Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 15, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | AiXin Life International, Inc. | |
Entity Central Index Key | 0000835662 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 49,999,891 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and equivalents | $ 7,638,444 | $ 7,676,689 |
Accounts receivable, net | ||
Other receivables and prepaid expenses | 35,090 | 32,323 |
Advance to suppliers | 157,338 | 155,686 |
Inventory | 147,074 | 45,535 |
Advance to related parties | 15,739 | |
Total current assets | 7,977,946 | 7,925,972 |
Property and equipment, net | 60,393 | 67,817 |
Operating lease right-of-use assets | 59,289 | 100,029 |
Total assets | 8,097,628 | 8,093,818 |
Current liabilities | ||
Accounts payable | 38,964 | 39,122 |
Unearned revenue | 2,746 | |
Taxes payable | 209,829 | 283,495 |
Accrued liabilities and other payables | 510,811 | 514,239 |
Operating lease liabilities - current | 35,019 | 70,780 |
Advance from related parties | 101,929 | 264,850 |
Total current liabilities | 899,298 | 1,172,486 |
Operating lease liabilities - non-current | 24,270 | 29,250 |
Total liabilities | 923,568 | 1,201,736 |
Stockholders' equity | ||
Undesignated preferred stock, $0.001 par value, 20,000,000 shares authorized, none issued and outstanding | ||
Common stock, par value $0.00001 per share, 500,000,000 shares authorized; 49,999,891 and 49,999,891 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively | 500 | 500 |
Additional paid in capital | 11,208,650 | 11,115,765 |
Statutory reserve | 151,988 | 151,988 |
Accumulated deficit | (4,743,009) | (4,964,711) |
Accumulated other comprehensive income | 555,931 | 588,540 |
Total stockholders' equity | 7,174,060 | 6,892,082 |
Total liabilities and stockholders' equity | $ 8,097,628 | $ 8,093,818 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Undesignated preferred stock, par value | $ 0.001 | $ 0.001 |
Undesignated preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Undesignated preferred stock, shares issued | ||
Undesignated preferred stock, shares outstanding | ||
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 49,999,891 | 49,999,891 |
Common stock, shares outstanding | 49,999,891 | 49,999,891 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Sales revenue: | ||
Total revenue, net | $ 698,158 | $ 611,163 |
Cost of goods sold | 135,659 | 25,448 |
Gross profit | 562,499 | 585,715 |
Operating expenses | ||
Selling | 53,194 | 79,714 |
General and administrative | 194,250 | 152,354 |
Provision for bad debts | 12,528 | |
Stock-based compensation | 92,885 | 92,885 |
Total operating expenses | 340,329 | 337,481 |
Income from operations | 222,170 | 248,234 |
Non-operating income (expenses) | ||
Interest income | 1,218 | 15 |
Other income | 160 | |
Other expense | (1,846) | (32) |
Total non-operating expenses, net | (468) | (17) |
Income before income tax | 221,702 | 248,217 |
Income tax expense | ||
Net income | 221,702 | 248,217 |
Other comprehensive items | ||
Foreign currency translation (loss) | (32,609) | (94,382) |
Comprehensive income | $ 189,093 | $ 153,835 |
Income per share - Basic and diluted | $ 0.004 | $ 0.003 |
Weighted average shares outstanding | 49,999,891 | 85,049,576 |
Products [Member] | ||
Sales revenue: | ||
Total revenue, net | $ 203,294 | $ 61,234 |
Advertising [Member] | ||
Sales revenue: | ||
Total revenue, net | $ 494,864 | $ 549,929 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid In Capital [Member] | Statutory Reserves [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Total |
Beginning balance at Dec. 31, 2019 | $ 850 | $ 10,743,875 | $ 11,721 | $ (5,841,955) | $ 151,481 | $ 5,065,972 |
Beginning balance, shares at Dec. 31, 2019 | 85,049,576 | |||||
Stock issued for services | 92,885 | 92,885 | ||||
Stock issued for services, shares | ||||||
Net income | 248,217 | 248,217 | ||||
Foreign currency translation | (94,382) | (94,382) | ||||
Ending balance at Mar. 31, 2020 | $ 850 | 10,836,760 | 11,721 | (5,593,738) | 57,099 | 5,312,692 |
Ending balance, shares at Mar. 31, 2020 | 85,049,576 | |||||
Beginning balance at Dec. 31, 2020 | $ 500 | 11,115,765 | 151,988 | (4,964,711) | 588,540 | 6,892,082 |
Beginning balance, shares at Dec. 31, 2020 | 49,999,891 | |||||
Stock-based compensation | 92,885 | 92,885 | ||||
Net income | 221,702 | 221,702 | ||||
Foreign currency translation | (32,609) | (32,609) | ||||
Ending balance at Mar. 31, 2021 | $ 500 | $ 11,208,650 | $ 151,988 | $ (4,743,009) | $ 555,931 | $ 7,174,060 |
Ending balance, shares at Mar. 31, 2021 | 49,999,891 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 221,702 | $ 248,217 |
Adjustments required to reconcile net income (loss) to net cash used in operating activities: | ||
Depreciation | 7,225 | 12,602 |
Provision for bad debts | 12,528 | |
Stock-based compensation | 92,885 | 92,885 |
Changes in net assets and liabilities: | ||
Other receivables and prepaid expenses | (2,930) | 9,270 |
Advances to suppliers | (2,313) | 1,483 |
Inventory | (102,826) | 16,055 |
Accounts payable | (5) | |
Unearned revenue | 2,776 | 26,656 |
Taxes payable | (73,290) | (37,812) |
Accrued liabilities and other payables | (1,385) | 189 |
Net cash provided by operating activities | 141,844 | 382,068 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Change in advance from related parties | (148,771) | (367,748) |
Net cash used in financing activities | (148,771) | (367,748) |
EFFECT OF EXCHANGE RATE CHANGE ON CASH | (31,318) | (336) |
NET INCREASE (DECREASE) IN CASH | (38,245) | 13,984 |
CASH, BEGINNING OF PERIOD | 7,676,689 | 9,833 |
CASH, END OF PERIOD | 7,638,444 | 23,817 |
Supplemental Cash flow data: | ||
Income tax paid | 60,458 | |
Interest paid |
Organization and Description of
Organization and Description of Business | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Organization and Description of Business | 1. ORGANIZATION AND DESCRIPTION OF BUSINESS Aixin Life International, Inc. (the “Company” or “Aixin” During each year since Mercari was reactivated until 2017, the Company had no revenue and had losses approximately equal to the expenditures required to reactivate and comply with filing and reporting obligations. Expenditures were paid by Mercari from capital contributions and loans made by Mercari’s principal stockholders and entities controlled by Mercari’s directors. On January 20, 2017, Algodon sold 10,955,500 shares of the Company’s common stock, 96.5% of the Company’s outstanding shares, to China Concentric, for $260,000, and assigned its right to the repayment of $150,087 of non-interest bearing advances to the Company for working capital, pursuant to a Stock Purchase Agreement dated December 20, 2016, as amended. Prior to entering into the Stock Purchase Agreement with Algodon, neither China Concentric nor any of its affiliates had any relationship to the Company, Algodon or any of their respective affiliates. On February 2, 2017, Mr. Quanzhong Lin purchased 7,380,352 shares of the Company’s common stock, 65.0% of its outstanding shares from China Concentric for $300,000, pursuant to a Stock Purchase Agreement dated December 21, 2016, which resulted in a change in control of our company. On December 12, 2017, the Company issued 56,838,151 shares of common stock to Mr. Lin, the sole stockholder of AiXin (BVI) International Group Co., Ltd. a British Virgin Islands corporation (“AiXin BVI”), for his shares of AiXin BVI, pursuant to a Share Exchange Agreement. As a result of the Share Exchange, AiXin BVI became the Company’s wholly-owned subsidiary, and the Company now owns all of the outstanding shares of HK AiXin International Group Co., Limited, a Hong Kong limited company (“AiXin HK”), which in turn owns all of the outstanding shares of Chengdu AiXinZhonghong Biological Technology Co., Ltd., a Chinese limited company (“AiXinZhonghong”), which markets and sells premium-quality nutritional products in China. AiXin BVI was incorporated on September 21, 2017 as a holding company and AiXin HK was established in Hong Kong on February 25, 2016 as an intermediate holding company. AiXinZhonghong was established in the People’s Republic of China (“PRC”) on March 4, 2013, and on May 27, 2017, the local government of the PRC issued a certificate of approval regarding the foreign ownership of AiXinZhonghong by AiXin HK. Neither AiXin BVI nor AiXin HK had operations prior to December 12, 2017. For accounting purposes, the acquisition was accounted for as a reverse acquisition and treated as a recapitalization of the Company effected by a share exchange, with AiXin BVI as the accounting acquirer. Since neither AiXin BVI nor AiXin HK had operations prior to December 12, 2017, the historical consolidated financial statements of AiXinZhonghong are now the historical consolidated financial statements of the Company. The assets and liabilities of AiXinZhonghong were brought forward at their book value and no goodwill was recognized. Effective February 1, 2018, pursuant to Articles of Amendment to the Company’s Articles of Incorporation filed with the Secretary of State of Colorado, the Company changed its name to AiXin Life International., Inc. The Company, through its indirectly owned AiXinZhonghong subsidiary, mainly develops and distributes consumer products by offering a line of nutritional products. The Company sells the products through exhibition events, conferences, and person-to-person marketing. Beginning in 2019, the Company began to provide advertising services to clients which engaged the Company to help distribute their products. During 2020, the Company’s product sales revenue was primarily generated from sales of Tonglìke, Huo’s oral solution, probiotics and food washing serum. During the first quarter of 2021, the Company’s product sales revenue was primarily generated from sales of Moutai Original Brew, probiotics and Tonglìke. The Company’s business mainly focuses on a proactive approach to its customers such as hosting events for clients, which it believes is ideally suited to marketing its products because sales of nutrition products are strengthened by ongoing personal contact and support, coaching and education of its clients, as to the benefits of a healthy and active lifestyle. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying are prepared in conformity with U.S. Generally Accepted Accounting Principles (“US GAAP”). The functional currency of is Chinese Renminbi (‘‘RMB’’). The accompanying are translated from RMB and presented in U.S. dollars (“USD”). The consolidated financial statements include the accounts of the Company and its current wholly owned subsidiaries, AiXin HK and AiXinZhonghong. Intercompany transactions and accounts were eliminated in consolidation. Unaudited Interim Financial Information These unaudited interim financial statements have been prepared in accordance with GAAP for interim financial reporting and the rules and regulations of the Securities and Exchange Commission that permit reduced disclosure for interim periods. Therefore, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. In the opinion of management, all adjustments of a normal recurring nature necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented have been made. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the year ending December 31, 2021. The balance sheets and certain comparative information as of December 31, 2020 are derived from the audited financial statements and related notes for the year ended December 31, 2020, included in the Company’s 2020 Annual Report on Form 10-K. These unaudited interim financial statements should be read in conjunction with the annual consolidated financial statements and the accompanying notes contained in our Annual Report on Form 10-K for the year ended December 31, 2020. Reclassification Certain prior period amounts have been reclassified to conform to the current period presentation and had no effect on previously reported consolidated net income (loss) or accumulated deficit. Covid – 19 On March 11, 2020, the World Health Organization announced that infections caused by the corona virus disease of 2019 (“COVID-19”) had become pandemic. The Government of China has adopted various regulations and orders, including mandatory quarantines, limits on the number of people that may gather in one location, closing non-essential businesses and travel bans to limit the spread of the disease. Many of these measures have been relaxed due to the decrease in the prevalence of Covid-19 in China. To date, the ongoing operations of the Company have not been materially adversely effected by the measures taken to limit the spread of the disease in China, though such measures have impacted its ability to timely complete its closing procedures and report the results of its operations. The measures adopted by the national government of China and local agencies, as well as the likelihood that many individuals and businesses will voluntarily shut down or self-quarantine, have and are expected to continue to have serious adverse impacts on the economy of China. The likely overall economic impact of the COVID-19 pandemic will be highly negative to the world’s economy. Financial impacts related to COVID-19, including the Company’s actions and costs incurred in response to the pandemic, were not material to the Company’s financial position, results of operations or cash flows for the quarter ended March 31, 2020. The Company has implemented procedures to promote employee and customer safety. These measures will not significantly increase its operating costs. In addition, the Company cannot predict with certainty what measures may be taken by its suppliers and customers and the impact these measures may have on its 2021 financial position, results of operations or cash flows. While the Company continues to operate substantially in the normal course, it cannot forecast with any certainty whether and to what degree the disruptions caused by the COVID-19 pandemic will increase, or the extent to which the disruption may materially impact its consolidated financial position, consolidated results of operations, and consolidated cash flows in fiscal 2021. Use of Estimates In preparing in conformity with US GAAP, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the , as well as the reported amounts of revenues and expenses during the reporting period. Significant estimates, required by management, include the recoverability of long-lived assets, allowance for doubtful accounts, and the reserve for obsolete and slow-moving inventories. Actual results could differ from those estimates. Change in Accounting Estimate Based on the recent results of an approval of small business taxpayer status and its receipt of a certificate of no tax due from the local tax department in March 2020, the Company determined that additionally accrued tax payables for , tax and tax (collectively “Other Taxes”) for the period from January 2014 to April 2016 based on the applicable tax rates for general business taxpayers should be adjusted for a change in accounting estimate. During the period from January 2014 to April 2016, the Company determined that it did not meet the requirements of a general business taxpayer other than the revenue amount level for Other Taxes filing purposes, and therefore, during this period the Company filed and paid Other Taxes in accordance with the applicable standards for a small business taxpayer. However, based on the principle of prudence, the Company accrued additional Other Taxes payable using the applicable standards for general business taxpayer for the same period until the Company’s tax filing status was settled and resolved. In March 2020, the local tax department approved the Company’s small business taxpayer status for the period from January 2014 to April 2016, and provided a certificate of no tax due to the Company. As a result, the Company reversed the previously accrued Other Taxes payable for the period and accounted for it as a change in accounting estimate. The effect of this change reduced tax payable by $1,168,377, increased non-operating income by $1,168,377, and increased basic and diluted earnings per share by $0.015 as of and for the year ended December 31, 2019. Cash and Cash Equivalents For financial statement purposes, the Company considers all highly liquid investments with an original maturity of three months or less to be cash and cash equivalents. Accounts Receivable The Company’s policy is to maintain an allowance for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. As of March 31, 2021, and December 31, 2020, the bad debt allowance was $147,912 and $148,520, respectively. Inventory Inventory mainly consists of health supplements. Inventory is valued at the lower of average cost or market, cost being determined on a moving weighted average method at the end of the month. Management compares the cost of inventories with the net realizable value and an allowance is made for writing down inventories to market value, if lower. The Company recorded no inventory impairment for the quarters ended March 31, 2021 and 2020. In July 2015, the FASB issued Accounting Standards Update (“ASU”) 2015-11, “Inventory (Topic 330) - Simplifying the Measurement of Inventory,” which requires that inventory within the scope of the guidance be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Property and Equipment Property and equipment are stated at cost, less accumulated depreciation, and impairment losses, if any. Major repairs and betterments that significantly extend original useful lives or improve productivity are capitalized and depreciated over the period benefited. Maintenance and repairs are expensed as incurred. When property and equipment are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gain or loss is included in operations. Building 20 years Office furniture 5 years Electronic Equipment 3 years Vehicles 5 years Impairment of Long-Lived Assets Long-lived assets, which include property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable, but at least annually. Recoverability of long-lived assets to be held and used is measured by comparing the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by it. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds its fair value. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. Based on its review, the Company believes that, as of March 31, 2021and December 31, 2020, there were no significant impairments of its long-lived assets. Income Taxes Income taxes are accounted for using an asset and liability method. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates, applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company follows Accounting Standards Codification (“ASC”) Topic 740, which prescribes a more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740 also provides guidance on recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods, and income tax disclosures. Under ASC Topic 740, when tax returns are filed, it is likely that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the consolidated financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50% likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. Interest associated with unrecognized tax benefits is classified as interest expense and penalties are classified in selling, general and administrative expenses in the statement of income. At March 31, 2021 and December 31, 2020, the Company did not take any uncertain positions that would necessitate recording a tax related liability. Revenue Recognition ASU No. 2014-09 Revenue from Contracts with Customers Topic 606. Topic 605, Revenue Recognition Revenue from sale of goods under Topic 606 ● executed contract(s) with customers that the Company believes is legally enforceable; ● identification of performance obligation in the respective contract; ● determination of the transaction price for each performance obligation in the respective contract; ● allocation of the transaction price to each performance obligation; and ● recognition of revenue only when the Company satisfies each performance obligation. These five elements, as applied to each of the Company’s revenue categories, is summarized below: ● Revenue from sale of goods is recognized when goods are shipped to the customer and no other obligation exits. The Company does not provide unconditional return or other concessions to the customer. The Company’s sales policy allows for the return of unopened products for cash after deducting certain service and transaction fees. As an alternative to the product return option, the customers have options of asking for an exchange for products with the same value. ● As part of the Company’s sales incentive program, the Company occasionally provides free travel to its customers whose prepayments to purchase the Company’s products reaches a certain amount. There are different travel incentives offered to customers based on amount received from each customer. The Company records the to-be-provided free travel cost when cash is collected from customers as a debit to deferred travel cost with corresponding credit to accrued travel cost. Once the customer utilizes the travel incentive, the cost of travel is recorded as selling expenses and reduces deferred travel cost. Sales revenue represents the invoiced value of goods, net of value-added taxes (“VAT”). All of the Company’s products sold in China are subject to the PRC VAT of 17% of the gross sales price prior to May 1, 2018, 16% since May 1, 2018 and 13% since April 1, 2019. This VAT may be offset by VAT paid by the Company on raw materials and other materials purchased in China. The Company records VAT payable and VAT receivable net of payments in the financial statements. The VAT tax return is filed offsetting the payables against the receivables. Sales and purchases are recorded net of VAT collected and paid as the Company acts as an agent for the government. Advertising Revenue Commencing in the third quarter of 2019, the Company began to provide advertising services to customers. Advertising contracts are signed to establish the price and advertising services to be provided. Pursuant to the advertising contracts, the Company provides advertising and marketing services to its clients through exhibition events, conferences, and person-to-person marketing. The Company performs a credit assessment of the customer to assess the collectability of the contract price prior to entering into contracts. Most of the advertisement contracts designated that the Company perform such advertising services for its clients through exhibition events, conferences, and person-to-person marketing during the contracted period, regardless of the number of such events. As such, the Company determined that the performance obligation is satisfied over time during the contracted period and revenue is recognized accordingly. Such advertising revenue amounted to $494,864 and $543,440 for the quarter ended March 31, 2021 and 2020, respectively. A smaller proportion of the Company’s advertising revenue is generated from services to its clients through exhibition events, conferences, and person-to-person marketing, and charges based on the number of promotional products sold. Such advertising revenue amounted to $0 and $6,489 for the quarter ended March 31, 2021 and 2020, respectively. Cost of Goods Sold Cost of goods sold consists primarily of the cost of inventory purchases. Reserve for inventory allowance due to lower of cost or market is also recorded in cost of goods sold. Concentration of Credit Risk The operations of the Company are in the PRC. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by the political, economic, and legal environments in the PRC, and by the general state of the PRC economy. The Company has cash on hand and demand deposits in accounts maintained with state-owned banks within the PRC. Cash in state-owned banks is covered by insurance up to RMB 500,000 ($72,500) per bank. The Company has not experienced any losses in such accounts and believes they are not exposed to any risks on its cash in these bank accounts. During the three months ended March 31, 2021, the Company had two major customers accounted for over 10% of its total revenue. Customer Net sales for the three months ended March 31, 2021 % of total revenue A* $ 494,864 71 % B 105,389 15 % During the three months ended March 31, 2020, the Company had one major customer accounted for over 10% of its total revenue. Customer Net sales for the three months ended % of total revenue A* $ 543,440 89 % During the three months ended March 31, 2021, the Company had one major supplier accounted for over 10% of its total purchase. Supplier Net purchase for the three months ended % of total purchase C $ 232,104 99 % During the three months ended March 31, 2020, the Company had one major supplier accounted for over 10% of its total purchase. Supplier Net purchase for the three months ended % of total purchase A* $ 6,341 100 % *Represented advertising revenues from this customer during the three months ended March 31, 2021 and 2020. The Company also purchased inventory from this customer in the three months ended March 31, 2020. Leases The Company adopted FASB Accounting Standards Codification, Topic 842, Leases (“ASC 842”) using the modified retrospective approach, electing the practical expedient that allows the Company not to restate prior to the adoption of the standard on January 1, 2019. As such, the disclosures required under ASC 842 are not presented for periods before the date of adoption. The Company applied the following practical expedients in the transition to the new standard allowed under ASC 842: Practical Expedient Description Reassessment of expired or existing contracts The Company elected not to reassess, at the application date, whether any expired or existing contracts contained leases, the lease classification for any expired or existing leases, and the accounting for initial direct costs for any existing leases. Use of hindsight The Company elected to use hindsight in determining the lease term (that is, when considering options to extend or terminate the lease and to purchase the underlying asset) and in assessing impairment of right-to-use assets. Reassessment of existing or expired land easements The Company elected not to evaluate existing or expired land easements that were not previously accounted for as leases under ASC 840, as allowed under the transition practical expedient. Going forward, new or modified land easements will be evaluated under ASU No. 2016-02. Separation of lease and non-lease components Lease agreements that contain both lease and non-lease components are generally accounted for separately. Short-term lease recognition exemption The Company also elected the short-term lease recognition exemption and will not recognize ROU assets or lease liabilities for leases with a term less than 12 months. The new leasing standard requires recognition of leases on the consolidated balance sheets as right-of-use (“ROU”) assets and lease liabilities. ROU assets represent the Company’s right to use underlying assets for the lease terms and lease liabilities represent the Company’s obligation to make lease payments arising from the leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value and future minimum lease payments over the lease term at commencement date. The Company’s future minimum based payments used to determine the Company’s lease liabilities mainly include minimum based rent payments. As most of the Company’s leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The adoption of ASC 842 had no substantial impact on the Company’s consolidated balance sheets. The most significant impact was the recognition of the operating lease right-of-use assets and the liability for operating leases. The adoption of ASC 842 did not result in a cumulative-effect adjustment to the opening balance of retained earnings (accumulated deficit). In addition, the adoption of the standard did not have a material impact on the Company’s results of operations or cash flows. Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in selling, general and administrative expenses. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur. Statement of Cash Flows In accordance with ASC Topic 230, “Statement of Cash Flows,” Fair Value of Financial Instruments The carrying amounts of certain of the Company’s financial instruments, including cash and equivalents, accrued liabilities and accounts payable, approximate their fair value due to their short maturities. FASB ASC Topic 825, “Financial Instruments,” requires disclosure of the fair value of financial instruments held by the Company. The carrying amounts reported in the consolidated balance sheets for current liabilities each qualify as financial instruments and are a reasonable estimate of their fair value because of the short period of time between the origination of such instruments and their expected realization and the current market rate of interest. Fair Value Measurements and Disclosures ASC Topic 820, “Fair Value Measurements and Disclosures,” defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The three levels are defined as follow: ● Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. ● Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement. As of March 31, 2021 and December 31, 2020, the Company did not identify any assets and liabilities that are required to be presented on the balance sheet at fair value. Foreign Currency Translation and Comprehensive Income (Loss) The functional currency of the Company is RMB. For financial reporting purposes, RMB is translated into USD as the reporting currency. Assets and liabilities are translated at the exchange rate in effect at the balance sheet dates. Revenues and expenses are translated at the average rate of exchange prevailing during the reporting period. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of stockholders’ equity as “Accumulated other comprehensive income”. Gains and losses resulting from foreign currency transactions are included in income. There was no significant fluctuation in the exchange rate for the conversion of RMB to USD after the balance sheet date. The Company uses FASB ASC Topic 220, “Comprehensive Income”. Comprehensive loss is comprised of net loss and all changes to the statements of stockholders’ equity, except those due to investments by stockholders, changes in paid-in capital and distributions to stockholders. Comprehensive income (loss) for the quarters ended March 31, 2020 and 2019 consisted of net income (loss) and foreign currency translation adjustments. Earnings per Share Basic income (loss) per share is computed on the basis of the weighted average number of common shares outstanding during the period. Dilution is computed by applying the treasury stock method for options and warrants. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. As of March 31, 2021 and December 31, 2020, the Company did not have any potentially dilutive instruments. Stock-Based Compensation The Company periodically grants stock options, warrants and awards to employees and non-employees in non-capital raising transactions as compensation for services rendered. The Company accounts for stock option, stock warrant and stock award grants to employees based on the authoritative guidance provided by the FASB where the value of the award is measured on the date of grant and recognized over the vesting period. The Company accounts for stock option, stock warrant and stock award grants to non-employees in accordance with the authoritative guidance of the FASB where the value of the stock compensation is determined based upon the measurement date at either a) the date at which a performance commitment is reached, or b) at the date at which the necessary performance to earn the equity instruments is complete. Stock-based compensation charges generally are amortized over the vesting period on a straight-line basis. In certain circumstances where there are no future performance requirements by the employees and non-employees, option, warrant and award grants are immediately vested and the total stock-based compensation charge is recorded in the period of the measurement date. Segment Reporting ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s chief operating decision maker organizes segments within the Company for making operating decisions assessing performance and allocating resources. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. Management determined the Company’s operations constitute a single reportable segment in accordance with ASC 280. The Company operates exclusively in one business and industry segment: sale of health supplement products. New Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes, as part of its initiative to reduce complexity in accounting standards. The amendments in the ASU are effective for fiscal years beginning after December 15, 2020, including interim periods therein. Early adoption of the standard is permitted, including adoption in interim or annual periods for which financial statements have not yet been issued. The Company is currently evaluating the effect, if any, that the ASU will have on its consolidated financial statements. |
Advances to Suppliers
Advances to Suppliers | 3 Months Ended |
Mar. 31, 2021 | |
Advances To Suppliers | |
Advances to Suppliers | 3. ADVANCES TO SUPPLIERS The Company had advances to suppliers of $157,338 and $155,686 as of March 31, 2021 and December 31, 2020, respectively. Advances to suppliers primarily include prepayments for products expected to be delivered subsequent to balance sheet dates. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventory | 4. INVENTORY Inventory consisted of the following at , 2021 and December 31, 2020: March 31, December 31, Finished goods – health supplements $ 147,074 $ 45,535 |
