UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-QSB

--------------------------------------------------------------------------------


(Mark one)

   X     Quarterly  Report Under Section 13 or 15(d) of the Securities  Exchange
-------  Act of 1934


                  For the quarterly period ended March 31, 2004

         Transition Report Under Section 13 or 15(d) of the Securities  Exchange
-------  Act of 1934


                  For the transition period from ______________ to _____________

--------------------------------------------------------------------------------


                        Commission File Number: 000-21627
                                                ---------

                 Safe Alternatives Corporation of America, Inc.
        (Exact name of small business issuer as specified in its charter)

        Florida                                                06-1413994
(State of incorporation)                                (IRS Employer ID Number)
                        2614 Main Street, Dallas TX 75226
                    (Address of principal executive offices)

                                 (214) 670-0005
                           (Issuer's telephone number)


--------------------------------------------------------------------------------

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such 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 X  NO
                                                             ---   ----

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: May 24, 2004: 165,853,058

Transitional Small Business Disclosure Format (check one): YES    NO X
                                                              ---   ---

<PAGE>

                 Safe Alternatives Corporation of America, Inc.

                Form 10-QSB for the Quarter ended March 31, 2004

                                Table of Contents


                                                                            Page
                                                                            ----
Part I - Financial Information

  Item 1   Financial Statements                                               3

  Item 2   Management's Discussion and Analysis or Plan of Operation         12

  Item 3   Controls and Procedures                                           13


Part II - Other Information

  Item 1   Legal Proceedings                                                 13

  Item 2   Changes in Securities                                             13

  Item 3   Defaults Upon Senior Securities                                   13

  Item 4   Submission of Matters to a Vote of Security Holders               13

  Item 5   Other Information                                                 13

  Item 6   Exhibits and Reports on Form 8-K                                  14


Signatures                                                                   14
























                                                                               2

<PAGE>

                                     PART I
Item 1 - Financial Statements

                 Safe Alternatives Corporation of America, Inc.
                                  Balance Sheet
                             March 31, 2004 and 2003

                                   (Unaudited)

                                                     March 31,       March 31,
                                                       2004            2003
                                                   ------------    ------------
                                     ASSETS
                                     ------
Current Assets
   Cash on hand and in bank                        $       --      $       --
                                                   ------------    ------------
     Total current assets                                  --              --
                                                   ------------    ------------

TOTAL ASSETS                                       $       --      $       --
                                                   ============    ============


                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------
Current Liabilities
   Accounts payable - trade                        $        806    $     18,560
   Advances from affiliate                                2,659            --
   Accrued interest payable                                --             7,591
                                                   ------------    ------------

     Total current liabilities                            3,465          26,151
                                                   ------------    ------------


Commitments and contingencies


Convertible notes payable                                  --            25,000
                                                   ------------    ------------


Stockholders' Equity (Deficit)
   Common stock - $0.0001 par value
     175,000,000 shares authorized
     165,853,058 shares issued and outstanding           16,585           8,113
   Additional paid-in capital                        23,711,311      22,806,382
   Accumulated deficit                              (23,733,520)    (22,867,805)
                                                   ------------    ------------
                                                         (5,624)        (53,310)
   Subscriptions issuable                                 2,160           2,160
   Treasury stock - at cost (11,682 shares)                  (1)             (1)
                                                   ------------    ------------

     Total stockholders' equity (deficit)                (3,465)        (51,151)
                                                   ------------    ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY         $       --      $       --
                                                   ============    ============












         The financial information presented herein has been prepared by
      management without audit by independent certified public accountants.
   The accompanying notes are an integral part of these financial statements.
                                                                               3

<PAGE>
<TABLE>
<CAPTION>

                 Safe Alternatives Corporation of America, Inc.
                 Statements of Operations and Comprehensive Loss
                   Three months ended March 31, 2004 and 2003

                                   (Unaudited)

                                                       Three months     Three months
                                                          ended            ended
                                                        March 31,        March 31,
                                                           2004             2003
                                                      -------------    -------------
<S>                                                   <C>              <C>

Revenuest                                             $        --      $        --
                                                      -------------    -------------

Operating expenses
   General and administrative expenses                       10,010            2,487
   Interest expense                                            --                375
   Compensation expense related to
     common stock issuances at less
     than "fair value"                                      838,736             --
   Depreciation and amortization                               --               --
                                                      -------------    -------------
     Total operating expenses                               848,746            2,487
                                                      -------------    -------------

Loss before provision for income taxes                     (848,746)          (2,487)

