Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Mar. 15, 2022 | Jun. 30, 2021 | |
Document Information Line Items | |||
Entity Registrant Name | IT Tech Packaging, Inc. | ||
Trading Symbol | ITP | ||
Document Type | 10-K | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Common Stock, Shares Outstanding | 99,049,900 | ||
Entity Public Float | $ 44,007,387 | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001358190 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity File Number | 001-34577 | ||
Entity Incorporation, State or Country Code | NV | ||
Entity Tax Identification Number | 20-4158835 | ||
Entity Address, Address Line One | Science Park | ||
Entity Address, Address Line Two | Juli Road | ||
Entity Address, Address Line Three | Xushui District | ||
Entity Address, City or Town | Baoding City | ||
Entity Address, Country | CN | ||
Entity Address, Postal Zip Code | 072550 | ||
City Area Code | (86) | ||
Local Phone Number | 312-8698215 | ||
Title of 12(b) Security | Common Stock | ||
Security Exchange Name | NYSE | ||
Entity Interactive Data Current | Yes | ||
Auditor Name | WWC, P.C | ||
Auditor Location | San Mateo, California | ||
Auditor Firm ID | 1171 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash and bank balances | $ 11,201,612 | $ 4,142,437 |
Restricted cash | ||
Accounts receivable (net of allowance for doubtful accounts of $69,053 and $34,391 as of December 31, 2021 and December 31, 2020, respectively) | 4,868,934 | 2,389,057 |
Inventories | 5,844,895 | 1,233,801 |
Prepayments and other current assets | 25,796,640 | 7,051,515 |
Due from related parties | 7,804,068 | 92,795 |
Total current assets | 55,516,149 | 14,909,605 |
Prepayment on property, plant and equipment | 43,446,210 | 21,149,749 |
Finance lease right-of-use assets, net | 2,286,459 | 2,397,653 |
Property, plant, and equipment, net | 126,587,428 | 145,142,642 |
Value-added tax recoverable | 2,430,277 | 2,566,195 |
Deferred tax asset non-current | 11,268,679 | 13,708,630 |
Total Assets | 241,535,202 | 199,874,474 |
Current Liabilities | ||
Short-term bank loans | 5,958,561 | 6,435,348 |
Current portion of long-term loans from credit union | 6,838,465 | 4,996,245 |
Lease liability | 210,161 | 182,852 |
Accounts payable | 10,255 | 592,391 |
Advance from customers | 39,694 | 82,625 |
Due to related parties | 727,433 | 727,433 |
Accrued payroll and employee benefits | 291,206 | 224,930 |
Other payables and accrued liabilities | 5,250,539 | 4,838,601 |
Income taxes payable | 1,108,038 | 259,649 |
Total current liabilities | 20,434,352 | 18,340,074 |
Loans from credit union | 2,980,065 | 4,597,772 |
Deferred gain on sale-leaseback | 155,110 | 387,087 |
Lease liability - non-current | 152,233 | 354,107 |
Derivative liability | 2,063,534 | 1,115,260 |
Total liabilities (including amounts of the consolidated VIE without recourse to the Company of $17,924,475 and $17,950,224 as of December 31, 2021 and 2020, respectively) | 25,785,294 | 24,794,300 |
Commitments and Contingencies | ||
Stockholders' Equity | ||
Common stock, 500,000,000 shares authorized, $0.001 par value per share, 99,049,900 and 28,535,816 shares issued and outstanding as of December 31, 2021 and December, 31,2020, respectively | 99,050 | 28,536 |
Additional paid-in capital | 88,927,787 | 53,989,548 |
Statutory earnings reserve | 6,080,574 | 6,080,574 |
Accumulated other comprehensive income | 10,496,168 | 5,740,722 |
Retained earnings | 110,146,329 | 109,240,794 |
Total stockholders' equity | 215,749,908 | 175,080,174 |
Total Liabilities and Stockholders' Equity | $ 241,535,202 | $ 199,874,474 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts (in Dollars) | $ 69,053 | $ 34,391 |
Consolidated VIE, liabilities (in Dollars) | $ 17,924,475 | $ 17,950,224 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares issued | 99,049,900 | 28,535,816 |
Common stock, shares outstanding | 99,049,900 | 28,535,816 |
Consolidated Statements of Inco
Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | ||
Revenues | $ 160,881,720 | $ 100,943,269 |
Cost of sales | (149,864,161) | (95,241,284) |
Gross Profit | 11,017,559 | 5,701,985 |
Selling, general and administrative expenses | (9,558,190) | (11,157,789) |
Gain on acquisition of a subsidiary | ||
Income (Loss) from Operations | 1,459,369 | (5,455,804) |
Other Income (Expense): | ||
Interest income | 38,766 | 32,033 |
Subsidy income | 198,530 | 220,478 |
Interest expense | (1,124,702) | (1,026,512) |
Gain (Loss) on derivative liability | 5,880,526 | (426,055) |
Income (Loss) before Income Taxes | 6,452,489 | (6,655,860) |
Provision for Income Taxes | (5,546,954) | 1,101,858 |
Net Income (Loss) | 905,535 | (5,554,002) |
Other Comprehensive Income (Loss) | ||
Foreign currency translation adjustment | 4,755,446 | 11,798,259 |
Total Comprehensive Income (Loss) | $ 5,660,981 | $ 6,244,257 |
Earnings (Losses) Per Share: | ||
Basic and Diluted Earnings (Losses) per Share (in Dollars per share) | $ 0.02 | $ (0.21) |
Outstanding – Basic and Diluted (in Shares) | 59,849,082 | 26,498,298 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders’ Equity - USD ($) | Common Stock | Additional Paid-in Capital | Statutory Earnings Reserve | Accumulated Other Comprehensive Income (loss) | Retained Earnings | Total |
Balance at Dec. 31, 2019 | $ 22,055 | $ 51,155,174 | $ 6,080,574 | $ (6,057,537) | $ 114,794,796 | $ 165,995,062 |
Balance (in Shares) at Dec. 31, 2019 | 22,054,816 | |||||
Issuance of shares to officer and directors | $ 2,000 | 1,198,000 | 1,200,000 | |||
Issuance of shares to officer and directors (in Shares) | 2,000,000 | |||||
Issuance of shares | $ 4,400 | 1,579,755 | 1,584,155 | |||
Issuance of shares (in Shares) | 4,400,000 | |||||
Issuance of shares to a consultant | $ 60 | 41,940 | 42,000 | |||
Issuance of shares to a consultant (in Shares) | 60,000 | |||||
Issuance of shares to a consultant | $ 21 | 14,679 | 14,700 | |||
Issuance of shares to a consultant (in Shares) | 21,000 | |||||
Foreign currency translation adjustment | 11,798,259 | 11,798,259 | ||||
Net income (loss) | (5,554,002) | (5,554,002) | ||||
Balance at Dec. 31, 2020 | $ 28,536 | 53,989,548 | 6,080,574 | 5,740,722 | 109,240,794 | 175,080,174 |
Balance (in Shares) at Dec. 31, 2020 | 28,535,816 | |||||
Issuance of shares to institutional investors | $ 26,182 | 8,002,488 | 8,028,670 | |||
Issuance of shares to institutional investors (in Shares) | 26,181,818 | |||||
Issuance of shares to public investors | $ 29,278 | 15,585,867 | 15,615,145 | |||
Issuance of shares to public investors (in Shares) | 29,277,866 | |||||
Exercise of warrants | $ 15,054 | 11,349,884 | 11,364,938 | |||
Exercise of warrants (in Shares) | 15,054,400 | |||||
Foreign currency translation adjustment | 4,775,446 | 4,775,446 | ||||
Net income (loss) | 905,535 | 905,535 | ||||
Balance at Dec. 31, 2021 | $ 99,050 | $ 88,927,787 | $ 6,080,574 | $ 10,496,168 | $ 110,146,329 | $ 215,749,908 |
Balance (in Shares) at Dec. 31, 2021 | 99,049,900 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash Flows from Operating Activities: | ||
Net income | $ 905,535 | $ (5,554,002) |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 15,358,452 | 15,793,854 |
(Gain) Loss on derivative liability | (5,880,526) | 426,055 |
(Recovery from) Allowance for bad debts | 33,480 | (28,087) |
Share-based compensation and expenses | 1,256,700 | |
Deferred tax | 2,730,050 | (2,364,575) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (2,430,495) | 923,429 |
Prepayments and other current assets | (8,350,716) | 5,301,953 |
Inventories | (4,531,263) | 458,878 |
Accounts payable | (589,371) | 307,198 |
Advance from customers | (44,366) | (21,281) |
Related parties | (785,097) | 1,984,619 |
Accrued payroll and employee benefits | 60,334 | (82,516) |
Other payables and accrued liabilities | 254,966 | (1,105,508) |
Income taxes payable | 832,946 | (1,153,191) |
Net Cash (Used in) Provided by Operating Activities | (2,436,071) | 16,143,526 |
Cash Flows from Investing Activities: | ||
Purchases of property, plant and equipment | (25,071,372) | (21,106,210) |
Proceeds from sale of property, plant and equipment | 580,206 | |
Net Cash Used in Investing Activities | (25,071,372) | (20,526,004) |
Cash Flows from Financing Activities: | ||
Proceeds from issuance of shares and warrants, net | 41,837,553 | 2,273,360 |
Proceeds from short term bank loans | 5,892,298 | 6,090,715 |
Repayment of bank loans | (6,512,703) | (6,237,217) |
Payment of capital lease obligation | (185,050) | (72,003) |
Loan to a related party | (6,838,274) | |
Net Cash Provided by (Used in) Financing Activities | 34,193,824 | 2,054,855 |
Effect of Exchange Rate Changes on Cash and Cash Equivalents | 372,794 | 632,315 |
Net Increase (Decrease) in Cash and Cash Equivalents | 7,059,175 | (1,695,308) |
Cash, Cash Equivalents and Restricted Cash - Beginning of Year | 4,142,437 | 5,837,745 |
Cash, Cash Equivalents and Restricted Cash - End of Year | 11,201,612 | 4,142,437 |
Supplemental Disclosure of Cash Flow Information: | ||
Cash paid for interest, net of capitalized interest cost | 577,194 | 592,140 |
Cash paid for income taxes | 1,970,984 | 2,401,191 |
Cash and bank balances | 11,201,612 | 4,142,437 |
Restricted cash | ||
Total cash, cash equivalents and restricted cash shown in the statement of cash flows | $ 11,201,612 | $ 4,142,437 |
Organization and Business Backg
Organization and Business Background | 12 Months Ended |
Dec. 31, 2021 | |
Organization and Business Background [Abstract] | |
Organization and Business Background | (1) Organization and Business Background IT Tech Packaging, Inc. (the “Company”) was incorporated in the State of Nevada on December 9, 2005, under the name “Carlateral, Inc.” Through the steps described immediately below, we became the holding company for Hebei Baoding Dongfang Paper Milling Company Limited (“Dongfang Paper”), a producer and distributor of paper products in China, on October 29, 2007. Effective on August 1, 2018, we changed our corporate name to IT Tech Packaging, Inc.. The name change was effected through a parent/subsidiary short-form merger of IT Tech Packaging, Inc., our wholly-owned Nevada subsidiary formed solely for the purpose of the name change, with and into us. We were the surviving entity. In connection with the name change, our common stock began being traded under a new NYSE symbol, “ITP,” and a new CUSIP number, 46527C100, at such time. On October 29, 2007, pursuant to an agreement and plan of merger (the “Merger Agreement”), the Company acquired Dongfang Zhiye Holding Limited (“Dongfang Holding”), a corporation formed on November 13, 2006 under the laws of the British Virgin Islands, and issued the shareholders of Dongfang Holding an aggregate of 7,450,497 (as adjusted for a four-for-one reverse stock split effected in November 2009) shares of our common stock, which shares were distributed pro-rata to the shareholders of Dongfang Holding in accordance with their respective ownership interests in Dongfang Holding. At the time of the Merger Agreement, Dongfang Holding owned all of the issued and outstanding stock and ownership of Dongfang Paper and such shares of Dongfang Paper were held in trust with Zhenyong Liu, Xiaodong Liu and Shuangxi Zhao, for Mr. Liu, Mr. Liu and Mr. Zhao (the original shareholders of Dongfang Paper) to exercise control over the disposition of Dongfang Holding’s shares in Dongfang Paper on Dongfang Holding’s behalf until Dongfang Holding successfully completed the change in registration of Dongfang Paper’s capital with the relevant PRC Administration of Industry and Commerce as the 100% owner of Dongfang Paper’s shares. As a result of the merger transaction, Dongfang Holding became a wholly owned subsidiary of the Company, and Dongfang Holding’s wholly owned subsidiary, Dongfang Paper, became an indirectly owned subsidiary of the Company. Dongfang Holding, as the 100% owner of Dongfang Paper, was unable to complete the registration of Dongfang Paper’s capital under its name within the proper time limits set forth under PRC law. In connection with the consummation of the restructuring transactions described below, Dongfang Holding directed the trustees to return the shares of Dongfang Paper to their original shareholders, and the original Dongfang Paper shareholders entered into certain agreements with Baoding Shengde Paper Co., Ltd. (“Baoding Shengde”) to transfer the control of Dongfang Paper over to Baoding Shengde. On June 24, 2009, the Company consummated a number of restructuring transactions pursuant to which it acquired all of the issued and outstanding shares of Shengde Holdings Inc., a Nevada corporation. Shengde Holdings Inc. was incorporated in the State of Nevada on February 25, 2009. On June 1, 2009, Shengde Holdings Inc. incorporated Baoding Shengde, a limited liability company organized under the laws of the PRC. Because Baoding Shengde is a wholly-owned subsidiary of Shengde Holdings Inc., it is regarded as a wholly foreign-owned entity under PRC law. To ensure proper compliance of the Company’s control over the ownership and operations of Dongfang Paper with certain PRC regulations, on June 24, 2009, the Company entered into a series of contractual agreements (the “Contractual Agreements”) with Dongfang Paper and Dongfang Paper Equity Owners via the Company’s wholly owned subsidiary Shengde Holdings Inc. (“Shengde Holdings”) a Nevada corporation and Baoding Shengde Paper Co., Ltd. (“Baoding Shengde”), a wholly foreign-owned enterprise in the PRC with an original registered capital of $10,000,000 (subsequently increased to $60,000,000 in June 2010). Baoding Shengde is mainly engaged in production and distribution of digital photo paper and single-use face masks and is 100% owned by Shengde Holdings. Prior to February 10, 2010, the Contractual Agreements included (i) Exclusive Technical Service and Business Consulting Agreement, which generally provides that Baoding Shengde shall provide exclusive technical, business and management consulting services to Dongfang Paper, in exchange for service fees including a fee equivalent to 80% of Dongfang Paper’s total annual net profits; (ii) Loan Agreement, which provides that Baoding Shengde will make a loan in the aggregate principal amount of $10,000,000 to Dongfang Paper Equity Owners in exchange for each such shareholder agreeing to contribute all of its proceeds from the loan to the registered capital of Dongfang Paper; (iii) Call Option Agreement, which generally provides, among other things, that Dongfang Paper Equity Owners irrevocably grant to Baoding Shengde an option to purchase all or part of each owner’s equity interest in Dongfang Paper. The exercise price for the options shall be RMB1 which Baoding Shengde should pay to each of Dongfang Paper Equity Owner for all their equity interests in Dongfang Paper; (iv) Share Pledge Agreement, which provides that Dongfang Paper Equity Owners will pledge all of their equity interests in Dongfang Paper to Baoding Shengde as security for their obligations under the other agreements described in this section. Specifically, Baoding Shengde is entitled to dispose of the pledged equity interests in the event that Dongfang Paper Equity Owners breach their obligations under the Loan Agreement or Dongfang Paper fails to pay the service fees to Baoding Shengde pursuant to the Exclusive Technical Service and Business Consulting Agreement; and (v) Proxy Agreement, which provides that Dongfang Paper Equity Owners shall irrevocably entrust a designee of Baoding Shengde with such shareholder’s voting rights and the right to represent such shareholder to exercise such owner’s rights at any equity owners’ meeting of Dongfang Paper or with respect to any equity owner action to be taken in accordance with the laws and Dongfang Paper’s Articles of Association. The terms of the agreement are binding on the parties for as long as Dongfang Paper Equity Owners continue to hold any equity interest in Dongfang Paper. A Dongfang Paper Equity Owner will cease to be a party to the agreement once it transfers its equity interests with the prior approval of Baoding Shengde. As the Company had controlled Dongfang Paper since July 16, 2007 through Dongfang Holding and the trust until June 24, 2009 and continued to control Dongfang Paper through Baoding Shengde and the Contractual Agreements, the execution of the Contractual Agreements is considered as a business combination under common control. On February 10, 2010, Baoding Shengde and the Dongfang Paper Equity Owners entered into a Termination of Loan Agreement to terminate the above-mentioned $10,000,000 Loan Agreement. Because of the Company’s decision to fund future business expansions through Baoding Shengde instead of Dongfang Paper, the $10,000,000 loan contemplated was never made prior to the point of termination. The parties believe the termination of the Loan Agreement does not in itself compromise the effective control of the Company over Dongfang Paper and its businesses in the PRC. An agreement was also entered into among Baoding Shengde, Dongfang Paper and the Dongfang Paper Equity Owners on December 31, 2010, reiterating that Baoding Shengde is entitled to 100% of the distributable profit of Dongfang Paper, pursuant to the above- mentioned Contractual Agreements. In addition, Dongfang Paper and the Dongfang Paper Equity Owners shall not declare any of Dongfang Paper’s unappropriated earnings as dividend, including the unappropriated earnings of Dongfang Paper from its establishment to 2010 and thereafter. On June 25, 2019, Dongfang Paper entered into an acquisition agreement with shareholder of Hebei Tengsheng Paper Co., Ltd. (“Hebei Tengsheng”), a limited liability company organized under the laws of the PRC, pursuant to which Dongfang Paper will acquire Hebei Tengsheng. Full payment of the consideration in the amount of RMB 320 million (approximately $45 million) was made on February 23, 2022. The Company has no direct equity interest in Dongfang Paper. However, through the Contractual Agreements described above, the Company is found to be the primary beneficiary (the “Primary Beneficiary”) of Dongfang Paper and is deemed to have the effective control over Dongfang Paper’s activities that most significantly affect its economic performance, resulting in Dongfang Paper being treated as a controlled variable interest entity of the Company in accordance with Topic 810 - Consolidation of the Accounting Standards Codification (the “ASC”) issued by the