Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Mar. 31, 2019 | Apr. 29, 2019 | |
Document And Entity Information | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Entity Registrant Name | GALAXY NEXT GENERATION, INC. | |
Entity Central Index Key | 0001127993 | |
Current Fiscal Year End Date | --06-30 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2019 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 10,390,339 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Current Assets | ||
Cash | $ 57,899 | $ 184,255 |
Accounts receivable | 54,004 | 341,726 |
Inventories | 171,083 | 586,764 |
Prepaid and other current assets | 1,184 | 2,764 |
Total Current Assets | 284,170 | 1,115,509 |
Property and Equipment, net (Note 2) | 31,383 | 4,254,451 |
Other Assets | ||
Goodwill (Note 11) | 834,220 | 892,312 |
Other assets (Note 11) | 1,522,714 | |
Total Other Assets | 834,220 | 2,415,026 |
Total Assets | 1,149,773 | 7,784,986 |
Current Liabilities | ||
Line of credit (Note 3) | 1,230,550 | 547,603 |
Convertible notes payable, net of discount (Note 4) | 1,131,322 | |
Current portion of long term notes payable (Note 4) | 281,045 | 362,181 |
Accounts payable | 555,459 | 771,080 |
Accrued expenses | 50,552 | 146,978 |
Advances from stockholders (Note 5) | 260,173 | |
Deferred revenue | 219,820 | |
Short term notes payable (Note 4) | 165,000 | |
Short term notes payable - related party (Note 5) | 485,534 | |
Total Current Liabilities | 3,248,928 | 2,958,369 |
Noncurrent Liabilities | ||
Notes payable, less current portion (Note 4) | 1,694 | 4,524,347 |
Total Liabilities | 3,250,622 | 7,482,716 |
Stockholders' Equity (Deficit) (Notes 1, 7, and 11) | ||
Common stock | 999 | 965 |
Additional paid-in capital | 4,574,998 | 3,108,873 |
Accumulated deficit | (6,676,846) | (2,807,568) |
Total Stockholders' Equity (Deficit) | (2,100,849) | 302,270 |
Total Liabilities and Stockholders' Equity (Deficit) | $ 1,149,773 | $ 7,784,986 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues | ||||
Total Revenues | $ 348,723 | $ 304,947 | $ 1,717,353 | $ 2,148,955 |
Cost of Sales | ||||
Total Cost of Sales | 285,148 | 236,243 | 1,165,711 | 1,767,601 |
Gross Profit | 63,575 | 68,704 | 551,642 | 381,354 |
General and Administrative Expenses | ||||
General and administrative | 2,043,181 | 566,137 | 4,408,951 | 1,562,009 |
Loss from Operations | (1,979,606) | (497,433) | (3,857,309) | (1,180,655) |
Other Income (Expense) | ||||
Other income | 97,471 | 177 | 151,289 | 1,056 |
Interest expense | (100,893) | (22,207) | (163,258) | (37,238) |
Total Other Income (Expense) | (3,422) | (22,030) | (11,969) | (36,182) |
Net Loss before Income Taxes | (1,983,028) | (519,463) | (3,869,278) | (1,216,837) |
Income taxes (Note 8) | ||||
Net Loss | $ (1,983,028) | $ (519,463) | $ (3,869,278) | $ (1,216,837) |
Net Basic and Fully Diluted Loss Per Share | $ (0.20) | $ (0.06) | $ (0.42) | $ (0.14) |
Weighted average common shares outstanding Basic and fully diluted | 10,105,121 | 8,572,233 | 9,154,161 | 8,572,233 |
Technology interactive panels and related products [Member] | ||||
Revenues | ||||
Total Revenues | $ 261,712 | $ 293,136 | $ 1,106,540 | $ 2,137,144 |
Cost of Sales | ||||
Total Cost of Sales | 230,833 | 236,243 | 948,073 | 1,767,601 |
Entertainment theater ticket sales and concessions [Member] | ||||
Revenues | ||||
Total Revenues | 78,661 | 589,705 | ||
Cost of Sales | ||||
Total Cost of Sales | 54,315 | 217,638 | ||
Technology office supplies [Member] | ||||
Revenues | ||||
Total Revenues | $ 8,350 | $ 11,811 | 21,108 | 11,811 |
Cost of Sales | ||||
Total Cost of Sales | $ 1,165,711 | $ 1,767,601 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity (Deficit) (Unaudited) - 9 months ended Mar. 31, 2019 - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Total |
Beginning Balance at Jun. 30, 2018 | $ 965 | $ 3,108,873 | $ (2,807,568) | $ 302,270 |
Beginning Balance, shares at Jun. 30, 2018 | 9,655,813 | 9,655,813 | ||
Common stock issued as part of the private placement in September 2018 | 637,000 | $ 637,000 | ||
Common stock issued as part of the private placement in September 2018, shares | 910 | |||
Common stock issued for services in December 2018 | $ 8 | 237,851 | $ 237,859 | |
Common stock issued for services in December 2018, shares | 75,511 | 300,000 | ||
Common stock issued for services in January 2019 | $ 10 | 219,990 | $ 220,000 | |
Common stock issued for services in January 2019, shares | 100,000 | |||
Common stock issued for services in February 2019 | $ 10 | 246,990 | 247,000 | |
Common stock issued for services in February 2019, shares | 100,000 | |||
Common stock issued for services in March 2019 | $ 10 | 216,990 | 217,000 | |
Common stock issued for services in March 2019, shares | 100,000 | |||
Non-cash consideration for net assets of Entertainment (Note 11) | $ (4) | (92,696) | (92,700) | |
Non-cash consideration for net assets of Entertainment, Shares (Note 11) | (38,625) | |||
Net loss | (3,869,278) | (3,869,278) | ||
Ending Balance at Mar. 31, 2019 | $ 999 | $ 4,574,998 | $ (6,676,846) | $ (2,100,849) |
Ending Balance, Shares at Mar. 31, 2019 | 9,993,609 | 9,993,609 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash Flows from Operating Activities | ||
Net loss | $ (3,869,278) | $ (1,216,837) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 216,642 | 14,547 |
Amortization of convertible note discount included in interest expense | 45,022 | |
Gain on sale of Entertainment | (60,688) | |
Issuance of stock for services | 921,859 | |
Changes in assets and liabilities: | ||
Accounts receivable | 283,222 | 336,591 |
Inventories | 410,071 | 32,674 |
Prepaid expenses and other assets | (34,710) | 13,029 |
Accounts payable | (135,105) | (79,405) |
Accrued expenses | 34,344 | 21,367 |
Deferred revenue | (219,820) | |
Net used in operating activities | (2,408,441) | (878,034) |
Cash Flows from Investing Activities | ||
Purchase of property and equipment | (2,686) | |
Net used in investing activities | (2,686) | |
Cash Flows from Financing Activities | ||
Dividends | (1,587) | |
Principal payments on mortgage and capital lease obligations | (37,989) | (8,604) |
Principal payments on short term notes payable | (20,000) | (225,000) |
Proceeds (payments) on advance from stockholder, net | (111,173) | 261,131 |
Proceeds from convertible note payable | 1,086,300 | |
Proceeds from line of credit | 682,947 | 528,603 |
Proceeds from issuance of common stock (Note 7) | 637,000 | 104,226 |
Proceeds from notes payable - related parties | 45,000 | |
Net provided in financing activities | 2,282,085 | 658,769 |
Net Decrease in Cash and Cash Equivalents | (126,356) | (221,951) |
Cash, Beginning of Period | 184,255 | 232,427 |
Cash, End of Period | 57,899 | 10,476 |
Supplemental and Non Cash Disclosures | ||
Non-cash debt discount on convertible notes payable | 120,700 | |
Non-cash sale of Entertainment | 92,700 | |
Cash paid during the period for interest | $ 132,560 | $ 37,238 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 1 - Summary of Significant Accounting Policies: Corporate History, Nature of Business and Mergers Galaxy Next Generation LTD CO. (Galaxy CO) was organized in the state of Georgia in February 2017 while R & G Sales, Inc. (R&G) was organized in the state of Georgia in August 2004. Galaxy CO merged with R&G (common controlled merger) on March 16, 2018, with R&G becoming the surviving company. R&G subsequently changed its name to Galaxy Next Generation, Inc. (Galaxy). FullCircle Registry, Inc., (FLCR) is a holding company created for the purpose of acquiring small profitable businesses to provide exit plans for those companys owners. FLCRs subsidiary, FullCircle Entertainment, Inc. (Entertainment or FLCE), owns and operates Georgetown 14 Cinemas, a fourteen-theater movie complex located in Indianapolis, Indiana. On June 22, 2018, Galaxy consummated a reverse triangular merger whereby Galaxy merged with and into Full Circle Registry, Inc.s (FLCR) newly formed subsidiary - formed specifically for the transaction (Galaxy MS). The merger resulted in Galaxy MS becoming a wholly-owned subsidiary of FLCR. For accounting purposes, the acquisition of Galaxy by FLCR is considered a reverse acquisition, an acquisition transaction where the acquired company, Galaxy, is considered the acquirer for accounting purposes, notwithstanding the form of the transaction. The primary reason the transaction is being treated as a purchase by Galaxy rather than a purchase by FLCR is that FLCR is a public reporting company, and Galaxys stockholders gained majority control of the outstanding voting power of FLCRs equity securities. Consequently, the assets and liabilities and the operations that are reflected in the historical financial statements of the Company prior to the merger are those of Galaxy. The financial statements after the completion of the merger include the combined assets and liabilities of the combined company (collectively Galaxy Next Generation, Inc., Full Circle Registry, Inc. and FullCircle Entertainment, Inc., or the Company). In recognition of Galaxys merger with FLCR, several things occurred: (1) FLCR amended its articles of incorporation to change its name from FullCircle Registry, Inc. to Galaxy Next Generation, Inc.; (2) Galaxy and FLCR changed its fiscal year end to June 30, effective June 2018; (3) FLCR authorized shares of preferred stock were increased to 200,000,000 and authorized shares of common stock were increased to 4,200,000,000, (prior to the Reverse Stock Split) both with a par value of $0.0001; and (4) the Board of Directors and Executive Officers approved Gary LeCroy, President and Director; Magen McGahee, Secretary and Director; and Carl Austin, Director; and (5) the primary business operated by the combined company became the business that was operated by Galaxy. Galaxy is a manufacturer and U.S. distributor of interactive learning technology hardware and software that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxys products include Galaxys own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. New technologies like Galaxys own SAM series touchscreen panels are sold along with renowned brands such as Google Chromebooks, Microsoft Surface Tablets, Lenovo & Acer computers, Verizon WiFi and more. Galaxys distribution channel consists of approximately 25 resellers across the U.S. who primarily sell its products within the commercial and educational market. Galaxy does not control where the resellers focus their resell efforts; however, the K-12 education market is the largest customer base for Galaxy products comprising nearly 90% of Galaxys sales. In addition, Galaxy also possesses its own reseller channel where it sells directly to the K-12 market, primarily throughout the Southeast region of the United States. As disclosed in Note 11, the Entertainment segment was sold effective on February 6, 2019 in exchange for 38,625 Galaxy common shares. Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. Any reference in these footnotes to applicable guidance is meant to refer to the authoritative U.S. generally accepted accounting principles (GAAP) as found in the Accounting Standards Codification (ASC) and Accounting Standards Update (ASU) of the Financial Accounting Standards Board (FASB). Due to the change in year-end, the Companys fiscal year 2018 is shortened from 12 months to 3 months and is ending on June 30, 2018. Further, the financial statements as of June 30, 2018 represent the financial information of the Company subsequent to the acquisition. The financial statements for the three-month and nine-month period ending March 31, 2018 represent the financial information of the Company prior to the acquisition. All intercompany transactions and accounts have been eliminated in the consolidation. The Companys financial reporting segments are Technology (reflecting the operations of Galaxy) and Entertainment (reflecting the operations of the movie theater). The Company is an over-the-counter public company traded under the stock symbol listing GAXY (formerly FLCR). Segment Reporting With the reverse merger between Galaxy and FLCR on June 22, 2018, the Company has identified two reportable segments: Technology and Entertainment. Segment determination is based on the internal organization structure, management of operations and performance evaluation by management and the Companys Board of Directors. Separate management of each segment is required because each business unit is subject to different operational issues and strategies. The Technology segment sells interactive learning technology hardware and software that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxys products include Galaxys own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. The Entertainment segment owns and operates Georgetown 14 Cinemas, a fourteen-theater movie complex located in Indianapolis, Indiana. Entertainment generates revenues from movie ticket sales and concessions. As part of the merger agreement, the parties have the right to spinout the Entertainment segment to the prior shareholders of FLCR. Management plans to implement the spinout in order to focus on its primary business plan, which is Galaxy. As disclosed in Note 11, the Entertainment segment was sold to an entity with a common board member, effective February 6, 2019. Use of Estimates The preparation of consolidated financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates used in preparing the consolidated financial statements include those assumed in computing the allowance for doubtful accounts, inventory reserves, product warranty liabilities, and the valuation of deferred tax assets. It is reasonably possible that the significant estimates used will change within the next year. Capital Structure In accordance with ASC 505, Equity, the Companys capital structure is as follows: March 31, 2019 Authorized Issued Outstanding Common stock 4,000,000,000 10,284,505 9,993,609 $.0001 par value, one vote per share Preferred stock 200,000,000 - - Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common June 30, 2018 Authorized Issued Outstanding Common stock 4,000,000,000 9,655,813 9,655,813 $.0001 par value, one vote per share Preferred stock 200,000,000 - - Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common There is no publicly traded market for the preferred shares. Business Combinations The Company accounts for business combinations under the acquisition method of accounting. Under this method, acquired assets, including separately identifiable intangible assets, and any assumed liabilities are recorded at their acquisition date estimated fair value. The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents the goodwill amount resulting from the acquisition. Determining the fair value of assets acquired and liabilities assumed involves the use of significant estimates and assumptions. Concurrent with the reverse triangular merger, the Company applied pushdown accounting. Pushdown accounting refers to the use of the acquirers basis in the preparation