Income tax benefit (expense)                                   --               --
                                                      -------------    -------------

Net Loss                                                   (848,746)          (2,487)

Other comprehensive income                                     --               --
                                                      -------------    -------------

Comprehensive Loss                                    $    (848,746)   $      (2,487)
                                                      =============    =============
Net loss per weighted-average share
   of common stock outstanding,
   calculated on Net Loss - basic and fully diluted   $       (0.01)             nil
                                                      =============    =============

Weighted-average number of shares
   of common stock outstanding                          165,853,058      165,853,058
                                                      =============    =============

</TABLE>



















         The financial information presented herein has been prepared by
      management without audit by independent certified public accountants.
   The accompanying notes are an integral part of these financial statements.
                                                                               4

<PAGE>
<TABLE>
<CAPTION>

                 Safe Alternatives Corporation of America, Inc.
                            Statements of Cash Flows
                   Three months ended March 31, 2004 and 2003

                                   (Unaudited)

                                                      Three months    Three months
                                                          ended           ended
                                                        March 31,       March 31,
                                                          2004            2003
                                                      ------------    ------------
<S>                                                   <C>             <C>
Cash Flows from Operating Activities
   Net loss for the period                            $   (848,746)   $     (2,487)
   Adjustments to reconcile net loss to net cash
     provided by operating activities
       Depreciation                                           --              --
       Professional fees paid with common stock              8,472            --
       Compensation expense related to common
         stock issuances at less than "fair value"         838,736            --
       Increase (Decrease) in
         Accounts payable - trade                           (1,121)         (2,379)
                                                      ------------    ------------
Net cash used in operating activities                       (2,659)         (4,491)
                                                      ------------    ------------

Cash Flows from Investing Activities                          --              --
                                                      ------------    ------------

Cash Flows from Financing Activities
   Cash advanced by affiliate to support operations          2,659            --
   Cash contributed to support operations                     --             4,491
                                                      ------------    ------------
Net cash provided by financing activities                    2,659           4,491
                                                      ------------    ------------

Increase (Decrease) in Cash                                   --              --

Cash at beginning of period                                   --              --
                                                      ------------    ------------

Cash at end of period                                 $       --      $       --
                                                      ============    ============

Supplemental Disclosure of
   Interest and Income Taxes Paid
     Interest paid for the period                     $       --      $       --
                                                      ============    ============
     Income taxes paid for the period                 $       --      $       --
                                                      ============    ============
</TABLE>














         The financial information presented herein has been prepared by
      management without audit by independent certified public accountants.
   The accompanying notes are an integral part of these financial statements.
                                                                               5

<PAGE>

                 Safe Alternatives Corporation of America, Inc.

                          Notes to Financial Statements


NOTE A - Organization and Description of Business

Safe Alternatives  Corporation of America, Inc. (Company) was organized in 1976,
under  the name  Knight  Airlines,  Inc.,  to  engage  in the  commuter  airline
business.  In October 1978, the Company  completed an initial public offering of
its Common Stock in Florida,  pursuant to an exemption from  registration  under
Regulation A  promulgated  under the  Securities  Act of 1933,  as amended.  The
Company  operated as a commuter  airline from its inception  through April 1983,
when it ceased  operations  and all of the  assets of the  Company  were sold to
satisfy all outstanding  indebtedness.  From April 1983, through September 1995,
the Company  was  dormant.  In May 1994,  the name of the Company was changed to
Portsmouth Corporation.

On September 15, 1995,  pursuant to the terms of an Asset Purchase Agreement and
Plan of  Reorganization  dated as of August 21, 1995 (the  "Agreement")  between
Safe  Alternatives   Corporation  of  America,   Inc.,  a  Delaware  corporation
("SAC-Delaware")  and the  Company,  the Company  purchased  the  business  (the
"Business"),  including,  without limitation, all of the assets of SAC-Delaware,
and assumed all of the liabilities of SAC-Delaware (the  "Reorganization"),  and
commenced operations. Prior to the Reorganization, the Company had no meaningful
operations.  On March 4, 1996, the Company changed its name to Safe Alternatives
Corporation of America, Inc. (a Florida corporation).

