )
                                                  
                                                  
                                                  (
      96
                                                  )
                                                  
                                                  
                                                  (
      96
                                                  )Inventory
                                                  
                                                  
                                                  41
                                                  
                                                  
                                                  
                                                  (
      4,645
                                                  )
                                                  
                                                  
                                                  (
      8,850
                                                  )Accounts
      payable and accrued expenses
                                                  
                                                  
                                                  (1,585
                                                  )
                                                  
                                                  
                                                  1,358
                                                  
                                                  
                                                  
                                                  10,591NET
      CASH (USED) INOPERATING
      ACTIVITIES
                                                  
                                                  
                                                  ( 21,806
                                                  )
                                                  
                                                  
                                                  ( 39,524
                                                  )
                                                  
                                                  
                                                  ( 193,538
                                                  )CASH
      FLOWS FROMINVESTING
      ACTIVITIES
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  -CASH
      FLOWS FROMFINANCING
      ACTIVIITESIssuance
      of common stock for cash
                                                  
                                                  
                                                  20,000
                                                  
                                                  
                                                  
                                                  36,000
                                                  
                                                  
                                                  
                                                  192,000Cash
      contributed by stockholder
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  2,345NET
      CASH PROVIDED BYFINANCING
      ACTIVITIES
                                                  
                                                  
                                                  20,000
                                                  
                                                  
                                                  
                                                  36,000
                                                  
                                                  
                                                  
                                                  194,345NET
      INCREASE (DECREASE) IN CASHAND
      CASH EQUIVALENTS
                                                  
                                                  
                                                  (
      1,806
                                                  )
                                                  
                                                  
                                                  (
      3,524
                                                  )
                                                  
                                                  
                                                  807CASH
      AND CASH EQUIVALENTS,BEGINNING
      OF PERIOD
                                                  
                                                  
                                                  2,613
                                                  
                                                  
                                                  
                                                  11,166
                                                  
                                                  
                                                  
                                                  -CASH
      AND CASH EQUIVALENTS,END
      OF PERIOD
                                                  
                                                  $
                                                  807
                                                  
                                                  
                                                  $
                                                  7,642
                                                  
                                                  
                                                  $
                                                  807
 The
accompanying notes are an integral part of these unaudited financial
statements
  3
  DON
MARCOS TRADING CO.
 (A
DEVELOPMENT STAGE COMPANY)
 CONDENSED
STATEMENTS OF CASH FLOWS (CONTINUED)
 FOR
THE NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008
 AND
FOR THE PERIOD FROM MAY 11, 1999 (INCEPTION) TO SEPTEMBER 30, 2009
 (UNAUDITED)
  (May
      11, 1999Inception)To September 30,2009
                                                                                                                          
                                                                                                                          
                                                                                                                          2008
                                                                                                                          
                                                                                                                          
                                                                                                                          2009SUPPLEMENTAL
      DISCLOSUREOF
      CASH FLOW INFORMATIONCASH PAID DURING THE YEAR
      FOR:Interest
                                                                                                                          
                                                                                                                          $
                                                                                                                          -
                                                                                                                          
                                                                                                                          
                                                                                                                          $
                                                                                                                          -
                                                                                                                          
                                                                                                                          
                                                                                                                          $
                                                                                                                          -Taxes
                                                                                                                          
                                                                                                                          $
                                                                                                                          -
                                                                                                                          
                                                                                                                          
                                                                                                                          $
                                                                                                                          -
                                                                                                                          
                                                                                                                          
                                                                                                                          $
                                                                                                                          -
 The
accompanying notes are an integral part of these unaudited financial
statements
  4
  DON
MARCOS TRADING CO.
 (A
DEVELOPMENT STAGE COMPANY)
 CONDENSED
NOTES TO FINANCIAL STATEMENTS
 SEPTEMBER
30, 2009 AND 2008
 (UNAUDITED)
   NOTE
1  SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES
 
 Nature of Business and
History of Company
 
 Don
Marcos Trading Co. (“the Company”) is a development stage enterprise
incorporated on May 11, 1999 in the state of Florida. The Company is the sole
importer and distributor of Don Marcos coffee.
 