of the acquirees separate financial statements as the new basis of accounting for the acquiree. See Note 11 for a discussion of the merger and the related impact on the Companys consolidated financial statements. Revenue Recognition Technology Interactive Panels and Related Products The Company derives revenue from the sale of interactive panels and other related products. Sales of these panels may also include optional equipment, accessories and services (installation, training and other services, including maintenance services and/or an extended warranty). Product sales and installation revenue are recognized when all of the following criteria have been met: (1) products have been shipped or customers have purchased and accepted title to the goods; service revenue for installation of products sold is recognized as the installation services are performed, (2) persuasive evidence of an arrangement exists, (3) the price to the customer is fixed, and (4) collectability is reasonably assured. Deferred revenue consists of customer deposits and advance billings of the Companys products where sales have not yet been recognized. Shipping and handling costs billed to customers are included in revenue in the accompanying statements of operations. Costs incurred by the Company associated with shipping and handling are included in cost of sales in the accompanying statements of operations. Sales are recorded net of sales returns and discounts, and sales are presented net of sales-related taxes. Because of the nature and quality of the Companys products, the Company provides for the estimated costs of warranties at the time revenue is recognized for a period of five years after purchase as a secondary warranty. The manufacturer also provides a warranty against certain manufacturing and other defects. As of the nine-month period ended March 31, 2019 and the period ended June 30, 2018, the Company accrued $1,350 for estimated product warranty claims, which is included in accrued expenses in the accompanying balance sheets. The accrued warranty costs are based primarily on historical experience of actual warranty claims as well as current repair costs. There were no warranty claim expenses during the period ended March 31, 2019. There was $1,350 of warranty expenses for the period ended March 31, 2018. Product sales resulting from fixed-price contracts involve a signed contract for a fixed price or a binding purchase order to provide the Companys interactive panels and accessories. Contract arrangements exclude a right of return for delivered items. Product sales resulting from fixed-price contracts are generated from multiple-element arrangements that require separate units of accounting and estimates regarding the fair value of individual elements. The Company has determined that its multiple-element arrangements that qualify as separate units of accounting are (1) product sales and (2) installation and related services. There is objective and reliable evidence of fair value for both the product sales and installation services and allocation of arrangement consideration for each of these units is based on their relative fair values. Each of these elements represent individual units of accounting, as the delivered item has value to a customer on a stand-alone basis. The Companys products can be sold on a stand-alone basis to customers which provides objective evidence of the fair value of the product portion of the multi-element contract, and thus represents the Companys best estimate of selling price. The fair value of installation services is separately calculated using expected costs of installation services. Many times, the value of installation services is calculated using price quotations from subcontractors to the Company who perform installation services on a stand-alone basis. The Company sells equipment with embedded software to its customers. The embedded software is not sold separately, and it is not a significant focus of the Companys marketing efforts. The Company does not provide post-contract customer support specific to the software or incur significant costs that are within the scope of Financial Accounting Standards Board (FASB) guidance on accounting for software to be leased or sold. Additionally, the functionality that the software provides is marketed as part of the overall product. The software embedded in the equipment is incidental to the equipment as a whole. Entertainment Theater Ticket Sales and Concessions Revenues are generated principally through admissions and concessions sales with proceeds received in cash or via credit card at the point of sale. Cash and Cash Equivalents The Company considers cash and cash equivalents to be cash in all bank accounts, including money market and temporary investments that have an original maturity of three months or less. From time to time, the Company has on deposit, in institutions whose accounts are insured by the Federal Deposit Insurance Corporation, funds in excess of the insured maximum. The at-risk amount is subject to significant fluctuation daily throughout the year. The Company has never experienced any losses related to these balances, and as such, the Company does not believe it is exposed to any significant risk. Accounts Receivable The Company reports accounts receivable at invoiced amounts less an allowance for doubtful accounts. Interest is not charged on past due accounts. Management reviews each receivable balance and estimates that portion, if any, of the balance that will not be collected. The carrying amount of the accounts receivable is then reduced by an allowance based on managements estimate. Management deemed no allowance for doubtful accounts was necessary at March 31, 2019 or June 30, 2018. Inventories Inventory is stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out (FIFO) method of accounting. All inventory at March 31, 2019 and June 30, 2018, represents goods available for sale. Galaxy inventory is mostly comprised of interactive panels and accessories while FLCR inventory consists of concession inventory such as popcorn, soft drinks, and candy. Management estimates no obsolete or slow-moving inventory reserves at March 31, 2019 or June 30, 2018. Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in operations. Property and equipment at March 31, 2019 and June 30, 2018, and the estimated useful lives used in computing depreciation, are as follows: Building 40 years Building improvements 8 years Vehicles 5 years Equipment 5 8 years Furniture and fixtures 5 years Depreciation is provided using the straight-line method over the estimated useful lives of the depreciable assets. Depreciation expense was $38,220 and $17,667 for the three-month periods ended March 31, 2019 and 2018, respectively. Depreciation expense was $216,642 and $14,547 for the nine-month periods ended March 31, 2019 and 2018, respectively. Long-lived Assets Long-lived assets to be held and used are tested for recoverability whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the excess of the assets carrying amount over the fair value of the asset. Goodwill Goodwill is not amortized, but is reviewed for impairment at least annually, or more frequently when events or changes in circumstances indicate that the carrying value may not be recoverable. Judgments regarding indicators of potential impairment are based on market conditions and operational performance of the business. At each fiscal year-end, the Company performs an impairment analysis of goodwill. The Company may assess its goodwill for impairment initially using a qualitative approach to determine whether conditions exist to indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value. If management concludes, based on its assessment of relevant events, facts and circumstances that it is more likely than not that a reporting units carrying value is greater than its fair value, then a goodwill impairment charge is recognized for the amount in excess, not to exceed the total amount of goodwill allocated to that reporting unit. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and no further testing is required. An impairment charge is recorded as a general and administrative expense within the Companys statement of operations. Income Taxes The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Current income taxes are recognized for the estimated income taxes payable or receivable on taxable income or loss from the current year and any adjustment to income taxes payable related to previous years. Current income taxes are determined using tax rates and tax laws that have been enacted or subsequently enacted by the year-end date. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. Under the asset and liability method the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion or all of the deferred tax asset will not be recognized. Prior to the merger, Galaxy was organized as a Subchapter S Corporation under the Internal Revenue Code. There was no provision for federal and state income taxes for the three-month or nine-month periods ended March 31, 2018 since the proportionate share of the taxable income or loss was included in the tax returns of the stockholders. However, upon completion of the merger, Galaxy consequently changed to a C Corporation. Research and Development The Company accounts for research and development (R&D) costs in accordance with the Research and Development topic of the ASC. Under the Research and Development topic of the ASC, all R&D costs must be charged to expense as incurred. Accordingly, internal R&D costs are expensed as incurred. Third-party R&D costs are expensed when the contracted work has been performed. Stock-based Compensation The Company records stock-based compensation in accordance with the provisions set forth in ASC 718, Stock Compensation Recent Accounting Pronouncements In January 2017, the FASB issued ASU No. 2017-01 Business Combinations (Topic 805)-Clarifying the Definition of a Business. This guidance changes the definition of a business to assist entities in evaluating when a set of transferred assets and activities constitutes a business. The guidance requires an entity to evaluate if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the set of transferred assets and activities is not a business. The guidance also requires a business to include at least one substantive process and narrows the definition of outputs by more closely aligning it with how outputs are described in Accounting Standards Codification (ASC 606) Revenue from Contracts with Customers. The new standard is effective for public entities beginning in fiscal years starting after December 15, 2017. We adopted this standard during the quarter ended December 31, 2018. There was no significant impact on our financial statements as a result of adopting this standard. In August 2017, FASB issued ASU No. 2017-12 Derivatives and Hedging (Topic 815)Targeted Improvements to Accounting for Hedging Activities. This guidance eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires, for qualifying hedges, the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also modifies the accounting for components excluded from the assessment of hedge effectiveness, eases documentation and assessment requirements and modifies certain disclosure requirements. The new standard is effective for public entities in fiscal years beginning after December 15, 2018. Early adoption is permitted. The Company is assessing the impact of this standard on its financial statements. In August 2018, the U.S. Securities and Exchange Commission ("SEC") adopted the final rule under SEC Release No. 33-10532 Disclosure Update and Simplification, to eliminate or modify certain disclosure rules that are redundant, outdated, or duplicative of U.S. GAAP or other regulatory requirements. Among other changes, the amendments eliminated the annual requirement to disclose the high and low trading prices of our common stock. In addition, the amendments provide that disclosure requirements related to the analysis of shareholders' equity are expanded for interim financial statements. An analysis of the changes in each caption of shareholders' equity presented in the balance sheet must be provided in a note or separate statement, as well as the amount of dividends per share for each class of shares. This rule was effective on November 5, 2018; and we adopted this guidance during the quarter ended December 31, 2018 with no impact on the financial statements presented in accordance with generally accepted accounting principles. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 2 - Property and Equipment: Property and equipment are comprised of the following: March 31, 2019 June 30, 2018 Land and buildings $ - $ 4,937,069 Building improvements - 363,083 Vehicles 92,353 92,353 Equipment - 1,470,709 Furniture and fixtures - 12,598 92,353 6,875,812 Accumulated depreciation (60,970) (2,621,361) Property and equipment, net $ 31,383 $ 4,254,451 As disclosed in Note 11, the Entertainment segment was sold effective February 6, 2019 in exchange for 38,625 Galaxy common shares. As a result of the sale, the property and equipment belonging to this segment was reduced to zero. |
Line of Credit
Line of Credit | 9 Months Ended |
Mar. 31, 2019 | |
Line of Credit Facility [Abstract] | |
Line of Credit | Note 3 - Line of Credit: The Company has a $1,250,000 line of credit agreement with a bank. The line of credit bears interest at prime plus 0.5% (6.0% as of March 31, 2019 and 5.5% as of June 30, 2018) and expires in December 2019. The line of credit is collateralized by all assets of the business, certain property owned by a family member of a stockholder, equity investments of two stockholders, personal guarantees of two stockholders, and a key man life insurance policy. A minimum average bank balance of $50,000 is required as part of the line of credit agreement. In addition, a 20% curtailment of the outstanding balance will occur during 2019. The outstanding balance was $1,230,550 and $547,603 at March 31, 2019 and June 30, 2018, respectively. |
Notes Payable