Financial Accounting Standard Board (the “FASB”). The revenue generated from Dongfang Paper for the years ended December 31, 2021 and 2020 was accounted for 99.11%and 98.91% of the Company’s total revenue, respectively. Dongfang Paper also accounted for 84.13% and 90.70% of the total assets of the Company as of December 31, 2021 and 2020, respectively. As of December 31, 2021, and 2020, details of the Company’s subsidiaries and variable interest entity are as follows: Date of Place of Percentage Incorporation Incorporation or of Name or Establishment Establishment Ownership Principal Activity Subsidiary: Dongfang Holding November 13, 2006 BVI 100 % Inactive investment holding Shengde Holdings February 25, 2009 State of Nevada 100 % Investment holding Baoding Shengde June 1, 2009 PRC 100 % Paper production and distribution Variable interest entity (“VIE”): Dongfang Paper March 10, 1996 PRC Control* Paper production and distribution * Dongfang Paper is treated as a 100% controlled variable interest entity of the Company. However, uncertainties in the PRC legal system could cause the Company’s current ownership structure to be found to be in violation of any existing and/or future PRC laws or regulations and could limit the Company’s ability, through its subsidiary, to enforce its rights under these contractual arrangements. Furthermore, shareholders of the VIE may have interests that are different than those of the Company, which could potentially increase the risk that they would seek to act contrary to the terms of the aforementioned agreements. In addition, if the current structure or any of the contractual arrangements were found to be in violation of any existing or future PRC law, the Company may be subject to penalties, which may include, but not be limited to, the cancellation or revocation of the Company’s business and operating licenses, being required to restructure the Company’s operations or being required to discontinue the Company’s operating activities. The imposition of any of these or other penalties may result in a material and adverse effect on the Company’s ability to conduct its operations. In such case, the Company may not be able to operate or control the VIE, which may result in deconsolidation of the VIE. The Company believes the possibility that it will no longer be able to control and consolidate its VIE will occur as a result of the aforementioned risks and uncertainties is remote. The Company has aggregated the financial information of Dongfang Paper in the table below. The aggregate carrying value of Dongfang Paper’s assets and liabilities (after elimination of intercompany transactions and balances) in the Company’s consolidated balance sheets as of December 31, 2021, and 2020 are as follows: December 31, December 31, 2021 2020 ASSETS Current Assets Cash and bank balances $ 1,921,407 $ 3,315,778 Restricted cash - - Accounts receivable 4,867,759 2,389,057 Inventories 5,823,762 1,223,020 Prepayments and other current assets 19,942,878 7,051,381 Due from related parties 888,893 92,795 Total current assets 33,444,699 14,072,031 Prepayment on property, plant and equipment 41,877,755 19,617,159 Finance lease right-of-use assets, net 2,286,459 2,397,653 Property, plant, and equipment, net 116,054,387 133,134,932 Deferred tax asset non-current 9,547,741 12,040,962 Total Assets $ 203,211,041 $ 181,262,737 LIABILITIES Current Liabilities Short-term bank loans $ 5,958,561 $ 6,435,348 Current portion of long-term loans from credit union 2,289,945 551,733 Lease liability 210,161 182,852 Accounts payable 10,255 592,391 Advance from customers 39,694 82,625 Due to related parties - - Accrued payroll and employee benefits 279,513 221,482 Other payables and accrued liabilities 4,740,900 4,672,265 Income taxes payable 1,108,038 259,649 Total current liabilities 14,637,067 12,998,345 Loans from credit union 2,980,065 4,597,772 Deferred gain on sale-leaseback 155,110 387,087 Lease liability - non-current 152,233 354,107 Total liabilities $ 17,924,475 $ 17,950,224 The Company and its consolidated subsidiaries are not required to provide financial support to the VIE, and no creditor (or beneficial interest holders) of the VIE have recourse to the assets of Company unless the Company separately agrees to be subject to such claims. There are no terms in any agreements or arrangements, implicit or explicit, which require the Company or its subsidiaries to provide financial support to the VIE. However, if the VIE does require financial support, the Company or its subsidiaries may, at its option and subject to statutory limits and restrictions, provide financial support to the VIE. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Organization and Business Background [Abstract] | |
Basis of Presentation and Significant Accounting Policies | (2) Basis of Presentation and Significant Accounting Policies Basis of Consolidation The consolidated financial statements of the Company are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”), and include the assets, liabilities, revenues, expenses and cash flows of all subsidiaries and variable interest entity. All significant inter-company balances, transactions and cash flows are eliminated on consolidation. Foreign Currency Translation The Company accounts for foreign currency translation pursuant to ASC Topic 830, Foreign Currency Matters Under ASC Topic 830-30, all assets and liabilities are translated into United States dollars using the current exchange rate at the end of each fiscal period. The current exchange rates used by the Company as of December 31, 2021, and 2020 to translate the Chinese RMB to the U.S. Dollars are 6.3757:1, and 6.5249:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.4474:1 and 6.8941:1 for the years ended December 31, 2021, and 2020, respectively. Translation adjustments are included in other comprehensive income (loss). Use of Estimates The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of December 31, 2021, and 2020, and revenues and expenses for the years ended December 31, 2021, and 2020. The most significant estimates relate to allowance for uncollectible accounts receivable, inventory valuation, useful lives and impairment for property, plant and equipment, valuation allowance for deferred tax assets and contingencies. Actual results could differ from those estimates made by management. Accounts Receivable Trade accounts receivable are recorded on shipment of products to customers. The trade receivables are all without customer collateral and interest is not accrued on past due accounts. Periodically, management reviews the adequacy of its provision for doubtful accounts based on historical bad debt expense results and current economic conditions using factors based on the aging of its accounts receivable. Additionally, the Company may identify additional allowance requirements based on indications that a specific customer may be experiencing financial difficulties. Actual bad debt results could differ materially from these estimates. As of December 31, 2021, and 2020, the balance of allowance for doubtful accounts was $69,053 and $34,391, respectively; and the movement of the provision of the doubtful accounts is as below. While management uses the best information available upon which to base estimates, future adjustments to the allowance may be necessary if economic conditions differ substantially from the assumptions used for the purposes of analysis. December 31, December 31, Allowance of doubtful accounts 2021 2020 Opening balance $ 34,391 $ 59,922 Provision (Reversal) for the year 33,480 (28,087 ) Exchange difference 1,181 2,556 Closing balance $ 69,053 $ 34,391 Inventories Inventories consist principally of raw materials and finished goods, and are stated at the lower of cost (average cost method) or market. Cost includes labor, raw materials, and allocated overhead. Provision in inventories were $ nil Property, Plant, and Equipment Property, plant, and equipment are stated at cost less accumulated depreciation and any impairment losses. Major renewals, betterments, and improvements are capitalized to the asset accounts while replacements, maintenance, and repairs, which do not improve or extend the lives of the respective assets, are expensed to operations. At the time property, plant, and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation or amortization accounts are relieved of the applicable amounts. Gains or losses from retirements or sales are credited or charged to operations. Construction-in-progress is stated at cost and capitalized as expenses are incurred or as payments are made pursuant to relevant construction contracts. Contract retention is recorded as accrued liability. Construction in progress is not depreciated until project completion and the constructed property being placed in service, at which time the capitalized balance will be transferred to appropriate account of property, plant and equipment. The Company depreciates property, plant, and equipment using the straight-line method as follows: Land use right Over the lease term Building and improvements 30 years Machinery and equipment 5-15 years Vehicles 15 years Valuation of long-lived asset The Company reviews the carrying value of long-lived assets to be held and used when events and circumstances warrants such a review. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flow from such asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the long-lived asset and intangible assets. Fair market value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. Losses on long-lived assets and intangible assets to be disposed are determined in a similar manner, except that fair market values are reduced for the cost to dispose. Statutory Reserves According to the laws and regulations in the PRC, the Company is required to provide for certain statutory funds, namely, a reserve fund by an appropriation from net profit after taxation but before dividend distribution based on the local statutory financial statements of the PRC subsidiary and variable interest entity prepared in accordance with the PRC accounting principles and relevant financial regulations. Each of the Company’s wholly owned subsidiary and variable interest entity in the PRC are required to allocate at least 10% of its net profit to the reserve fund until the balance of such fund has reached 50% of its registered capital. Appropriations of additional reserve fund are determined at the discretion of its directors. The reserve fund can only be used, upon approval by the relevant authority, to offset accumulated losses or increase capital. For the years ended December 31, 2021, and 2020, IT Tech Packaging made transfers of $ nil Employee Benefit Plan Full time employees of the PRC entities participate in a government mandated multi-employer defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance and other welfare benefits are provided to employees. The total provision for such employee benefits was $ nil Revenue Recognition The Company adopted ASC Topic 606, Revenue from Contracts with Customers 1. Identify the contract(s) with a customer; 2. Identify the performance obligations in the contract; 3. Determine the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue when (or as) the entity satisfies a performance obligation. A contract contains a promise (or promises) to transfer goods or services to a customer. A performance obligation is a promise (or a group of promises) that is distinct. The transaction price is the amount of consideration a company expects to be entitled from a customer in exchange for providing the goods or services. The unit of account for revenue recognition is a performance obligation (a good or service). A contract may contain one or more performance obligations. Performance obligations are accounted for separately if they are distinct. A good or service is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and the good or service is distinct in the context of the contract. Otherwise, performance obligations are combined with other promised goods or services until the Company identifies a bundle of goods or services that is distinct. Promises in contracts which do not result in the transfer of a good or service are not performance obligations, as well as those promises that are administrative in nature, or are immaterial in the context of the contract. The Company has addressed whether various goods and services promised to the customer represent distinct performance obligations. The Company applied the guidance of ASC Topic 606-10-25-16 through 18 in order to verify which promises should be assessed for classification as distinct performance obligations. The Company’s revenue is primary derived from sales of paper products. The Company recognizes revenue when goods are delivered, when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist, and collectability is reasonably assured. Goods are considered delivered when customer’s truck picks up goods at the Company’s finished goods inventory warehouse. Shipping Cost Substantially all customers use their own trucks or hire commercial trucking companies to pick up goods from the Company. The Company usually incurs no shipping cost for delivery of goods to customers. For those rare situations where products are not shipped utilizing customer specified shipping services, the Company charges customers a shipping fee which is included in net revenues and was not material. Freight-in and handling costs incurred by the Company with respect to purchased goods are recorded as a component of inventory cost and charged to cost of sales when the inventory items are sold. Advertising The Company expenses all advertising and promotion costs as incurred. The Company incurred $3,972 and $ nil Research and development costs Research and development costs are expensed as incurred and included in selling, general and administrative expenses. Research and development expenses incurred $101,410 and $69,208 for the years ended December 31, 2021, and 2020, respectively. Borrowing costs Borrowing costs attributable directly to the acquisition, construction or production of qualifying assets which require a substantial period of time to be ready for their intended use or sale, are capitalized as part of the cost of those assets. Income earned on temporary investments of specific borrowings pending their expenditure on those assets is deducted from borrowing costs capitalized. All other borrowing costs are recognized in interest expenses in the period in which they are incurred. Government subsidies A government subsidy is not recognized until there is reasonable assurance that: (a) the enterprise will comply with the conditions attached to the grant; and(b)the grant will be received. When the Company receives government subsidies but the conditions attached to the grants have not been fulfilled, such government subsidies are deferred and recorded under other payables and accrued expenses, and other long-term liability. The classification of short-term or long-term liabilities is depended on the management’s expectation of when the conditions attached to the grant can be fulfilled. For the years ended December 31, 2021, and 2020, the Company received government subsidies of $198,530 and $220,478, which are recognized as subsidy income in the consolidated statements of income in that fiscal year. Income Taxes The Company accounts for income taxes pursuant to ASC Topic 740, Income Taxes. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Any tax paid by subsidiaries during the year is recorded. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. ASC Topic 740 also requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry-forwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets, including those related to the U.S. net operating loss carry-forwards, are dependent upon future earnings, if any, of which the timing and amount are uncertain. The Company adopted ASC Topic 740-10-05, Income Tax The Company’s policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expense. Value Added Tax Both the PRC subsidiary and variable interest entity of the Company are subject to value added tax (“VAT”) imposed by the PRC government on its purchase and sales of goods. The output VAT is charged to customers who purchase goods from the Company and the input VAT is paid when the Company purchases goods from its vendors. VAT rate is 17% (before May 1, 2018), 16% (after May 1, 2018) and 13% (after April 1, 2019) in general, depending on the types of products purchased and sold. The input VAT can be offset against the output VAT. Debit balance of VAT payable represents a credit against future collection of output VAT instead of a receivable due from government. Comprehensive Income (Loss) The Company presents comprehensive income (loss) in accordance with ASC Topic 220, Comprehensive Income Earnings Per Share Basic earnings per share is computed by dividing the net income attributable to the common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. There were no potentially dilutive securities that were in-the-money that were outstanding during the years ended December 31, 2021. Share-Based Compensation The Company uses the fair value recognition provision of ASC Topic 718, Compensation-Stock Compensation, The Company also applies the provisions of ASC Topic 505-50, Equity Based Payments to Non-Employees Fair Value Measurements The Company has adopted ASC Topic 820, Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. It does not require any new fair value measurement, but provides guidance on how to measure fair value by providing a fair value hierarchy used to classify the source of the information. It establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable inputs, which may be used to measure fair value and include the following: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement. The Company estimates the fair value of financial instruments using the available market information and valuation methods. Considerable judgment is required in estimating fair value. Accordingly, the estimates of fair value may not be indicative of the amounts that the Company could realize in a current market exchange. As of December 31, 2021, and 2020, the carrying value of the Company’s short term financial instruments, such as cash and bank balances, accounts receivable, accounts and notes payable, short-term bank loans and balance due to related parties, approximate at their fair values because of the short maturity of these instruments; while loans from credit union approximates at their fair value as the interest rates thereon are close to the market rates of interest published by the People’s Bank of China. Derivative liabilities are measured at fair value on a recurring basis. Non-Recurring Fair Value Measurements The Company reviews long-lived assets for impairment annually or more frequently if events or changes in circumstances indicate the possibility of impairment. For the continuing operations, long-lived assets are measured at fair value on a nonrecurring basis when there is an indicator of impairment, and they are recorded at fair value only when impairment is recognized. For discontinued operations, long-lived assets are measured at the lower of carrying amount or fair value less cost to sell. The fair value of these assets was determined using models with significant unobservable inputs which were classified as Level 3 inputs, primarily the discounted future cash flow. |