Loan to Third Party
Loan to Third Party | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Loan to Third Party | 7. LOAN TO THIRD PARTY On June 8, 2020, the Company entered into an unsecured loan agreement with a third party, pursuant to which the Company agreed to lend RMB 50,300,000, equivalent to $7,408,389, to the third party. This loan bears interest of RMB 74,000, equivalent to $10,718, per day, and will mature on July 28, 2020. As of December 31, 2020, the Company has received the repayment of principal and interest in full amount, and recorded interest income of $535,906 during the year ended December 31, 2020. |
Property and Equipment, Net
Property and Equipment, Net | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | 8. PROPERTY AND EQUIPMENT, NET Property and equipment consisted of the following at , 2021 and December 31, 2020: March 31, 2021 December 31, 2020 Vehicle $ 287,424 $ 288,604 Office furniture 48,266 48,464 Electronic equipment 14,791 14,852 Total 350,481 351,920 Less: Accumulated depreciation (290,088 ) (284,103 ) Property and equipment, net $ 60,393 $ 67,817 Depreciation expense for the quarters ended March 31, 2021 and 2020 was $7,225 and $12,602, respectively. |
Taxes Payable
Taxes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Taxes Payable | 9. TAXES PAYABLE Taxes payable consisted of the following at , 2021 and December 31, 2020: March 31, 2021 December 31, 2020 Value-added $ 21,315 $ 32,318 Income 174,527 235,300 City construction 1,651 2,422 Education 1,230 1,781 Other 11,106 11,674 Taxes payable $ 209,829 $ 283,495 See Note 2 for the change in accounting estimate of taxes payable. |
Accrued Liabilities and Other P
Accrued Liabilities and Other Payables | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities and Other Payables | 10. ACCRUED LIABILITIES AND OTHER PAYABLES Accrued liabilities and other payables consisted of the following at : March 31, December 31, Accrued employees’ social insurance $ 354,831 $ 364,870 Accrued professional fees 15,756 16,927 Accrued payroll and commission 112,124 105,844 Other payables 28,100 26,598 Total $ 510,811 $ 514,239 |
Lease
Lease | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Lease | 11. LEASE On September 12, 2018, the Company entered into a contract to sell its rights to a portion of a building with a buyer (the “Buyer”), at which time the Buyer paid RMB 100,000 ($14,898) to a shareholder of the Company as a down payment. The contract stipulated the remaining RMB 8,900,000 ($1,325,964) should be paid by the Buyer on or before September 30, 2018 and before the Company would be required to go to the relevant authority to effectuate the transfer of its property rights. The Buyer failed to make the payment on or prior to September 30, 2018, a default under the contract which gave the Company the right to terminate the contract. In October 2018, the Buyer delivered to the shareholder an additional RMB 7 million ($1.0 million). On March 25, 2019, the parties entered into a supplemental agreement which provided that the Company would transfer the property rights to Buyer if it agreed the Company would get the benefit of the RMB 7,000,000 ($1,042,893) and otherwise pay the remaining balance of RMB 1,200,000 ($178,782) on or prior to March 31, 2019. The RMB 1,200,000 ($178,782) was paid directly to the shareholder on a timely basis and the Company was given the benefit of the RMB 8,900,000 ($1,325,964) delivered to the Shareholder. The cost and accumulated depreciation of the building was $1,739,228 and $364,834, respectively. The Company recorded a loss on sale of $32,945 during the nine months ended September 30, 2019. $1,340,862 of the proceeds from the sale was collected by the principal shareholder which was offset against amounts due to the shareholder. Concurrent with the completion of this sale, the Company entered into an agreement to lease a portion of the building back from the Buyer over a lease term of 2 years. The Company accounted for this lease as an operating lease right-of-use asset and a corresponding operating lease liability in accordance with the Lease Standard. As a result, $207,049 (RMB 1,389,731) was recorded as operating lease right-of-use asset and lease liability on March 31, 2019 when the lease commenced based on a 4.75% discount factor. The lease agreement expired on March 31, 2021. Commencing in April, 2021, the Company continues to lease the office on a monthly basis. The Company also has operating leases for other sales locations under various operating lease arrangements. The leases have remaining lease terms of approximately six months to 3 years. Balance sheet information related to the Company’s leases is presented below: March 31, December 31, Operating Leases Operating lease right-of-use assets $ 59,289 $ 100,029 Operating lease liabilities - current $ 35,019 $ 70,780 Operating lease liability – non-current 24,270 29,250 Total operating lease liabilities $ 59,289 $ 100,030 The following provides details of the Company’s lease expenses: Three Months Ended March 31, 2021 2020 Operating lease expenses $ 41,300 $ 39,541 Other information related to leases is presented below: Three Months Ended March 31, 2021 2020 Cash Paid For Amounts Included In Measurement of Liabilities: Operating cash flows from operating leases $ 41,300 39,541 Weighted Average Remaining Lease Term: Operating leases 1.12 years 1.62 years Weighted Average Discount Rate: Operating leases 4.75 % 4.75 % Maturities of lease liabilities were as follows: For the year ending December 31: 2021 (excluding the three months ended March 31, 2021) $ 31,585 2022 20,284 2023 9,864 Total lease payments 61,733 Less: imputed interest (2,444 ) Total lease liabilities 59,289 Less: current portion (35,019 ) Lease liabilities – non-current portion $ 24,270 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 12. RELATED PARTY TRANSACTIONS Advance to related parties Advance to related parties consisted of the following as of the periods indicated: March 31, December 31, 2021 2020 Qionglai Weide Pharmacy $ - $ 10,421 Chengdu Xindu Cundetang Pharmacy Co., Ltd. - 5,318 Total $ - $ 15,739 These entities are controlled by Mr. Quanzhong Lin, a major shareholder. The advances were for working capital purpose, payable on demand, and bear no interest. Advance from related parties Advance from related parties consisted of the following as of the periods indicated: March 31, December 31, 2021 2020 Quanzhong Lin $ 98,702 $ 258,862 Chengdu Aixin E-Commerce Company Ltd. 3,227 3,240 Chengdu Beibang Pharmacy - 2,748 Total $ 101,929 $ 264,850 These entities are controlled by Mr. Quanzhong Lin, a major shareholder. These advances were for working capital purpose, payable on demand, and bear no interest. Office lease from a Major Shareholder In May 2014, the Company entered a lease with its major shareholder for office use; the lease term was three years until May 2017 with an option to renew. The monthly rent was RMB 5,000 ($763), the Company was required to prepay each year’s annual rent at 15th of May of each year. The Company renewed the lease until May 28, 2023 with monthly rents of RMB 5,000 ($763), payable quarterly. The future annual minimum lease payment at March 31, 2021 is $9,158 for the year ended March 31, 2022 and 2023, and $1,526 for the year ended March 31, 2024. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 13. INCOME TAXES The Company was incorporated in the United States of America (“USA”) and has operations in one tax jurisdiction, i.e. the PRC. The Company generated substantially all of its sales from its operations in the PRC for the , and recorded income tax provision for the periods. China has a tax rate of 25% for all enterprises (including foreign-invested enterprises). Uncertain Tax Positions Interest associated with unrecognized tax benefits are classified as income tax, and penalties are classified in selling, general and administrative expenses in the statements of operations. For the quarters ended March 31, 2021 and 2020, the Company had no unrecognized tax benefits and related interest and penalties expenses. Currently, the Company is not subject to examination by major tax jurisdictions. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | 14. STOCKHOLDERS’ EQUITY On August 17, 2020, by unanimous written consent in lieu of a meeting, the Board adopted resolutions authorizing a one (1)-for-four (4) reverse stock split and on August 19, 2020 filed Articles of Amendment to effect the reverse stock split with the Secretary of State of the State of Colorado. The reverse stock split becomes effective on October 27, 2020. According to the Articles of Amendment, the Company is authorized to issue 20,000,000 shares of blank check preferred stock at $0.001 par value and to reduce the number of authorized common stock to 500,000,000 shares at $.00001 par value per share from 950,000,000 shares. All share and earnings per share information has been retroactively adjusted to reflect the reverse stock split. As of March 31, 2021 and December 31, 2020, the Company had 49,999,891 post-split common shares issued and outstanding. During the year ended December 31, 2020, 35,049,685 post-split shares owned by a major shareholder were cancelled. Stock Awards Issued for Services On October 22, 2019, the Company granted and issued 37,500 post-split shares to its employees and contractors under its 2019 Equity Incentive Plan. The stock awards were valued at $337,500 based on the post-split closing price of $9 on the grant date. On October 24, 2019, the Company granted and issued 550,000 post-split shares to its employees and contractors under its 2019 Equity Incentive Plan. The stock awards were valued at $1,520,200 based on the post-split closing price of $2.764 on the grant date. The stock awards will vest over five (5) years from the grant date, and the grantee will forfeit a portion of the shares granted (“Shares Granted”) if the grantee is no longer employed by or contracted with the Company. Specifically, the grantee will forfeit 80% of Shares Granted if no longer employed by or contracted with the Company on the date that is one year from the grant date, forfeit 60% of Shares Granted if no longer employed by or contracted with the Company on the date that is two years from the grant date, forfeit 40% of Shares Granted if no longer employed by or contracted with the Company on the date that is three years from the grant date, and forfeit 20% of Shares Granted if no longer employed by or contracted with the Company on the date that is four years from the grant date. Effective on the 5 th For the quarters ended March 31, 2021 and 2020, stock-based compensation expenses were $92,885. As of March 31, 2021, unrecognized compensation expenses related to these stock awards are $1,322,862. These expenses are expected to be recognized over 4 years. |
Statutory Reserves
Statutory Reserves | 3 Months Ended |
Mar. 31, 2021 | |
Statutory Reserves | |