Notes Payable | 9 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Notes Payable | Notes 4 - Notes Payable: Long Term Notes Payable The Company's long term notes payable obligations to unrelated parties are as follows as of March 31, 2019 and June 30, 2018: March 31, 2019 June 30, 2018 The Company has a note payable with a bank. The note bears interest at 3.10% and matures in June 2019. The note is guaranteed by a stockholder and collateralized by a certificate of deposit owned by a related party. In May 2018, 50,000 shares of stock were issued to the related party in exchange for a $100,000 reduction in the short-term note balance. $ 274,900 $ 275,000 Note payable to an individual executed March 2018 in which the note accrues interest on the original principal balance at a rate of 6.25% annually. Interest is paid annually with principal due March 2021. - 75,000 Mortgage payable assumed in acquisition; interest payable at 4.75% monthly payments of $34,435 through December 31, 2016. The note payable was modified during the year ended December 31, 2017. After the modification, the interest rate was modified to 2.5% annually with monthly payment of $15,223 through July 15, 2020, and a balloon payment at maturity. The mortgage payable is secured by the building and land as well as guarantees by related parties. - 4,512,710 Note payable to a financial institution for acquisition of vehicle with monthly installment of $153 maturing June 2022. - 6,150 Capital leases for 3 delivery vehicles with monthly installments from $253 to $461, including 4% to 4.75% interest, maturing over 5-year terms expiring between April 2019 and July 2020. 7,839 17,668 Total Non-Related Party Notes Payable 282,739 4,886,528 Current Portion of Non-Related Party Notes Payable 281,045 362,181 Long-term Portion of Non-Related Party Notes Payable $ 1,694 $ 4,524,347 As disclosed in Note 11, the Entertainment segment was sold effective February 6, 2019 in exchange for 38,625 Galaxy common shares. As a result of the sale, the notes payable belonging to this segment was reduced to zero. Future minimum principal payments on the non-related party long term notes payable are as follows: Period ending March 31, 2020 $ 281,045 2021 1,694 $ 282,739 Short Term Notes Payable The Company's short term notes payable obligations to unrelated parties assumed in the acquisition (Note 11) are as follows as of March 31, 2019 and June 30, 2018: March 31, 2019 June 30, 2018 Note payable to individual and bears interest at a rate of 8% interest annually and is due on demand. $ - $ 20,000 Note payable to individual and bears interest at a rate of 8% interest annually and is due on demand. - 10,000 Note payable to an individual in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and due on demand. - 60,000 Note payable to an individual in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and was scheduled to mature in August 2018. The term was extended for another year. - 25,000 Note payable to an individual in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and is due on demand. - 25,000 Note payable to an individual in which the note accrues interest on the original principal balance at a rate of 10% interest annually and is due on demand. - 25,000 Total Short Term Non-Related Party Notes Payable $ - $ 165,000 As disclosed in Note 11, the Entertainment segment was sold effective February 6, 2019 in exchange for 38,625 Galaxy common shares. As a result of the sale, the notes payable belonging to this segment was reduced to zero. Convertible Notes Payable March 31, 2019 June 30, 2018 On November 30, 2018, the Company signed a convertible promissory note with an investment firm. The $400,000 note was issued at a discount of $40,000 and bears interest at 5% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in May 2019. The note matures in August 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. As of March 31, 2019, the outstanding principal balance of the note is $400,000, with an unamortized debt discount of $22,222. $ 377,778 $ - On January 16, 2019, the Company signed a convertible promissory note with an investment firm. The $382,000 note was issued at a discount of $38,200 and bears interest at 12% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in June 2019. The note matures in July 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. As of March 31, 2019, the outstanding principal balance of the note is $382,000, with an unamortized debt discount of $21,829. 360,171 - On February 20, 2019, the Company signed a convertible promissory note with an investment firm. The $225,000 note was issued at a discount of $22,500 and bears interest at 12% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in August 2019. The note matures in August 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. As of March 31, 2019, the outstanding principal balance of the note is $225,000, with an unamortized debt discount of $16,071. 208,929 - On February 22, 2019, the Company signed a convertible promissory note with an investment firm. The $200,000 note was issued at a discount of $20,000 and bears interest at 5% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in August 2019. The note matures in November 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. As of March 31, 2019, the outstanding principal balance of the note is $200,000, with an unamortized debt discount of $15,556. 184,444 - On March 28, 2019, the Company signed a convertible promissory note with an investment firm. The $225,000 note was issued at a discount of $20,000 and bears interest at 10% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share. The note matures in March 2020. - - Total Convertible Notes Payable 1,131,322 - Current Portion of Convertible Notes Payable 1,131,322 - Long-term Portion of Convertible Notes Payable $ - $ - During the three and nine-month periods ended March 31, 2019, the Company recorded interest expense of $40,578 and $45,022 of amortization of debt discount, included in interest expense. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 5 - Related Party Transactions: Notes Payable The Company's notes payable obligations to related parties assumed in the acquisition (Note 11) are as follows as of March 31, 2019 and June 30, 2018: March 31, 2019 June 30, 2018 Various notes payable to a related party in which the notes accrue interest on the original principal balance at a rate of 8% interest annually and is due on demand. Five of these notes were converted into common stock in accordance with a board resolution at a rate of $.01 per share. One note did not convert. $ - $ 15,000 Various notes payable to a related party in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and was scheduled to mature in October 2017 and is currently due on demand. - 91,000 Note payable to a related party in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and is due in August 2019. - 8,000 Notes payable to a related party in which the note bears no interest and is scheduled to mature on demand. - 25,000 Note payable to a related party in which the note accrues interest on the original principal balance at a rate of 9% interest annually and is scheduled to mature in October 2019. - 125,000 Note payable to an individual executed February 2018 in which the note accrues interest on the original principal balance at a rate of 18% annually and is due on demand. - 10,000 Various notes payable to a related party in which the note accrues interest on the original principal balance at a rate of 10% interest annually through December 31, 2016 at which time the interest rate was reduced to 6.25% interest annually. The notes are scheduled to mature at various dates through July 2021. - 211,534 Total Related Party Notes Payable - 485,534 Current Portion of Related Party Notes Payable - 485,534 Long-term Portion of Related Party Notes Payable $ - $ - As disclosed in Note 11, the Entertainment segment was sold effective February 6, 2019 in exchange for 38,625 Galaxy common shares. As a result of the sale, the notes payable belonging to this segment was reduced to zero. Other Advances and Commitments In support of the Companys efforts and cash requirements, it may rely on advances from related parties until such time that it can support its operations or attain adequate financing through sales of its equity or traditional debt financing. There is no formal written commitment for continued support by officers, directors or shareholders. Amounts represent advances or amounts paid in satisfaction of liabilities. The advances are unsecured, due on demand, and the amounts outstanding at March 31, 2019 and June 30, 2018 is $0 and $260,173, respectively. Galaxy pays a related party $7,500 as a collateral fee for securing the Companys short-term note payable with a certificate of deposit (see Note 4). Leases The Companys technology segment leases property used in operations from a related party under terms of an operating lease. The term of the lease expired on December 31, 2018 when the lease changed to a month-to-month operating lease. The monthly lease payment is $1,500 plus maintenance and property taxes, as defined in the lease agreement. Rent expense for this lease, as well as other month-to-month leases, totaled $21,646 and $10,500 for the three-month periods ended March 31, 2019 and 2018, respectively. Rent expense totaled $24,634 and $14,169 for the nine-month periods ended March 31, 2019 and 2018, respectively. The Company leases three vehicles from related parties under capital leases. The Company is paying the lease payments directly to the creditors, rather than the lessor. The leased vehicles are used in operations for deliveries and installations. Other Agreements A stockholders family member collateralizes the Companys short-term note with a CD in the amount of $375,000, held at the same bank. The family member will receive a $7,500 collateral fee for this service. In May 2018, 50,000 shares of stock were issued in exchange for a $100,000 reduction in the short-term note balance. Notes Payable Converted to Common Stock On June 22, 2018, various board members and executives of FLCR exchanged their outstanding related party debt and accrued interest for 4% of the Companys common stock as described in Note 11. |
Lease Agreements
Lease Agreements | 9 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Lease Agreements | Note 6 - Lease Agreements: Capital Lease Agreements Capital lease agreements for vehicles (disclosed in Note 4) require monthly payments totaling $1,066 (ranging from $253 to $461), including interest (ranging from 4.0% to 4.75%), over 5-year terms expiring between April 2019 and July 2020. Operating Lease Agreements The Company leases office, retail shop and warehouse facilities under operating leases from a related party (disclosed in Note 5) which require monthly payments of $1,500 and subsequent to December 2018, became a month-to-month operating lease. Rent expense for this lease, as well as other month-to-month leases, totaled $21,646 and $10,500 for the three-month periods ended March 31, 2019 and 2018, respectively. Rent expense totaled $24,634 and $14,169 for the nine-month periods ended March 31, 2019 and 2018, respectively. |
Equity
Equity | 9 Months Ended |
Mar. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Equity | Note 7 - Equity: Certain equity transactions related to the reverse triangular merger occurred in September 2018, but have been reflected as of June 30, 2018, in the consolidated financial statements due to FLCR effectively transferring control to Galaxy as of June 22, 2018 (see Note 11). The following equity transactions occurred simultaneously, and are treated in these consolidated financial statements as being effective on that date: Galaxy shareholders transferred all the outstanding shares of common stock to the Merger Sub; Preferred Class C shares were converted into common stock in an amount equivalent to 89% ownership in the outstanding shares of the merged company; Common shares were issued to common stockholders in an amount equivalent to 7% ownership in the outstanding shares of the merged company; Common shares were issued to convertible debt holders in an amount equivalent to 4% ownership in the outstanding shares of the merged company (See Note 5). A reverse stock split was approved at a ratio of one new share for every 350 shares of common stock outstanding (1:350 Reverse Stock Split). Private Placement In March 2018, the Company offered 1,500,000 common shares to qualified investors at $2 per share in a private placement memorandum (PPM). The private placement offering period expired in September 2018. Proceeds were raised to purchase inventory, pay merger costs and provide working capital. As a result of the PPM, the Company issued 1,374,850 shares to new investors resulting in proceeds of $2,004,500. The shares issued in the PPM are prior to the Reverse Stock Split. In May 2018, 50,000 shares of stock (143 shares post-Reverse Stock Split) were issued to the related party in exchange for a $100,000 reduction in the short-term note balance (see Note 4). On December 19, 2018, the Company issued 75,511 shares as a bonus to a board member for consulting services and as a performance incentive to a key employee. During the three-month period ended March 31, 2019, the Company issued 300,000 shares for professional consulting services. During the three-month period ended March 31, 2019, the Company acquired 38,625 shares from an entity with a common board member under a Share Purchase Agreement related to the sale of Entertainment. These shares are issued but not outstanding at March 31, 2019. See the capital structure section in Note 1 for disclosure of the equity components included in the Companys consolidated financial statements. |
Income Taxes
Income Taxes | 9 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 8 - Income Taxes: The U.S. Tax Cuts and Jobs Act (TCJA) legislation, enacted on December 22, 2017, reduces the U.S. federal corporate income tax rate from 35.0% to 21.0% and is effective January 1, 2018 for the Company. The Company has not generated any taxable income and has not recorded any current income tax expense at March 31, 2019. Consequently, the tax rate change has had no impact on the Companys current tax expense but impacts the deferred tax assets and liabilities and will impact future deferred tax assets and liabilities to be recognized. The Companys deferred tax assets are primarily comprised of net operating losses (NOL) that give rise to deferred tax assets. Estimated net operating losses available at March 31, 2019 amounted to approximately $2,500,000, set to expire through 2038. There is no tax benefit for goodwill impairment, which is permanently non-deductible for tax purposes. Additionally, due to the uncertainty of the utilization of net operating loss carry forwards a valuation allowance equal to the net deferred tax assets has been recorded. The Companys effective tax rate differed from the federal statutory income tax rate for the period ended March 31, 2019 is as follows: Federal statutory rate 21% State tax, net of federal tax effect 5.25% Valuation allowance -26.25% Effective tax rate 0% As of March 31, 2019, the Company does not believe that it has taken any tax positions that would require the recording of any additional tax liability nor does it believe that there are any unrealized tax benefits that would either increase or decrease within the next twelve months. As of March 31, 2019, the Companys income tax returns generally remain open for examination for three years from the date filed with each taxing jurisdiction. |
Commitments, Contingencies, and