Restricted Cash
Restricted Cash | 12 Months Ended |
Dec. 31, 2021 | |
Cash and Cash Equivalents [Abstract] | |
Restricted Cash | (3) Restricted Cash Restricted cash was nil |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | (4) Inventories Raw materials inventory includes mainly recycled paper and coal. Finished goods include mainly products of corrugating medium paper and offset printing paper. Inventories consisted of the following as of and December 31, 2021, and 2020: December 31, December 31, 2021 2020 Raw Materials Recycled paper board $ 2,097,062 $ 19,459 Recycled white scrap paper 11,808 11,193 Gas 32,753 55,473 Base paper and other raw materials 206,531 181,426 2,348,154 267,551 Semi-finished Goods 96,087 176,703 Finished Goods 3,400,654 789,547 Total inventory, gross 5,844,895 1,233,801 Inventory reserve - - Total inventory, net $ 5,844,895 $ 1,233,801 |
Prepayments and Other Current A
Prepayments and Other Current Assets | 12 Months Ended |
Dec. 31, 2021 | |
Prepaid Expenses And Other Current Assets Disclosure [Abstract] | |
Prepayments and other current assets | (5) Prepayments and other current assets Prepayments and other current assets consisted of the following as of December 31, 2021, and 2020: December 31, December 31, 2021 2020 Prepaid land lease $ 188,215 $ 183,912 Prepayment for purchase of materials 9,190,527 10,945 Prepayment for purchase of equipment 980,786 - Value-added tax recoverable 14,740,296 5,864,989 Others 696,816 991,669 $ 25,796,640 $ 7,051,515 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, plant and equipment | (6) Property, plant and equipment As of December 31, 2021, and 2020, property, plant and equipment consisted of the following: December 31, December 31, 2021 2020 Property, Plant, and Equipment: Land use rights $ 12,790,062 $ 12,497,601 Building and improvements 74,609,698 81,233,162 Machinery and equipment 170,149,367 163,787,807 Vehicles 725,838 628,462 Construction in progress - 586,216 Totals 258,274,965 258,733,248 Less: accumulated depreciation and amortization (131,687,537 ) (113,590,606 ) Property, Plant and Equipment, net $ 126,587,428 $ 145,142,642 As of December 31, 2021, and 2020, land use rights represented two parcel of state-owned lands located in Xushui District of Hebei Province in China, with lease terms of 50 years expiring from 2061 to 2066. Construction in progress mainly represents payments for paper machine of a new tissue paper production line PM10. As of December 31, 2021, and 2020, certain property, plant and equipment of Dongfang Paper with net values of $1,130,333 and $2,349,796, respectively, have been pledged pursuant to a long-term loan from credit union of Dongfang Paper. Land use right of Dongfang Paper with net values of $6,002,195 and $6,010,359, respectively, as of December 31, 2021 and 2020 was pledged for the bank loan from Bank of Industrial & Commercial Bank of China. Land use right of Hebei Tengsheng with net value of $5,690,261 and $5,560,146, respectively, as of December 31, 2021 and 2020 was pledged for a long-term loan from credit union of Baoding Shengde. In addition, land use right of Hebei Tengsheng with net value of $8,815,778 and $8,614,194, respectively, as of December 31, 2021 and 2020 was pledged for another long-term loan from credit union of Baoding Shengde. See “ Short-term bank loans Depreciation and amortization of property, plant and equipment was $15,304,686 and $15,793,854 for the years ended December 31, 2021, and 2020, respectively. No Impairment loss was recorded for the years ended December 31, 2021, and 2020. |
Financing with Sale-Leaseback
Financing with Sale-Leaseback | 12 Months Ended |
Dec. 31, 2021 | |
Financing with Sale-Leaseback [Abstract] | |
Financing with Sale-Leaseback | (7) Financing with Sale-Leaseback The Company entered into a sale-leaseback arrangement (the “Lease Financing Agreement”) with TAC Leasing Co., Ltd.(“TLCL”) on August 6, 2020, for a total financing proceeds in the amount of RMB 16 million (approximately US$2.5 million). Under the sale-leaseback arrangement, Hebei Tengsheng sold the Leased Equipment to TLCL for 16 million (approximately US$2.5 million). Concurrent with the sale of equipment, Hebei Tengsheng leases back the equipment sold to TLCL for a lease term of three years. At the end of the lease term, Hebei Tengsheng may pay a nominal purchase price of RMB 100 (approximately $15) to TLCL and buy back the Leased Equipment. The Leased Equipment in amount of $2,349,452 was recorded as right of use assets and the net present value of the minimum lease payments was recorded as lease liability and calculated with TLCL’s implicit interest rate of15.6% per annum and stated at $567,099 at the inception of the lease on August 17, 2020. Hebei Tengsheng made payments due according to the schedule. As of December 31, 2021 and 2020, the balance of Leased Equipment net of amortization was $2,286,459 and $2,397,653, respectively. The lease liability were $362,394 and $536,959, and its current portion in the amount of $210,161 and $182,852 as of December 31, 2021 and 2020, respectively. Amortization of the Leased Equipment was $165,441 and $51,574 for the year ended December 31, 2021 and 2020, respectively. Total interest expenses for the sale lease back arrangement was $71,798 and $28,083 for the year ended December 31, 2021 and 2020, respectively. As a result of the sale and leaseback, a deferred gain in the amount of $430,695 was recorded. The deferred gain is amortized over the lease term and as an offset to amortization of the Leased Equipment. The future minimum lease payments of the capital lease as of December 31, 2021 were as follows: December 31, Amount 2022 259,736 2023 151,513 Less: unearned discount (48,855 ) 362,394 Less: Current portion lease liability (210,161 ) $ 152,233 |
Loans Payable
Loans Payable | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Loans Payable | (8) Loans Payable Short-term bank loans December 31, December 31, 2021 2020 Industrial and Commercial Bank of China (“ICBC”) Loan 1 $ - $ 6,435,348 Industrial and Commercial Bank of China (“ICBC”) Loan 2 5,958,561 - Total short-term bank loans $ 5,958,561 $ 6,435,348 On December 11, 2020, the Company entered into a working capital loan agreement with the ICBC, with a balance of $6,435,348 as of December 31, 2020. The working capital loan was secured by the Land use right of Dongfang Paper as collateral for the benefit of the bank. The loan bears a fixed interest rate of 4.785% per annum. The loan was fully repaid in November 2021. On November 25, 2021, the Company entered into a working capital loan agreement with the ICBC, with a balance of $5,958,561 as of December 31, 2021. The working capital loan was secured by the Land use right of Dongfang Paper as collateral for the benefit of the bank and guaranteed by Mr. liu. The loan bears a fixed interest rate of 4.785% per annum. The loan will be due and repaid at various installments by November 17, 2022. As of December 31, 2020, there were guaranteed short-term borrowings of $5,958,561 and unsecured bank loans of $ nil nil The average short-term borrowing rates for the years ended December 31, 2021, and 2020 were approximately 4.73% and 4.79%, respectively. Long-term loans from credit union As of December 31, 2020, and 2019, loans payable to Rural Credit Union of Xushui County, amounted to $9,818,530 and $9,594,017, respectively. December 31, December 31, 2021 2020 Rural Credit Union of Xushui District Loan 1 $ 1,348,871 $ 1,318,028 Rural Credit Union of Xushui District Loan 2 3,921,139 3,831,476 Rural Credit Union of Xushui District Loan 3 2,509,528 2,452,145 Rural Credit Union of Xushui District Loan 4 2,038,992 1,992,368 Total 9,818,530 9,594,017 Less: Current portion of long-term loans from credit union (6,838,465 ) (4,996,245 ) Long-term loans from credit union $ 2,980,065 $ 4,597,772 As of Dec 31, 2021, the Company’s long-term debt repayments for the next two years were as follows: Amount Fiscal year 2022 $ 6,838,465 2023 and after 2,980,065 Total 9,818,530 On April 16, 2014, the Company entered into a loan agreement with the Rural Credit Union of Xushui District for a term of 5 years, which was originally due in various installments from June 21, 2014 to November 18, 2018. The loan is guaranteed by an independent third party. Interest payment is due quarterly and bears the rate of 0.64% per month. On November 6, 2018, the loan was renewed for additional 5 years and will be due and payable in various installments from December 21, 2018 to November 5, 2023. As of December 31, 2021, and 2020, total outstanding loan balance was $1,348,871 and $1,318,028, respectively, Out of the total outstanding loan balance, current portion amounted were $329,376 and $214,563 as of December 31, 2021, and 2020, respectively, which are presented as current liabilities in the consolidated balance sheet and the remaining balance of $1,019,495 and $1,103,465 are presented as non-current liabilities in the consolidated balance sheet as of December 31, 2021, and 2020, respectively. On July 15, 2013, the Company entered into a loan agreement with the Rural Credit Union of Xushui District for a term of 5 years, which was originally due and payable in various installments from December 21, 2013 to July 26, 2018. On June 21, 2018, the loan was extended for additional 5 years and will be due and payable in various installments from December 21, 2018 to June 20, 2023. The loan is secured by certain of the Company’s manufacturing equipment with net book value of $1,130,333 and $2,349,796 as of December 31, 2021, and 2020, respectively. Interest payment is due quarterly and bears a fixed rate of 0.64% per month. As of December 31, 2021, and 2020, the total outstanding loan balance was $3,921,139 and $3,831,476, respectively. Out of the total outstanding loan balance, current portion amounted were $1,960,569 and $337,169 as of December 31, 2021, and 2020 respectively, which are presented as current liabilities in the consolidated balance sheet and the remaining balance of $1,960,570 and $3,494,307 are presented as non-current liabilities in the consolidated balance sheet as of December 31, 2021, and 2020, respectively. On April 17, 2019, the Company entered into a loan agreement with the Rural Credit Union of Xushui District for a term of 2 years, which was due and payable in various installments from August 21, 2019 to April 16, 2021. The loan was renewed on March 22, 2021 and December 24, 2021 and extended for additional 3 years in total, which will be due on April 16, 2024 according to the new schedule. The loan is secured by Hebei Tengsheng with its land use right as collateral for the benefit of the credit union. Interest payment is due quarterly and bears a fixed rate of 0.6% per month. As of December 31, 2021, and 2020, the total outstanding loan balance was $2,509,528 and $2,452,145, respectively, which are presented as current liabilities in the consolidated balance sheet as of December 31, 2021, and 2020. On December 12, 2019, the Company entered into a loan agreement with the Rural Credit Union of Xushui District for a term of 2 years, which is due and payable in various installments from June 21, 2020 to December 11, 2021. The loan was renewed on March 22, 2021 and December 24, 2021 and extended for additional 3 years in total, which will be due on December 11, 2024 according to the new schedule. The loan is secured by Hebei Tengsheng with its land use right as collateral for the benefit of the credit union. Interest payment is due monthly and bears a fixed rate of 7.56% per annum. As of December 31, 2021, and 2020, the total outstanding loan balance was $2,038,992 and $1,992,368, respectively, which are presented as current liabilities in the consolidated balance sheet as of December 31, 2021, and 2020. Total interest expenses for the short-term bank loans and long-term loans for the years ended December 31, 2021, and 2020 were $1,052,904 and $998,429, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | (9) Related Party Transactions Mr. Zhenyong Liu has loaned money to Dongfang Paper for working capital purposes over a period of time. On January 1, 2013, Dongfang Paper and Mr. Zhenyong Liu renewed the three-year term loan previously entered on January 1, 2010, and extended the maturity date further to December 31, 2015. On December 31, 2015, the Company paid off the loan of $2,249,279, together with interest of $391,374 for the period from 2013 to 2015. Approximately $402,047 and $392,855 of interest were outstanding to Mr. Zhenyong Liu, which were recorded in other payables and accrued liabilities as part of the current liabilities in the consolidated balance sheet as of December 31, 2021, and 2020, respectively. On December 10, 2014, Mr. Zhenyong Liu provided a loan to the Company, amounted to $8,742,278 to Dongfang Paper for working capital purpose with an interest rate of 4.35% per annum, which was based on the primary lending rate of People’s Bank of China. The unsecured loan was provided on December 10, 2014, and would be originally due on December 10, 2017. During the year of 2016, the Company repaid $6,012,416 to Mr. Zhenyong Liu, together with interest of $288,596. In February 2018, the company paid off the remaining balance, together with interest of $20,400. As of December 31, 2021, and 2020, approximately $47,054 and $45,978 of interest were outstanding to Mr. Zhenyong Liu, which was recorded in other payables and accrued liabilities as part of the current liabilities in the consolidated balance sheet. On March 1, 2015, the Company entered an agreement with Mr. Zhenyong Liu which allows Dongfang Paper to borrow from the CEO an amount up to $17,201,342 (RMB120,000,000) for working capital purposes. The advances or funding under the agreement are due three years from the date each amount is funded. The loan is unsecured and carries an annual interest rate set on the basis of the primary lending rate of the People’s Bank of China at the time of the borrowing. On July 13, 2015, an unsecured amount of $4,324,636 was drawn from the facility. On October 14, 2016 an unsecured amount of $2,883,091 was drawn from the facility. In February 2018, the company repaid $1,507,432 to Mr. Zhenyong Liu. The loan would be originally due on July 12, 2018. Mr. Zhenyong Liu agreed to extend the loan for additional 3 years and the remaining balance will be due on July 12, 2021. On November 23, 2018, the company repaid $3,768,579 to Mr. Zhenyong Liu, together with interest of $158,651. In December 2019, the company paid off the remaining balance, together with interest of 94,636. As of December 2021, and 2020, the outstanding interest was $215,565 and $210,635, respectively, which was recorded in other payables and accrued liabilities as part of the current liabilities in the consolidated balance sheet. As of December 31, 2021, and 2020, total amount of loans due to Mr. Zhenyong Liu were $nil. The interest expense incurred for such related party loans are $nil for the years ended December 31, 2021, and 2020. The accrued interest owe to the CEO was approximately $664,666 and $649,468, as of December 31, 2021, and 2020, respectively, which was recorded in other payables and accrued liabilities. On December 8, 2021, the Company entered an agreement with Mr. Zhenyong Liu, which allows Mr.Zhenyong Liu to borrow from the Company an amount of $6,915,176(RMB44,089,085). The loan will be due on June 29, 2022. The loan is unsecured and carries a fixed interest rate of 3% per annum. As of December 31, 2021, the outstanding balance of the loan was $6,915,176 and outstanding interest due from CEO is $ nil As of December 31, 2021, and 2020, amount due to shareholder are $727,433, which represent funds from shareholders to pay for various expenses incurred in the U.S. The amount is due on demand with interest free. |
Other Payables and Accrued Liab
Other Payables and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2021 | |
Payables And Accruals [Abstract] | |
Other payables and accrued liabilities | (10) Other payables and accrued liabilities Other payables and accrued liabilities consist of the following: December 31, December 31, 2021 2020 Accrued electricity $ 135,360 $ 14,544 Accrued rental 61,879 - Value-added tax payable - 428,481 Accrued interest to a related party 664,666 649,468 Payable for purchase of equipment 3,379,368 3,262,153 Accrued commission to salesmen 15,274 10,917 Accrued bank loan interest 992,989 429,279 Others 1,003 43,759 Totals $ 5,250,539 $ 4,838,601 |
Derivative Liabilities
Derivative Liabilities | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Liabilities | (11) Derivative Liabilities The Company analyzed the warrant for derivative accounting consideration under ASC 815, “ Derivatives and Hedging, and hedging, ASC 815 requires we assess the fair market value of derivative liability at the end of each reporting period and recognize any change in the fair market value as other income or expense item. The Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of December 31, 2021. The Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each warrant is estimated using the Black-Scholes valuation model. The following weighted-average assumptions were used in the December 31, 2021: Year ended 2021 Expected term 1.92 - 2.75 Expected average volatility 85% - 104% Expected dividend yield - Risk-free interest rate 0.19% - 0.97% The following table summarizes the changes in the derivative liabilities during the year ended December 31, 2021: Fair Value Measurements Using Significant Observable Inputs (Level 3) Balance at December 31, 2020 $ 1,115,260 Addition of new derivatives recognized as warrant 9,730,919 Addition of new derivatives recognized as loss on derivatives 10,813,347 Exercise of warrants (2,902,119 ) Change in fair value of derivative liability (16,693,873 ) Balance at December 31, 2021 $ 2,063,534 The following table summarizes the loss on derivative liability included in the income statement for the year ended December 31, 2021 and 2020, respectively. Year Ended December 31, 2021 2020 Day one loss due to derivative liabilities as warrant $ 10,813,347 $ 306,215 (Gain) Loss on change in fair value of derivative liability (16,693,873 ) 119,840 (5,880,526 ) 426,055 |