 Use of
Estimates
 
 The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
 
 Cash and Cash
Equivalents
 
 For
purposes of the statement of cash flows, the Company considers all highly liquid
debt instruments purchased with an original maturity of three months or less to
be cash equivalents.
 
 Fair value of financial
instruments
 
 For
certain Company instruments, including cash and accounts payable and accrued
expenses, the carrying amounts approximate fair value due to their short
maturities.
 
 Revenue
Recognition
 
 The
Company recognizes revenue from product sales when shipment of product to the
customer has been made, which is when title passes. The Company estimates and
records provisions for rebates, sales returns and allowances in the period the
sale is recorded. Shipping and handling charges are included in gross sales,
with the related costs included in selling, general and administrative
expenses.
 
 Inventory
 
 Inventory
is stated at the lower of cost (determined by the first-in, first-out method) or
market.  Inventories are adjusted for estimated obsolescence and
written down to net realizable value based upon estimates of future demand,
technology developments, and market conditions.
  5
  DON
MARCOS TRADING CO.
 (A
DEVELOPMENT STAGE COMPANY)
 CONDENSED
NOTES TO FINANCIAL STATEMENTS
 SEPTEMBER
30, 2009 AND 2008
 (UNAUDITED)
 
 
 NOTE
1 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
  Common
Stock Issued for Non-Cash Transaction
  It is the Company’s policy to value
stock issued for non-cash transactions, such as services, at the fair market
value of the goods or services received or the consideration granted, whichever
is more readily determinable, at the date the transaction is
negotiated.
  NOTE
2 GOING
CONCERN
 
 The
      accompanying financial statements have been prepared assuming that the
      Company will continue as a going concern, which contemplates the
      recoverability of assets and the satisfaction of liabilities in the normal
      course of business.
 
 The
      Company’s development activities since inception have been financially
      sustained through stockholder contribution to the Company and issuance of
      common stock. The Company may raise additional funding to continue its
      operations through contributions from the current shareholders and stock
      issuance to other investors.
 
 The
      ability of the Company to continue as a going concern is dependent upon
      its ability to raise additional capital from the sale of common stock and,
      ultimately, the achievement of significant operating revenues. The
      accompanying financial statements do not include any adjustments that
      might be required should the Company be unable to recover the value of its
      assets or satisfy its liabilities.
  NOTE
3 INVENTORY
 
 Inventory
      consists of the following as of September 30, 2009 and December 31,
      2008:
  2009
                                  
                                  
                                  2008Finished
      goods inventory
                                  
                                  $
                                  12
                                  
                                  
                                  $
                                  54Materials
                                  
                                  
                                  8,838
                                  
                                  
                                  
                                  8,837$
                                  8,850
                                  
                                  
                                  $
                                  8,891
  NOTE
4 
COMMON STOCK
 
 On April
13, 2009, the Company entered into Stock Purchase Agreements with certain of the
Company’s officers for the sale to those officers of the Company’s common stock
for cash as follows:
  6
  DON
MARCOS TRADING CO.
 (A
DEVELOPMENT STAGE COMPANY)
 CONDENSED
NOTES TO FINANCIAL STATEMENTS
 SEPTEMBER
30, 2009 AND 2008
 (UNAUDITED)
   NOTE
4 
COMMON STOCK (CONTINUED)
 
 Name of Officer
                            
                            Number
      of
                              Common
      Stock
                              Shares
      Purchased
                            
                            
                            Purchase
                              Price
      PaidEarl
      Shannon
                            
                            
                            1,000,000
                            
                            
                            $
                            5,000Steven
      W. Hudson
                            
                            
                            1,000,000
                            
                            
                            $
                            5,000Scott
      W. Bodenweber
                            
                            
                            1,000,000
                            
                            
                            $
                            5,000
 
 On July
14, 2009, the Company entered into a
Stock Purchase Agreement with Mark Tupper, a director of the Company, for
the sale of 1,000,000 shares of common stock for cash for an aggregate value of
$5,000.
 