Commitments, Contingencies, and Concentrations | 9 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies, and Concentrations | Note 9 - Commitments, Contingencies, and Concentrations: Contingencies Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Companys management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Companys legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Companys consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Concentrations Galaxy contracts the manufacturer of its products with overseas suppliers. The Companys sales could be adversely impacted by a suppliers inability to provide Galaxy with an adequate supply of inventory. Galaxy has three customers that accounted for approximately 76% of accounts receivable at March 31, 2019 and 87% of accounts receivable at June 30, 2018. Galaxy has three customers that accounted for approximately 67% and 42% of revenues for the three-month periods ended March 31, 2019 and March 31, 2018, respectively. Galaxy has three customers that accounted for approximately 57% and 52% of revenues for the nine-month periods ended March 31, 2019 and 2018, respectively. |
Material Agreements
Material Agreements | 9 Months Ended |
Mar. 31, 2019 | |
Disclosure of Material Agreements [Abstract] | |
Material Agreements | Note 10 - Material Agreements: Manufacturing and Distributorship Agreement In December 2016, Galaxy executed an agreement with a company in South Korea. Pursuant to such distribution agreement, the manufacturer agreed to manufacture, and the Company agreed to be the sole distributor of the interactive panels in the United States for a term of one year, with automatic annual renewals. The Company must submit a three-month rolling sales forecast (which acts as a purchase order) to the manufacturer, updated monthly. The manufacturer has three days to accept the purchase order and once accepted, the Company must pay the manufacturer 105% of the cost shown on the purchase order, 10% at the time the order is accepted and the remaining 95% within 120 days if the Company has sold the panels and been paid by the end customer. The manufacturer also provides a warranty for any defects in material and workmanship for a period of 26 months from the date of shipment to the Company. There was a $4 million minimum purchase commitment for the 12-month period ended December 31, 2017. This minimum purchase commitment was not met; however, the manufacturer and the Company extended the agreement for an additional year under the same terms. Because the Company did not meet the minimum purchase commitment, the manufacturer can require the Company to work with their sales representative to establish a performance improvement plan, and the manufacturer has the right to terminate the agreement. The agreement expires December 31, 2019. Consulting Agreement Galaxy entered into a consulting agreement in May 2017 with two consultants for advisory services through July 2019. In exchange for consulting services provided, these consultants are entitled to receive consulting fees of $15,000 per month and a 5.5% combined equity interest in Galaxy. The 5.5% equity interest was converted to common stock upon the commencement of the Common Controlled Merger Agreement of R&G and Galaxy CO (as described in Note 1). The Company paid the consultants $161,500 and $374,500 in fees and expenses for consulting services provided during the three-month and nine-month periods ended March 31, 2019. No consulting fees were paid under this agreement during the periods ended March 31, 2018. The consulting agreement was renewed effective May 1, 2019 (as described in Note 15). Consulting Agreement Magellan FIN, LLC The Company entered into a consulting agreement in May 2018 for advisory services such as maintaining ongoing stock market support such as drafting and delivering press releases and handling investor requests. The program will be predicated on accurate, deliberate and direct disclosure and information flow from the Company and dissemination to the appropriate investor audiences. In exchange for these consulting services provided, the advisor received $15,000 at contract inception, an additional $4,000 monthly through the term of the agreement, which is April 2019, and 10,000 shares of common stock. The Company incurred no amounts for consulting fees during the three-month period and $23,000 during the nine-month period ended March 31, 2019. No consulting fees were paid under this agreement during the periods ended March 31, 2018. KLIK Distribution Agreement In September 2018, the Company signed a 1-year distributor agreement with KLIK Communications to be the sole distributor of KLIK products to US educational market. The agreement will automatically renew annually, unless three months notice is given by either party. The agreement will end upon successful acquisition of KLIK by Galaxy, per the Letter of Intent signed in July 2018. Payment terms are 45 days after invoice. Delivery terms are FOB Deliver location. The KLIK product will replace the VIVI product (specialized interactive router) previously sold with the Galaxy panels. KLIK will provide a 2-year manufacturers warranty from the date of shipment, and free software updates. The agreement provides KLIK with the option of storing the manufacturers inventory at the Galaxy warehouse. Distribution Agreement Effective September 15, 2018, the Company signed a 2-year distribution agreement for Galaxys SLIM series of interactive panels, a new Galaxy product. Galaxy outsourced the manufacturing to a vendor as manufacturing costs are less, and customers prefer an Android operating system. The agreement includes a commitment by Galaxy to purchase $2 million of product during the first year beginning September 2018. The manufacturer will provide Galaxy with the product, including a three-year manufacturers warranty from the date of shipment. The agreement renews automatically in two-year increments unless three months notice is given by either party. Agency Agreement Effective December 11, 2018, the Company entered into a contract with Carter, Terry and Company (CTC) to act as an agent in raising capital. CTC will have the opportunity to receive a finders fee ranging from 4 to 8% relative to the amount of capital raised, if successful. No fees were paid during the three-month or nine-month periods ended March 31, 2019. No fees were paid under this agreement during the periods ended March 31, 2018. Master Service Agreement Effective January 2, 2019, the Company entered into a 3 month contract with Invictus Resources for advisory services including among other services, presenting and introducing the Company to the financial community of investors. The Company paid $75,000 and issued 300,000 common stock shares under this agreement during the three-month period ended March 31, 2019. No advisory fees were paid under this agreement during the period ended March 31, 2018. |
Reverse Acquisition
Reverse Acquisition | 9 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Reverse Acquisition | Note 11 - Reverse Acquisition: On June 22, 2018, Galaxy consummated a reverse triangular merger whereby Galaxy merged with and into FLCRs newly formed subsidiary, Galaxy MS, Inc. which was formed specifically for the transaction. Under the terms of the merger, Galaxys shareholders transferred all their outstanding shares of common stock to Galaxy MS, in return for FLCRs Series C Preferred Shares, which were equivalent to approximately 3,065,000,000 shares of the common stock of FLCR on a pre-reverse stock split basis. This represents approximately 89% of the outstanding common stock of FLCR, with the remaining 11% of common stock distributed as follows: (a) an ownership interest of seven percent (7%) to the holders of common stock, pro rata; and (b) four percent (4%) of the common stock to the holders of convertible debt, pro rata. Concurrent with the reverse triangular merger, the Company applied pushdown accounting; therefore, the consolidated financial statements after completion of the reverse merger include the assets, liabilities, and results of operations of the combined company from and after the closing date of the reverse merger, with only certain aspects of pre-consummation stockholders equity remaining in the consolidated financial statements. There was no cash consideration paid by Galaxy to FLCR on the date of the reverse triangular merger. Instead, shares of stock were issued and exchanged, and the Company acquired $1,511,844 of net assets of FLCR. At the closing of the merger, all of FLCRs convertible promissory notes were converted into FLCRs common shares. The merger agreement contains potential future tax advantages of the net operating loss carryforward available to offset future taxable income of the combined company, up to a maximum of $150,000, over a 5-year period beginning June 22, 2018. There is a valuation allowance reducing this tax benefit to zero. The following table summarizes the preliminary allocation of the fair value of the assets and liabilities as of the merger date through pushdown accounting. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as the Company continues to finalize the fair value estimates. Assets Cash $ 22,205 Property and equipment 4,209,995 Other 20,716 Other assets 1,511,844 Goodwill 834,220 Total Assets 6,598,980 Liabilities Accounts payable 208,763 Long-term debt 4,593,851 Short-term debt 799,534 Accrued interest 78,948 Other 83,664 Total Liabilities 5,764,760 Net Assets $ 834,220 Consideration $ - Fair value of noncontrolling interests 834,220 $ 834,220 As a result of the Company pushing down the effects of the acquisition, certain accounting adjustments are reflected in the consolidated financial statements, such as goodwill recognized amounting to $834,220 and reflected in the balance sheet. Goodwill recognized is primarily attributable to the acquisition of the fair value of the public company structure and other intangible assets that do not qualify for separate recognition. Other assets noted in the table above consist of the differences between the acquired assets and liabilities of Full Circle Entertainment to be distributed to pre-acquisition FLCR shareholders. The Company expects to exercise its option to spin out the Entertainment subsidiary within one year to focus on its primary business plan as discussed herein and distribute all respective Entertainment assets and liabilities to these shareholders. As a result, the Company does not anticipate receiving any economic benefit from the related assets in the table above, nor incurring any obligations from the corresponding liabilities. The Company sold the Entertainment subsidiary to an entity related by common board member on February 6, 2019. The sale of Entertainment enabled the Company to focus its resources into the operations of the Technology segment. The consideration received for the sale of Entertainment was 38,625 shares of Galaxy common stock at the fair value on the date of the transaction, or $92,700. The fair value of the Galaxy common shares received offset the assets and liabilities of Entertainment, with the difference recorded as a gain on the sale for the nine-months ended March 31, 2019. The gain on the sale has been recorded in general and administrative expenses in the Consolidated Statement of Operations. The following table presents a summary of Entertainments identifiable assets and liabilities at February 6, 2019, the date of the sale: Assets Cash $ 36,290 Property and equipment, net 4,006,426 Receivables 4,500 Inventories 5,610 Other assets 1,522,714 Total Assets 5,575,540 Liabilities Accounts payable 22,424 Debt 5,393,620 Accrued expenses 127,484 Total Liabilities 5,543,528 Net Assets 32,012 Noncash consideration for net assets of Entertainment 92,700 Gain on Sale $ 60,688 |
Stock Plan
Stock Plan | 9 Months Ended |
Mar. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock Plan | Note 12 Stock Plan An Employee, Directors, and Consultants Stock Plan for the Year 2019 (Plan) was established by the Company. The Plan is intended to attract and retain employees, directors and consultants by aligning the economic interest of such individuals more closely with the Companys stockholders, by paying fees or salaries in the form of shares of the Companys common stock. The Plan is effective December 28, 2018, and expires December 31, 2019. Common shares of 1,000,000 are reserved for stock awards under the Plan. There were no shares awarded under the Plan as of March 31, 2019. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 13 - Segment Reporting The Company has identified two reportable segments due to the merger that occurred on June 22, 2018: Technology and Entertainment. The Technology segment sells interactive learning technology hardware and software that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxys products include Galaxys own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. The Entertainment segment owns and operates Georgetown 14 Cinemas, a fourteen-theater movie complex located in Indianapolis, Indiana. Entertainment generates revenues from movie ticket sales and concessions. As part of the merger agreement, the parties have the right to spinout the Entertainment segment to the prior shareholders of FLCR. Management plans to implement the pinout in order to focus on its primary business plan, which is Galaxy. As disclosed in Note 11, the Entertainment segment was sold effective February 6, 2019. The following table presents a summary of operating information for the nine-month period ended March 31, 2019 for technology and the period from January 1, 2019 to February 6, 2019 for entertainment: Revenues Technology Entertainment Technology $ 1,106,540 $ - Entertainment - 589,705 Cost of Sales Technology 948,073 - Entertainment - 217,638 Gross Profit 158,467 372,067 General and Administrative Expenses Technology 3,897,139 - Entertainment - 511,812 Other Income (Expense) Technology (100,672) - Entertainment - 109,811 Net Loss $ (3,839,344) $ (29,934) |
Going Concern
Going Concern | 9 Months Ended |
Mar. 31, 2019 | |
Disclosure of Going Concern [Abstract] | |