Common Stock
Common Stock | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity Note [Abstract] | |
Common Stock | (12) Common Stock Issuance of common stock to investors On April 29, 2020, the Company and certain institutional investors entered into a securities purchase agreement, as amended on May 4, 2020 (the “2020 Purchase Agreement”), pursuant to which the Company agreed to sell to such investors an aggregate of 4,400,000 shares of common stock in a registered direct offering and warrants to purchase up to 4,400,000 shares of the Company’s common stock in a concurrent private placement, for gross proceeds of approximately $2.55 million (net proceeds of approximately 2.27 million). The purchase price for each share of Common Stock and the corresponding warrant was $0.58. The exercise price of the warrant was $0.7425 per share. On January 20, 2021, the Company offered and sold to certain institutional investors an aggregate of 26,181,818 shares of common stock and 26,181,818warrants to purchase up to 26,181,818 shares of common stock in a best efforts public offering for gross proceeds of approximately $14.4 million. The purchase price for each share of common stock and the corresponding warrant was $0.55. The exercise price of the warrant was $0.55 per share. On March 1, 2021, the Company offered and sold to the public investors an aggregate of 29,277,866 shares of common stock and 14,638,933 warrants to purchase up to 14,638,933 shares of common stock in a firm commitment underwritten public offering for gross proceeds of approximately $21.9 million. The purchase price for each share of common stock and accompanying warrant was $0.75. The exercise price of the warrant was $0.75 per share. Issuance of common stock pursuant to the 2015 Omnibus Equity Incentive and 2019 Omnibus Equity Incentive On September 13, 2018, the compensation committee granted an aggregate of 534,500 shares of common stock at $0.88 per share to fifteen officers, directors and employees of the Company, which were granted under the 2015 Omnibus Equity Incentive Plan. Total fair value of the shares of common stock granted was calculated at $470,360 as of the date of issuance. On April 2, 2020, the compensation committee granted an aggregate of 2,000,000 shares of restricted common stock to fifteen officers, directors and employees of the Company, which were granted under the 2019 Omnibus Equity Incentive Plan. Total fair value of the shares of common stock granted was calculated at $1,200,000 as of the date of issuance at $0.60 per share. Issuance of common stock to a consultant On January 2, 2020, the Company entered into an agreement with a consultant and agreed as compensation to issue to the consultant in the aggregate of 60,000 shares of common stock for merger and acquisition consulting service rendered from January 2, 2020 to January 2, 2021. 60,000 shares of common stock were issued to this consultant on April 28, 2020. Total fair value of the shares of common stock issued was calculated at $42,000 at $0.70 per share. Issuance of common stock to a consultant On November 2, 2020, the Company entered into an agreement with a consultant and agreed as compensation to issue to the consultant in the aggregate of 21,000 shares of common stock for investor relations consulting service rendered from November 2, 2020 to November 2, 2021. 21,000 shares of common stock were issued to this consultant on November 30, 2020. Total fair value of the shares of common stock issued was calculated at $14,700 at $0.70 per share. |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2021 | |
Warrant Disclosure [Abstract] | |
Warrants | (13) Warrants Pursuant to the 2020 Purchase Agreement, the Company agreed to sell to such investors an aggregate of 4,400,000 shares of common stock and warrants to purchase up to 4,400,000 shares of common stock in a concurrent private placement (the “May 2020 Warrants”). The exercise price of the May 2020 Warrant is $0.7425 per share. These warrants are exercisable on July 23, 2020 and have a term of exercise equal to five years and six months from the date of issuance till July 23, 2025. 880,000 May 2020 Warrants were exercised in February 2021 at the exercise price of $0.7425 per share and 3,520,000 May 2020 Warrants were outstanding as of September 30, 2021. The Company classified warrant as liabilities and accounted for the issuance of the May 2020 Warrants as a derivative. On January 20, 2021, the Company offered and sold to certain institutional investors an aggregate of 26,181,818 shares of common stock and 26,181,818warrants to purchase up to 26,181,818 shares of common stock (the “January 2021 Warrants”). The January 2021 Warrants are exercisable commencing on January 20, 2021 at an exercise price of $0.55 and will expire on January 20, 2026. 14,106,900 January 2021 Warrants were exercised in January and February of 2021 at the exercise price of $0.55 per share. 12,074,918 January 2021 Warrants were outstanding as of December 31, 2021. On March 1, 2021, the Company offered and sold to the public investors an aggregate of 29,277,866 shares of common stock and 14,638,933 warrants to purchase up to 14,638,933 shares of common stock (the “March 2021 Warrants”). The March 2021Warrants are exercisable commencing on March 1, 2021 at an exercise price of $0.75 and will expire on March 1, 2026. 67,500 March 2021 Warrants were exercised in January and March 2021 at the exercise price of $0.75 per share and 14,571,433 March 2021 Warrants were outstanding as of December 31, 2021. A summary of stock warrant activities is as below: Year Ended December 31, 2021 Weight average exercise Number price Outstanding and exercisable at beginning of the period 4,400,000 $ 0.7425 Issued during the period 40,820,751 0.622 Exercised during the period (15,054,400 ) 0.5621 Cancelled or expired during the period - - Outstanding and exercisable at end of the period 30,166,351 $ 0.6691 The following table summarizes information relating to outstanding and exercisable warrants as of December 31, 2021. Warrants Outstanding Warrants Exercisable Weighted Average Weighted Weighted Remaining Average Average Number of Contractual life Exercise Number of Exercise Shares (in years) Price Shares Price 30,166,351 4.08 $ 0.6691 30,166,351 $ 0.6691 Aggregate intrinsic value is the sum of the amounts by which the quoted market price of the Company’s stock exceeded the exercise price of the warrants at December 31, 2021 for those warrants for which the quoted market price was in excess of the exercise price (“in-the-money” warrants). The intrinsic value of the warrants as of December 31, 2021 and 2020 are $nil. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | (14) Earnings Per Share For the years ended December 31, 2021, and 2020, basic and diluted net income per share are calculated as follows: Year Ended 2021 2020 Basic income (loss) per share Net income (loss) for the year - numerator $ 905,535 $ (5,554,002 ) Weighted average common stock outstanding - denominator 59,849,082 26,498,298 Net income (loss) per share $ 0.02 $ (0.21 ) Diluted income (loss) per share Net income (loss) for the year - numerator $ 905,535 $ (5,554,002 ) Weighted average common stock outstanding - denominator 59,849,082 26,498,298 Effect of dilution - - Weighted average common stock outstanding - denominator 59,849,082 26,498,298 Diluted income (loss) per share $ 0.02 $ (0.21 ) |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (15) Income Taxes United States The Company and Shengde Holdings are incorporated in the State of Nevada and are subject to the U.S. federal tax and state statutory tax rates up to 34% and 0%, respectively. On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the “2017 TCJA”), which significantly changed U.S. tax law. The 2017 TCJAlowered the Company’s U.S. statutory federal income tax rate from the highest rate of 35% to 21% effective January 1, 2018, while also imposing a deemed repatriation tax on deferred foreign income which requires companies to pay a one-time transition tax on previously unremitted earnings of non-U.S. subsidiaries that were previously tax deferred and creates new taxes on certain foreign sourced earnings. The SEC staff issued Staff Accounting Bulletin (SAB) 118, which provides guidance on accounting for enactment effects of the 2017 TCJA. SAB 118 provides a measurement period of up to one year from the 2017 TCJA’s enactment date for companies to complete their accounting under ASC 740. In accordance with SAB 118, to the extent that a company’s accounting for certain income tax effects of the 2017 TCJA is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in its financial statements. If a company cannot determine a provisional estimate to be included in its financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the 2017 TCJA. Transition tax: The transition tax is a tax on previously untaxed accumulated and current earnings and profits (E&P) of certain of the Company’s non-U.S. subsidiaries. To determine the amount of the transition tax, the Company must determine, in addition to other factors, the amount of post-1986 E&P of the relevant subsidiaries, as well as the amount of non-U.S. income taxes paid on such earnings. Further, the transition tax is based in part on the amount of those earnings held in cash and other specified assets. The Company was able to make a reasonable estimate of the transition tax and recorded a provisional obligation and additional income tax expense of approximately $80,000 in the fourth quarter of 2017. However, the Company is continuing to gather additional information and will consider additional technical guidance to more precisely compute and account for the amount of the transition tax. This amount may change when the Company finalizes the calculation of post-1986 foreign E&P previously deferred from U.S. federal taxation and finalizes the amounts held in cash or other specified assets. The 2017 TCJA’s transition tax is payable over eight years beginning in 2018. PRC Dongfang Paper and Baoding Shengde are PRC operating companies and are subject to PRC Enterprise Income Tax. Pursuant to the PRC New Enterprise Income Tax Law, Enterprise Income Tax is generally imposed at a statutory rate of 25%. The provisions for income taxes for the years ended December 31, 2021, and 2020 were as follows: Year Ended December 31, 2021 2020 Provision for Income Taxes Current Tax Provision U.S. $ 14,717 $ 14,747 Current Tax Provision PRC 2,802,187 1,247,970 Deferred Tax Provision PRC 2,730,050 (2,364,575 ) Total Provision for (Deferred tax benefit)/ Income Taxes $ 5,546,954 $ (1,101,858 ) In addition to the reversible future PRC income tax benefits stemming from the timing differences of items such as recognition of asset disposal gain or loss and asset depreciation, the Company was incorporated in the United States and incurred net operating losses of approximately $2,508,797 and $0 for U.S. income tax purposes for the years ended December 31, 2021 and 2019, respectively. The net operating loss carried forward may be available to reduce future years’ taxable income. These carry forwards would expire, if not utilized, during the period of 2030 through 2035. As of December 31, 2021, management believed that the realization of all the U.S. income tax benefits from these losses, which generally would generate a deferred tax asset if it can be expected to be utilized in the future, appears not more than likely due to the Company’s limited operating history and continuing losses for United States income tax purposes. Accordingly, As of December 31, 2021, the Company provided a 100% valuation allowance on the U.S. deferred tax asset benefit to reduce the total deferred tax asset to the amount realizable for the PRC income tax purposes. Management reviews this valuation allowance periodically and will make adjustments as warranted. A summary of the otherwise deductible (or taxable) deferred tax items is as follows: December 31, December 31, 2021 2020 Deferred tax assets (liabilities) Depreciation and amortization of property, plant and equipment $ 14,754,456 $ 12,397,323 Impairment of property, plant and equipment 783,433 680,800 Miscellaneous 342,170 258,963 Net operating loss carryover of PRC company 388,620 371,544 Total deferred tax assets 16,268,679 13,708,630 Less: Valuation allowance (5,000,000 ) - Total deferred tax assets, net $ 11,268,679 13,708,630 The following table reconciles the statutory rates to the Company’s effective tax rate as of: Year Ended December 31, 2021 2020 PRC Statutory rate 25.0 % 25.0 % Effect of different tax jurisdiction Effect of tax and book difference (16.5 )% (8.4 )% (Over) Under-provision in previous year Change in valuation allowance 77.5 % Effective income tax rate 86.0 % 16.6 % During the years ended December 31, 2021, and 2020, the effective income tax rate was estimated by the Company to be 86.0% and 16.6%, respectively. As of December 31, 2017, except for the one-time transition tax under the 2017 TCJA which imposes a U.S. tax liability on all unrepatriated foreign E&Ps, the Company does not believe that its future dividend policy and the available U.S. tax deductions and net operating losses will cause the Company to recognize any other substantial current U.S. federal or state corporate income tax liability in the near future. Nor does it believe that the amount of the repatriation of the VIE’s earnings and profits for purposes of paying dividends will change the Company’s position that its PRC subsidiary Baoding Shengde and the VIE, Dongfang Paper are considered or are expected to be indefinitely reinvested offshore to support our future capacity expansion. If these earnings are repatriated to the U.S. resulting in U.S. taxable income in the future, or if it is determined that such earnings are to be remitted in the foreseeable future, additional tax provisions would be required. The Company has adopted ASC Topic 740-10-05, Income Taxes. To date, the adoption of this interpretation has not impacted the Company’s financial position, results of operations, or cash flows. The Company performed self-assessment and the Company’s liability for income taxes includes the liability for unrecognized tax benefits, interest and penalties which relate to tax years still subject to review by taxing authorities. Audit periods remain open for review until the statute of limitations has passed, which in the PRC is usually 5 years. The completion of review or the expiration of the statute of limitations for a given audit period could result in an adjustment to the Company’s liability for income taxes. Any such adjustment could be material to the Company’s results of operations for any given quarterly or annual period based, in part, upon the results of operations for the given period. As of September 30, 2021 and December 31, 2021, management considered that the Company had no uncertain tax positions affecting its consolidated financial position and results of operations or cash flows, and will continue to evaluate for any uncertain position in future. There are no estimated interest costs and penalties provided in the Company’s consolidated financial statements for the nine months ended December 31, 2021and 2020, respectively. The Company’s tax positions related to open tax years are subject to examination by the relevant tax authorities and the major one is the China Tax Authority. |
Stock Incentive Plans
Stock Incentive Plans | 12 Months Ended |
Dec. 31, 2021 | |
Stock Incentive Plans [Abstract] | |