On September 17, 2002,  the Board of Directors of the Company agreed to sell, as
of June 30, 2002, of all of the Company's assets to Environmental  Alternatives,
Inc.  ("EAI"),  a privately  held  Vermont  corporation,  in exchange  for EAI's
assumption  of and  agreement to indemnify  and hold the Company  harmless  from
paying any and all claims, causes of action, or other liabilities, including but
not limited to interest,  costs,  expenses,  disbursements  and attorneys' fees,
that  could,  may or does  attach to the Company as of June 30, 2002 as a result
of,  or is in  any  way  related  to any of  the  Company's  obligations  to its
creditors  and all adverse  judgments  entered  against  the Company  except any
obligations to the following:  (A) Continental Stock Transfer and Trust Company,
the Company's  independent  stock transfer agent;  (B) Green,  Holman,  Frenia &
Company,  L.L.P., the Company's former independent  auditors;  (C) Arab Commerce
Bank, a holder of a 6% Convertible Note; and (D) any settlement amounts due upon
the completion of a merger or other combination  between the Company and another
company.  Except as  provided  above,  the  agreement  to assume  the  Company's
liabilities and to indemnify and hold the Company  harmless from paying the same
is unlimited as to amount or as to time.  A copy of the  Agreement  was filed by
the Company as an exhibit in a Current  Report on Form 8-K as of  September  17,
2002. Since July 1, 2002, the Company has had no assets or operating activities.


NOTE B - Preparation of Financial Statements

The  Company  follows  the  accrual  basis  of  accounting  in  accordance  with
accounting principles generally accepted in the United States of America and has
a year-end of December 31.

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.

Management further acknowledges that it is solely responsible for adopting sound
accounting  practices,   establishing  and  maintaining  a  system  of  internal
accounting  control and preventing and detecting  fraud. The Company's system of
internal  accounting  control is designed to assure,  among other items, that 1)
recorded  transactions  are valid; 2) valid  transactions  are recorded;  and 3)
transactions  are  recorded in the proper  period in a timely  manner to produce
financial  statements which present fairly the financial  condition,  results of
operations  and cash  flows of the  Company  for the  respective  periods  being
presented.



                (Remainder of this page left blank intentionally)

                                                                               6

<PAGE>

                 Safe Alternatives Corporation of America, Inc.

                    Notes to Financial Statements - Continued


NOTE B - Preparation of Financial Statements - Continued

During interim periods, the Company follows the accounting policies set forth in
its annual  audited  financial  statements  filed with the U. S.  Securities and
Exchange  Commission  on its  Annual  Report on Form  10-KSB  for the year ended
December 31, 2003.  The  information  presented  within these interim  financial
statements  may not  include all  disclosures  required  by  generally  accepted
accounting  principles  and the  users of  financial  information  provided  for
interim periods should refer to the annual  financial  information and footnotes
when reviewing the interim financial results presented herein.

In the opinion of management,  the accompanying  interim  financial  statements,
prepared in  accordance  with the U. S.  Securities  and  Exchange  Commission's
instructions   for  Form  10-QSB,   are   unaudited  and  contain  all  material
adjustments,  consisting  only of  normal  recurring  adjustments  necessary  to
present fairly the financial condition,  results of operations and cash flows of
the Company for the respective  interim  periods  presented.  The current period
results of operations are not necessarily indicative of results which ultimately
will be reported for the full fiscal year ending December 31, 2004.


NOTE C - Going Concern Uncertainty

As of July 1, 2002,  the Company has no assets or operations and intends to seek
a suitable business combination transaction through either a purchase or merger.
The  Company's  continued  existence is  dependent  upon its ability to generate
sufficient cash flows from operations to support its daily operations as well as
provide sufficient resources to retire existing liabilities and obligations on a
timely  basis.  Additionally,  as a result  of our  having  no  assets,  several
liabilities and no operations,  our auditors have issued an audit opinion on our
accompanying  financial  statements  which  includes a statement  describing our
going concern status.  This means, in our auditor's  opinion,  substantial doubt
about our  ability to continue  as a going  concern  exists at the date of their
opinion.

On May 14, 2004,  the  Company's  President,  Dale Hensel,  executed a Letter of
Intent with Mortgage Assistance  Corporation,  a Texas corporation controlled by
Mr.  Hensel,  whereby  subject to the  approval of the  Company's  shareholders,
Mortgage  Assistance  Corporation  offered to be  acquired by the Company on the
following  terms and  conditions:  SACA  board  will call a special  shareholder
meeting or obtain a majority  shareholder  consent in lieu of a special  meeting
according to the Florida Business Corporation Statutes and recommend and approve
the following actions:

     1.   Effect a reverse split of the Company's common shares on a One for Two
          Hundred Fifty (1:250) basis;
     2.   Effect a corporate name change from Safe  Alternatives  Corporation of
          America, Inc. Mortgage Assistance Corporation;
     3.   Change the authorized  number of common stock shares to be issued from
          175,000,000 to 50,000,000 shares;
     4.   Authorized a business  combination  whereby the Company will  exchange
          12,000,000  post reverse split common shares for all of the issued and
          outstanding common stock of Mortgage Assistance Corporation; and
     5.   Any such further  recommendations as may be considered  reasonable and
          in the best interest of the shareholders.