Going Concern | Note 14 - Going Concern: The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As reflected in the accompanying consolidated financial statements, the Company had negative working capital of approximately $3,000,000, an accumulated deficit of approximately $2,100,000, and cash used in operations of approximately $2,400,000 at March 31, 2019. The Companys operational activities and the payment for such has primarily been funded through related party advances, debt financing, a private placement offering of common stock and through the deferral of accounts payable and other expenses. The Company intends to raise additional capital through the sale of equity securities or borrowings from financial institutions and possibly from related and nonrelated parties who may in fact lend to the Company on reasonable terms. Management believes that its actions to secure additional funding will allow the Company to continue as a going concern. There is no guarantee the Company will be successful in achieving any of these objectives. These sources of working capital are not assured, and consequently do not sufficiently mitigate the risks and uncertainties disclosed above. The ability of the Company to continue as a going concern is dependent upon managements ability to raise capital from the sale of its equity and, ultimately, the achievement of operating revenues. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 15 - Subsequent Events: The Company has evaluated subsequent events through the date on which the consolidated financial statements were available to be issued. On April 18, 2019, the Company signed a $200,000 promissory note with a stockholder and board member. Principal and fixed interest, of $10,000, on the note are due at maturity in July 2019. Note is personally guaranteed by a different stockholder. On April 29, 2019, the Company signed a convertible promissory note with an investment firm. The $1,325,000 note was issued at a discount of $92,750 and bears interest at 8% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 75% of the lowest traded price of the common stock during the 10 trading days immediately preceding the notice of conversion or (b) $2.75 per share. The note matures in April 2020. Effective May 1, 2019, the Company renewed a consulting contract with TPI Business Consultants, Inc. The contract calls for an initial payment of 450,000 common shares and then $15,000 monthly. The contract renews annually, unless either party cancels with a 30 day notice. On May 1, 2019, two convertible notes totaling $736,484 were paid off prior to maturity or conversion. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Corporate History, Nature of Business and Mergers | Corporate History, Nature of Business and Mergers Galaxy Next Generation LTD CO. (Galaxy CO) was organized in the state of Georgia in February 2017 while R & G Sales, Inc. (R&G) was organized in the state of Georgia in August 2004. Galaxy CO merged with R&G (common controlled merger) on March 16, 2018, with R&G becoming the surviving company. R&G subsequently changed its name to Galaxy Next Generation, Inc. (Galaxy). FullCircle Registry, Inc., (FLCR) is a holding company created for the purpose of acquiring small profitable businesses to provide exit plans for those companys owners. FLCRs subsidiary, FullCircle Entertainment, Inc. (Entertainment or FLCE), owns and operates Georgetown 14 Cinemas, a fourteen-theater movie complex located in Indianapolis, Indiana. On June 22, 2018, Galaxy consummated a reverse triangular merger whereby Galaxy merged with and into Full Circle Registry, Inc.s (FLCR) newly formed subsidiary - formed specifically for the transaction (Galaxy MS). The merger resulted in Galaxy MS becoming a wholly-owned subsidiary of FLCR. For accounting purposes, the acquisition of Galaxy by FLCR is considered a reverse acquisition, an acquisition transaction where the acquired company, Galaxy, is considered the acquirer for accounting purposes, notwithstanding the form of the transaction. The primary reason the transaction is being treated as a purchase by Galaxy rather than a purchase by FLCR is that FLCR is a public reporting company, and Galaxys stockholders gained majority control of the outstanding voting power of FLCRs equity securities. Consequently, the assets and liabilities and the operations that are reflected in the historical financial statements of the Company prior to the merger are those of Galaxy. The financial statements after the completion of the merger include the combined assets and liabilities of the combined company (collectively Galaxy Next Generation, Inc., Full Circle Registry, Inc. and FullCircle Entertainment, Inc., or the Company). In recognition of Galaxys merger with FLCR, several things occurred: (1) FLCR amended its articles of incorporation to change its name from FullCircle Registry, Inc. to Galaxy Next Generation, Inc.; (2) Galaxy and FLCR changed its fiscal year end to June 30, effective June 2018; (3) FLCR authorized shares of preferred stock were increased to 200,000,000 and authorized shares of common stock were increased to 4,200,000,000, (prior to the Reverse Stock Split) both with a par value of $0.0001; and (4) the Board of Directors and Executive Officers approved Gary LeCroy, President and Director; Magen McGahee, Secretary and Director; and Carl Austin, Director; and (5) the primary business operated by the combined company became the business that was operated by Galaxy. Galaxy is a manufacturer and U.S. distributor of interactive learning technology hardware and software that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxys products include Galaxys own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. New technologies like Galaxys own SAM series touchscreen panels are sold along with renowned brands such as Google Chromebooks, Microsoft Surface Tablets, Lenovo & Acer computers, Verizon WiFi and more. Galaxys distribution channel consists of approximately 25 resellers across the U.S. who primarily sell its products within the commercial and educational market. Galaxy does not control where the resellers focus their resell efforts; however, the K-12 education market is the largest customer base for Galaxy products comprising nearly 90% of Galaxys sales. In addition, Galaxy also possesses its own reseller channel where it sells directly to the K-12 market, primarily throughout the Southeast region of the United States. As disclosed in Note 11, the Entertainment segment was sold effective on February 6, 2019 in exchange for 38,625 Galaxy common shares. |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. Any reference in these footnotes to applicable guidance is meant to refer to the authoritative U.S. generally accepted accounting principles (GAAP) as found in the Accounting Standards Codification (ASC) and Accounting Standards Update (ASU) of the Financial Accounting Standards Board (FASB). Due to the change in year-end, the Companys fiscal year 2018 is shortened from 12 months to 3 months and is ending on June 30, 2018. Further, the financial statements as of June 30, 2018 represent the financial information of the Company subsequent to the acquisition. The financial statements for the three-month and nine-month period ending March 31, 2018 represent the financial information of the Company prior to the acquisition. All intercompany transactions and accounts have been eliminated in the consolidation. The Companys financial reporting segments are Technology (reflecting the operations of Galaxy) and Entertainment (reflecting the operations of the movie theater). The Company is an over-the-counter public company traded under the stock symbol listing GAXY (formerly FLCR). |
Segment Reporting | Segment Reporting With the reverse merger between Galaxy and FLCR on June 22, 2018, the Company has identified two reportable segments: Technology and Entertainment. Segment determination is based on the internal organization structure, management of operations and performance evaluation by management and the Companys Board of Directors. Separate management of each segment is required because each business unit is subject to different operational issues and strategies. The Technology segment sells interactive learning technology hardware and software that allows the presenter and participant to engage in a fully collaborative instructional environment. Galaxys products include Galaxys own private-label interactive touch screen panel as well as numerous other national and international branded peripheral and communication devices. The Entertainment segment owns and operates Georgetown 14 Cinemas, a fourteen-theater movie complex located in Indianapolis, Indiana. Entertainment generates revenues from movie ticket sales and concessions. As part of the merger agreement, the parties have the right to spinout the Entertainment segment to the prior shareholders of FLCR. Management plans to implement the spinout in order to focus on its primary business plan, which is Galaxy. As disclosed in Note 11, the Entertainment segment was sold to an entity with a common board member, effective February 6, 2019. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates used in preparing the consolidated financial statements include those assumed in computing the allowance for doubtful accounts, inventory reserves, product warranty liabilities, and the valuation of deferred tax assets. It is reasonably possible that the significant estimates used will change within the next year. |
Capital Structure | Capital Structure In accordance with ASC 505, Equity, the Companys capital structure is as follows: March 31, 2019 Authorized Issued Outstanding Common stock 4,000,000,000 10,284,505 9,993,609 $.0001 par value, one vote per share Preferred stock 200,000,000 - - Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common June 30, 2018 Authorized Issued Outstanding Common stock 4,000,000,000 9,655,813 9,655,813 $.0001 par value, one vote per share Preferred stock 200,000,000 - - Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common There is no publicly traded market for the preferred shares. |
Business Combinations | Business Combinations The Company accounts for business combinations under the acquisition method of accounting. Under this method, acquired assets, including separately identifiable intangible assets, and any assumed liabilities are recorded at their acquisition date estimated fair value. The excess of purchase price over the fair value amounts assigned to the assets acquired and liabilities assumed represents the goodwill amount resulting from the acquisition. Determining the fair value of assets acquired and liabilities assumed involves the use of significant estimates and assumptions. Concurrent with the reverse triangular merger, the Company applied pushdown accounting. Pushdown accounting refers to the use of the acquirers basis in the preparation of the acquirees separate financial statements as the new basis of accounting for the acquiree. See Note 11 for a discussion of the merger and the related impact on the Companys consolidated financial statements. |
Revenue Recognition | Revenue Recognition Technology Interactive Panels and Related Products The Company derives revenue from the sale of interactive panels and other related products. Sales of these panels may also include optional equipment, accessories and services (installation, training and other services, including maintenance services and/or an extended warranty). Product sales and installation revenue are recognized when all of the following criteria have been met: (1) products have been shipped or customers have purchased and accepted title to the goods; service revenue for installation of products sold is recognized as the installation services are performed, (2) persuasive evidence of an arrangement exists, (3) the price to the customer is fixed, and (4) collectability is reasonably assured. Deferred revenue consists of customer deposits and advance billings of the Companys products where sales have not yet been recognized. Shipping and handling costs billed to customers are included in revenue in the accompanying statements of operations. Costs incurred by the Company associated with shipping and handling are included in cost of sales in the accompanying statements of operations. Sales are recorded net of sales returns and discounts, and sales are presented net of sales-related taxes. Because of the nature and quality of the Companys products, the Company provides for the estimated costs of warranties at the time revenue is recognized for a period of five years after purchase as a secondary warranty. The manufacturer also provides a warranty against certain manufacturing and other defects. As of the nine-month period ended March 31, 2019 and the period ended June 30, 2018, the Company accrued $1,350 for estimated product warranty claims, which is included in accrued expenses in the accompanying balance sheets. The accrued warranty costs are based primarily on historical experience of actual warranty claims as well as current repair costs. There were no warranty claim expenses during the period ended March 31, 2019. There was $1,350 of warranty expenses for the period ended March 31, 2018. Product sales resulting from fixed-price contracts involve a signed contract for a fixed price or a binding purchase order to provide the Companys interactive panels and accessories. Contract arrangements exclude a right of return for delivered items. Product sales resulting from fixed-price contracts are generated from multiple-element arrangements that require separate units of accounting and estimates regarding the fair value of individual elements. The Company has determined that its multiple-element arrangements that qualify as separate units of accounting are (1) product sales and (2) installation and related services. There is objective and reliable evidence of fair value for both the product sales and installation services and allocation of arrangement consideration for each of these units is based on their relative fair values. Each of these elements represent individual units of accounting, as the delivered item has value to a customer on a stand-alone basis. The Companys products can be sold on a stand-alone basis to customers which provides objective evidence of the fair value of the product portion of the multi-element contract, and thus represents the Companys best estimate of selling price. The fair value of installation services is separately calculated using expected costs of installation services. Many times, the value of installation services is calculated using price quotations from subcontractors to the Company who perform installation services on a stand-alone basis. The Company sells equipment with embedded software to its customers. The embedded software is not sold separately, and it is not a significant focus of the Companys marketing efforts. The Company does not provide post-contract customer support specific to the software or incur significant costs that are within the scope of Financial Accounting Standards Board (FASB) guidance on accounting for software to be leased or sold. Additionally, the functionality that the software provides is marketed as part of the overall product. The software embedded in the equipment is incidental to the equipment as a whole. Entertainment Theater Ticket Sales and Concessions Revenues are generated principally through admissions and concessions sales with proceeds received in cash or via credit card at the point of sale. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers cash and cash equivalents to be cash in all bank accounts, including money market and temporary investments that have an original maturity of three months or less. From time to time, the Company has on deposit, in institutions whose accounts are insured by the Federal Deposit Insurance Corporation, funds in excess of the insured maximum. The at-risk amount is subject to significant fluctuation daily throughout the year. The Company has never experienced any losses related to these balances, and as such, the Company does not believe it is exposed to any significant risk. |