Stock Incentive Plans | (16) Stock Incentive Plans 2019 Incentive Stock Plan On October 31, 2019, the shareholders of the Company at the Company’s Annual Shareholders General Meeting adopted and approved the 2019 Omnibus Equity Incentive Plan of IT Tech Packaging, Inc. (the “2019 ISP”). Under the 2019 ISP, the Company has reserved a total of 2,000,000 shares of common stock for issuance as or under awards to be made to the directors, officers, employees and/or consultants of the Company and its subsidiaries. On April 2, 2020, 2,000,000 shares of common stock were granted under the 2019 ISP. Total fair value of the shares of common stock granted was calculated at $1,200,000 as of the date of issuance at $0.60 per share. 2021 Incentive Stock Plan On November 12, 2021, the Company’s Annual General Meeting adopted and approved the 2021 Omnibus Equity Incentive Plan of IT Tech Packaging, Inc.(the”2021 Plan”).Under the 2021 ISP, the Company has reserved a total of 1,500,000 shares of common stock for issuance as or under awards to be made to the directors, officers, employees and/or consultants of the Company and its subsidiaries. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (17) Commitments and Contingencies Operating Lease The Company leases 32.95 acres of land from a local government in Xushui District, Baoding City, Hebei, China through a real estate lease with a 30-year term, which expires on December 31, 2031. The lease requires an annual rental payment of approximately $18,612 (RMB120,000). This operating lease is renewable at the end of the 30-year term. Sale of Headquarters Compound Real Properties On August 7, 2013, the Company’s Audit Committee and the Board of Directors approved the sale of the land use right of the Headquarters Compound (the “LUR”), the office building and essentially all industrial-use buildings in the Headquarters Compound (the “Industrial Buildings”), and three employee dormitory buildings located within the Headquarters Compound (the “Dormitories”) to Hebei Fangsheng for cash prices of approximately $2.77 million, $1.15 million, and $4.31 million respectively. Sales of the LUR and the Industrial Buildings were completed in year 2013. In connection with the sale of the Industrial Buildings, Hebei Fangsheng agreed to lease the Industrial Buildings back to the Company for its original use for a term of up to three years, with an annual rental payment of approximately $155,101 (RMB1,000,000). The lease agreement expired in August 2016. On August 6, 2016 and August 6, 2018, the Company entered into two supplementary agreements with Hebei Fangsheng, who agreed to extend the lease term for another four years in total, with the same rental payment as original lease agreement. Future minimum lease payments are as follows: December 31, Amount 2022 110,315 2023 18,821 2024 18,821 2025 18,821 2026 18,821 Thereafter 94,107 Total operating lease payments $ 279,708 Capital commitment As of December 31, 2021, the Company has entered into several contracts for the purchase of paper machine of a new tissue paper production line PM10 and the improvement of Industrial Buildings. Total outstanding commitments under these contracts were $4,700,927 and $4,570,331 as of December 31, 2021 and 2020, respectively. The Company expected to pay off all the balances within 1-3 years. Guarantees and Indemnities The Company agreed with Baoding Huanrun Trading Co., a major supplier of raw materials, to guarantee certain obligations of this third party, and as of December 31, 2021, and 2020, the Company guaranteed its long-term loan from financial institutions amounting to $4,862,211 (RMB31,000,000) and $4,751,031 (RMB31,000,000), respectively, that matured at various times in 2018-2023. If Huanrun Trading Co., were to become insolvent, the Company could be materially adversely affected. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Reporting | (18) Segment Reporting Since March 10, 2010, Baoding Shengde started its operations and thereafter the Company manages its operations through two business operating segments: Dongfang Paper, which produces offset printing paper and corrugating medium paper, and Baoding Shengde, which produces digital photo paper. They are managed separately because each business requires different technology and marketing strategies. The Company evaluates performance of its operating segments based on net income. Administrative functions such as finance, treasury, and information systems are centralized. However, where applicable, portions of the administrative function expenses are allocated between the operating segments based on gross revenue generated. The operating segments do share facilities in Xushui County, Baoding City, Hebei Province, China. All sales were sold to customers located in the PRC. Summarized financial information for the two reportable segments is as follows: Year Ended December 31, 2021 Dongfang Paper Hebei Tengsheng Baoding Shengde Not Attributable to Segments Elimination of Inter-segment Enterprise-wide, consolidated Revenues $ 151,574,318 8,765,380 5,878,568 - (5,336,546 ) 160,881,720 Gross profit 12,138,849 (1,255,190 ) 133,900 - - 11,017,559 Depreciation and amortization 5,213,598 8,408,713 1,736,141 - - 15,358,452 Interest income 24,732 1,703 12,331 - - 38,766 Interest expense 717,265 71,798 335,639 - - 1,124,702 Income tax expense(benefit) 2,348,694 3,197,629 (14,086 ) 14,717 - 5,546,954 Net income (loss) 6,744,417 (10,620,350 ) (322,525 ) 5,103,993 - 905,535 Year Ended December 31, 2020 Dongfang Paper Hebei Tengsheng Baoding Shengde Not Attributable to Segments Elimination of Inter-segment Enterprise-wide, consolidated Revenues $ 91,426,671 8,414,654 1,101,944 - - 100,943,269 Gross profit 7,000,150 (1,828,214 ) 530,049 - - 5,701,985 Depreciation and amortization 7,039,687 8,613,750 140,417 - - 15,793,854 Interest income 27,046 1,770 3,217 - - 32,033 Interest expense 683,605 28,083 314,824 - - 1,026,512 Income tax expense(benefit) 967,408 (2,140,532 ) 56,550 14,717 - (1,101,857 ) Net income (loss) 2,849,742 (5,837,914 ) (42,250 ) (2,523,580 ) - (5,554,002 ) As of December 31, 2021 Dongfang Hebei Baoding Not Attributable Elimination of Enterprise-wide, Paper Tengsheng Shengde to Segments Inter-segment consolidated Total assets $ 109,369,167 93,841,874 29,181,392 9,142,769 - 241,535,202 As of December 31, 2020 Dongfang Hebei Baoding Not Attributable Elimination of Enterprise-wide, Paper Tengsheng Shengde to Segments Inter-segment consolidated Total assets $ 79,206,447 102,056,291 18,589,570 22,166 - 199,874,474 |
Concentration and Major Custome
Concentration and Major Customers and Suppliers | 12 Months Ended |
Dec. 31, 2021 | |
Concentration And Major Customers And Suppliers [Abstract] | |
Concentration and Major Customers and Suppliers | (19) Concentration and Major Customers and Suppliers For the years ended December 31, 2021, and 2020, the Company had no single customer contributed over 10% of total sales. For the year ended December 31, 2021, the Company had two major suppliers that accounted for 78% and 11% of total purchases by the Company. For the year ended December 31, 2020, the Company had two major suppliers that accounted for 72% and 12% of total purchases by the Company. |
Concentration of Credit Risk
Concentration of Credit Risk | 12 Months Ended |
Dec. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Concentration of Credit Risk | (20) Concentration of Credit Risk Financial instruments for which the Company is potentially subject to concentration of credit risk consist principally of cash. The Company places its cash in reputable financial institutions in the PRC and the United States. Although it is generally understood that the PRC central government stands behind all of the banks in China in the event of bank failure, there is no deposit insurance system in China that is similar to the protection provided by the Federal Deposit Insurance Corporation (“FDIC”) of the United States as of December 31, 2018 and December 31, 2017. On May 1, 2015, the new “Deposit Insurance Regulations” was effective in the PRC that the maximum protection would be up to RMB500,000 (US$78,423) per depositor per insured financial intuition, including both principal and interest. For the cash placed in financial institutions in the United States, the Company’s U.S. bank accounts are all fully covered by the FDIC insurance as of December 31, 2021, and 2020, while for the cash placed in financial institutions in the PRC, the balances exceeding the maximum coverage of RMB500,000 amounted to RMB11,520,053 (US$1,806,869) as of December 31, 2021. |
Risks and Uncertainties
Risks and Uncertainties | 12 Months Ended |
Dec. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Risks and Uncertainties | (21) Risks and Uncertainties IT Tech Packaging is subject to substantial risks from, among other things, intense competition associated with the industry in general, other risks associated with financing, liquidity requirements, rapidly changing customer requirements, foreign currency exchange rates, and operating in the PRC under its various laws and restrictions. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2021 | |
Recent Accounting Pronouncements [Abstract] | |
Recent Accounting Pronouncements | (22) Recent Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaced the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 requires use of a forward-looking expected credit loss model for accounts receivables, loans, and other financial instruments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. In October 2019, the FASB issued ASU No. 2019-10, “Financial Instruments-Credit Losses (Topic 326): Effective Dates”, to finalize the effective date delays for private companies, not-for-profits, and smaller reporting companies applying the CECL standards. The ASU is effective for reporting periods beginning after December 15, 2022 and interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating the impact of the adoption of ASU 2016-13 on our condensed consolidated financial statements. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Event | (23) Subsequent Event On February 23, 2022, Dongfang Paper fully paid the RMB320 million (approximately $45million) as the consideration for the acquisition per agreement that Dongfang Paper had entered into with the shareholder of Hebei Tengsheng Paper Co., Ltd. |
Summarized Quarterly Financial
Summarized Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2021 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summarized Quarterly Financial Data (Unaudited) | (24) Summarized Quarterly Financial Data (Unaudited) Quarterly financial information for 2021and 2020is as follows: Quarter 2021 First Second Third Fourth Revenues $ 24,209,427 $ 46,534,915 $ 45,087,671 $ 45,049,707 Gross profit 1,831,005 3,029,020 1,821,536 4,335,998 (Loss) income from operations (724,313 ) 431,408 (198,029 ) 1,950,303 Net (loss) income (4,338,856 ) (453,248 ) 1,542,576 4,155,063 Net income per share Basic $ -0.12 $ -0.01 $ 0.03 $ 0.07 Diluted $ -0.12 $ -0.01 $ 0.03 $ 0.07 Quarter 2020 First Second Third Fourth Revenues $ 8,743,851 $ 26,362,273 $ 33,357,451 $ 32,479,694 Gross (loss) profit (169,719 ) 2,558,829 2,567,551 745,323 (Loss) income from operations (2,866,682 ) (798,643 ) 176,631 (1,967,110 ) Net loss (2,436,287 ) (980,031 ) (520,974 ) (1,616,710 ) Net loss per share Basic $ -0.11 $ -0.04 $ -0.02 $ -0.06 Diluted $ -0.11 $ -0.04 $ -0.02 $ -0.06 |
Condensed Financial Information
Condensed Financial Information of the Parent Company | 12 Months Ended |
Dec. 31, 2021 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Financial Information of the Parent Company | (25) Condensed Financial Information of the Parent Company The condensed financial statements of IT Tech Packaging Inc. (“ITP”, the “parent company”) have been prepared in accordance with accounting principles generally accepted in the United States of America. Under the PRC laws and regulations, the Company’s PRC subsidiaries are restricted in their ability to transfer certain of their net assets to the parent company in the form of dividend payments, loans or advances. The amounts restricted include paid-in capital, capital surplus and statutory reserves, as determined pursuant to PRC generally accepted accounting principles, totaling $79,641,643 ad $47,589,643 as of December 31, 2021, and 2020. The following represents condensed unconsolidated financial information of the parent company only: December 31, December 31, 2021 2020 ASSETS Current Assets Cash and cash equivalents $ 9,135,996 $ 16,172 Total current assets 9,135,996 16,172 Investment in subsidiaries 213,804,439 181,194,669 Total Assets $ 222,940,435 $ 181,210,840 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities Inter-company payable $ 4,399,560 $ 4,287,974 Due to related parties 727,433 727,433 Total current liabilities 5,126,993 5,015,407 Derivative liability 2,063,534 1,115,260 Total liabilities $ 7,190,527 $ 6,130,667 Total stockholders’ equity 215,749,908 175,080,173 Total Liabilities and Stockholders’ Equity $ 222,940,435 $ 181,210,840 CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS) Year Ended December 31, 2021 2020 Revenue - - Selling, general and administrative expenses $ 761,596 $ 2,082,743 Loss from Operations (761,596 ) (2,082,743 ) Equity in earnings of unconsolidated subsidiaries (4,198,678 ) (3,030,487 ) Loss on derivative liability 5,880,526 (426,055 ) Other Income (Expense) - - Income before Income Taxes 920,252 (5,539,285 ) Provision for Income Taxes (14,717 ) (14,717 ) Net Income $ 905,535 $ (5,554,002 ) Other comprehensive income /(loss) 4,755,446 11,798,259 Total Comprehensive Income (loss) $ 5,660,981 $ 6,244,257 Year Ended December 31, 2021 2020 Net Cash Used in Operating Activities $ (776,313 ) $ (846,820 ) Net Cash Used in Investing Activities (32,053,000 ) (2,000,000 ) Net Cash Provided by Financing Activities 41,949,138 2,791,000 Net Increase (Decrease) in Cash and Cash Equivalents 9,119,824 (55,820 ) Cash and Cash Equivalents - Beginning of Year 16,172 71,991 Cash and Cash Equivalents - End of Year $ 9,135,996 $ 16,172 The condensed financial information has been prepared using the same accounting policies as set out in the Company’s consolidated financial statements except that the parent company has used equity method to account for its investments in the subsidiaries. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Organization and Business Background [Abstract] | |
Basis of Consolidation | Basis of Consolidation The consolidated financial statements of the Company are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”), and include the assets, liabilities, revenues, expenses and cash flows of all subsidiaries and variable interest entity. All significant inter-company balances, transactions and cash flows are eliminated on consolidation. |
Foreign Currency Translation | Foreign Currency Translation The Company accounts for foreign currency translation pursuant to ASC Topic 830, Foreign Currency Matters Under ASC Topic 830-30, all assets and liabilities are translated into United States dollars using the current exchange rate at the end of each fiscal period. The current exchange rates used by the Company as of December 31, 2021, and 2020 to translate the Chinese RMB to the U.S. Dollars are 6.3757:1, and 6.5249:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.4474:1 and 6.8941:1 for the years ended December 31, 2021, and 2020, respectively. Translation adjustments are included in other comprehensive income (loss). |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of December 31, 2021, and 2020, and revenues and expenses for the years ended December 31, 2021, and 2020. The most significant estimates relate to allowance for uncollectible accounts receivable, inventory valuation, useful lives and impairment for property, plant and equipment, valuation allowance for deferred tax assets and contingencies. Actual results could differ from those estimates made by management. |
Accounts Receivable | Accounts Receivable Trade accounts receivable are recorded on shipment of products to customers. The trade receivables are all without customer collateral and interest is not accrued on past due accounts. Periodically, management reviews the adequacy of its provision for doubtful accounts based on historical bad debt expense results and current economic conditions using factors based on the aging of its accounts receivable. Additionally, the Company may identify additional allowance requirements based on indications that a specific customer may be experiencing financial difficulties. Actual bad debt results could differ materially from these estimates. As of December 31, 2021, and 2020, the balance of allowance for doubtful accounts was $69,053 and $34,391, respectively; and the movement of the provision of the doubtful accounts is as below. While management uses the best information available upon which to base estimates, future adjustments to the allowance may be necessary if economic conditions differ substantially from the assumptions used for the purposes of analysis. December 31, December 31, Allowance of doubtful accounts 2021 2020 Opening balance $ 34,391 $ 59,922 Provision (Reversal) for the year 33,480 (28,087 ) Exchange difference 1,181 2,556 Closing balance $ 69,053 $ 34,391 |
Inventories | Inventories Inventories consist principally of raw materials and finished goods, and are stated at the lower of cost (average cost method) or market. Cost includes labor, raw materials, and allocated overhead. Provision in inventories were $ nil |
Property, Plant, and Equipment | Property, Plant, and Equipment Property, plant, and equipment are stated at cost less accumulated depreciation and any impairment losses. Major renewals, betterments, and improvements are capitalized to the asset accounts while replacements, maintenance, and repairs, which do not improve or extend the lives of the respective assets, are expensed to operations. At the time property, plant, and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation or amortization accounts are relieved of the applicable amounts. Gains or losses from retirements or sales are credited or charged to operations. Construction-in-progress is stated at cost and capitalized as expenses are incurred or as payments are made pursuant to relevant construction contracts. Contract retention is recorded as accrued liability. Construction in progress is not depreciated until project completion and the constructed property being placed in service, at which time the capitalized balance will be transferred to appropriate account of property, plant and equipment. The Company depreciates property, plant, and equipment using the straight-line method as follows: Land use right Over the lease term Building and improvements 30 years Machinery and equipment 5-15 years Vehicles 15 years |
Valuation of long-lived asset | Valuation of long-lived asset The Company reviews the carrying value of long-lived assets to be held and used when events and circumstances warrants such a review. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flow from such asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the long-lived asset and intangible assets. Fair market value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. Losses on long-lived assets and intangible assets to be disposed are determined in a similar manner, except that fair market values are reduced for the cost to dispose. |
Statutory Reserves | Statutory Reserves According to the laws and regulations in the PRC, the Company is required to provide for certain statutory funds, namely, a reserve fund by an appropriation from net profit after taxation but before dividend distribution based on the local statutory financial statements of the PRC subsidiary and variable interest entity prepared in accordance with the PRC accounting principles and relevant financial regulations. Each of the Company’s wholly owned subsidiary and variable interest entity in the PRC are required to allocate at least 10% of its net profit to the reserve fund until the balance of such fund has reached 50% of its registered capital. Appropriations of additional reserve fund are determined at the discretion of its directors. The reserve fund can only be used, upon approval by the relevant authority, to offset accumulated losses or increase capital. For the years ended December 31, 2021, and 2020, IT Tech Packaging made transfers of $ nil |