While the Company is of the opinion that good faith  estimates of the  Company's
ability to secure additional  capital in the future to reach our goals have been
made, there is no guarantee that the Company will receive  sufficient funding to
sustain operations or implement any future business plan steps.

If no additional  operating  capital is received  during the next twelve months,
the  Company  will be  forced  to rely on  existing  cash in the  bank  and upon
additional  funds  loaned  by  management  and/or  significant  stockholders  to
preserve the  integrity of the  corporate  entity at this time. In the event the
Company  is  unable to  acquire  advances  from  management  and/or  significant
stockholders, the Company's ongoing operations would be negatively impacted.


                                                                               7

<PAGE>

                 Safe Alternatives Corporation of America, Inc.

                    Notes to Financial Statements - Continued


NOTE C- Going Concern Uncertainty - Continued

It  is  the  intent  of  management  and  significant  stockholders  to  provide
sufficient  working  capital  necessary to support and preserve the integrity of
the corporate entity.  However, no formal commitments or arrangements to advance
or loan funds to the Company or repay any such advances or loans exist. There is
no legal obligation for either management or significant stockholders to provide
additional future funding.


NOTE D - Summary of Significant Accounting Policies

1.   Cash and cash equivalents
     -------------------------

     For  Statement of Cash Flows  purposes,  the Company  considers all cash on
     hand  and  in  banks,  including  accounts  in  book  overdraft  positions,
     certificates of deposit and other highly-liquid investments with maturities
     of three months or less, when purchased, to be cash and cash equivalents.

2.   Income Taxes
     ------------

     The Company uses the asset and liability  method of  accounting  for income
     taxes. At March 31, 2004 and 2003, respectively, the deferred tax asset and
     deferred tax liability accounts, as recorded when material to the financial
     statements,  are entirely the result of  temporary  differences.  Temporary
     differences   represent  differences  in  the  recognition  of  assets  and
     liabilities for tax and financial reporting purposes, primarily accumulated
     depreciation and amortization, allowance for doubtful accounts and vacation
     accruals.

     As of March 31, 2004 and 2003, the deferred tax asset related to the
     Company's net operating loss carryforward is fully reserved. Due to the
     provisions of Internal Revenue Code Section 338, the Company may have
     limited net operating loss carryforwards available to offset financial
     statement or tax return taxable income in future periods as a result of a
     Fiscal 2000 change in control involving 50 percentage points or more of the
     issued and outstanding securities of the Company.

3.   Income (Loss) per share
     -----------------------

     Basic  earnings  (loss) per share is computed  by  dividing  the net income
     (loss)  by  the   weighted-average   number  of  shares  of  common   stock
     outstanding.  The  calculation of fully diluted  earnings  (loss) per share
     assumes the  dilutive  effect of the  exercise of  outstanding  options and
     warrants,  using the treasury stock method,  at either the beginning of the
     respective period presented or the date of issuance, whichever is later. As
     of March 31, 2004 and 2003,  respectively,  the Company has no  outstanding
     stock warrants, options or convertible securities which could be considered
     as dilutive for purposes of the loss per share calculation.


NOTE E - Fair Value of Financial Instruments

The carrying amount of cash,  accounts  receivable,  accounts  payable and notes
payable, as applicable,  approximates fair value due to the short term nature of
these items  and/or the current  interest  rates  payable in relation to current
market conditions.

Interest  rate risk is the risk  that the  Company's  earnings  are  subject  to
fluctuations  in interest  rates on either  investments  or on debt and is fully
dependent  upon  the  volatility  of  these  rates.  The  Company  does  not use
derivative instruments to moderate its exposure to interest rate risk, if any.

Financial  risk  is  the  risk  that  the  Company's  earnings  are  subject  to
fluctuations in interest rates or foreign exchange rates and are fully dependent
upon the  volatility  of  these  rates.  The  company  does  not use  derivative
instruments to moderate its exposure to financial risk, if any.


                                                                               8

<PAGE>

                 Safe Alternatives Corporation of America, Inc.

