Reading One Character Of Text

The following code reads text one character at a time, and each character is determined either to be a blank space or to be any other character. If it's determined to be any other character, then the character is added to the active cell. If it's determined to be a blank space, then the active cell becomes the cell one column over. The idea is to have different words written in columns next to each other.

The sample text file I'm reading from reads: "text file". The file has only those two words. One space between them. No space before the first word, and no space after the second word. The following code compiles and runs. BUT the result is that the word "text" is in column k, not A. And the word "file" is in column J, not b.