Employee Benefit Plan | Employee Benefit Plan Full time employees of the PRC entities participate in a government mandated multi-employer defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance and other welfare benefits are provided to employees. The total provision for such employee benefits was $ nil |
Revenue Recognition | Revenue Recognition The Company adopted ASC Topic 606, Revenue from Contracts with Customers 1. Identify the contract(s) with a customer; 2. Identify the performance obligations in the contract; 3. Determine the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue when (or as) the entity satisfies a performance obligation. A contract contains a promise (or promises) to transfer goods or services to a customer. A performance obligation is a promise (or a group of promises) that is distinct. The transaction price is the amount of consideration a company expects to be entitled from a customer in exchange for providing the goods or services. The unit of account for revenue recognition is a performance obligation (a good or service). A contract may contain one or more performance obligations. Performance obligations are accounted for separately if they are distinct. A good or service is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and the good or service is distinct in the context of the contract. Otherwise, performance obligations are combined with other promised goods or services until the Company identifies a bundle of goods or services that is distinct. Promises in contracts which do not result in the transfer of a good or service are not performance obligations, as well as those promises that are administrative in nature, or are immaterial in the context of the contract. The Company has addressed whether various goods and services promised to the customer represent distinct performance obligations. The Company applied the guidance of ASC Topic 606-10-25-16 through 18 in order to verify which promises should be assessed for classification as distinct performance obligations. The Company’s revenue is primary derived from sales of paper products. The Company recognizes revenue when goods are delivered, when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist, and collectability is reasonably assured. Goods are considered delivered when customer’s truck picks up goods at the Company’s finished goods inventory warehouse. |
Shipping Cost | Shipping Cost Substantially all customers use their own trucks or hire commercial trucking companies to pick up goods from the Company. The Company usually incurs no shipping cost for delivery of goods to customers. For those rare situations where products are not shipped utilizing customer specified shipping services, the Company charges customers a shipping fee which is included in net revenues and was not material. Freight-in and handling costs incurred by the Company with respect to purchased goods are recorded as a component of inventory cost and charged to cost of sales when the inventory items are sold. |
Advertising | Advertising The Company expenses all advertising and promotion costs as incurred. The Company incurred $3,972 and $ nil |
Research and development costs | Research and development costs Research and development costs are expensed as incurred and included in selling, general and administrative expenses. Research and development expenses incurred $101,410 and $69,208 for the years ended December 31, 2021, and 2020, respectively. |
Borrowing costs | Borrowing costs Borrowing costs attributable directly to the acquisition, construction or production of qualifying assets which require a substantial period of time to be ready for their intended use or sale, are capitalized as part of the cost of those assets. Income earned on temporary investments of specific borrowings pending their expenditure on those assets is deducted from borrowing costs capitalized. All other borrowing costs are recognized in interest expenses in the period in which they are incurred. |
Government subsidies | Government subsidies A government subsidy is not recognized until there is reasonable assurance that: (a) the enterprise will comply with the conditions attached to the grant; and(b)the grant will be received. When the Company receives government subsidies but the conditions attached to the grants have not been fulfilled, such government subsidies are deferred and recorded under other payables and accrued expenses, and other long-term liability. The classification of short-term or long-term liabilities is depended on the management’s expectation of when the conditions attached to the grant can be fulfilled. For the years ended December 31, 2021, and 2020, the Company received government subsidies of $198,530 and $220,478, which are recognized as subsidy income in the consolidated statements of income in that fiscal year. |
Income Taxes | Income Taxes The Company accounts for income taxes pursuant to ASC Topic 740, Income Taxes. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Any tax paid by subsidiaries during the year is recorded. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. ASC Topic 740 also requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry-forwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets, including those related to the U.S. net operating loss carry-forwards, are dependent upon future earnings, if any, of which the timing and amount are uncertain. The Company adopted ASC Topic 740-10-05, Income Tax The Company’s policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expense. |
Value Added Tax | Value Added Tax Both the PRC subsidiary and variable interest entity of the Company are subject to value added tax (“VAT”) imposed by the PRC government on its purchase and sales of goods. The output VAT is charged to customers who purchase goods from the Company and the input VAT is paid when the Company purchases goods from its vendors. VAT rate is 17% (before May 1, 2018), 16% (after May 1, 2018) and 13% (after April 1, 2019) in general, depending on the types of products purchased and sold. The input VAT can be offset against the output VAT. Debit balance of VAT payable represents a credit against future collection of output VAT instead of a receivable due from government. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) The Company presents comprehensive income (loss) in accordance with ASC Topic 220, Comprehensive Income |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing the net income attributable to the common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. There were no potentially dilutive securities that were in-the-money that were outstanding during the years ended December 31, 2021. |
Share-Based Compensation | Share-Based Compensation The Company uses the fair value recognition provision of ASC Topic 718, Compensation-Stock Compensation, The Company also applies the provisions of ASC Topic 505-50, Equity Based Payments to Non-Employees |
Fair Value Measurements | Fair Value Measurements The Company has adopted ASC Topic 820, Fair Value Measurements and Disclosures, which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. It does not require any new fair value measurement, but provides guidance on how to measure fair value by providing a fair value hierarchy used to classify the source of the information. It establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable inputs, which may be used to measure fair value and include the following: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement. The Company estimates the fair value of financial instruments using the available market information and valuation methods. Considerable judgment is required in estimating fair value. Accordingly, the estimates of fair value may not be indicative of the amounts that the Company could realize in a current market exchange. As of December 31, 2021, and 2020, the carrying value of the Company’s short term financial instruments, such as cash and bank balances, accounts receivable, accounts and notes payable, short-term bank loans and balance due to related parties, approximate at their fair values because of the short maturity of these instruments; while loans from credit union approximates at their fair value as the interest rates thereon are close to the market rates of interest published by the People’s Bank of China. Derivative liabilities are measured at fair value on a recurring basis. |
Non-Recurring Fair Value Measurements | Non-Recurring Fair Value Measurements The Company reviews long-lived assets for impairment annually or more frequently if events or changes in circumstances indicate the possibility of impairment. For the continuing operations, long-lived assets are measured at fair value on a nonrecurring basis when there is an indicator of impairment, and they are recorded at fair value only when impairment is recognized. For discontinued operations, long-lived assets are measured at the lower of carrying amount or fair value less cost to sell. The fair value of these assets was determined using models with significant unobservable inputs which were classified as Level 3 inputs, primarily the discounted future cash flow. |
Organization and Business Bac_2
Organization and Business Background (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Organization and Business Background [Abstract] | |
Schedule of subsidiaries and variable interest entity | Date of Place of Percentage Incorporation Incorporation or of Name or Establishment Establishment Ownership Principal Activity Subsidiary: Dongfang Holding November 13, 2006 BVI 100 % Inactive investment holding Shengde Holdings February 25, 2009 State of Nevada 100 % Investment holding Baoding Shengde June 1, 2009 PRC 100 % Paper production and distribution Variable interest entity (“VIE”): Dongfang Paper March 10, 1996 PRC Control* Paper production and distribution |
Schedule of aggregate aggregate carrying value of Dongfang Paper’s assets and liabilities | December 31, December 31, 2021 2020 ASSETS Current Assets Cash and bank balances $ 1,921,407 $ 3,315,778 Restricted cash - - Accounts receivable 4,867,759 2,389,057 Inventories 5,823,762 1,223,020 Prepayments and other current assets 19,942,878 7,051,381 Due from related parties 888,893 92,795 Total current assets 33,444,699 14,072,031 Prepayment on property, plant and equipment 41,877,755 19,617,159 Finance lease right-of-use assets, net 2,286,459 2,397,653 Property, plant, and equipment, net 116,054,387 133,134,932 Deferred tax asset non-current 9,547,741 12,040,962 Total Assets $ 203,211,041 $ 181,262,737 LIABILITIES Current Liabilities Short-term bank loans $ 5,958,561 $ 6,435,348 Current portion of long-term loans from credit union 2,289,945 551,733 Lease liability 210,161 182,852 Accounts payable 10,255 592,391 Advance from customers 39,694 82,625 Due to related parties - - Accrued payroll and employee benefits 279,513 221,482 Other payables and accrued liabilities 4,740,900 4,672,265 Income taxes payable 1,108,038 259,649 Total current liabilities 14,637,067 12,998,345 Loans from credit union 2,980,065 4,597,772 Deferred gain on sale-leaseback 155,110 387,087 Lease liability - non-current 152,233 354,107 Total liabilities $ 17,924,475 $ 17,950,224 |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Organization and Business Background [Abstract] | |
Schedule of provision of the doubtful accounts | December 31, December 31, Allowance of doubtful accounts 2021 2020 Opening balance $ 34,391 $ 59,922 Provision (Reversal) for the year 33,480 (28,087 ) Exchange difference 1,181 2,556 Closing balance $ 69,053 $ 34,391 |
Schedule of property, plant, and equipment | Land use right Over the lease term Building and improvements 30 years Machinery and equipment 5-15 years Vehicles 15 years |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | December 31, December 31, 2021 2020 Raw Materials Recycled paper board $ 2,097,062 $ 19,459 Recycled white scrap paper 11,808 11,193 Gas 32,753 55,473 Base paper and other raw materials 206,531 181,426 2,348,154 267,551 Semi-finished Goods 96,087 176,703 Finished Goods 3,400,654 789,547 Total inventory, gross 5,844,895 1,233,801 Inventory reserve - - Total inventory, net $ 5,844,895 $ 1,233,801 |
Prepayments and Other Current_2
Prepayments and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Prepaid Expenses And Other Current Assets Disclosure [Abstract] | |
Schedule of prepayments and other current assets | December 31, December 31, 2021 2020 Prepaid land lease $ 188,215 $ 183,912 Prepayment for purchase of materials 9,190,527 10,945 Prepayment for purchase of equipment 980,786 - Value-added tax recoverable 14,740,296 5,864,989 Others 696,816 991,669 $ 25,796,640 $ 7,051,515 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | December 31, December 31, 2021 2020 Property, Plant, and Equipment: Land use rights $ 12,790,062 $ 12,497,601 Building and improvements 74,609,698 81,233,162 Machinery and equipment 170,149,367 163,787,807 Vehicles 725,838 628,462 Construction in progress - 586,216 Totals 258,274,965 258,733,248 Less: accumulated depreciation and amortization (131,687,537 ) (113,590,606 ) Property, Plant and Equipment, net $ 126,587,428 $ 145,142,642 |
Financing with Sale-Leaseback (
Financing with Sale-Leaseback (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of future minimum lease payments of the capital lease | December 31, Amount 2022 259,736 2023 151,513 Less: unearned discount (48,855 ) 362,394 Less: Current portion lease liability (210,161 ) $ 152,233 |
Loans Payable (Tables)
Loans Payable (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of short-term loans payable | December 31, December 31, 2021 2020 Industrial and Commercial Bank of China (“ICBC”) Loan 1 $ - $ 6,435,348 Industrial and Commercial Bank of China (“ICBC”) Loan 2 5,958,561 - Total short-term bank loans $ 5,958,561 $ 6,435,348 |
Schedule of long-term loans payable | December 31, December 31, 2021 2020 Rural Credit Union of Xushui District Loan 1 $ 1,348,871 $ 1,318,028 Rural Credit Union of Xushui District Loan 2 3,921,139 3,831,476 Rural Credit Union of Xushui District Loan 3 2,509,528 2,452,145 Rural Credit Union of Xushui District Loan 4 2,038,992 1,992,368 Total 9,818,530 9,594,017 Less: Current portion of long-term loans from credit union (6,838,465 ) (4,996,245 ) Long-term loans from credit union $ 2,980,065 $ 4,597,772 |
Schedule of long-term debt repayments | Amount Fiscal year 2022 $ 6,838,465 2023 and after 2,980,065 Total 9,818,530 |
Other Payables and Accrued Li_2
Other Payables and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Payables And Accruals [Abstract] | |
Schedule of other payables and accrued liabilities | December 31, December 31, 2021 2020 Accrued electricity $ 135,360 $ 14,544 Accrued rental 61,879 - Value-added tax payable - 428,481 Accrued interest to a related party 664,666 649,468 Payable for purchase of equipment 3,379,368 3,262,153 Accrued commission to salesmen 15,274 10,917 Accrued bank loan interest 992,989 429,279 Others 1,003 43,759 Totals $ 5,250,539 $ 4,838,601 |
Derivative Liabilities (Tables)
Derivative Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of fair value warrant estimated valuation weighted-average assumptions | Year ended 2021 Expected term 1.92 - 2.75 Expected average volatility 85% - 104% Expected dividend yield - Risk-free interest rate 0.19% - 0.97% |
Schedule of changes in the derivative liabilities | Balance at December 31, 2020 $ 1,115,260 Addition of new derivatives recognized as warrant 9,730,919 Addition of new derivatives recognized as loss on derivatives 10,813,347 Exercise of warrants (2,902,119 ) Change in fair value of derivative liability (16,693,873 ) Balance at December 31, 2021 $ 2,063,534 |
Schedule of loss on derivative liability included in the income statement | Year Ended December 31, 2021 2020 Day one loss due to derivative liabilities as warrant $ 10,813,347 $ 306,215 (Gain) Loss on change in fair value of derivative liability (16,693,873 ) 119,840 (5,880,526 ) 426,055 |
Warrants (Tables)
Warrants (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Warrant Disclosure [Abstract] | |
Schedule of stock warrant activities | Year Ended December 31, 2021 Weight average exercise Number price Outstanding and exercisable at beginning of the period 4,400,000 $ 0.7425 Issued during the period 40,820,751 0.622 Exercised during the period (15,054,400 ) 0.5621 Cancelled or expired during the period - - Outstanding and exercisable at end of the period 30,166,351 $ 0.6691 |
Schedule of outstanding and exercisable warrants | Warrants Outstanding Warrants Exercisable Weighted Average Weighted Weighted Remaining Average Average Number of Contractual life Exercise Number of Exercise Shares (in years) Price Shares Price 30,166,351 4.08 $ 0.6691 30,166,351 $ 0.6691 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted net income per share | Year Ended 2021 2020 Basic income (loss) per share Net income (loss) for the year - numerator $ 905,535 $ (5,554,002 ) Weighted average common stock outstanding - denominator 59,849,082 26,498,298 Net income (loss) per share $ 0.02 $ (0.21 ) Diluted income (loss) per share Net income (loss) for the year - numerator $ 905,535 $ (5,554,002 ) Weighted average common stock outstanding - denominator 59,849,082 26,498,298 Effect of dilution - - Weighted average common stock outstanding - denominator 59,849,082 26,498,298 Diluted income (loss) per share $ 0.02 $ (0.21 ) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of provisions for income taxes | Year Ended December 31, 2021 2020 Provision for Income Taxes Current Tax Provision U.S. $ 14,717 $ 14,747 Current Tax Provision PRC 2,802,187 1,247,970 Deferred Tax Provision PRC 2,730,050 (2,364,575 ) Total Provision for (Deferred tax benefit)/ Income Taxes $ 5,546,954 $ (1,101,858 ) |
Schedule of deferred tax | December 31, December 31, 2021 2020 Deferred tax assets (liabilities) Depreciation and amortization of property, plant and equipment $ 14,754,456 $ 12,397,323 Impairment of property, plant and equipment 783,433 680,800 Miscellaneous 342,170 258,963 Net operating loss carryover of PRC company 388,620 371,544 Total deferred tax assets 16,268,679 13,708,630 Less: Valuation allowance (5,000,000 ) - Total deferred tax assets, net $ 11,268,679 13,708,630 |