                    Notes to Financial Statements - Continued


NOTE F - Convertible Notes Payable

On March 10, 1998, the Company  entered into an Agency  Agreement with Alexander
Wescott & Co., Inc. (AWC) for the offer and sale of 6% Convertible  Notes,  with
maximum gross proceeds not to exceed $1,000,000.

In March and April  1998,  the  Company  issued  its 6%  Convertible  Notes (the
"Notes") in the aggregate  principal  amount of $726,500 in a private  placement
under  Rule 505 of  Regulation  D. The Notes  bear  interest  at 6.0% per annum,
payable semi-annually in arrears, in cash or, at the Company's option, in shares
of Common Stock of the Company. The notes mature on the earlier of (i) the first
anniversary of the initial  closing of the proposed offer (April 10, 1999),  and
(ii) a sale of all or  substantially  all of the  Company's  assets or a merger,
acquisition  or  consolidation  in  which  the  Company  is  not  the  surviving
corporation.  The notes rank senior to all other indebtedness of the Company now
or hereafter  existing,  other than  indebtedness to banks, in terms of priority
and security.

The Notes  were  convertible  into  shares of Common  Stock at the option of the
holder at any time  following  the  earlier of (i) 90 days after the filing of a
registration  statement with the U. S. Securities and Exchange  Commission (SEC)
covering  the shares to be  received  upon  conversion  or (ii) the date the SEC
declares such registration  statement effective.  The conversion price per share
is the lesser of (i) 70% of the  average  closing  bid price per share of Common
Stock for the five trading days prior to the conversion date or (ii) $0.25. Upon
conversion, any accrued and unpaid interest is waived by the holder. The Company
had the option to repurchase the Notes from the holder prior to  registration of
the underlying  shares at a premium of 10% over the purchase price of the Notes.
The Company agreed to file a registration  statement with the SEC not later than
June 3,  1998,  and use its  best  efforts  to have the  registration  statement
declared  effective  not later than July 3, 1998.  Through  June 30,  2002,  the
Company made no payments on these notes; had not repurchased any of these Notes,
and was in default with regard to its registration obligation

AWC received a commission of 10% plus 3% non-accountable  expense  reimbursement
on the gross proceeds raised. In addition,  AWC was issued warrants  exercisable
for  400,000  shares of Common  Stock at an  exercise  price of $0.30 per share,
expiring  June 28, 2003.  On September  30, 2002,  the Company and AWC reached a
settlement  agreement  whereby AWC agreed to cancel the  outstanding  warrant in
exchange for 800,000 shares of restricted,  unregistered shares of the Company's
common stock.

As of December 31, 2001 two note holders with notes  totaling  $50,000  notified
the Company that they have written off the balances  owed to them by the Company
and  therefore  have  discharged  the Company from any further  liability.  As a
result  the  Company  recognized  a  $56,000  forgiveness  of debt  income as of
December 31, 2001, which includes $6,000 of accrued interest.

During 2002, all but one (1) of the Holders of the foregoing  Convertible Notes,
totaling  approximately  $651,500,  agreed to release all obligations  under the
Convertible  Notes,  including  accrued interest of approximately  $157,273,  in
exchange for the issuance of an aggregate of  21,303,264  shares of  restricted,
unregistered shares of the Company's common stock.

During the quarter  ended June 30, 2003,  the Company  exercised  it's option to
repurchase the remaining outstanding Convertible Note from the Noteholder with a
cash  payment  aggregating  approximately  $35,389,  which  included  $25,000 in
principal,  the stated 10%  repurchase  premium  and all  accrued,  but  unpaid,
interest.





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                                                                               9
<PAGE>

                 Safe Alternatives Corporation of America, Inc.

                    Notes to Financial Statements - Continued


NOTE G - Advances from Affilates

During  2003,   an  affiliate  of  the  Company  made   unsecured   advances  of
approximately  $70,700 to support  operations and provide  working  capital.  At
December  31, 2003,  the  affiliate  contributed  these  advances as  additional
paid-in capital.

During the three  months ended March  31,2004,  in  anticipation  of the reverse
acquisition  transaction  discussed in previous  footnotes,  Mortgage Assistance
Corporation   advanced  to  or  paid  expenses  on  behalf  of  the  Company  of
approximately  $2,660.  These  advances are  unsecured  and are  repayable  upon
demand.