Accounts Receivable | Accounts Receivable The Company reports accounts receivable at invoiced amounts less an allowance for doubtful accounts. Interest is not charged on past due accounts. Management reviews each receivable balance and estimates that portion, if any, of the balance that will not be collected. The carrying amount of the accounts receivable is then reduced by an allowance based on managements estimate. Management deemed no allowance for doubtful accounts was necessary at March 31, 2019 or June 30, 2018. |
Inventories | Inventories Inventory is stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out (FIFO) method of accounting. All inventory at March 31, 2019 and June 30, 2018, represents goods available for sale. Galaxy inventory is mostly comprised of interactive panels and accessories while FLCR inventory consists of concession inventory such as popcorn, soft drinks, and candy. Management estimates no obsolete or slow-moving inventory reserves at March 31, 2019 or June 30, 2018. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation. Expenditures for repairs and maintenance are charged to expense as incurred and additions and improvements that significantly extend the lives of assets are capitalized. Upon sale or other retirement of depreciable property, the cost and accumulated depreciation are removed from the related accounts and any gain or loss is reflected in operations. Property and equipment at March 31, 2019 and June 30, 2018, and the estimated useful lives used in computing depreciation, are as follows: Building 40 years Building improvements 8 years Vehicles 5 years Equipment 5 8 years Furniture and fixtures 5 years Depreciation is provided using the straight-line method over the estimated useful lives of the depreciable assets. Depreciation expense was $38,220 and $17,667 for the three-month periods ended March 31, 2019 and 2018, respectively. Depreciation expense was $216,642 and $14,547 for the nine-month periods ended March 31, 2019 and 2018, respectively. |
Long-lived Assets | Long-lived Assets Long-lived assets to be held and used are tested for recoverability whenever events or changes in circumstances indicate that the related carrying amount may not be recoverable. When required, impairment losses on assets to be held and used are recognized based on the excess of the assets carrying amount over the fair value of the asset. |
Goodwill | Goodwill Goodwill is not amortized, but is reviewed for impairment at least annually, or more frequently when events or changes in circumstances indicate that the carrying value may not be recoverable. Judgments regarding indicators of potential impairment are based on market conditions and operational performance of the business. At each fiscal year-end, the Company performs an impairment analysis of goodwill. The Company may assess its goodwill for impairment initially using a qualitative approach to determine whether conditions exist to indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value. If management concludes, based on its assessment of relevant events, facts and circumstances that it is more likely than not that a reporting units carrying value is greater than its fair value, then a goodwill impairment charge is recognized for the amount in excess, not to exceed the total amount of goodwill allocated to that reporting unit. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and no further testing is required. An impairment charge is recorded as a general and administrative expense within the Companys statement of operations. |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Current income taxes are recognized for the estimated income taxes payable or receivable on taxable income or loss from the current year and any adjustment to income taxes payable related to previous years. Current income taxes are determined using tax rates and tax laws that have been enacted or subsequently enacted by the year-end date. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. Under the asset and liability method the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion or all of the deferred tax asset will not be recognized. Prior to the merger, Galaxy was organized as a Subchapter S Corporation under the Internal Revenue Code. There was no provision for federal and state income taxes for the three-month or nine-month periods ended March 31, 2018 since the proportionate share of the taxable income or loss was included in the tax returns of the stockholders. However, upon completion of the merger, Galaxy consequently changed to a C Corporation. |
Research and Development | Research and Development The Company accounts for research and development (R&D) costs in accordance with the Research and Development topic of the ASC. Under the Research and Development topic of the ASC, all R&D costs must be charged to expense as incurred. Accordingly, internal R&D costs are expensed as incurred. Third-party R&D costs are expensed when the contracted work has been performed. |
Stock-based Compensation | Stock-based Compensation The Company records stock-based compensation in accordance with the provisions set forth in ASC 718, Stock Compensation |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In January 2017, the FASB issued ASU No. 2017-01 Business Combinations (Topic 805)-Clarifying the Definition of a Business. This guidance changes the definition of a business to assist entities in evaluating when a set of transferred assets and activities constitutes a business. The guidance requires an entity to evaluate if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the set of transferred assets and activities is not a business. The guidance also requires a business to include at least one substantive process and narrows the definition of outputs by more closely aligning it with how outputs are described in Accounting Standards Codification (ASC 606) Revenue from Contracts with Customers. The new standard is effective for public entities beginning in fiscal years starting after December 15, 2017. We adopted this standard during the quarter ended December 31, 2018. There was no significant impact on our financial statements as a result of adopting this standard. In August 2017, FASB issued ASU No. 2017-12 Derivatives and Hedging (Topic 815)Targeted Improvements to Accounting for Hedging Activities. This guidance eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires, for qualifying hedges, the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also modifies the accounting for components excluded from the assessment of hedge effectiveness, eases documentation and assessment requirements and modifies certain disclosure requirements. The new standard is effective for public entities in fiscal years beginning after December 15, 2018. Early adoption is permitted. The Company is assessing the impact of this standard on its financial statements. In August 2018, the U.S. Securities and Exchange Commission ("SEC") adopted the final rule under SEC Release No. 33-10532 Disclosure Update and Simplification, to eliminate or modify certain disclosure rules that are redundant, outdated, or duplicative of U.S. GAAP or other regulatory requirements. Among other changes, the amendments eliminated the annual requirement to disclose the high and low trading prices of our common stock. In addition, the amendments provide that disclosure requirements related to the analysis of shareholders' equity are expanded for interim financial statements. An analysis of the changes in each caption of shareholders' equity presented in the balance sheet must be provided in a note or separate statement, as well as the amount of dividends per share for each class of shares. This rule was effective on November 5, 2018; and we adopted this guidance during the quarter ended December 31, 2018 with no impact on the financial statements presented in accordance with generally accepted accounting principles. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of Capital Structure | In accordance with ASC 505, Equity, the Companys capital structure is as follows: March 31, 2019 Authorized Issued Outstanding Common stock 4,000,000,000 10,284,505 9,993,609 $.0001 par value, one vote per share Preferred stock 200,000,000 - - Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common June 30, 2018 Authorized Issued Outstanding Common stock 4,000,000,000 9,655,813 9,655,813 $.0001 par value, one vote per share Preferred stock 200,000,000 - - Preferred stock - Class A 750,000 - - $.0001 par value; no voting rights Preferred stock - Class B 1,000,000 - - Voting rights of 10 votes for 1 Preferred B share; 2% preferred dividend payable annually Preferred stock - Class C 9,000,000 - - $.0001 par value; 500 votes per share, convertible to common |
Schedule of Useful lives of Property and Equipment | Property and equipment at March 31, 2019 and June 30, 2018, and the estimated useful lives used in computing depreciation, are as follows: Building 40 years Building improvements 8 years Vehicles 5 years Equipment 5 8 years Furniture and fixtures 5 years |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment are comprised of the following: March 31, 2019 June 30, 2018 Land and buildings $ - $ 4,937,069 Building improvements - 363,083 Vehicles 92,353 92,353 Equipment - 1,470,709 Furniture and fixtures - 12,598 92,353 6,875,812 Accumulated depreciation (60,970) (2,621,361) Property and equipment, net $ 31,383 $ 4,254,451 |
Notes Payable (Tables)
Notes Payable (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Notes Payable | The Company's long term notes payable obligations to unrelated parties are as follows as of March 31, 2019 and June 30, 2018: March 31, 2019 June 30, 2018 The Company has a note payable with a bank. The note bears interest at 3.10% and matures in June 2019. The note is guaranteed by a stockholder and collateralized by a certificate of deposit owned by a related party. In May 2018, 50,000 shares of stock were issued to the related party in exchange for a $100,000 reduction in the short-term note balance. $ 274,900 $ 275,000 Note payable to an individual executed March 2018 in which the note accrues interest on the original principal balance at a rate of 6.25% annually. Interest is paid annually with principal due March 2021. - 75,000 Mortgage payable assumed in acquisition; interest payable at 4.75% monthly payments of $34,435 through December 31, 2016. The note payable was modified during the year ended December 31, 2017. After the modification, the interest rate was modified to 2.5% annually with monthly payment of $15,223 through July 15, 2020, and a balloon payment at maturity. The mortgage payable is secured by the building and land as well as guarantees by related parties. - 4,512,710 Note payable to a financial institution for acquisition of vehicle with monthly installment of $153 maturing June 2022. - 6,150 Capital leases for 3 delivery vehicles with monthly installments from $253 to $461, including 4% to 4.75% interest, maturing over 5-year terms expiring between April 2019 and July 2020. 7,839 17,668 Total Non-Related Party Notes Payable 282,739 4,886,528 Current Portion of Non-Related Party Notes Payable 281,045 362,181 Long-term Portion of Non-Related Party Notes Payable $ 1,694 $ 4,524,347 |
Schedule of Minimum Future Principal Payments | Future minimum principal payments on the non-related party long term notes payable are as follows: Period ending March 31, 2020 $ 281,045 2021 1,694 $ 282,739 |
Schedule of Short-term Notes Payable | The Company's short term notes payable obligations to unrelated parties assumed in the acquisition (Note 11) are as follows as of March 31, 2019 and June 30, 2018: March 31, 2019 June 30, 2018 Note payable to individual and bears interest at a rate of 8% interest annually and is due on demand. $ - $ 20,000 Note payable to individual and bears interest at a rate of 8% interest annually and is due on demand. - 10,000 Note payable to an individual in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and due on demand. - 60,000 Note payable to an individual in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and was scheduled to mature in August 2018. The term was extended for another year. - 25,000 Note payable to an individual in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and is due on demand. - 25,000 Note payable to an individual in which the note accrues interest on the original principal balance at a rate of 10% interest annually and is due on demand. - 25,000 Total Short Term Non-Related Party Notes Payable $ - $ 165,000 |
Schedule of Convertible Notes Payable | Convertible Notes Payable March 31, 2019 June 30, 2018 On November 30, 2018, the Company signed a convertible promissory note with an investment firm. The $400,000 note was issued at a discount of $40,000 and bears interest at 5% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in May 2019. The note matures in August 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. As of March 31, 2019, the outstanding principal balance of the note is $400,000, with an unamortized debt discount of $22,222. $ 377,778 $ - On January 16, 2019, the Company signed a convertible promissory note with an investment firm. The $382,000 note was issued at a discount of $38,200 and bears interest at 12% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in June 2019. The note matures in July 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. As of March 31, 2019, the outstanding principal balance of the note is $382,000, with an unamortized debt discount of $21,829. 360,171 - On February 20, 2019, the Company signed a convertible promissory note with an investment firm. The $225,000 note was issued at a discount of $22,500 and bears interest at 12% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in August 2019. The note matures in August 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. As of March 31, 2019, the outstanding principal balance of the note is $225,000, with an unamortized debt discount of $16,071. 208,929 - On February 22, 2019, the Company signed a convertible promissory note with an investment firm. The $200,000 note was issued at a discount of $20,000 and bears interest at 5% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share, beginning in August 2019. The note matures in November 2019. The note has prepayment penalties ranging from 110% to 125% of the principal and interest outstanding if repaid within 60 to 180 days from issuance. As of March 31, 2019, the outstanding principal balance of the note is $200,000, with an unamortized debt discount of $15,556. 