Schedule of reconciles the statutory rates effective tax rates | Year Ended December 31, 2021 2020 PRC Statutory rate 25.0 % 25.0 % Effect of different tax jurisdiction Effect of tax and book difference (16.5 )% (8.4 )% (Over) Under-provision in previous year Change in valuation allowance 77.5 % Effective income tax rate 86.0 % 16.6 % |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum lease payments | December 31, Amount 2022 110,315 2023 18,821 2024 18,821 2025 18,821 2026 18,821 Thereafter 94,107 Total operating lease payments $ 279,708 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of financial information for reportable segments | Year Ended December 31, 2021 Dongfang Paper Hebei Tengsheng Baoding Shengde Not Attributable to Segments Elimination of Inter-segment Enterprise-wide, consolidated Revenues $ 151,574,318 8,765,380 5,878,568 - (5,336,546 ) 160,881,720 Gross profit 12,138,849 (1,255,190 ) 133,900 - - 11,017,559 Depreciation and amortization 5,213,598 8,408,713 1,736,141 - - 15,358,452 Interest income 24,732 1,703 12,331 - - 38,766 Interest expense 717,265 71,798 335,639 - - 1,124,702 Income tax expense(benefit) 2,348,694 3,197,629 (14,086 ) 14,717 - 5,546,954 Net income (loss) 6,744,417 (10,620,350 ) (322,525 ) 5,103,993 - 905,535 Year Ended December 31, 2020 Dongfang Paper Hebei Tengsheng Baoding Shengde Not Attributable to Segments Elimination of Inter-segment Enterprise-wide, consolidated Revenues $ 91,426,671 8,414,654 1,101,944 - - 100,943,269 Gross profit 7,000,150 (1,828,214 ) 530,049 - - 5,701,985 Depreciation and amortization 7,039,687 8,613,750 140,417 - - 15,793,854 Interest income 27,046 1,770 3,217 - - 32,033 Interest expense 683,605 28,083 314,824 - - 1,026,512 Income tax expense(benefit) 967,408 (2,140,532 ) 56,550 14,717 - (1,101,857 ) Net income (loss) 2,849,742 (5,837,914 ) (42,250 ) (2,523,580 ) - (5,554,002 ) As of December 31, 2021 Dongfang Hebei Baoding Not Attributable Elimination of Enterprise-wide, Paper Tengsheng Shengde to Segments Inter-segment consolidated Total assets $ 109,369,167 93,841,874 29,181,392 9,142,769 - 241,535,202 As of December 31, 2020 Dongfang Hebei Baoding Not Attributable Elimination of Enterprise-wide, Paper Tengsheng Shengde to Segments Inter-segment consolidated Total assets $ 79,206,447 102,056,291 18,589,570 22,166 - 199,874,474 |
Summarized Quarterly Financia_2
Summarized Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly financial information | Quarter 2021 First Second Third Fourth Revenues $ 24,209,427 $ 46,534,915 $ 45,087,671 $ 45,049,707 Gross profit 1,831,005 3,029,020 1,821,536 4,335,998 (Loss) income from operations (724,313 ) 431,408 (198,029 ) 1,950,303 Net (loss) income (4,338,856 ) (453,248 ) 1,542,576 4,155,063 Net income per share Basic $ -0.12 $ -0.01 $ 0.03 $ 0.07 Diluted $ -0.12 $ -0.01 $ 0.03 $ 0.07 Quarter 2020 First Second Third Fourth Revenues $ 8,743,851 $ 26,362,273 $ 33,357,451 $ 32,479,694 Gross (loss) profit (169,719 ) 2,558,829 2,567,551 745,323 (Loss) income from operations (2,866,682 ) (798,643 ) 176,631 (1,967,110 ) Net loss (2,436,287 ) (980,031 ) (520,974 ) (1,616,710 ) Net loss per share Basic $ -0.11 $ -0.04 $ -0.02 $ -0.06 Diluted $ -0.11 $ -0.04 $ -0.02 $ -0.06 |
Condensed Financial Informati_2
Condensed Financial Information of the Parent Company (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule of condensed unconsolidated financial information | December 31, December 31, 2021 2020 ASSETS Current Assets Cash and cash equivalents $ 9,135,996 $ 16,172 Total current assets 9,135,996 16,172 Investment in subsidiaries 213,804,439 181,194,669 Total Assets $ 222,940,435 $ 181,210,840 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities Inter-company payable $ 4,399,560 $ 4,287,974 Due to related parties 727,433 727,433 Total current liabilities 5,126,993 5,015,407 Derivative liability 2,063,534 1,115,260 Total liabilities $ 7,190,527 $ 6,130,667 Total stockholders’ equity 215,749,908 175,080,173 Total Liabilities and Stockholders’ Equity $ 222,940,435 $ 181,210,840 |
Schedule of condensed statements of income and comprehensive income (loss) | Year Ended December 31, 2021 2020 Revenue - - Selling, general and administrative expenses $ 761,596 $ 2,082,743 Loss from Operations (761,596 ) (2,082,743 ) Equity in earnings of unconsolidated subsidiaries (4,198,678 ) (3,030,487 ) Loss on derivative liability 5,880,526 (426,055 ) Other Income (Expense) - - Income before Income Taxes 920,252 (5,539,285 ) Provision for Income Taxes (14,717 ) (14,717 ) Net Income $ 905,535 $ (5,554,002 ) Other comprehensive income /(loss) 4,755,446 11,798,259 Total Comprehensive Income (loss) $ 5,660,981 $ 6,244,257 |
Schedule of condensed cash flow statement | Year Ended December 31, 2021 2020 Net Cash Used in Operating Activities $ (776,313 ) $ (846,820 ) Net Cash Used in Investing Activities (32,053,000 ) (2,000,000 ) Net Cash Provided by Financing Activities 41,949,138 2,791,000 Net Increase (Decrease) in Cash and Cash Equivalents 9,119,824 (55,820 ) Cash and Cash Equivalents - Beginning of Year 16,172 71,991 Cash and Cash Equivalents - End of Year $ 9,135,996 $ 16,172 |
Organization and Business Bac_3
Organization and Business Background (Details) ¥ in Millions | 1 Months Ended | 12 Months Ended | ||||||
Jun. 25, 2019USD ($) | Jun. 25, 2019CNY (¥) | Jun. 24, 2009USD ($) | Oct. 29, 2007shares | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2010 | Feb. 10, 2010USD ($) | |
Organization and Business Background (Details) [Line Items] | ||||||||
Percentage of ownership | 100.00% | |||||||
Registered capital (in Dollars) | $ 60,000,000 | |||||||
Percentage of distributable profit of Dongfang Paper | 100.00% | |||||||
Dongfang Holding [Member] | ||||||||
Organization and Business Background (Details) [Line Items] | ||||||||
Shares of common stock issued to shareholders under merger agreement (in Shares) | shares | 7,450,497 | |||||||
Percentage of ownership | 100.00% | |||||||
Baoding Shengde [Member] | ||||||||
Organization and Business Background (Details) [Line Items] | ||||||||
Percentage of ownership | 100.00% | |||||||
Registered capital (in Dollars) | $ 10,000,000 | |||||||
Loan agreement to terminate (in Dollars) | $ 10,000,000 | |||||||
Dongfang Paper [Member] | ||||||||
Organization and Business Background (Details) [Line Items] | ||||||||
Percentage of annual net profits | 80.00% | |||||||
Principal amount (in Dollars) | $ 10,000,000 | |||||||
Loan amount (in Dollars) | $ 10,000,000 | |||||||
Percentage of distributable profit of Dongfang Paper | 100.00% | |||||||
Percentage of total assets | 84.13% | 90.70% | ||||||
Dongfang Paper [Member] | Revenue [Member] | ||||||||
Organization and Business Background (Details) [Line Items] | ||||||||
Percentage of revenue | 99.11% | 98.91% | ||||||
Hebei Tengsheng [Member] | ||||||||
Organization and Business Background (Details) [Line Items] | ||||||||
Business combination, consideration transferred | $ 45,000,000 | ¥ 320 |
Organization and Business Bac_4
Organization and Business Background (Details) - Schedule of subsidiaries and variable interest entity | 12 Months Ended | |
Dec. 31, 2021 | ||
Dongfang Holding [Member] | ||
Variable Interest Entity [Line Items] | ||
Date of incorporation or establishment | November 13, 2006 | |
Place of incorporation or establishment | BVI | |
Percentage of Ownership | 100% | |
Principal Activity | Inactive investment holding | |
Shengde Holdings [Member] | ||
Variable Interest Entity [Line Items] | ||
Date of incorporation or establishment | February 25, 2009 | |
Place of incorporation or establishment | State of Nevada | |
Percentage of Ownership | 100% | |
Principal Activity | Investment holding | |
Baoding Shengde [Member] | ||
Variable Interest Entity [Line Items] | ||
Date of incorporation or establishment | June 1, 2009 | |
Place of incorporation or establishment | PRC | |
Percentage of Ownership | 100% | |
Principal Activity | Paper production and distribution | |
Dongfang Paper [Member] | ||
Variable Interest Entity [Line Items] | ||
Date of incorporation or establishment | March 10, 1996 | |
Place of incorporation or establishment | PRC | |
Percentage of Ownership | Control* | [1] |
Principal Activity | Paper production and distribution | |
[1] | Dongfang Paper is treated as a 100% controlled variable interest entity of the Company. |
Organization and Business Bac_5
Organization and Business Background (Details) - Schedule of aggregate aggregate carrying value of Dongfang Paper’s assets and liabilities - VIE [Member] - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash and bank balances | $ 1,921,407 | $ 3,315,778 |
Restricted cash | ||
Accounts receivable | 4,867,759 | 2,389,057 |
Inventories | 5,823,762 | 1,223,020 |
Prepayments and other current assets | 19,942,878 | 7,051,381 |
Due from related parties | 888,893 | 92,795 |
Total current assets | 33,444,699 | 14,072,031 |
Prepayment on property, plant and equipment | 41,877,755 | 19,617,159 |
Finance lease right-of-use assets, net | 2,286,459 | 2,397,653 |
Property, plant, and equipment, net | 116,054,387 | 133,134,932 |
Deferred tax asset non-current | 9,547,741 | 12,040,962 |
Total Assets | 203,211,041 | 181,262,737 |
Current Liabilities | ||
Short-term bank loans | 5,958,561 | 6,435,348 |
Current portion of long-term loans from credit union | 2,289,945 | 551,733 |
Lease liability | 210,161 | 182,852 |
Accounts payable | 10,255 | 592,391 |
Advance from customers | 39,694 | 82,625 |
Due to related parties | ||
Accrued payroll and employee benefits | 279,513 | 221,482 |
Other payables and accrued liabilities | 4,740,900 | 4,672,265 |
Income taxes payable | 1,108,038 | 259,649 |
Total current liabilities | 14,637,067 | 12,998,345 |
Loans from credit union | 2,980,065 | 4,597,772 |
Deferred gain on sale-leaseback | 155,110 | 387,087 |
Lease liability - non-current | 152,233 | 354,107 |
Total liabilities | $ 17,924,475 | $ 17,950,224 |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Details) | 12 Months Ended | ||
Dec. 31, 2021USD ($) | Dec. 31, 2021CNY (¥) | Dec. 31, 2020USD ($) | |
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | |||
Current exchange rates, description | The current exchange rates used by the Company as of December 31, 2021, and 2020 to translate the Chinese RMB to the U.S. Dollars are 6.3757:1, and 6.5249:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.4474:1 and 6.8941:1 for the years ended December 31, 2021, and 2020, respectively. | The current exchange rates used by the Company as of December 31, 2021, and 2020 to translate the Chinese RMB to the U.S. Dollars are 6.3757:1, and 6.5249:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.4474:1 and 6.8941:1 for the years ended December 31, 2021, and 2020, respectively. | The current exchange rates used by the Company as of December 31, 2021, and 2020 to translate the Chinese RMB to the U.S. Dollars are 6.3757:1, and 6.5249:1, respectively. Revenues and expenses are translated using the average exchange rates prevailing throughout the respective years at 6.4474:1 and 6.8941:1 for the years ended December 31, 2021, and 2020, respectively. |
Allowance for doubtful accounts | $ 69,053 | $ 34,391 | |
AllowancesForObsoleteInventoriesNet | |||
Reserve fund percentage | 10.00% | ||
Transfers of reserve fund | |||
Registered capital amount | 50.00% | ||
Registered capital, amount | $ 11,811,470 | ¥ 75,030,000 | |
Provision for employee benefits | |||
Advertising and promotion cost | 3,972 | ||
Research and development expenses | 101,410 | 69,208 | |
Subsidy income | $ 198,530 | $ 220,478 | |
Before May 1, 2018 [Member] | |||
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | |||
Vat rate of percentage | 17.00% | ||
After May 1, 2018 [Member] | |||
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | |||
Vat rate of percentage | 16.00% | ||
After April 1, 2019 [Member] | |||
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | |||
Vat rate of percentage | 13.00% | ||
Variable interest entity [Member] | |||
Basis of Presentation and Significant Accounting Policies (Details) [Line Items] | |||
Reserve fund percentage | 50.00% |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies (Details) - Schedule of provision of the doubtful accounts - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Schedule of provision of the doubtful accounts [Abstract] | ||
Opening balance | $ 34,391 | $ 59,922 |
Provision (Reversal) for the year | 33,480 | (28,087) |
Exchange difference | 1,181 | 2,556 |
Closing balance | $ 69,053 | $ 34,391 |
Basis of Presentation and Sig_5
Basis of Presentation and Significant Accounting Policies (Details) - Schedule of property, plant, and equipment | 12 Months Ended |
Dec. 31, 2021 | |
Land Use Right [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment Term Descriptions | Over the lease term |
Building and Improvements [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment Term | 30 years |
Vehicles [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment Term | 15 years |
Minimum [Member] | Machinery and Equipment [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment Term | 5 years |
Maximum [Member] | Machinery and Equipment [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment Term | 15 years |
Restricted Cash (Details)
Restricted Cash (Details) | Dec. 31, 2021USD ($) |
Cash and Cash Equivalents [Abstract] | |
Restricted cash |
Inventories (Details) - Schedul
Inventories (Details) - Schedule of inventories - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Raw Materials | ||
Raw materials | $ 2,348,154 | $ 267,551 |
Semi-finished Goods | 96,087 | 176,703 |
Finished Goods | 3,400,654 | 789,547 |
Total inventory, gross | 5,844,895 | 1,233,801 |
Inventory reserve | ||
Total inventory, net | 5,844,895 | 1,233,801 |
Recycled paper board [Member] | ||
Raw Materials | ||
Raw materials | 2,097,062 | 19,459 |
Recycled white scrap paper [Member] | ||
Raw Materials | ||
Raw materials | 11,808 | 11,193 |
Gas [Member] | ||
Raw Materials | ||
Raw materials | 32,753 | 55,473 |
Base paper and other raw materials [Member] | ||
Raw Materials | ||
Raw materials | $ 206,531 | $ 181,426 |
Prepayments and Other Current_3
Prepayments and Other Current Assets (Details) - Schedule of prepayments and other current assets - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Schedule of prepayments and other current assets [Abstract] | ||
Prepaid land lease | $ 188,215 | $ 183,912 |
Prepayment for purchase of materials | 9,190,527 | 10,945 |
Prepayment for purchase of equipment | 980,786 | |
Value-added tax recoverable | 14,740,296 | 5,864,989 |
Others | 696,816 | 991,669 |
Total | $ 25,796,640 | $ 7,051,515 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment (Details) [Line Items] | ||
Term of lease, description | As of December 31, 2021, and 2020, land use rights represented two parcel of state-owned lands located in Xushui District of Hebei Province in China, with lease terms of 50 years expiring from 2061 to 2066. | |
Land use right net values pledged for sale-leaseback financing | $ 6,002,195 | $ 6,010,359 |
Value of land use right pledged for bank loan | 8,815,778 | 8,614,194 |
Depreciation and amortization | 15,304,686 | 15,793,854 |
Dongfang Paper [Member] | ||
Property, Plant and Equipment (Details) [Line Items] | ||
Property, plant and equipment net value | $ 1,130,333 | $ 2,349,796 |
Hebei Tengsheng [Member] | ||
Property, Plant and Equipment (Details) [Line Items] | ||
Land use right net value | $5,690,261 | $5,560,146 |
Property, Plant and Equipment_3
Property, Plant and Equipment (Details) - Schedule of property, plant and equipment - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, gross | $ 258,274,965 | $ 258,733,248 |
Less: accumulated depreciation and amortization | (131,687,537) | (113,590,606) |
Property, Plant and Equipment, net | 126,587,428 | 145,142,642 |
Land use rights [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, gross | 12,790,062 | 12,497,601 |
Building and improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, gross | 74,609,698 | 81,233,162 |
Machinery and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, gross | 170,149,367 | 163,787,807 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, gross | $ 725,838 | 628,462 |
Construction in progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, gross | $ 586,216 |
Financing with Sale-Leaseback_2
Financing with Sale-Leaseback (Details) | Aug. 06, 2020USD ($) | Aug. 06, 2020CNY (¥) | Dec. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Aug. 17, 2020USD ($) |
Financing with Sale-Leaseback (Details) [Line Items] | |||||
Sale of lease equipment | $ 16,000,000 | ||||
Right-of-use assets | 2,349,452 | $ 2,286,459 | $ 2,397,653 | ||
Implicit interest rate | 6.00% | ||||
Inception of lease | $ 567,099 | ||||
Lease liability | 362,394 | 536,959 | |||
Current portion amount | 210,161 | 182,852 | |||
Amortization of lease asset | 165,441 | 51,574 | |||
Interest expenses | 71,798 | 28,083 | |||
Deferred gain amount | 430,695 | ||||
Hebei Tengsheng [Member] | |||||
Financing with Sale-Leaseback (Details) [Line Items] | |||||
Finance proceeding amount | 2,500,000 | ¥ 16,000,000 | |||
Leased equipment net | $ 2,286,459 | $ 2,397,653 | |||
TLCL [Member] | |||||
Financing with Sale-Leaseback (Details) [Line Items] | |||||
Sale of lease equipment | $ 2,500,000 | ||||
Lease term | 3 years | ||||
Purchase price | $ 15 | ¥ 100 |
Financing with Sale-Leaseback_3
Financing with Sale-Leaseback (Details) - Schedule of future minimum lease payments of the capital lease | Dec. 31, 2021USD ($) |
Schedule of future minimum lease payments of the capital lease [Abstract] | |
2022 | $ 259,736 |
2023 | 151,513 |
Less: unearned discount | (48,855) |
Total future minimum lease payments | 362,394 |
Less: Current portion lease liability | (210,161) |
Present value of operating lease liability | $ 152,233 |
Loans Payable (Details)
Loans Payable (Details) - USD ($) | Dec. 12, 2019 | Nov. 06, 2018 | Jul. 15, 2013 | Apr. 17, 2019 | Jun. 21, 2018 | Apr. 16, 2014 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Loans Payable (Details) [Line Items] | |||||||||
Short-term bank loans | $ 5,958,561 | $ 6,435,348 | |||||||
Short-term borrowings | 6,435,348 | ||||||||
Unsecured bank loans | |||||||||
Average short-term borrowing rates | 4.73% | 4.79% | |||||||
Loans payable | $ 9,818,530 | $ 9,594,017 | |||||||
Long-term debt, interest rate per month | 7.56% | 0.60% | |||||||
Non-current liabilities | 6,915,176 | ||||||||
Loan extension period | 2 years | 2 years | 5 years | ||||||
Repayments due, description | The loan was renewed on March 22, 2021 and December 24, 2021 and extended for additional 3 years in total, which will be due on April 16, 2024 according to the new schedule. | ||||||||