NOTE H - Income Taxes

The components of income tax (benefit) expense,  on continuing  operations,  for
the three months ended March 31, 2004 and 2003, respectively, are as follows:

                                                          March 31,   March 31,
                                                             2004        2003
                                                          ---------   ---------
     Federal:
       Current                                            $    --     $    --
       Deferred                                                --          --
                                                          ---------   ---------
                                                               --          --
                                                          ---------   ---------
     State:
       Current                                                 --          --
       Deferred                                                --          --
                                                          ---------   ---------
                                                               --          --
                                                          ---------   ---------
       Total                                              $    --     $    --
                                                          =========   =========

As of March 31,  2004,  the Company had a net  operating  loss  carryforward  of
approximately  $9,500,000  to  offset  future  taxable  income.  If the  reverse
acquisition  transaction discussed previously occurs, the usage of the Company's
net  operating  loss  carryforward  will be  severely  limited.  The  amount and
availability  of  the  net  operating  loss  carryforwards  may  be  subject  to
limitations set forth by Section 338 of the Internal Revenue Code.  Factors such
as the number of shares  ultimately issued within a three year look-back period;
whether there is a deemed more than 50 percent change in control; the applicable
long-term  tax  exempt  bond  rate;  continuity  of  historical  business;   and
subsequent  income of the  Company  all enter  into the  annual  computation  of
allowable annual utilization of the carryforwards.

The  Company's  income tax expense for the three months ended March 31, 2004 and
2003, respectively, differed from the statutory tax rate of 34.0% as follows:
<TABLE>
<CAPTION>
                                                           Three months    Three months
                                                               ended           ended
                                                             March 31,       March 31,
                                                               2004            2003
                                                           ------------    ------------
<S>                                                        <C>             <C>
Statutory rate applied to income before income taxes       $   (288,570)   $       (800)
Increase (decrease) in income taxes resulting from:
     State income taxes                                            --              --
     Non-deductible compensation expense related
       to common stock issued at less than "fair value"         285,170            --
     Other, including reserve for deferred tax asset and
       application of net operating loss carryforward             3,400             800
                                                           ------------    ------------

       Income tax expense                                  $       --      $       --
                                                           ============    ============
</TABLE>




                                                                              10
<PAGE>

                 Safe Alternatives Corporation of America, Inc.

                    Notes to Financial Statements - Continued


NOTE H - Income Taxes - Continued

Temporary  differences,  consisting primarily of statutory deferrals of expenses
for organizational costs and statutory  differences in the depreciable lives for
property and equipment, between the financial statement carrying amounts and tax
bases of assets and liabilities give rise to deferred tax assets and liabilities
as of March 31, 2004 and 2003, respectively:

                                                     March 31,     December 31,
                                                       2004            2003
                                                   ------------    ------------
     Deferred tax assets
       Net operating loss carryforwards            $  3,230,000    $  3,230,000
       Less valuation allowance                      (3,230,000)     (3,230,000)
                                                   ------------    ------------

     Net Deferred Tax Asset                        $       --      $       --
                                                   ============    ============

During the years ended December 31, 2003 and 2002, respectively, the reserve for
the deferred current tax asset did not significantly change.


NOTE I - Common Stock Transactions

During the year  ended  December  31,  2002,  the  Company  issued an  aggregate
21,303,264  shares of restricted,  unregistered  shares of the Company's  common
stock in settlement of approximately $651,000 in face amount of 6.0% Convertible
Notes and accrued interest of approximately $157,273.

During the year ended  December 31, 2002,  the Company  issued 448,101 shares of
restricted, unregistered common stock to various unsecured creditors in exchange
for their release of any further claims related to trade accounts payable. These
transactions  were valued at  approximately  $448,100,  including a "fair value"
adjustment  of  approximately  $410,597 for shares issued at less than the "fair
value"  of  the  shares  based  on  the  valuation   established  by  equivalent
transactions on equivalent dates.

Effective  September 30, 2002,  the Company issued 800,000 shares of restricted,
unregistered  common  stock in exchange  for the  retirement  of an  outstanding
warrant to  purchase up to 400,000  shares of the  Company's  common  stock at a
price of $0.30 per share, expiring June 28, 2003. This transaction was valued at
approximately  $80, which  approximates the "fair value" of the Company's common
stock on the date of the transaction.