 NOTE
5 
SUBSEQUENT EVENT
 
 Management
has evaluated subsequent events through October 28, 2009, the date which the
financial statements were available for issue.
  7
  ITEM
2. MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
 
 The
following discussion and analysis should be read in conjunction with our
financial statements, including the notes thereto, appearing elsewhere in this
Report.
 
 Overview
 
 We were
incorporated on May 11, 1999 in the state of Florida to be the sole importer and
distributor of Don Marcos® Coffee.
 
 Critical
Accounting Policies
 
 Our
discussion and analysis of our financial condition and results of operations are
based upon our financial statements, which have been prepared in accordance with
accounting principles generally accepted in the United States of America. The
preparation of these financial statements requires us to make estimates and
judgments that affect the reported amounts of assets, liabilities, revenues and
expenses.  In consultation with our Board of Directors, we have
identified several accounting principles that we believe are key to
understanding of our financial statements.  These important accounting
policies require management's most difficult, subjective judgments.
 
 Development
Stage Enterprise
 
 We are a
development stage enterprise, as defined in Financial Accounting Standards Board
No. 7.  Our planned principal operations have not commenced, and,
accordingly, only nominal revenue has been derived during the
period.
 
 Use
of Estimates
 
 The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period.  Actual results could differ from those
estimates.
 
 Net
Loss per Share
 
 We
adopted Statement of Financial Accounting Standards No. 128 that requires the
reporting of both basic and diluted earnings (loss) per share. Basic earnings
(loss) per share is computed by dividing net income (loss) available to common
stockholders by the weighted average number of common shares outstanding for the
period.  Diluted earnings (loss) per share reflects the potential
dilution that could occur if securities or other contracts to issue common stock
were exercised or converted into common stock. In accordance with FASB 128, any
anti-dilutive effects on net income (loss) per share are excluded.
  8
 
 Inventory
 
 Inventory
is stated at the lower of cost (determined by the first-in, first-out method),
or market.  Inventories are adjusted for estimated obsolescence and
written down to net realizable value based upon estimates of future demand,
technology developments, and market conditions.
 
 Stock
Issued for Non-Cash Transactions
 
 It is our
policy to value stock issued for non-cash transactions, such as services, at the
fair market value of the goods or services received or the consideration
granted, whichever is more readily determinable, at the date the transaction is
negotiated.
 
 There
were no shares of common stock issued for services during the nine months ended
September 30, 2009 and 2008.
 
 Going
Concern
 
 Our
financial statements are prepared using generally accepted accounting principles
applicable to a going concern, which contemplates the realization of assets and
liquidation of liabilities in the normal course of business.  Our
ability to continue as a going concern is dependent upon our ability to locate
sources of capital, and attain future profitable operations.  Our
management is currently initiating their business plan.  The
accompanying financial statements do not include any adjustments that might be
necessary should we be unable to continue as a going concern.
 
 Stock
Based Compensation
 
 We
adopted SFAS No. 123 (Revised 2004), Share Based Payment (“SFAS
No. 123R”), under the modified-prospective transition method on
January 1, 2006.  SFAS No. 123R requires companies to
measure and recognize the cost of employee services received in exchange for an
award of equity instruments based on the grant-date
fair-value.  Share-based compensation recognized under the
modified-prospective transition method of SFAS No. 123R includes
share-based compensation based on the grant-date fair-value determined in
accordance with the original provisions of SFAS No. 123, Accounting for
Stock-Based Compensation, for all share-based payments granted prior to and not
yet vested as of January 1, 2006 and share-based compensation based on the
grant-date fair-value determined in accordance with SFAS No. 123R for all
share-based payments granted after January 1, 2006.  SFAS
No. 123R eliminates the ability to account for the award of these
instruments under the intrinsic value method prescribed by Accounting Principles
Board (“APB”) Opinion No. 25, Accounting for Stock Issued to Employees, and
allowed under the original provisions of SFAS No. 123.  Prior to
the adoption of SFAS No. 123R, we accounted for our stock option plans
using the intrinsic value method in accordance with the provisions of APB
Opinion No. 25 and related interpretations.
 