184,444 - On March 28, 2019, the Company signed a convertible promissory note with an investment firm. The $225,000 note was issued at a discount of $20,000 and bears interest at 10% per year. The loan principal and interest are convertible into shares of common stock at the lower of (a) 70% of the lowest traded price of the common stock during the 20 trading days immediately preceding the notice of conversion or (b) $3 per share. The note matures in March 2020. - - Total Convertible Notes Payable 1,131,322 - Current Portion of Convertible Notes Payable 1,131,322 - Long-term Portion of Convertible Notes Payable $ - $ - |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of Notes Payable Obligations to Related Parties Assumed in Acquisition | The Company's notes payable obligations to related parties assumed in the acquisition (Note 11) are as follows as of March 31, 2019 and June 30, 2018: March 31, 2019 June 30, 2018 Various notes payable to a related party in which the notes accrue interest on the original principal balance at a rate of 8% interest annually and is due on demand. Five of these notes were converted into common stock in accordance with a board resolution at a rate of $.01 per share. One note did not convert. $ - $ 15,000 Various notes payable to a related party in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and was scheduled to mature in October 2017 and is currently due on demand. - 91,000 Note payable to a related party in which the note accrues interest on the original principal balance at a rate of 6.25% interest annually and is due in August 2019. - 8,000 Notes payable to a related party in which the note bears no interest and is scheduled to mature on demand. - 25,000 Note payable to a related party in which the note accrues interest on the original principal balance at a rate of 9% interest annually and is scheduled to mature in October 2019. - 125,000 Note payable to an individual executed February 2018 in which the note accrues interest on the original principal balance at a rate of 18% annually and is due on demand. - 10,000 Various notes payable to a related party in which the note accrues interest on the original principal balance at a rate of 10% interest annually through December 31, 2016 at which time the interest rate was reduced to 6.25% interest annually. The notes are scheduled to mature at various dates through July 2021. - 211,534 Total Related Party Notes Payable - 485,534 Current Portion of Related Party Notes Payable - 485,534 Long-term Portion of Related Party Notes Payable $ - $ - |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | The Companys effective tax rate differed from the federal statutory income tax rate for the period ended March 31, 2019 is as follows: Federal statutory rate 21% State tax, net of federal tax effect 5.25% Valuation allowance -26.25% Effective tax rate 0% |
Reverse Acquisition (Tables)
Reverse Acquisition (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Business Combinations [Abstract] | |
Schedule of preliminary allocation of fair value of assets and liabilities | The following table summarizes the preliminary allocation of the fair value of the assets and liabilities as of the merger date through pushdown accounting. The preliminary allocation to certain assets and/or liabilities may be adjusted by material amounts as the Company continues to finalize the fair value estimates. Assets Cash $ 22,205 Property and equipment 4,209,995 Other 20,716 Other assets 1,511,844 Goodwill 834,220 Total Assets 6,598,980 Liabilities Accounts payable 208,763 Long-term debt 4,593,851 Short-term debt 799,534 Accrued interest 78,948 Other 83,664 Total Liabilities 5,764,760 Net Assets $ 834,220 Consideration $ - Fair value of noncontrolling interests 834,220 $ 834,220 |
Schedule of identifiable assets and liabilities | The following table presents a summary of Entertainments identifiable assets and liabilities at February 6, 2019, the date of the sale: Assets Cash $ 36,290 Property and equipment, net 4,006,426 Receivables 4,500 Inventories 5,610 Other assets 1,522,714 Total Assets 5,575,540 Liabilities Accounts payable 22,424 Debt 5,393,620 Accrued expenses 127,484 Total Liabilities 5,543,528 Net Assets 32,012 Noncash consideration for net assets of Entertainment 92,700 Gain on Sale $ 60,688 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Operating Information | The following table presents a summary of operating information for the nine-month period ended March 31, 2019 for technology and the period from January 1, 2019 to February 6, 2019 for entertainment: Revenues Technology Entertainment Technology $ 1,106,540 $ - Entertainment - 589,705 Cost of Sales Technology 948,073 - Entertainment - 217,638 Gross Profit 158,467 372,067 General and Administrative Expenses Technology 3,897,139 - Entertainment - 511,812 Other Income (Expense) Technology (100,672) - Entertainment - 109,811 Net Loss $ (3,839,344) $ (29,934) |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Feb. 06, 2019 | Jun. 30, 2018 | |
Accounting Policies [Abstract] | ||||||
Increase in Authorized shares of Common stock | 4,200,000,000 | 4,200,000,000 | ||||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Accrued Expense | $ 1,350 | $ 1,350 | $ 1,350 | |||
Warranty expenses | $ 1,350 | |||||
Depreciation expense | $ 38,220 | $ 17,667 | $ 216,642 | $ 14,547 | ||
Number of Common shares exchange | 38,625 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Schedule of Capital Structure) (Details) - $ / shares | Mar. 31, 2019 | Jun. 30, 2018 |
Common Stock, Shares Authorized | 4,000,000,000 | 4,000,000,000 |
Common Stock, Shares, Issued | 10,284,505 | 9,655,813 |
Common Stock, Shares, Outstanding | 9,993,609 | 9,655,813 |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Authorized | 200,000,000 | 200,000,000 |
Preferred Class A [Member] | ||
Preferred Stock, Shares Authorized | 750,000 | 750,000 |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Preferred Class B [Member] | ||
Preferred Stock, Shares Authorized | 1,000,000 | 1,000,000 |
Preferred Class C [Member] | ||
Preferred Stock, Shares Authorized | 9,000,000 | 9,000,000 |
Preferred Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Schedule of Useful lives of Property and Equipment) (Details) | 3 Months Ended | 9 Months Ended |
Jun. 30, 2018 | Mar. 31, 2019 | |
Building [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 40 years | 40 years |
Building Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 8 years | 8 years |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Minimum [Member] | Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Maximum [Member] | Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 8 years | 8 years |
Property and Equipment (Narrati
Property and Equipment (Narrative) (Details) | Feb. 06, 2019shares |
Property, Plant and Equipment [Abstract] | |
Number of Common shares exchange | 38,625 |
Property and Equipment (Schedul
Property and Equipment (Schedule of Property and Equipment) (Details) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 92,353 | $ 6,875,812 |
Accumulated depreciation | (60,970) | (2,621,361) |
Property and equipment, net | 31,383 | 4,254,451 |
Land and buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 4,937,069 | |
Building improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 363,083 | |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 92,353 | 92,353 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 1,470,709 | |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 12,598 |
Line of Credit (Details)
Line of Credit (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2017 | Jun. 30, 2018 | |
Line of Credit Facility [Abstract] | |||
Line of credit maximum borrowing capacity | $ 1,250,000 | ||
Interest rate basis | prime plus 0.5% | ||
Interest rate | 6.00% | 2.50% | 5.50% |
Debt maturity | Dec. 31, 2019 | Jul. 15, 2020 | |
Line of credit | $ 1,230,550 | $ 547,603 | |
Minimum average bank balance | $ 50,000 | ||
Percentage of curtailment of outstanding balance | 20.00% |
Notes Payable (Narrative) (Deta
Notes Payable (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||
Mar. 28, 2019 | Feb. 22, 2019 | Feb. 20, 2019 | Jan. 16, 2019 | Nov. 30, 2018 | May 31, 2018 | Mar. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2017 | Feb. 06, 2019 | Jun. 30, 2018 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 1,694 | $ 1,694 | $ 15,223 | $ 4,524,347 | ||||||||
Interest rate | 6.00% | 6.00% | 2.50% | 5.50% | ||||||||
Debt maturity | Dec. 31, 2019 | Jul. 15, 2020 | ||||||||||
Share Issued | 50,000 | |||||||||||
Stock issued in excahnge of reduction in short- term notes value | $ 100,000 | $ 637,000 | ||||||||||
Accrued interest | 4.00% | 4.00% | ||||||||||
Number of Common shares exchange | 38,625 | |||||||||||
Individual [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt maturity | Mar. 31, 2021 | |||||||||||
Accrued interest | 6.25% | 6.25% | ||||||||||
Convertible Notes Payable [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 400,000 | $ 400,000 | $ 400,000 | |||||||||
Debt discount | $ 40,000 | 22,222 | 22,222 | |||||||||
Interest rate | 5.00% | |||||||||||
Debt maturity | Aug. 31, 2019 | |||||||||||
Interest expense | $ 40,578 | $ 45,022 | ||||||||||
Percentage of lowest traded price | 70.00% | |||||||||||
Conversion price | $ 3 | |||||||||||
Convertible Notes Payable [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Prepayment penalties, percentage | 110.00% | |||||||||||
Convertible Notes Payable [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Prepayment penalties, percentage | 125.00% | |||||||||||
Bank [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate | 3.10% | 3.10% | ||||||||||
Debt maturity | Jun. 30, 2019 | |||||||||||
Mortgage Payable [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 34,435 | |||||||||||
Interest rate | 4.75% | |||||||||||
Financial Institution [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 153 | $ 153 | ||||||||||
Debt maturity | Jun. 30, 2022 | |||||||||||
Financial Institution [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 253 | $ 253 | ||||||||||
Interest rate | 4.00% | 4.00% | ||||||||||
Debt maturity | Apr. 30, 2019 | |||||||||||
Financial Institution [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 461 | $ 461 | ||||||||||
Interest rate | 4.75% | 4.75% | ||||||||||
Debt maturity | Jul. 31, 2020 | |||||||||||
Notes Payable [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate | 8.00% | 8.00% | ||||||||||
Notes Payable One [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate | 8.00% | 8.00% | ||||||||||
Notes Payable Two [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate | 6.25% | 6.25% | ||||||||||
Notes Payable Three [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate | 6.25% | 6.25% | ||||||||||
Debt maturity | Aug. 31, 2018 | |||||||||||
Notes Payable Four [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate | 6.25% | 6.25% | ||||||||||
Notes Payable Five [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate | 10.00% | 10.00% | ||||||||||
Convertible Notes Payable one [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 382,000 | $ 382,000 | $ 382,000 | |||||||||
Debt discount | $ 38,200 | 21,829 | 21,829 | |||||||||
Interest rate | 12.00% | |||||||||||
Debt maturity | Jun. 30, 2019 | |||||||||||
Percentage of lowest traded price | 70.00% | |||||||||||
Conversion price | $ 3 | |||||||||||
Convertible Notes Payable one [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Prepayment penalties, percentage | 110.00% | |||||||||||
Convertible Notes Payable one [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Prepayment penalties, percentage | 125.00% | |||||||||||
Convertible Notes Payable Two [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 225,000 | 225,000 | 225,000 | |||||||||
Debt discount | $ 22,500 | 16,071 | 16,071 | |||||||||
Interest rate | 12.00% | |||||||||||
Debt maturity | Aug. 31, 2019 | |||||||||||
Percentage of lowest traded price | 70.00% | |||||||||||
Conversion price | $ 3 | |||||||||||
Convertible Notes Payable Two [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Prepayment penalties, percentage | 110.00% | |||||||||||
Convertible Notes Payable Two [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Prepayment penalties, percentage | 125.00% | |||||||||||
Convertible Notes Payable Three [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 200,000 | 200,000 | 200,000 | |||||||||
Debt discount | $ 20,000 | $ 15,556 | $ 15,556 | |||||||||
Interest rate | 5.00% | |||||||||||
Debt maturity | Nov. 30, 2019 | |||||||||||
Percentage of lowest traded price | 70.00% | |||||||||||
Conversion price | $ 3 | |||||||||||
Convertible Notes Payable Three [Member] | Minimum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Prepayment penalties, percentage | 110.00% | |||||||||||
Convertible Notes Payable Three [Member] | Maximum [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Prepayment penalties, percentage | 125.00% | |||||||||||
Convertible Notes Payable Four [Member] | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Notes Payable | $ 225,000 | |||||||||||
Debt discount | $ 20,000 | |||||||||||
Interest rate | 10.00% | |||||||||||
Debt maturity | Mar. 31, 2020 | |||||||||||
Percentage of lowest traded price | 70.00% | |||||||||||
Conversion price | $ 3 |
Notes Payable (Schedule of long
Notes Payable (Schedule of long-term Notes Payable) (Details) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | |||
Total Non-Related Party Notes Payable | $ 282,739 | $ 4,886,528 | |
Current Portion of Non-Related Party Notes Payable | 281,045 | 362,181 | |
Long-term Portion of Non-Related Party Notes Payable | 1,694 | 4,524,347 | $ 15,223 |
Notes Payable [Member] | |||
Debt Instrument [Line Items] | |||
Total Non-Related Party Notes Payable | 274,900 | 275,000 | |
Notes Payable One [Member] | |||
Debt Instrument [Line Items] | |||
Total Non-Related Party Notes Payable | 75,000 | ||
Notes Payable Two [Member] | |||
Debt Instrument [Line Items] | |||
Total Non-Related Party Notes Payable | 4,512,710 | ||
Notes Payable Three [Member] | |||
Debt Instrument [Line Items] | |||
Total Non-Related Party Notes Payable | 6,150 | ||
Notes Payable Four [Member] | |||
Debt Instrument [Line Items] | |||
Total Non-Related Party Notes Payable | $ 7,839 | $ 17,668 |
Notes Payable (Schedule of Futu
Notes Payable (Schedule of Future minimum principal payments on the non-related party long term notes payable) (Details) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Debt Disclosure [Abstract] | ||
2020 | $ 281,045 | |
2021 | 1,694 | |
Long-term Debt | $ 282,739 | $ 4,886,528 |
Notes Payable (Schedule of Shor
Notes Payable (Schedule of Short-term Notes Payable) (Details) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Debt Instrument [Line Items] | ||
Total Short Term Non-Related Party Notes Payable | $ 165,000 | |
Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Total Short Term Non-Related Party Notes Payable | 20,000 | |
Notes Payable One [Member] | ||
Debt Instrument [Line Items] | ||
Total Short Term Non-Related Party Notes Payable | 10,000 | |
Notes Payable Two [Member] | ||
Debt Instrument [Line Items] | ||
Total Short Term Non-Related Party Notes Payable | 60,000 | |
Notes Payable Three [Member] | ||
Debt Instrument [Line Items] | ||
Total Short Term Non-Related Party Notes Payable | 25,000 | |
Notes Payable Four [Member] | ||
Debt Instrument [Line Items] | ||