During July 2002, in order to facilitate the Company's  merger or other business
combination  transaction  with another  company,  the Company  issued a total of
84,720,733 shares of the Company's  unregistered,  restricted common stock to be
held in escrow for the benefit of the Company's  merger or combination  partner.
No value has been  assigned  to this  issuance  pending  the  consummation  of a
business  combination  transaction.  On March 9, 2004,  the  Company's  Board of
Directors  authorized  the  issuance  of  these  shares  held in  escrow  to the
Company's legal counsel,  Loper & Seymour, P.A. of St. Paul, Minnesota for legal
services and said  transaction is valued at approximately  $8,470,  which equals
the common  stock's par value of $.0001 per share,  and these  shares are deemed
fully paid and  non-assessable.  Pursuant to Statement  of Financial  Accounting
Standards No. 123, "Accounting for Stock-Based  Compensation",  the imputed fair
value of this  transaction  was calculated  using the discounted  closing quoted
stock price on March 9, 2004.  The  differential  between the imputed fair value
and the agreed-upon value of the services provided,  approximately $838,700, was
recorded as "compensation expense related to common stock issuances at less than
"fair value" upon  exercise of  outstanding  stock  options in the  accompanying
statement of operations.


NOTE J - Treasury Stock

Treasury stock  represents  11,682 shares (recorded at cost) being held in trust
to be used for future  issuance to  employees,  investors,  and other  potential
funding sources.  As the Company directly  benefits from the sales of the shares
in the trust, these shares have been recorded as treasury stock.



                                                                              11
<PAGE>

Item 2 - Management's Discussion and Analysis of Financial Condition and Results
of Operations

(1)  Caution Regarding Forward-Looking Information

Certain  statements  contained  in this  quarterly  filing,  including,  without
limitation, statements containing the words "believes", "anticipates", "expects"
and  words  of  similar  import,  constitute  forward-looking  statements.  Such
forward-looking  statements  involve known and unknown risks,  uncertainties and
other factors that may cause the actual results,  performance or achievements of
the Company,  or industry  results,  to be materially  different from any future
results,   performance   or   achievements   expressed   or   implied   by  such
forward-looking statements.

Such factors include, among others, the following:  international,  national and
local general economic and market conditions:  demographic  changes; the ability
of the Company to sustain,  manage or  forecast  its growth;  the ability of the
Company to successfully make and integrate acquisitions;  raw material costs and
availability;  new product  development and  introduction;  existing  government
regulations  and  changes  in,  or  the  failure  to  comply  with,   government
regulations;  adverse publicity;  competition; the loss of significant customers
or suppliers;  fluctuations  and  difficulty in forecasting  operating  results;
changes in business strategy or development  plans;  business  disruptions;  the
ability  to attract  and  retain  qualified  personnel;  the  ability to protect
technology; and other factors referenced in this and previous filings.

Given  these  uncertainties,  readers  of this Form  10-QSB  and  investors  are
cautioned not to place undue reliance on such  forward-looking  statements.  The
Company  disclaims  any  obligation  to update any such  factors or to  publicly
announce the result of any  revisions to any of the  forward-looking  statements
contained herein to reflect future events or developments.

(2)  Results of Operations, Liquidity and Capital Resources

As of July 1, 2002,  the Company has no assets or operations and intends to seek
a suitable business combination transaction through either a purchase or merger.

The  Company  does not  expect  to  generate  any  meaningful  revenue  or incur
operating  expenses for purposes  other than  fulfilling  the  obligations  of a
reporting  company  under the  Securities  Exchange Act of 1934 unless and until
such time that the Company begins meaningful operations.

On May 14, 2004,  the  Company's  President,  Dale Hensel,  executed a Letter of
Intent with Mortgage Assistance  Corporation,  a Texas corporation controlled by
Mr.  Hensel,  whereby  subject to the  approval of the  Company's  shareholders,
Mortgage  Assistance  Corporation  offered to be  acquired by the Company on the
following  terms and  conditions:  SACA  board  will call a special  shareholder
meeting or obtain a majority  shareholder  consent in lieu of a special  meeting
according to the Florida Business Corporation Statutes and recommend and approve
the following actions:

     1.   Effect a reverse split of the Company's common shares on a One for Two
          Hundred Fifty (1:250) basis;
     2.   Effect a corporate name change from Safe  Alternatives  Corporation of
          America, Inc. Mortgage Assistance Corporation;
     3.   Change the authorized  number of common stock shares to be issued from
          175,000,000 to 50,000,000 shares;
     4.   Authorized a business  combination  whereby the Company will  exchange
          12,000,000  post reverse split common shares for all of the issued and
          outstanding common stock of Mortgage Assistance Corporation; and
     5.   Any such further  recommendations as may be considered  reasonable and
          in the best interest of the shareholders.