 Stock-based
compensation represents the cost related to stock-based awards granted to
employees.  We measure stock-based compensation cost at grant date,
based on the estimated fair value of the award, and recognizes the cost as
expense on a straight-line basis (net of estimated forfeitures) over the
employee requisite service period.  We estimate the fair value of
stock options using a Black-Scholes valuation model.  The expense is
recorded in operating expenses in the condensed statements of
operations.
  9
 
 Results
of Operations
 
 You
should read the selected financial data set forth below along with our
discussion and our financial statements and the related notes.  We
have derived the financial data from our unaudited financial
statements.  We believe the financial data shown in the table below
include all adjustments consisting only of normal recurring adjustments, that we
consider necessary for a fair presentation of such
information.  Operating results for the period are not necessarily
indicative of the results that may be expected in the future.
 
 Nine
      Months Ended
                            September
      30,
                          
                          
                          Three
      Months Ended
                            September
      30,2009
                            (unaudited)
                          
                          
                          2008
                            (unaudited)
                          
                          
                          2009
                            (unaudited)
                          
                          
                          2008
                            (unaudited)Revenue
                          
                          $
                          864
                          
                          
                          $
                          288
                          
                          
                          $
                          288
                          
                          
                          $
                          288Operating
      expenses
                          
                          
                          21,030
                          
                          
                          
                          36,429
                          
                          
                          
                          7,527
                          
                          
                          
                          11,983Net
      (loss)
                          
                          $
                          (20,166
                          )
                          
                          $
                          (36,141
                          )
                          
                          $
                          (7,239
                          )
                          
                          $
                          (11,695
                          )Net
      (loss) per share
                          
                          $
                          (.00
                          )
                          
                          $
                          (.00
                          )
                          
                          $
                          (.00
                          )
                          
                          $
                          (.00
                          )
 
 Results for the Nine Months
Ended September 30, 2009 Compared to the Nine Months Ended September 30, 2008
(unaudited)
 
 Revenues
 
 We had
revenue of $864 and $288 for the nine months dated September 30, 2009 and 2008,
respectively.
 
 Operating
Expenses
 
 Operating
expenses decreased by $15,399 to $21,030 for the nine months ended September 30,
2009 as compared to $36,429 for the nine months ended September 30,
2008.  The decrease arose from reduction in legal and accounting fees
required for our SEC filings.
 
 Net
Loss
 
 Primarily
as a result of our operating expenses, we had a net loss of $20,166 for the nine
months ended September 30, 2009 compared to a net loss of $36,141 for the same
period in the prior year.
 
 Impact
of Inflation
 
 We
believe that inflation has had a negligible effect on our operations over the
past three years.
  10
 
 Results for the Three Months
Ended September 30, 2009 Compared to the Three Months Ended September 30, 2008
(unaudited)
 
 Revenues
 
 We had
revenue from operations in the amount of $288 for the three months ended
September 30, 2009 and 2008.
 
 Operating
Expenses
 
 Our total
operating expenses for the three months ended September 30, 2009 were $7,527
compared to $11,983 for the three months ended September 30,
2008.  Our expenses for the three months ended September 30, 2009 and
2008 were primarily for legal and accounting fees associated with our SEC
filings required of a public company.
 
 Liquidity
and Capital Resources
 
 We
currently have no material commitments for capital expenditures and have no
fixed expenses.
 