Total Short Term Non-Related Party Notes Payable | 250,000 | |
Notes Payable Five [Member] | ||
Debt Instrument [Line Items] | ||
Total Short Term Non-Related Party Notes Payable | $ 25,000 |
Notes Payable (Schedule of Conv
Notes Payable (Schedule of Convertible Notes Payable) (Details) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Debt Instrument [Line Items] | ||
Total Convertible Notes Payable | $ 1,131,322 | |
Current Portion of Convertible Notes Payable | 1,131,322 | |
Long-term Portion of Convertible Notes Payable | ||
Convertible Notes Payable [Member] | ||
Debt Instrument [Line Items] | ||
Total Convertible Notes Payable | 377,778 | |
Convertible Notes Payable one [Member] | ||
Debt Instrument [Line Items] | ||
Total Convertible Notes Payable | 360,171 | |
Convertible Notes Payable Two [Member] | ||
Debt Instrument [Line Items] | ||
Total Convertible Notes Payable | 208,929 | |
Convertible Notes Payable Three [Member] | ||
Debt Instrument [Line Items] | ||
Total Convertible Notes Payable | 184,444 | |
Convertible Notes Payable Four [Member] | ||
Debt Instrument [Line Items] | ||
Total Convertible Notes Payable |
Related Party Transactions (Nar
Related Party Transactions (Narrative) (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
May 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2017 | Feb. 06, 2019 | Jun. 30, 2018 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||||||||
Accrued interest | 4.00% | 4.00% | |||||||
Interest rate | 6.00% | 6.00% | 2.50% | 5.50% | |||||
Debt maturity | Dec. 31, 2019 | Jul. 15, 2020 | |||||||
Advances from shareholders | $ 260,173 | ||||||||
Collateral fee | $ 7,500 | ||||||||
Lease Expired | Dec. 31, 2018 | ||||||||
Operating Leases, Rent Expense | 21,646 | $ 10,500 | $ 24,634 | $ 14,169 | |||||
Share Issued | 50,000 | ||||||||
Stock issued in excahnge of reduction in short- term notes value | $ 100,000 | 637,000 | |||||||
Short term commercial deposite | $ 375,000 | $ 375,000 | |||||||
Number of Common shares exchange | 38,625 | ||||||||
Related Party Note Payable - 1 [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Accrued interest | 8.00% | 8.00% | |||||||
Conversion price | $ 0.01 | $ 0.01 | |||||||
Related Party Note Payable - 2 [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Accrued interest | 6.25% | 6.25% | |||||||
Debt maturity | Oct. 31, 2017 | ||||||||
Related Party Note Payable - 3 [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Accrued interest | 6.25% | 6.25% | |||||||
Debt maturity | Aug. 31, 2019 | ||||||||
Related Party Note Payable - 5 [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Accrued interest | 9.00% | 9.00% | |||||||
Debt maturity | Aug. 31, 2019 | ||||||||
Related Party Note Payable - 6 [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Accrued interest | 18.00% | 18.00% | |||||||
Related Party Note Payable - 7 [Member] | |||||||||
Related Party Transaction [Line Items] | |||||||||
Accrued interest | 10.00% | ||||||||
Interest rate | 6.25% | 6.25% | |||||||
Debt maturity | Jul. 31, 2021 |
Related Party Transactions (Sch
Related Party Transactions (Schedule of Notes Payable Obligations to Related Parties Assumed in Acquisition) (Details) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Related Party Transaction [Line Items] | ||
Related Party Notes Payable | $ 485,534 | |
Current Portion of Related Party Notes Payable | 485,534 | |
Long-term Portion of Related Party Notes Payable | ||
Long-term Note Payable to Related Party - 1 [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Notes Payable | 15,000 | |
Long-term Note Payable to Related Party - 2 [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Notes Payable | 91,000 | |
Long-term Note Payable to Related Party - 3 [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Notes Payable | 8,000 | |
Long-term Note Payable to Related Party - 4 [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Notes Payable | 25,000 | |
Long-term Note Payable to Related Party - 5 [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Notes Payable | 125,000 | |
Long-term Note Payable to Related Party - 6 [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Notes Payable | 100,000 | |
Long-term Note Payable to Related Party - 7 [Member] | ||
Related Party Transaction [Line Items] | ||
Related Party Notes Payable | $ 211,534 |
Lease Agreements (Narrative) (D
Lease Agreements (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2018 | |
Notes Payable | $ 1,694 | $ 1,694 | $ 15,223 | $ 4,524,347 | ||
Interest rate | 6.00% | 6.00% | 2.50% | 5.50% | ||
Debt maturity | Dec. 31, 2019 | Jul. 15, 2020 | ||||
Monthly lease payment | $ 1,500 | |||||
Operating Leases, Rent Expense | $ 21,646 | $ 10,500 | 24,634 | $ 14,169 | ||
Financial Institution [Member] | ||||||
Notes Payable | $ 153 | $ 153 | ||||
Debt maturity | Jun. 30, 2022 | |||||
Monthly lease payment | $ 1,066 | |||||
Lease term | 5 years | 5 years | ||||
Financial Institution [Member] | Minimum [Member] | ||||||
Notes Payable | $ 253 | $ 253 | ||||
Interest rate | 4.00% | 4.00% | ||||
Debt maturity | Apr. 30, 2019 | |||||
Financial Institution [Member] | Maximum [Member] | ||||||
Notes Payable | $ 461 | $ 461 | ||||
Interest rate | 4.75% | 4.75% | ||||
Debt maturity | Jul. 31, 2020 |
Equity (Details)
Equity (Details) - USD ($) | Feb. 05, 2019 | Dec. 19, 2018 | May 31, 2018 | Mar. 31, 2018 | Sep. 30, 2018 | Mar. 31, 2019 | Mar. 31, 2018 |
Class of Stock [Line Items] | |||||||
Reverse stock split | every 350 shares of common stock outstanding (1:350 Reverse Stock Split). | ||||||
Share Issued | 50,000 | ||||||
Proceeds from shares issuance | $ 637,000 | $ 104,226 | |||||
Share issued value | $ 100,000 | 637,000 | |||||
Commitment fees | $ 252,271 | ||||||
Shares issued for services | 300,000 | ||||||
Number of shares acquired | 38,625 | 38,625 | |||||
Private Placement [Member] | |||||||
Class of Stock [Line Items] | |||||||
Sale of Stock, Price Per Share | $ 2 | $ 2 | |||||
Share Issued | 1,500,000 | ||||||
Convertible debt holders [Member] | |||||||
Class of Stock [Line Items] | |||||||
Ownership percentage | 4.00% | ||||||
Preferred Class C [Member] | |||||||
Class of Stock [Line Items] | |||||||
Ownership percentage | 89.00% | ||||||
Shareholders [Member] | |||||||
Class of Stock [Line Items] | |||||||
Ownership percentage | 7.00% | ||||||
Investor [Member] | |||||||
Class of Stock [Line Items] | |||||||
Share Issued | 1,374,850 | ||||||
Proceeds from shares issuance | $ 2,004,500 | ||||||
Related Party [Member] | |||||||
Class of Stock [Line Items] | |||||||
Share Issued | 50,000 | ||||||
Reverse Stock Split shares issued | 143 | ||||||
Share issued value | $ 100,000 | ||||||
Board member and employee [Member] | |||||||
Class of Stock [Line Items] | |||||||
Share Issued | 75,511 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) | 9 Months Ended |
Mar. 31, 2019USD ($) | |
Operating Loss Carryforwards [Line Items] | |
Federal statutory rate | 21.00% |
Operating loss carry-forwards | $ 2,500,000 |
Operating Loss Carryforwards, Expiration Date | Dec. 31, 2038 |
Minimum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Federal statutory rate | 21.00% |
Maximum [Member] | |
Operating Loss Carryforwards [Line Items] | |
Federal statutory rate | 35.00% |
Income Taxes (Schedule of Effec
Income Taxes (Schedule of Effective Income Tax Rate Reconciliation) (Details) | 9 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Federal statutory rate | 21.00% |
State tax, net of federal tax effect | 5.25% |
Valuation allowance | (26.25%) |
Effective tax rate | 0.00% |
Commitments, Contingencies, a_2
Commitments, Contingencies, and Concentrations (Details) - Three customer [Member] | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Jun. 30, 2018 | |
Accounts receivable [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentrations risk | 76.00% | 87.00% | |||
Revenue [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentrations risk | 67.00% | 42.00% | 57.00% | 52.00% |
Material Agreements (Details)
Material Agreements (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2017 | |
Other Commitments [Line Items] | |||||
Consulting service fees and expense | $ 252,271 | ||||
Consulting Agreement [Member] | |||||
Other Commitments [Line Items] | |||||
Receivables from consulting service | $ 15,000 | 15,000 | |||
Consulting service fees and expense | 161,500 | $ 374,500 | |||
Maturity date | Jul. 31, 2019 | ||||
Consulting Agreement - Magellan FIN, LLC [Member] | |||||
Other Commitments [Line Items] | |||||
Receivables from consulting service | 15,000 | $ 15,000 | |||
Additional amount received from services | 4,000 | 4,000 | |||
Consulting service fees and expense | $ 23,000 | ||||
Maturity date | Apr. 30, 2019 | ||||
Common stock | 10,000 | ||||
Distribution Agreement [Member] | |||||
Other Commitments [Line Items] | |||||
Term period for agreement | 2 years | ||||
Purchase commitment amount | 2,000,000 | $ 2,000,000 | |||
Agency Agreement [Member] | |||||
Other Commitments [Line Items] | |||||
Consulting service fees and expense | |||||
Agency Agreement [Member] | Minimum [Member] | |||||
Other Commitments [Line Items] | |||||
Percentage of finder's fee | 4.00% | ||||
Agency Agreement [Member] | Maximum [Member] | |||||
Other Commitments [Line Items] | |||||
Percentage of finder's fee | 8.00% | ||||
Master Service Agreement [Member] | |||||
Other Commitments [Line Items] | |||||
Consulting service fees and expense | $ 75,000 | ||||
Common stock | 300,000 | ||||
Manufacturing and Distributorship Agreement [Member] | |||||
Other Commitments [Line Items] | |||||
Minimum purchase commitment | $ 4,000,000 | ||||
Maturity date | Dec. 31, 2019 |
Reverse Acquisition (Narrative)
Reverse Acquisition (Narrative) (Details) - USD ($) | Feb. 05, 2019 | Jun. 22, 2018 | Mar. 31, 2019 |
Business Acquisition [Line Items] | |||
Description of pre reverse stock split | every 350 shares of common stock outstanding (1:350 Reverse Stock Split). | ||
Number of shares exchanged | 38,625 | ||
Shares issued in acquisition | 38,625 | 38,625 | |
Shares issued in acquisition, value | $ 92,700 | ||
FLCR [Member] | |||
Business Acquisition [Line Items] | |||
Pre-reverse stock split | 3,065,000,000 | ||
Description of pre reverse stock split | 89% of the outstanding common stock of FLCR, with the remaining 11% of common stock distributed as follows: (a) an ownership interest of seven percent (7%) to the holders of common stock, pro rata; and (b) four percent (4%) of the common stock to the holders of convertible debt, pro rata. | ||
Net operating loss carryforward | $ 150,000 | ||
Term period for agreement | 5 years |
Reverse Acquisition (Schedule o
Reverse Acquisition (Schedule of preliminary allocation of fair value of assets and liabilities) (Details) - USD ($) | Mar. 31, 2019 | Jun. 30, 2018 |
Assets | ||
Goodwill | $ 834,220 | $ 892,312 |
FLCR [Member] | ||
Assets | ||
Cash | 22,205 | |
Property and equipment | 4,209,995 | |
Other | 20,716 | |
Other assets | 1,511,844 | |
Goodwill | 834,220 | |
Total Assets | 6,598,980 | |
Liabilities | ||
Accounts payable | 208,763 | |
Long-term debt | 4,593,851 | |
Short-term debt | 799,534 | |
Accrued interest | 78,948 | |
Other | 83,664 | |
Total Liabilities | 5,764,760 | |
Net Assets | 834,220 | |
Consideration | ||
Fair value of noncontrolling interests | 834,220 | |
Total Recongnized Identifiable Assets Acquired | $ 834,220 |
Reverse Acquisition (Schedule_2
Reverse Acquisition (Schedule of identifiable assets and liabilities) (Details) - USD ($) | Feb. 06, 2019 | Mar. 31, 2019 | Mar. 31, 2018 | Jun. 30, 2018 |
Assets | ||||
Property and equipment, net | $ 31,383 | $ 4,254,451 | ||
Inventory | 171,083 | 586,764 | ||
Total Assets | 1,149,773 | 7,784,986 | ||
Liabilities | ||||
Accounts payable | 555,459 | 771,080 | ||
Accrued expenses | 50,552 | 146,978 | ||
Total Liabilities | 3,250,622 | $ 7,482,716 | ||
Noncash consideration for net assets of Entertainment | (92,700) | |||
Gain on Sale | $ 60,688 | |||
Entertainment [Member] | ||||
Assets | ||||
Cash | $ 36,290 | |||
Property and equipment, net | 4,006,426 | |||
Receivables | 4,500 | |||
Inventory | 5,610 | |||
Other assets | 1,522,714 | |||
Total Assets | 5,575,540 | |||
Liabilities | ||||
Accounts payable | 22,424 | |||
Debt | 5,393,620 | |||
Accrued expenses | 127,484 | |||
Total Liabilities | 5,543,528 | |||
Net Assets | 32,012 | |||
Noncash consideration for net assets of Entertainment | 92,700 | |||
Gain on Sale | $ 60,688 |
Stock Plan (Details)
Stock Plan (Details) | 9 Months Ended |
Mar. 31, 2019USD ($) | |
Share-based Payment Arrangement [Abstract] | |
Proceeds from reserved for stock awards | $ 1,000,000 |
Segment Reporting (Schedule of
Segment Reporting (Schedule of Operating Information) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 348,723 | $ 304,947 | $ 1,717,353 | $ 2,148,955 |
Gross Profit | 63,575 | 68,704 | 551,642 | 381,354 |
General and Administrative Expenses | 2,043,181 | 566,137 | 4,408,951 | 1,562,009 |
Net Loss | $ (1,983,028) | $ (519,463) | (3,869,278) | $ (1,216,837) |
Technology [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 1,106,540 | |||
Cost of Sales | 948,073 | |||
Gross Profit | 158,467 | |||
General and Administrative Expenses | 3,897,139 | |||
Other Income (Expense) | (100,672) | |||
Net Loss | (3,839,344) | |||
Entertainment [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 589,705 | |||
Cost of Sales | 217,638 | |||
Gross Profit | 372,067 | |||
General and Administrative Expenses | 511,812 | |||
Other Income (Expense) | 109,811 | |||
Net Loss | $ (29,934) |
Going Concern (Details)
Going Concern (Details) - USD ($) | 9 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Jun. 30, 2018 | |
Disclosure of Going Concern [Abstract] | |||
Accumulated deficit | $ 6,676,846 | $ 2,807,568 | |
Cash used in operations | 2,408,441 | $ 878,034 | |
Working capital deficit | $ 3,000,000 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | May 01, 2019 | Apr. 29, 2019 | Apr. 18, 2019 | Mar. 31, 2019 | Dec. 31, 2017 | Jun. 30, 2018 |
Subsequent Event [Line Items] | ||||||
Notes Payable | $ 1,694 | $ 15,223 | $ 4,524,347 | |||
Interest rate | 6.00% | 2.50% | 5.50% | |||
Debt maturity | Dec. 31, 2019 | Jul. 15, 2020 | ||||
TPI Business Consultants, Inc [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Principal amount | $ 450,000 | |||||
Monthly payment | 15,000 | |||||
Subsequent Event [Member] | Promissory Note [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Notes Payable | $ 200,000 | |||||
Debt maturity | Jul. 31, 2019 | |||||
Principal amount | $ 10,000 | |||||
Subsequent Event [Member] | Convertible Promissory Note [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Notes Payable | $ 1,325,000 | |||||
Debt discount | $ 92,750 | |||||
Interest rate | 8.00% | |||||
Debt maturity | Apr. 30, 2020 | |||||
Percentage of lowest traded price | 75.00% | |||||
Conversion price | $ 2.75 | |||||
Subsequent Event [Member] | Two Convertible Notes [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Notes Payable | $ 736,484 |