It  is  the  intent  of  management  and  significant  stockholders  to  provide
sufficient  working  capital  necessary to support and preserve the integrity of
the  corporate  entity.  However,  there  is  no  legal  obligation  for  either
management or significant  stockholders  to provide  additional  future funding.
Should this pledge fail to provide financing, the Company has not identified any
alternative  sources.  Consequently,   there  is  substantial  doubt  about  the
Company's ability to continue as a going concern.

The  Company's  need for  capital  may  change  dramatically  as a result of any
business acquisition or combination transaction.  There can be no assurance that
the Company will  identify any such  business,  product,  technology  or company




                                                                              12
<PAGE>

suitable for acquisition in the future.  Further, there can be no assurance that
the Company would be successful in  consummating  any  acquisition  on favorable
terms  or that it will be able  to  profitably  manage  the  business,  product,
technology or company it acquires.

Item 3 - Controls and Procedures

As required by Rule 13a-15 under the Exchange  Act,  within the 90 days prior to
the filing date of this report,  the Company  carried out an  evaluation  of the
effectiveness of the design and operation of the Company's  disclosure  controls
and  procedures.  This evaluation was carried out under the supervision and with
the  participation  of  the  Company's   management,   including  the  Company's
President,  Chief  Executive  and  Chief  Financial  Officer.  Based  upon  that
evaluation, the Company's President, Chief Executive and Chief Financial Officer
concluded that the Company's  disclosure  controls and procedures are effective.
There have been no significant  changes in the Company's internal controls or in
other factors,  which could significantly affect internal controls subsequent to
the date the Company carried out its evaluation.

Disclosure  controls and procedures are controls and other  procedures  that are
designed to ensure that information  required to be disclosed in Company reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported,  within the time  periods  specified  in the  Securities  and Exchange
Commission's  rules and  forms.  Disclosure  controls  and  procedures  include,
without limitation,  controls and procedures designed to ensure that information
required to be  disclosed  in Company  reports  filed under the  Exchange Act is
accumulated  and  communicated  to  management,  including the  Company's  Chief
Executive and Chief Financial Officer as appropriate,  to allow timely decisions
regarding required disclosure.


                           PART II - OTHER INFORMATION

Item 1 - Legal Proceedings

     None

Item 2 - Changes in Securities

     During July 2002,  in order to  facilitate  the  Company's  merger or other
     business combination transaction with another company, the Company issued a
     total of 84,720,733 shares of the Company's unregistered, restricted common
     stock to be held in  escrow  for the  benefit  of the  Company's  merger or
     combination  partner.  No value has been assigned to this issuance  pending
     the consummation of a business combination transaction.

     On March 9, 2004, the Company's Board of Directors  authorized the issuance
     of these  shares held in escrow to the  Company's  legal  counsel,  Loper &
     Seymour,   P.A.  of  St.  Paul,  Minnesota  for  legal  services  and  said
     transaction  is valued at  approximately  $8,470,  which  equals the common
     stock's par value of $.0001 per share,  and these  shares are deemed  fully
     paid and  non-assessable.  Pursuant to Statement  of  Financial  Accounting
     Standards No. 123, "Accounting for Stock-Based  Compensation",  the imputed
     fair value of this transaction was calculated using the discounted  closing
     quoted stock price on March 9, 2004. The  differential  between the imputed
     fair  value  and  the   agreed-upon   value  of  the   services   provided,
     approximately  $838,700,  was recorded as "compensation  expense related to
     common  stock  issuances  at  less  than  "fair  value"  upon  exercise  of
     outstanding stock options in the accompanying statement of operations.

Item 3 - Defaults upon Senior Securities

     None

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

     None

Item 5 - Other Information

     None




                                                                              13
<PAGE>

Item 6 - Exhibits and Reports on Form 8-K

   Exhibits
   --------

     31.1      Certification  pursuant to Section 302 of  Sarbanes-Oxley  Act of
               2002
     32.1      Certification  pursuant to Section 906 of  Sarbanes-Oxley  Act of
               2002.

   Reports on Form 8-K
   -------------------

     March 19, 2004         Disclosure  of a change  in the  Company's  Board of
                            Directors and Management
     May 19, 2004           Disclosure  of a Letter of Intent for the Company to
                            acquire Mortgage Assistance Corporation in a reverse
                            acquisition  transaction  contingent  on defined due
                            diligence and corporate actions.

--------------------------------------------------------------------------------

                                   SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                  Safe Alternatives Corporation of America, Inc.

Dated: May 24, 2004                                  /s/ Dale Hensel
       ------------                         ----------------------------------
                                                                     Dale Hensel
                                             President, Chief Executive Officer,
                                            Chief Financial Officer,and Director























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