Statutory Reserves | 15. STATUTORY RESERVES Pursuant to the PRC corporate law, the Company is now only required to maintain one statutory reserve by appropriating from its after-tax profit before declaration or payment of dividends. The statutory reserve represents restricted retained earnings. Surplus reserve fund The Company is now required to transfer 10% of its net income, as determined under PRC accounting rules and regulations, to a statutory surplus reserve fund until such reserve balance reaches 50% of the Company’s registered capital. During the quarters ended March 31, 2021 and 2020, the Company did not make any contribution to statutory reserve fund. The surplus reserve fund is non-distributable other than during liquidation and can be used to fund previous years’ losses, if any, and may be utilized for business expansion or converted into share capital by issuing new shares to existing shareholders in proportion to their shareholding or by increasing the par value of the shares currently held by them, provided that the remaining reserve balance after such issue is not less than 25% of the registered capital. Common welfare fund Common welfare fund is a voluntary fund to which the Company can elect to transfer 5% to 10% of its net income, as determined under PRC accounting rules and regulations. The Company did not make any contribution to this fund during the quarters ended March 31, 2021 and 2020. This fund can only be utilized on capital items for the collective benefit of the Company’s employees, such as construction of dormitories, cafeteria facilities, and other staff welfare facilities. This fund is non-distributable other than upon liquidation. |
Operating Contingencies
Operating Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Operating Contingencies | 16. OPERATING CONTINGENCIES The Company’s operations in the PRC are subject to specific considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks associated with, among others, the political, economic and legal environments and foreign currency exchange. The Company’s results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. The Company’s sales, purchases and expenses are denominated in RMB and all of the Company’s assets and liabilities are also denominated in RMB. The RMB is not freely convertible into foreign currencies under the current law. In China, foreign exchange transactions are required by law to be transacted only by authorized financial institutions. Remittances in currencies other than RMB may require certain supporting documentation to affect the remittance. The Company is, from time to time, involved in litigation incidental to the conduct of its business regarding merchandise sold, employment matters, and litigation regarding intellectual property rights. The Company believes that current pending litigation will not have a material adverse effect on its consolidated financial position, results of operations or cash flows. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Event | 17. SUBSEQUENT EVENT Management has evaluated subsequent events through the date which the financial statements were available to be issued. All subsequent events requiring recognition as of March 31, 2021 have been incorporated into these consolidated financial statements and there are no subsequent events that require disclosure in accordance with FASB ASC Topic 855, “Subsequent Events.” |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying are prepared in conformity with U.S. Generally Accepted Accounting Principles (“US GAAP”). The functional currency of is Chinese Renminbi (‘‘RMB’’). The accompanying are translated from RMB and presented in U.S. dollars (“USD”). The consolidated financial statements include the accounts of the Company and its current wholly owned subsidiaries, AiXin HK and AiXinZhonghong. Intercompany transactions and accounts were eliminated in consolidation. |
Unaudited Interim Financial Information | Unaudited Interim Financial Information These unaudited interim financial statements have been prepared in accordance with GAAP for interim financial reporting and the rules and regulations of the Securities and Exchange Commission that permit reduced disclosure for interim periods. Therefore, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. In the opinion of management, all adjustments of a normal recurring nature necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented have been made. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the year ending December 31, 2021. The balance sheets and certain comparative information as of December 31, 2020 are derived from the audited financial statements and related notes for the year ended December 31, 2020, included in the Company’s 2020 Annual Report on Form 10-K. These unaudited interim financial statements should be read in conjunction with the annual consolidated financial statements and the accompanying notes contained in our Annual Report on Form 10-K for the year ended December 31, 2020. |
Reclassification | Reclassification Certain prior period amounts have been reclassified to conform to the current period presentation and had no effect on previously reported consolidated net income (loss) or accumulated deficit. |
Covid-19 | Covid – 19 On March 11, 2020, the World Health Organization announced that infections caused by the corona virus disease of 2019 (“COVID-19”) had become pandemic. The Government of China has adopted various regulations and orders, including mandatory quarantines, limits on the number of people that may gather in one location, closing non-essential businesses and travel bans to limit the spread of the disease. Many of these measures have been relaxed due to the decrease in the prevalence of Covid-19 in China. To date, the ongoing operations of the Company have not been materially adversely effected by the measures taken to limit the spread of the disease in China, though such measures have impacted its ability to timely complete its closing procedures and report the results of its operations. The measures adopted by the national government of China and local agencies, as well as the likelihood that many individuals and businesses will voluntarily shut down or self-quarantine, have and are expected to continue to have serious adverse impacts on the economy of China. The likely overall economic impact of the COVID-19 pandemic will be highly negative to the world’s economy. Financial impacts related to COVID-19, including the Company’s actions and costs incurred in response to the pandemic, were not material to the Company’s financial position, results of operations or cash flows for the quarter ended March 31, 2020. The Company has implemented procedures to promote employee and customer safety. These measures will not significantly increase its operating costs. In addition, the Company cannot predict with certainty what measures may be taken by its suppliers and customers and the impact these measures may have on its 2021 financial position, results of operations or cash flows. While the Company continues to operate substantially in the normal course, it cannot forecast with any certainty whether and to what degree the disruptions caused by the COVID-19 pandemic will increase, or the extent to which the disruption may materially impact its consolidated financial position, consolidated results of operations, and consolidated cash flows in fiscal 2021. |
Use of Estimates | Use of Estimates In preparing in conformity with US GAAP, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the , as well as the reported amounts of revenues and expenses during the reporting period. Significant estimates, required by management, include the recoverability of long-lived assets, allowance for doubtful accounts, and the reserve for obsolete and slow-moving inventories. Actual results could differ from those estimates. |
Change in Accounting Estimate | Change in Accounting Estimate Based on the recent results of an approval of small business taxpayer status and its receipt of a certificate of no tax due from the local tax department in March 2020, the Company determined that additionally accrued tax payables for , tax and tax (collectively “Other Taxes”) for the period from January 2014 to April 2016 based on the applicable tax rates for general business taxpayers should be adjusted for a change in accounting estimate. During the period from January 2014 to April 2016, the Company determined that it did not meet the requirements of a general business taxpayer other than the revenue amount level for Other Taxes filing purposes, and therefore, during this period the Company filed and paid Other Taxes in accordance with the applicable standards for a small business taxpayer. However, based on the principle of prudence, the Company accrued additional Other Taxes payable using the applicable standards for general business taxpayer for the same period until the Company’s tax filing status was settled and resolved. In March 2020, the local tax department approved the Company’s small business taxpayer status for the period from January 2014 to April 2016, and provided a certificate of no tax due to the Company. As a result, the Company reversed the previously accrued Other Taxes payable for the period and accounted for it as a change in accounting estimate. The effect of this change reduced tax payable by $1,168,377, increased non-operating income by $1,168,377, and increased basic and diluted earnings per share by $0.015 as of and for the year ended December 31, 2019. |
Cash and Cash Equivalents | Cash and Cash Equivalents For financial statement purposes, the Company considers all highly liquid investments with an original maturity of three months or less to be cash and cash equivalents. |
Accounts Receivable | Accounts Receivable The Company’s policy is to maintain an allowance for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. As of March 31, 2021, and December 31, 2020, the bad debt allowance was $147,912 and $148,520, respectively. |
Inventory | Inventory Inventory mainly consists of health supplements. Inventory is valued at the lower of average cost or market, cost being determined on a moving weighted average method at the end of the month. Management compares the cost of inventories with the net realizable value and an allowance is made for writing down inventories to market value, if lower. The Company recorded no inventory impairment for the quarters ended March 31, 2021 and 2020. In July 2015, the FASB issued Accounting Standards Update (“ASU”) 2015-11, “Inventory (Topic 330) - Simplifying the Measurement of Inventory,” which requires that inventory within the scope of the guidance be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, less accumulated depreciation, and impairment losses, if any. Major repairs and betterments that significantly extend original useful lives or improve productivity are capitalized and depreciated over the period benefited. Maintenance and repairs are expensed as incurred. When property and equipment are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gain or loss is included in operations. Building 20 years Office furniture 5 years Electronic Equipment 3 years Vehicles 5 years |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets, which include property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable, but at least annually. Recoverability of long-lived assets to be held and used is measured by comparing the carrying amount of an asset to the estimated undiscounted future cash flows expected to be generated by it. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds its fair value. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. Based on its review, the Company believes that, as of March 31, 2021and December 31, 2020, there were no significant impairments of its long-lived assets. |