 Working
capital is summarized and compared as follows:
  September
      30,
                                  
                                  
                                  September
      30,2009
                                  
                                  
                                  2008Current
      assets
                                  
                                  $
                                  9,753
                                  
                                  
                                  $
                                  9,022Current
      liabilities
                                  
                                  
                                  10,591
                                  
                                  
                                  
                                  7,621Working
      Capital (Deficit)
                                  
                                  $
                                  (838
                                  )
                                  
                                  $
                                  (1,401
                                  )
  Changes
in cash flows is summarized as follows:
 
 Our net
cash used by operations was $21,806 for the nine months ended September 30, 2009
as compared to $39,524 for the nine months ended September 30,
2008.  During the nine months ended September 30, 2009, we experienced
a net loss of $20,166.   In addition, we had an increase in
accounts receivable of $96 and a decrease in accounts payable of
$1,585.  This was offset by a decrease in inventory of
$41.  During the nine months ended September 30, 2008, we experienced
a net loss of $36,141.  In addition, we had an increase in accounts
receivable of $96 and an increase in inventory of $4,645.  These were
offset by an increase in accounts payable and accrued expenses of
$1,358.
 
 There was
no net cash used or provided from investing activities for the nine months ended
September 30, 2009 and 2008.
  11
 
 Our net
cash provided from financing activities was $20,000 during the nine months ended
September 30, 2009 and $36,000 during the nine months ended September 30, 2008,
due to the sale of common stock for cash in each respective period.
 
 Off-Balance
Sheet Arrangements
 
 None.
 
 ITEM
3. QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
 We are a
smaller reporting company as defined by Rule 12b-2 of the Securities Exchange
Act of 1934 and are not required to provide information under this
item.
 
 ITEM
4.             CONTROLS
AND PROCEDURES
 
 Evaluation
of Disclosure Controls and Procedures
 
 Our
President and Chief Financial Officer have evaluated the effectiveness of our
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
of the Securities Exchange Act of 1934) as of the end of period covered by this
report.  Based upon such evaluation,  the President and
Chief Financial Officer concluded that our disclosure controls and procedures
were effective to ensure that the information required to be disclosed by us in
the reports that we file or submit under the Securities Exchange Act of 1934 is
recorded, processed, summarized and reported within the time periods specified
in the SEC’s rules and forms, and is accumulated and communicated to our
management, including our President and Chief Financial Officer, as appropriate
to allow timely decisions regarding required disclosure.
 
 Changes
in Internal Control Over Financial Reporting
 
 There
were no changes in our internal control over financial reporting during the
period covered by this report that have materially affected, or are reasonably
likely to materially affect, our internal control over financial
reporting.
 
 ITEM
4T. CONTROLS
AND PROCEDURES
 
 We are a
smaller reporting company as defined by Rule 12b-2 of the Securities Exchange
Act of 1934 and are not required to provide information under this
item.
  12
 
 PART
II - OTHER INFORMATION
   ITEM
1.             LEGAL
PROCEEDINGS
 
 To the
best knowledge of our management, there are no legal proceedings pending or
threatened against us.
 
 ITEM
1A.          RISK
FACTORS.
 
 We are a
smaller reporting company as defined by Rule 12b-2 of the Securities Exchange
Act of 1934 and are not required to provide information under this
item.
 
 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
 
 The
following Exhibits are filed herein:
  No.
                                                                              Title31.1
                                                                              Certification
      of President Pursuant to the Securities Exchange Act of 1934, Rules
      13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the
      Sarbanes-Oxley Act of 200231.2
                                                                              Certification
      of Chief Financial Officer Pursuant to the Securities Exchange Act of
      1934, Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of
      the Sarbanes-Oxley Act of 200232
                                                                              Certifications
      Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of
      the Sarbanes-Oxley Act of
2002
 13
  SIGNATURES
 Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
  DON
      MARCOS TRADING CO.DATED:
      October 28, 2009
                              
                              /s/ Earl
      T. ShannonBY:
      Earl T. Shannon
                                ITS:
      President
                                (Principal Executive
      Officer)
  /s/ Scott
      W. BodenweberBY:
      Scott W. Bodenweber
                                    ITS: Chief Financial
      Officer
                                    (Principal Financial
      Officer and Principal Accounting Officer)
   14