Income Taxes | Income Taxes Income taxes are accounted for using an asset and liability method. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates, applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company follows Accounting Standards Codification (“ASC”) Topic 740, which prescribes a more-likely-than-not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740 also provides guidance on recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods, and income tax disclosures. Under ASC Topic 740, when tax returns are filed, it is likely that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the consolidated financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50% likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. Interest associated with unrecognized tax benefits is classified as interest expense and penalties are classified in selling, general and administrative expenses in the statement of income. At March 31, 2021 and December 31, 2020, the Company did not take any uncertain positions that would necessitate recording a tax related liability. |
Revenue Recognition | Revenue Recognition ASU No. 2014-09 Revenue from Contracts with Customers Topic 606. Topic 605, Revenue Recognition Revenue from sale of goods under Topic 606 ● executed contract(s) with customers that the Company believes is legally enforceable; ● identification of performance obligation in the respective contract; ● determination of the transaction price for each performance obligation in the respective contract; ● allocation of the transaction price to each performance obligation; and ● recognition of revenue only when the Company satisfies each performance obligation. These five elements, as applied to each of the Company’s revenue categories, is summarized below: ● Revenue from sale of goods is recognized when goods are shipped to the customer and no other obligation exits. The Company does not provide unconditional return or other concessions to the customer. The Company’s sales policy allows for the return of unopened products for cash after deducting certain service and transaction fees. As an alternative to the product return option, the customers have options of asking for an exchange for products with the same value. ● As part of the Company’s sales incentive program, the Company occasionally provides free travel to its customers whose prepayments to purchase the Company’s products reaches a certain amount. There are different travel incentives offered to customers based on amount received from each customer. The Company records the to-be-provided free travel cost when cash is collected from customers as a debit to deferred travel cost with corresponding credit to accrued travel cost. Once the customer utilizes the travel incentive, the cost of travel is recorded as selling expenses and reduces deferred travel cost. Sales revenue represents the invoiced value of goods, net of value-added taxes (“VAT”). All of the Company’s products sold in China are subject to the PRC VAT of 17% of the gross sales price prior to May 1, 2018, 16% since May 1, 2018 and 13% since April 1, 2019. This VAT may be offset by VAT paid by the Company on raw materials and other materials purchased in China. The Company records VAT payable and VAT receivable net of payments in the financial statements. The VAT tax return is filed offsetting the payables against the receivables. Sales and purchases are recorded net of VAT collected and paid as the Company acts as an agent for the government. Advertising Revenue Commencing in the third quarter of 2019, the Company began to provide advertising services to customers. Advertising contracts are signed to establish the price and advertising services to be provided. Pursuant to the advertising contracts, the Company provides advertising and marketing services to its clients through exhibition events, conferences, and person-to-person marketing. The Company performs a credit assessment of the customer to assess the collectability of the contract price prior to entering into contracts. Most of the advertisement contracts designated that the Company perform such advertising services for its clients through exhibition events, conferences, and person-to-person marketing during the contracted period, regardless of the number of such events. As such, the Company determined that the performance obligation is satisfied over time during the contracted period and revenue is recognized accordingly. Such advertising revenue amounted to $494,864 and $543,440 for the quarter ended March 31, 2021 and 2020, respectively. A smaller proportion of the Company’s advertising revenue is generated from services to its clients through exhibition events, conferences, and person-to-person marketing, and charges based on the number of promotional products sold. Such advertising revenue amounted to $0 and $6,489 for the quarter ended March 31, 2021 and 2020, respectively. |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold consists primarily of the cost of inventory purchases. Reserve for inventory allowance due to lower of cost or market is also recorded in cost of goods sold. |
Concentration of Credit Risk | Concentration of Credit Risk The operations of the Company are in the PRC. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by the political, economic, and legal environments in the PRC, and by the general state of the PRC economy. The Company has cash on hand and demand deposits in accounts maintained with state-owned banks within the PRC. Cash in state-owned banks is covered by insurance up to RMB 500,000 ($72,500) per bank. The Company has not experienced any losses in such accounts and believes they are not exposed to any risks on its cash in these bank accounts. During the three months ended March 31, 2021, the Company had two major customers accounted for over 10% of its total revenue. Customer Net sales for the three months ended March 31, 2021 % of total revenue A* $ 494,864 71 % B 105,389 15 % During the three months ended March 31, 2020, the Company had one major customer accounted for over 10% of its total revenue. Customer Net sales for the three months ended % of total revenue A* $ 543,440 89 % During the three months ended March 31, 2021, the Company had one major supplier accounted for over 10% of its total purchase. Supplier Net purchase for the three months ended % of total purchase C $ 232,104 99 % During the three months ended March 31, 2020, the Company had one major supplier accounted for over 10% of its total purchase. Supplier Net purchase for the three months ended % of total purchase A* $ 6,341 100 % *Represented advertising revenues from this customer during the three months ended March 31, 2021 and 2020. The Company also purchased inventory from this customer in the three months ended March 31, 2020. |
Leases | Leases The Company adopted FASB Accounting Standards Codification, Topic 842, Leases (“ASC 842”) using the modified retrospective approach, electing the practical expedient that allows the Company not to restate prior to the adoption of the standard on January 1, 2019. As such, the disclosures required under ASC 842 are not presented for periods before the date of adoption. The Company applied the following practical expedients in the transition to the new standard allowed under ASC 842: Practical Expedient Description Reassessment of expired or existing contracts The Company elected not to reassess, at the application date, whether any expired or existing contracts contained leases, the lease classification for any expired or existing leases, and the accounting for initial direct costs for any existing leases. Use of hindsight The Company elected to use hindsight in determining the lease term (that is, when considering options to extend or terminate the lease and to purchase the underlying asset) and in assessing impairment of right-to-use assets. Reassessment of existing or expired land easements The Company elected not to evaluate existing or expired land easements that were not previously accounted for as leases under ASC 840, as allowed under the transition practical expedient. Going forward, new or modified land easements will be evaluated under ASU No. 2016-02. Separation of lease and non-lease components Lease agreements that contain both lease and non-lease components are generally accounted for separately. Short-term lease recognition exemption The Company also elected the short-term lease recognition exemption and will not recognize ROU assets or lease liabilities for leases with a term less than 12 months. The new leasing standard requires recognition of leases on the consolidated balance sheets as right-of-use (“ROU”) assets and lease liabilities. ROU assets represent the Company’s right to use underlying assets for the lease terms and lease liabilities represent the Company’s obligation to make lease payments arising from the leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value and future minimum lease payments over the lease term at commencement date. The Company’s future minimum based payments used to determine the Company’s lease liabilities mainly include minimum based rent payments. As most of the Company’s leases do not provide an implicit rate, the Company uses its estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The adoption of ASC 842 had no substantial impact on the Company’s consolidated balance sheets. The most significant impact was the recognition of the operating lease right-of-use assets and the liability for operating leases. The adoption of ASC 842 did not result in a cumulative-effect adjustment to the opening balance of retained earnings (accumulated deficit). In addition, the adoption of the standard did not have a material impact on the Company’s results of operations or cash flows. Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in selling, general and administrative expenses. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur. |
Statement of Cash Flows | Statement of Cash Flows In accordance with ASC Topic 230, “Statement of Cash Flows,” |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of certain of the Company’s financial instruments, including cash and equivalents, accrued liabilities and accounts payable, approximate their fair value due to their short maturities. FASB ASC Topic 825, “Financial Instruments,” requires disclosure of the fair value of financial instruments held by the Company. The carrying amounts reported in the consolidated balance sheets for current liabilities each qualify as financial instruments and are a reasonable estimate of their fair value because of the short period of time between the origination of such instruments and their expected realization and the current market rate of interest. |
Fair Value Measurements and Disclosures | Fair Value Measurements and Disclosures ASC Topic 820, “Fair Value Measurements and Disclosures,” defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The three levels are defined as follow: ● Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. ● Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement. As of March 31, 2021 and December 31, 2020, the Company did not identify any assets and liabilities that are required to be presented on the balance sheet at fair value. |
Foreign Currency Translation and Comprehensive Income (Loss) | Foreign Currency Translation and Comprehensive Income (Loss) The functional currency of the Company is RMB. For financial reporting purposes, RMB is translated into USD as the reporting currency. Assets and liabilities are translated at the exchange rate in effect at the balance sheet dates. Revenues and expenses are translated at the average rate of exchange prevailing during the reporting period. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of stockholders’ equity as “Accumulated other comprehensive income”. Gains and losses resulting from foreign currency transactions are included in income. There was no significant fluctuation in the exchange rate for the conversion of RMB to USD after the balance sheet date. The Company uses FASB ASC Topic 220, “Comprehensive Income”. Comprehensive loss is comprised of net loss and all changes to the statements of stockholders’ equity, except those due to investments by stockholders, changes in paid-in capital and distributions to stockholders. Comprehensive income (loss) for the quarters ended March 31, 2020 and 2019 consisted of net income (loss) and foreign currency translation adjustments. |
Earnings Per Share | Earnings per Share Basic income (loss) per share is computed on the basis of the weighted average number of common shares outstanding during the period. Dilution is computed by applying the treasury stock method for options and warrants. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. As of March 31, 2021 and December 31, 2020, the Company did not have any potentially dilutive instruments. |
Stock-Based Compensation | Stock-Based Compensation The Company periodically grants stock options, warrants and awards to employees and non-employees in non-capital raising transactions as compensation for services rendered. The Company accounts for stock option, stock warrant and stock award grants to employees based on the authoritative guidance provided by the FASB where the value of the award is measured on the date of grant and recognized over the vesting period. The Company accounts for stock option, stock warrant and stock award grants to non-employees in accordance with the authoritative guidance of the FASB where the value of the stock compensation is determined based upon the measurement date at either a) the date at which a performance commitment is reached, or b) at the date at which the necessary performance to earn the equity instruments is complete. Stock-based compensation charges generally are amortized over the vesting period on a straight-line basis. In certain circumstances where there are no future performance requirements by the employees and non-employees, option, warrant and award grants are immediately vested and the total stock-based compensation charge is recorded in the period of the measurement date. |
Segment Reporting | Segment Reporting ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s chief operating decision maker organizes segments within the Company for making operating decisions assessing performance and allocating resources. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. Management determined the Company’s operations constitute a single reportable segment in accordance with ASC 280. The Company operates exclusively in one business and industry segment: sale of health supplement products. |
New Accounting Pronouncements | New Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes, as part of its initiative to reduce complexity in accounting standards. The amendments in the ASU are effective for fiscal years beginning after December 15, 2020, including interim periods therein. Early adoption of the standard is permitted, including adoption in interim or annual periods for which financial statements have not yet been issued. The Company is currently evaluating the effect, if any, that the ASU will have on its consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives of Property and Equipment | Depreciation of property and equipment is provided using the straight-line method for substantially all assets with 5% salvage value and estimated lives as follows: Building 20 years Office furniture 5 years Electronic Equipment 3 years Vehicles 5 years |
Schedule of Concentration of Credit Risk | During the three months ended March 31, 2021, the Company had two major customers accounted for over 10% of its total revenue. Customer Net sales for the three months ended March 31, 2021 % of total revenue A* $ 494,864 71 % B 105,389 15 % During the three months ended March 31, 2020, the Company had one major customer accounted for over 10% of its total revenue. Customer Net sales for the three months ended % of total revenue A* $ 543,440 89 % During the three months ended March 31, 2021, the Company had one major supplier accounted for over 10% of its total purchase. Supplier Net purchase for the three months ended % of total purchase C $ 232,104 99 % During the three months ended March 31, 2020, the Company had one major supplier accounted for over 10% of its total purchase. Supplier Net purchase for the three months ended % of total purchase A* $ 6,341 100 % *Represented advertising revenues from this customer during the three months ended March 31, 2021 and 2020. The Company also purchased inventory from this customer in the three months ended March 31, 2020. |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consisted of the following at , 2021 and December 31, 2020: March 31, December 31, Finished goods – health supplements $ 147,074 $ 45,535 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following at , 2021 and December 31, 2020: March 31, 2021 December 31, 2020 Vehicle $ 287,424 $ 288,604 Office furniture 48,266 48,464 Electronic equipment 14,791 14,852 Total 350,481 351,920 Less: Accumulated depreciation (290,088 ) (284,103 ) Property and equipment, net $ 60,393 $ 67,817 |
Taxes Payable (Tables)
Taxes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Taxes Payable | Taxes payable consisted of the following at , 2021 and December 31, 2020: March 31, 2021 December 31, 2020 Value-added $ 21,315 $ 32,318 Income 174,527 235,300 City construction 1,651 2,422 Education 1,230 1,781 Other 11,106 11,674 Taxes payable $ 209,829 $ 283,495 |
Accrued Liabilities and Other_2
Accrued Liabilities and Other Payables (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities and Other Payables | Accrued liabilities and other payables consisted of the following at : March 31, December 31, Accrued employees’ social insurance $ 354,831 $ 364,870 Accrued professional fees 15,756 16,927 Accrued payroll and commission 112,124 105,844 Other payables 28,100 26,598 Total $ 510,811 $ 514,239 |
Lease (Tables)
Lease (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Schedule of Operating Lease Liabilities | Balance sheet information related to the Company’s leases is presented below: March 31, December 31, Operating Leases Operating lease right-of-use assets $ 59,289 $ 100,029 Operating lease liabilities - current $ 35,019 $ 70,780 Operating lease liability – non-current 24,270 29,250 Total operating lease liabilities $ 59,289 $ 100,030 |
Schedule of Operating Lease Expenses | The following provides details of the Company’s lease expenses: Three Months Ended March 31, 2021 2020 Operating lease expenses $ 41,300 $ 39,541 |
Schedule of Other Information Related Leases | Other information related to leases is presented below: Three Months Ended March 31, 2021 2020 Cash Paid For Amounts Included In Measurement of Liabilities: Operating cash flows from operating leases $ 41,300 39,541 Weighted Average Remaining Lease Term: Operating leases 1.12 years 1.62 years Weighted Average Discount Rate: Operating leases 4.75 % 4.75 % |
Schedule of Maturities of Lease Liabilities | Maturities of lease liabilities were as follows: For the year ending December 31: 2021 (excluding the three months ended March 31, 2021) $ 31,585 2022 20,284 2023 9,864 Total lease payments 61,733 Less: imputed interest (2,444 ) Total lease liabilities 59,289 Less: current portion (35,019 ) Lease liabilities – non-current portion $ 24,270 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Schedule of Related party Transactions | Advance to related parties Advance to related parties consisted of the following as of the periods indicated: March 31, December 31, 2021 2020 Qionglai Weide Pharmacy $ - $ 10,421 Chengdu Xindu Cundetang Pharmacy Co., Ltd. - 5,318 Total $ - $ 15,739 These entities are controlled by Mr. Quanzhong Lin, a major shareholder. The advances were for working capital purpose, payable on demand, and bear no interest. Advance from related parties Advance from related parties consisted of the following as of the periods indicated: March 31, December 31, 2021 2020 Quanzhong Lin $ 98,702 $ 258,862 Chengdu Aixin E-Commerce Company Ltd. 3,227 3,240 Chengdu Beibang Pharmacy - 2,748 Total $ 101,929 $ 264,850 |
Organization and Description _2
Organization and Description of Business (Details Narrative) - USD ($) | Dec. 12, 2017 | Feb. 02, 2017 | Jan. 20, 2017 | Mar. 31, 2021 |
Entity incorporation, date of incorporation | Dec. 30, 1987 | |||
Entity incorporation, state country code | CO | |||
Quanzhong Lin [Member] | ||||
Number of common stock shares issued | 56,838,151 | |||
China Concentric [Member] | ||||
Number of common stock sold, shares | 10,955,500 | |||
Ownership percentage | 65.00% | 96.50% | ||
Number of common stock sold | $ 260,000 | |||
Repayment of non-interest bearing advances | $ 150,087 | |||
Number of common stock shares purchased | 7,380,352 | |||
Purchase price of common stock | $ 300,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) | Apr. 02, 2019 | May 01, 2018 | Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($)$ / shares | Mar. 31, 2021CNY (¥) |
Tax payable | $ 1,168,377 | ||||||
Non-operating income | $ (468) | $ (17) | $ 1,168,377 | ||||
Increase in basic and diluted earnings per share | $ / shares | $ 0.015 | ||||||
Bad debt allowance | 147,912 | $ 148,520 | |||||
Inventory impairment | |||||||
Property plant and equipment salvage value percentage | 5.00% | 5.00% | |||||
Impairments of long-lived assets | |||||||
VAT of gross sales price percentage | 13.00% | 16.00% | |||||
Advertisement revenue | 494,864 | 543,440 | |||||
Services advertisement revenue | $ 0 | $ 6,489 | |||||
Cash in insurance covered by bank | $ 72,500 | ||||||
RMB [Member] | |||||||
Cash in insurance covered by bank | ¥ | ¥ 500,000 | ||||||
Prior to May 1, 2018 [Member] | |||||||
VAT of gross sales price percentage | 17.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Estimated Useful Lives of Property and Equipment (Details) | 3 Months Ended |
Mar. 31, 2021 | |
Building [Member] | |
Estimated useful lives of property and equipment | 20 years |
Office Furniture [Member] | |
Estimated useful lives of property and equipment | 5 years |
Electronic Equipment [Member] | |
Estimated useful lives of property and equipment | 3 years |
Vehicles [Member] | |
Estimated useful lives of property and equipment | 5 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Concentration of Credit Risk (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Revenue [Member] | Concentration Risk [Member] | Customer A [Member] | |||
Total revenue | [1] | $ 494,864 | $ 543,440 |
Concentration risk, percentage | [1] | 71.00% | 89.00% |
Revenue [Member] | Concentration Risk [Member] | Customer B [Member] | |||
Total revenue | $ 105,389 | ||
Concentration risk, percentage | 15.00% | ||
Cost of Sales [Member] | Supplier C [Member] | |||
Total revenue | $ 232,104 | ||
Concentration risk, percentage | 99.00% | ||
Cost of Sales [Member] | Supplier A [Member] | |||
Total revenue | [1] | $ 6,341 | |
Concentration risk, percentage | [1] | 100.00% | |
[1] | Represented advertising revenues from this customer during the three months ended March 31, 2021 and 2020. The Company also purchased inventory from this customer in the three months ended March 31, 2020. |
Advances to Suppliers (Details
Advances to Suppliers (Details Narrative) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Advances To Suppliers | ||
Advances to suppliers prepayment amount | $ 157,338 | $ 155,686 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Finished goods - health supplements | $ 147,074 | $ 45,535 |
Loan to Third Party (Details Na
Loan to Third Party (Details Narrative) - Unsecured Loan Agreement [Member] - Third Party [Member] | Jun. 08, 2020USD ($) | Dec. 31, 2020USD ($) | Jun. 08, 2020CNY (¥) |
Debt instrument face amount | $ 7,408,389 | ||
Debt instrument interest | $ 10,718 | ||
Debt instrument maturity date | Jul. 28, 2020 | ||
Interest receivable | $ 535,906 | ||
RMB [Member] | |||
Debt instrument face amount | ¥ | ¥ 50,300,000 | ||
Debt instrument interest | ¥ | ¥ 74,000 |
Property and Equipment, Net (De
Property and Equipment, Net (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 7,225 | $ 12,602 |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property and Equipment (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Property and equipment, gross | $ 350,481 | $ 351,920 |
Less: Accumulated depreciation | (290,088) | (284,103) |
Property and equipment, net | 60,393 | 67,817 |
Vehicle [Member] | ||
Property and equipment, gross | 287,424 | 288,604 |
Office Furniture [Member] | ||
Property and equipment, gross | 48,266 | 48,464 |
Electronic Equipment [Member] | ||
Property and equipment, gross | $ 14,791 | $ 14,852 |
Taxes Payable - Schedule of Tax
Taxes Payable - Schedule of Taxes Payable (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Taxes payable | $ 209,829 | $ 283,495 |
Value-added [Member] | ||
Taxes payable | 21,315 | 32,318 |
Income [Member] | ||
Taxes payable | 174,527 | 235,300 |
City Construction [Member] | ||
Taxes payable | 1,651 | 2,422 |
Education [Member] | ||
Taxes payable | 1,230 | 1,781 |
Other [Member] | ||
Taxes payable | $ 11,106 | $ 11,674 |
Accrued Liabilities and Other_3
Accrued Liabilities and Other Payables - Schedule of Accrued Liabilities and Other Payables (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accrued employees' social insurance | $ 354,831 | $ 364,870 |
Accrued professional fees | 15,756 | 16,927 |
Accrued payroll and commission | 112,124 | 105,844 |
Other payables | 28,100 | 26,598 |
Total | $ 510,811 | $ 514,239 |
Lease (Details Narrative)
Lease (Details Narrative) | Mar. 25, 2019 | Sep. 12, 2018USD ($) | Sep. 12, 2018CNY (¥) | Oct. 31, 2018USD ($) | Oct. 31, 2018CNY (¥) | Sep. 30, 2019USD ($) | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2019CNY (¥) | May 31, 2014 |
Proceeds from sale of building | $ 1,340,862 | ||||||||||
Payments to secure right to purchase the property rights | $ 1,000,000 | ||||||||||
Cost of building | $ 1,739,228 | ||||||||||
Accumulated depreciation of building | $ 364,834 | ||||||||||
Loss on sale of building | $ 32,945 | ||||||||||
Lease term | 2 years | 3 years | |||||||||
Right of use assets | $ 59,289 | $ 100,029 | $ 207,049 | ||||||||
Operating lease liabilities | $ 59,289 | $ 100,030 | $ 207,049 | ||||||||
Lease, discount rate | 4.75% | 4.75% | |||||||||
Minimum [Member] | |||||||||||
Operating lease, remaining lease term | 6 months | ||||||||||
Maximum [Member] | |||||||||||
Operating lease, remaining lease term | 3 years | ||||||||||
Supplemental Agreement [Member] | |||||||||||
Agreement payment, description | On March 25, 2019, the parties entered into a supplemental agreement which provided that the Company would transfer the property rights to Buyer if it agreed the Company would get the benefit of the RMB 7,000,000 ($1,042,893) and otherwise pay the remaining balance of RMB 1,200,000 ($178,782) on or prior to March 31, 2019. The RMB 1,200,000 ($178,782) was paid directly to the shareholder on a timely basis and the Company was given the benefit of the RMB 8,900,000 ($1,325,964) delivered to the Shareholder. | ||||||||||
RMB [Member] | |||||||||||
Payments to secure right to purchase the property rights | ¥ | ¥ 7,000,000 | ||||||||||
Right of use assets | ¥ | ¥ 1,389,731 | ||||||||||
Operating lease liabilities | ¥ | ¥ 1,389,731 | ||||||||||
Building [Member] | |||||||||||
Proceeds from sale of building | $ 1,325,964 | ||||||||||
Building [Member] | RMB [Member] | |||||||||||
Proceeds from sale of building | ¥ | ¥ 8,900,000 | ||||||||||
Building [Member] | Shareholder [Member] | |||||||||||
Proceeds from sale of building | $ 14,898 | ||||||||||
Building [Member] | Shareholder [Member] | RMB [Member] | |||||||||||
Proceeds from sale of building | ¥ | ¥ 100,000 |
Lease - Schedule of Operating L
Lease - Schedule of Operating Lease Liabilities (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2019 |
Leases [Abstract] | |||
Operating lease right-of-use assets | $ 59,289 | $ 100,029 | $ 207,049 |
Operating lease liabilities - current | 35,019 | 70,780 | |
Operating lease liability - non-current | 24,270 | 29,250 | |
Total operating lease liabilities | $ 59,289 | $ 100,030 | $ 207,049 |
Lease - Schedule of Operating_2
Lease - Schedule of Operating Lease Expenses (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Operating lease expenses | $ 41,300 | $ 39,541 |
Lease - Schedule of Other Infor
Lease - Schedule of Other Information Related Leases (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Leases [Abstract] | ||
Operating cash flows from operating leases | $ 41,300 | $ 39,541 |
Weighted Average Remaining Lease Term: Operating leases | 1 year 1 month 13 days | 1 year 7 months 13 days |
Weighted Average Discount Rate: Operating leases | 4.75% | 4.75% |
Lease - Schedule of Maturities
Lease - Schedule of Maturities of Lease Liabilities (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2019 |
Leases [Abstract] | |||
2021 (excluding the three months ended March 31, 2021) | $ 31,585 | ||
2022 | 20,284 | ||
2023 | 9,864 | ||
Total lease payments | 61,733 | ||
Less: imputed interest | (2,444) | ||
Total lease liabilities | 59,289 | $ 100,030 | $ 207,049 |
Less: current portion | (35,019) | (70,780) | |
Lease liabilities - non-current portion | $ 24,270 | $ 29,250 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) | 1 Months Ended | 3 Months Ended | |||
May 31, 2017USD ($) | May 31, 2017CNY (¥) | May 31, 2014USD ($) | May 31, 2014CNY (¥) | Mar. 31, 2021USD ($) | |
Monthly rent | $ (763) | $ (763) | |||
Lease term | 3 years | 3 years | 2 years | ||
Lease expiry date | May 28, 2023 | May 28, 2023 | |||
March 31, 2022 [Member] | |||||
Future annual minimum lease payment | $ 9,158 | ||||
March 31, 2023 [Member] | |||||
Future annual minimum lease payment | 9,158 | ||||
March 31, 2024 [Member] | |||||
Future annual minimum lease payment | $ 1,526 | ||||
Major Shareholder [Member] | |||||
Lease payments description | The monthly rent was RMB 5,000 ($763), the Company was required to prepay each year's annual rent at 15th of May of each year. The Company renewed the lease until May 28, 2023 with monthly rents of RMB 5,000 ($763), payable quarterly. | ||||
RMB [Member] | |||||
Monthly rent | ¥ | ¥ (5,000) | ¥ (5,000) |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Related Party Transactions (Details) - USD ($) | Mar. 31, 2021 | Dec. 31, 2020 |
Advance to related parties | $ 15,739 | |
Advance from related parties | 101,929 | 264,850 |
Qionglai Weide Pharmacy [Member] | ||
Advance to related parties | 10,421 | |
Chengdu Xindu Cundetang Pharmacy Co., Ltd [Member] | ||
Advance to related parties | 5,318 | |
Quanzhong Lin [Member] | ||
Advance to related parties | 258,862 | |
Advance from related parties | 98,702 | |
Chengdu Aixin E-Commerce Company Ltd [Member] | ||
Advance to related parties | 3,240 | |
Advance from related parties | 3,227 | |
Chengdu Beibang Pharmacy [Member] | ||
Advance to related parties | $ 2,748 | |
Advance from related parties |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | 3 Months Ended |
Mar. 31, 2021 | |
China [Member] | |
Income tax rate | 25.00% |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | Oct. 24, 2019 | Oct. 22, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Aug. 17, 2020 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | ||||
Preferred stock, par value | $ 0.001 | $ 0.001 | ||||
Common stock, shares authorized | 500,000,000 | 500,000,000 | 950,000,000 | |||
Common stock, par value | $ 0.00001 | $ 0.00001 | ||||
Common stock, shares issued | 49,999,891 | 49,999,891 | ||||
Common stock, shares outstanding | 49,999,891 | 49,999,891 | ||||
Shares granted and issued for services, values | $ 92,885 | |||||
Stock awards vesting period | 5 years | |||||
Stock awards description | The grantee will forfeit a portion of the shares granted ("Shares Granted") if the grantee is no longer employed by or contracted with the Company. Specifically, the grantee will forfeit 80% of Shares Granted if no longer employed by or contracted with the Company on the date that is one year from the grant date, forfeit 60% of Shares Granted if no longer employed by or contracted with the Company on the date that is two years from the grant date, forfeit 40% of Shares Granted if no longer employed by or contracted with the Company on the date that is three years from the grant date, and forfeit 20% of Shares Granted if no longer employed by or contracted with the Company on the date that is four years from the grant date. Effective on the 5th year from the grant date, none of the shares will be subject to forfeiture. | |||||
Share based compensation | $ 92,885 | $ 92,885 | ||||
Unrecognized compensation expenses | $ 1,322,862 | |||||
Share based compensation expected to recognize over period | 4 years | |||||
Major Shareholder [Member] | ||||||
Number of shares transferred for cancellation | 35,049,685 | |||||
Employees and Contractors [Member] | 2019 Equity Incentive Plan [Member] | ||||||
Shares granted and issued for services | 550,000 | 37,500 | ||||
Shares granted and issued for services, values | $ 1,520,200 | $ 337,500 | ||||
Shares issued at closing price | $ 2.764 | $ 9 |
Statutory Reserves (Details Nar
Statutory Reserves (Details Narrative) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Net income transfer percentage | 10.00% | |
Capital reserve, percentage | 50.00% | 50.00% |
Minimum [Member] | ||
Net income transfer percentage | 5.00% | |
Capital reserve, percentage | 25.00% | |
Maximum [Member] | ||
Net income transfer percentage | 10.00% |