Total outstanding loan | 6,838,465 | 4,996,245 | |||||||
Total interest expenses | 1,052,904 | 998,429 | |||||||
ICBC Loan 1 [Member] | |||||||||
Loans Payable (Details) [Line Items] | |||||||||
Short-term bank loans | $ 5,958,561 | ||||||||
Loans fixed interest rate | 4.785% | ||||||||
Loans Payable [Member] | |||||||||
Loans Payable (Details) [Line Items] | |||||||||
Short-term borrowings | 5,958,561 | ||||||||
Unsecured bank loans | |||||||||
Non-current liabilities | $ 1,960,570 | 3,494,307 | |||||||
Loans Payable [Member] | ICBC Loan 1 [Member] | |||||||||
Loans Payable (Details) [Line Items] | |||||||||
Short-term bank loans | 6,435,348 | ||||||||
Loans fixed interest rate | 4.785% | ||||||||
Rural Credit Union of Xushui District [Member] | |||||||||
Loans Payable (Details) [Line Items] | |||||||||
Loans payable | 9,818,530 | $ 9,594,017 | |||||||
Installment repayment, description | On November 6, 2018, the loan was renewed for additional 5 years and will be due and payable in various installments from December 21, 2018 to November 5, 2023. | On April 16, 2014, the Company entered into a loan agreement with the Rural Credit Union of Xushui District for a term of 5 years, which was originally due in various installments from June 21, 2014 to November 18, 2018. | |||||||
Total outstanding loan | $ 2,509,528 | 2,452,145 | |||||||
Rural Credit Union of Xushui District [Member] | Long-term Loans [Member] | |||||||||
Loans Payable (Details) [Line Items] | |||||||||
Installment repayment, description | On July 15, 2013, the Company entered into a loan agreement with the Rural Credit Union of Xushui District for a term of 5 years, which was originally due and payable in various installments from December 21, 2013 to July 26, 2018. | ||||||||
Non-current liabilities | 1,348,871 | 1,318,028 | |||||||
Total outstanding loan balance | $ 329,376 | 214,563 | |||||||
Rural Credit Union of Xushui District [Member] | New Term Loan Agreement [Member] | |||||||||
Loans Payable (Details) [Line Items] | |||||||||
Long-term debt, interest rate per month | 0.64% | ||||||||
Total outstanding loan balance | $ 3,921,139 | 3,831,476 | |||||||
Net book value | 1,130,333 | 2,349,796 | |||||||
Rural Credit Union of Xushui District [Member] | Loans Payable [Member] | Long-term Loans [Member] | |||||||||
Loans Payable (Details) [Line Items] | |||||||||
Non-current liabilities | 1,019,495 | 1,103,465 | |||||||
Rural Credit Union of Xushui District One [Member] | |||||||||
Loans Payable (Details) [Line Items] | |||||||||
Long-term debt, interest rate per month | 0.64% | ||||||||
Total outstanding loan | 2,038,992 | 1,992,368 | |||||||
Rural Credit Union of Xushui District One [Member] | New Term Loan Agreement [Member] | |||||||||
Loans Payable (Details) [Line Items] | |||||||||
Total outstanding loan balance | $ 1,960,569 | $ 337,169 |
Loans Payable (Details) - Sched
Loans Payable (Details) - Schedule of short-term bank loans - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Short-term Debt [Line Items] | ||
Total short-term bank loans | $ 5,958,561 | $ 6,435,348 |
Industrial and Commercial Bank of China (“ICBC”) Loan 1 [Member] | ||
Short-term Debt [Line Items] | ||
Total short-term bank loans | 6,435,348 | |
Industrial and Commercial Bank of China (“ICBC”) Loan 2 [Member] | ||
Short-term Debt [Line Items] | ||
Total short-term bank loans | $ 5,958,561 |
Loans Payable (Details) - Sch_2
Loans Payable (Details) - Schedule of long-term loans payable - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Total | $ 9,818,530 | $ 9,594,017 |
Less: Current portion of long-term loans from credit union | (6,838,465) | (4,996,245) |
Long-term loans from credit union | 2,980,065 | 4,597,772 |
Rural Credit Union of Xushui District Loan 1 [Member] | ||
Debt Instrument [Line Items] | ||
Total | 1,348,871 | 1,318,028 |
Rural Credit Union of Xushui District Loan 2 [Member] | ||
Debt Instrument [Line Items] | ||
Total | 3,921,139 | 3,831,476 |
Rural Credit Union of Xushui District Loan 3 [Member] | ||
Debt Instrument [Line Items] | ||
Total | 2,509,528 | 2,452,145 |
Rural Credit Union of Xushui District Loan 4 [Member] | ||
Debt Instrument [Line Items] | ||
Total | $ 2,038,992 | $ 1,992,368 |
Loans Payable (Details) - Sch_3
Loans Payable (Details) - Schedule of long-term debt repayments | Dec. 31, 2021USD ($) |
Fiscal year | |
2022 | $ 6,838,465 |
2023 and after | 2,980,065 |
Total | $ 9,818,530 |
Related Party Transactions (Det
Related Party Transactions (Details) | Aug. 06, 2016 | Dec. 10, 2014USD ($) | Aug. 07, 2013USD ($) | Jan. 01, 2013 | Dec. 31, 2019USD ($) | Nov. 23, 2018USD ($) | Feb. 28, 2018USD ($) | Feb. 28, 2018USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2021USD ($) | Dec. 31, 2021USD ($) | Dec. 31, 2016USD ($) | Dec. 08, 2021USD ($) | Dec. 08, 2021CNY (¥) | Dec. 31, 2020USD ($) | Oct. 14, 2016USD ($) | Jul. 13, 2015USD ($) | Mar. 01, 2015USD ($) | Mar. 01, 2015CNY (¥) |
Related Party Transactions (Details) [Line Items] | |||||||||||||||||||
Interest amount | $ 94,636 | $ 20,400 | $ 2,249,279 | ||||||||||||||||
Amount due to shareholder | $ 391,374 | ||||||||||||||||||
Outstanding loan balance | $ 6,915,176 | ||||||||||||||||||
Loan due description | Mr. Zhenyong Liu agreed to extend the loan for additional 3 years and the remaining balance will be due on July 12, 2021. | ||||||||||||||||||
Accrued interest | $ 992,989 | $ 429,279 | |||||||||||||||||
Fixed interest rate | 3.00% | ||||||||||||||||||
Shareholder expenses description | As of December 31, 2021, and 2020, amount due to shareholder are $727,433, which represent funds from shareholders to pay for various expenses incurred in the U.S. The amount is due on demand with interest free. | ||||||||||||||||||
Mr Zhenyong Liu [Member] | |||||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||||
Loans payable to related party | $ 6,012,416 | $ 6,915,176 | ¥ 44,089,085 | ||||||||||||||||
Interest paid | $ 288,596 | ||||||||||||||||||
Outstanding loan balance | $ 47,054 | 45,978 | |||||||||||||||||
Chief Executive Officer [Member] | |||||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||||
Loans payable to related party | $ 2,883,091 | $ 4,324,636 | $ 17,201,342 | ¥ 120,000,000 | |||||||||||||||
Outstanding loan balance | 215,565 | 210,635 | |||||||||||||||||
Industrial building lease term | $727,433 | ||||||||||||||||||
Chief Executive Officer [Member] | Mr Zhenyong Liu [Member] | |||||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||||
Accrued interest | $ 664,666 | 649,468 | |||||||||||||||||
Dongfang Paper [Member] | Mr Zhenyong Liu [Member] | |||||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||||
Interest amount | $ 158,651 | ||||||||||||||||||
Other payables and accrued liabilities | $ 402,047 | $ 392,855 | |||||||||||||||||
Loans payable to related party | $ 8,742,278 | ||||||||||||||||||
Interest rate on loans | 4.35% | ||||||||||||||||||
Repayment of related party loans | $ 3,768,579 | $ 1,507,432 | |||||||||||||||||
Dongfang Paper [Member] | Mr Zhenyong Liu [Member] | |||||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||||
Loan payable term, description | On January 1, 2013, Dongfang Paper and Mr. Zhenyong Liu renewed the three-year term loan previously entered on January 1, 2010, and extended the maturity date further to December 31, 2015. | ||||||||||||||||||
Hebei Fangsheng [Member] | One employee dormitory buildings [Member] | |||||||||||||||||||
Related Party Transactions (Details) [Line Items] | |||||||||||||||||||
Sale price of dormitory buildings |
Other Payables and Accrued Li_3
Other Payables and Accrued Liabilities (Details) - Schedule of other payables and accrued liabilities - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Schedule of other payables and accrued liabilities [Abstract] | ||
Accrued electricity | $ 135,360 | $ 14,544 |
Accrued rental | 61,879 | |
Value-added tax payable | 428,481 | |
Accrued interest to a related party | 664,666 | 649,468 |
Payable for purchase of equipment | 3,379,368 | 3,262,153 |
Accrued commission to salesmen | 15,274 | 10,917 |
Accrued bank loan interest | 992,989 | 429,279 |
Others | 1,003 | 43,759 |
Totals | $ 5,250,539 | $ 4,838,601 |
Derivative Liabilities (Details
Derivative Liabilities (Details) - Schedule of fair value warrant estimated valuation weighted-average assumptions | 12 Months Ended |
Dec. 31, 2021 | |
Product Warranty Liability [Line Items] | |
Expected dividend yield | |
Minimum [Member] | |
Product Warranty Liability [Line Items] | |
Expected term | 1 year 11 months 1 day |
Expected average volatility | 85.00% |
Risk-free interest rate | 0.19% |
Maximum [Member] | |
Product Warranty Liability [Line Items] | |
Expected term | 2 years 9 months |
Expected average volatility | 104.00% |
Risk-free interest rate | 0.97% |
Derivative Liabilities (Detai_2
Derivative Liabilities (Details) - Schedule of changes in the derivative liabilities - Fair Value, Inputs, Level 3 [Member] | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Derivative Liabilities (Details) - Schedule of changes in the derivative liabilities [Line Items] | |
Balance at December 31, 2020 | $ 1,115,260 |
Addition of new derivatives recognized as warrant | 9,730,919 |
Addition of new derivatives recognized as loss on derivatives | 10,813,347 |
Exercise of warrants | (2,902,119) |
Change in fair value of derivative liability | (16,693,873) |
Balance at December 31, 2021 | $ 2,063,534 |
Derivative Liabilities (Detai_3
Derivative Liabilities (Details) - Schedule of loss on derivative liability included in the income statement - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Schedule of loss on derivative liability included in the income statement [Abstract] | ||
Day one loss due to derivative liabilities as warrant | $ 10,813,347 | $ 306,215 |
(Gain) Loss on change in fair value of derivative liability | (16,693,873) | 119,840 |
Loss on derivative liability | $ (5,880,526) | $ 426,055 |
Common Stock (Details)
Common Stock (Details) | Mar. 01, 2021USD ($)$ / sharesshares | Apr. 28, 2020shares | Apr. 02, 2020USD ($)$ / sharesshares | Jan. 02, 2020shares | Sep. 13, 2018USD ($)$ / sharesshares | Apr. 29, 2020USD ($)$ / sharesshares | Dec. 31, 2021USD ($)$ / shares |
Common Stock (Details) [Line Items] | |||||||
Issuance of common stock and warrants | 60,000 | ||||||
Share price | $ / shares | $ 0.7 | ||||||
Exercise price warrant | $ / shares | $ 0.75 | $ 0.7425 | $ 0.55 | ||||
Common stock description | On January 20, 2021, the Company offered and sold to certain institutional investors an aggregate of 26,181,818 shares of common stock and 26,181,818warrants to purchase up to 26,181,818 shares of common stock in a best efforts public offering for gross proceeds of approximately $14.4 million. | ||||||
Corresponding price per share | $ / shares | $ 0.75 | $ 0.55 | |||||
Aggregate shares of common stock | 29,277,866 | ||||||
Warrants to purchase shares | 14,638,933 | ||||||
Shares of common stock | 14,638,933 | ||||||
Public offering for gross proceeds | $ | $ 21,900,000 | ||||||
Shares of common stock under compensatory incentive plans | 60,000 | ||||||
Total fair value of stock of grant | $ | $ 470,360 | $ 42,000 | |||||
Description of consulting service | On November 2, 2020, the Company entered into an agreement with a consultant and agreed as compensation to issue to the consultant in the aggregate of 21,000 shares of common stock for investor relations consulting service rendered from November 2, 2020 to November 2, 2021. 21,000 shares of common stock were issued to this consultant on November 30, 2020. Total fair value of the shares of common stock issued was calculated at $14,700 at $0.70 per share. | ||||||
Compensatory Incentive Plans [Member] | |||||||
Common Stock (Details) [Line Items] | |||||||
Share price | $ / shares | $ 0.6 | $ 0.88 | |||||
Shares of common stock under compensatory incentive plans | 2,000,000 | 534,500 | |||||
Number of officers | 15 | 15 | |||||
Total fair value of stock of grant | $ | $ 1,200,000 | ||||||
2020 Purchase Agreement [Member] | |||||||
Common Stock (Details) [Line Items] | |||||||
Issuance of common stock and warrants | 4,400,000 | ||||||
Purchase of shares | 4,400,000 | ||||||
Gross proceeds | $ | $ 2,550,000 | ||||||
Net proceeds | $ | $ 2,270,000 | ||||||
Share price | $ / shares | $ 0.58 |
Warrants (Details)
Warrants (Details) - $ / shares | 1 Months Ended | 12 Months Ended | |
Mar. 01, 2021 | Jan. 20, 2021 | Dec. 31, 2021 | |
Warrants (Details) [Line Items] | |||
Warrants to purchase shares of common stock | 14,638,933 | 26,181 | |
Warrant term, description | The March 2021Warrants are exercisable commencing on March 1, 2021 at an exercise price of $0.75 and will expire on March 1, 2026. 67,500 March 2021 Warrants were exercised in January and March 2021 at the exercise price of $0.75 per share and 14,571,433 March 2021 Warrants were outstanding as of December 31, 2021. | Warrants are exercisable commencing on January 20, 2021 at an exercise price of $0.55 and will expire on January 20, 2026. 14,106,900 January 2021 Warrants were exercised in January and February of 2021 at the exercise price of $0.55 per share. 12,074,918 January 2021 Warrants were outstanding as of December 31, 2021 | These warrants are exercisable on July 23, 2020 and have a term of exercise equal to five years and six months from the date of issuance till July 23, 2025. 880,000 May 2020 Warrants were exercised in February 2021 at the exercise price of $0.7425 per share and 3,520,000 May 2020 Warrants were outstanding as of September 30, 2021. |
Warrant [Member] | |||
Warrants (Details) [Line Items] | |||
Issuance of common stock and warrants | 29,277,866 | 26,181,818 | 4,400,000 |
Warrants to purchase shares of common stock | 14,638,933 | 26,181,818 | 4,400,000 |
Exercise price (in Dollars per share) | $ 0.7425 |
Warrants (Details) - Schedule o
Warrants (Details) - Schedule of stock warrant activities | 12 Months Ended |
Dec. 31, 2021$ / sharesshares | |
Schedule of stock warrant activities [Abstract] | |
Number of Outstanding and exercisable at beginning of the period | shares | 4,400,000 |
Weight average exercise price of Outstanding and exercisable at beginning of the period | $ / shares | $ 0.7425 |
Number of Issued during the period | shares | 40,820,751 |
Weight average exercise price of Issued during the period | $ / shares | $ 0.622 |
Number of Exercised during the period | shares | (15,054,400) |
Weight average exercise price of Exercised during the period | $ / shares | $ 0.5621 |
Number of Cancelled or expired during the period | shares | |
Weight average exercise price of Cancelled or expired during the period | $ / shares | |
Number of Outstanding and exercisable at end of the period | shares | 30,166,351 |
Weight average exercise price of Outstanding and exercisable at end of the period | $ / shares | $ 0.6691 |
Warrants (Details) - Schedule_2
Warrants (Details) - Schedule of outstanding and exercisable warrants - Warrant [Member] | 12 Months Ended |
Dec. 31, 2021$ / sharesshares | |
Warrants (Details) - Schedule of outstanding and exercisable warrants [Line Items] | |
Warrants Outstanding, Number of Shares | shares | 30,166,351 |
Warrants Outstanding, Weighted Average Remaining Contractual life (in years) | 4 years 29 days |
Warrants Outstanding, Weighted Average Exercise Price | $ / shares | $ 0.6691 |
Warrants Exercisable, Number of Shares | shares | 30,166,351 |
Warrants Exercisable, Weighted Average Exercise Price | $ / shares | $ 0.6691 |
Earnings Per Share (Details) -
Earnings Per Share (Details) - Schedule of basic and diluted net income per share - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Basic income (loss) per share | ||
Net income (loss) for the year - numerator | $ 905,535 | $ (5,554,002) |
Weighted average common stock outstanding - denominator | 59,849,082 | 26,498,298 |
Net income (loss) per share | $ 0.02 | $ (0.21) |
Diluted income (loss) per share | ||
Net income (loss) for the year - numerator | $ 905,535 | $ (5,554,002) |
Weighted average common stock outstanding - denominator | 59,849,082 | 26,498,298 |
Effect of dilution | ||
Diluted income (loss) per share | $ 0.02 | $ (0.21) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Dec. 22, 2017 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2017 | Dec. 31, 2019 | |
Income Taxes (Details) [Line Items] | |||||
Statutory tax rate | 25.00% | 25.00% | |||
Effective income tax rate | 86.00% | 16.60% | |||
Description of carry forwards expire | These carry forwards would expire, if not utilized, during the period of 2030 through 2035. | ||||
Percentage of valuation allowance | 100.00% | ||||
Effective income tax rate | 86.00% | 16.60% | |||
Income tax, statute of limitations period | 5 years | ||||
Maximum [Member] | |||||
Income Taxes (Details) [Line Items] | |||||
Effective income tax rate | 35.00% | ||||
Minimum [Member] | |||||
Income Taxes (Details) [Line Items] | |||||
Effective income tax rate | 21.00% | ||||
United States [Member] | |||||
Income Taxes (Details) [Line Items] | |||||
Statutory tax rate | 34.00% | ||||
State tax rates | 0.00% | ||||
Additional income tax expense (in Dollars) | $ 80,000 | ||||
China [Member] | |||||
Income Taxes (Details) [Line Items] | |||||
Net operating losses (in Dollars) | $ 2,508,797 | $ 0 |
Income Taxes (Details) - Schedu
Income Taxes (Details) - Schedule of provisions for income taxes - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Provision for Income Taxes | ||
Current Tax Provision U.S. | $ 14,717 | $ 14,747 |
Current Tax Provision PRC | 2,802,187 | 1,247,970 |
Deferred Tax Provision PRC | 2,730,050 | (2,364,575) |
Total Provision for (Deferred tax benefit)/ Income Taxes | $ 5,546,954 | $ (1,101,858) |
Income Taxes (Details) - Sche_2
Income Taxes (Details) - Schedule of deferred tax - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets (liabilities) | ||
Depreciation and amortization of property, plant and equipment | $ 14,754,456 | $ 12,397,323 |
Impairment of property, plant and equipment | 783,433 | 680,800 |
Miscellaneous | 342,170 | 258,963 |
Net operating loss carryover of PRC company | 388,620 | 371,544 |
Total deferred tax assets | 16,268,679 | 13,708,630 |
Less: Valuation allowance | (5,000,000) | |
Total deferred tax assets, net | $ 11,268,679 | $ 13,708,630 |
Income Taxes (Details) - Sche_3
Income Taxes (Details) - Schedule of reconciles the statutory rates effective tax rates - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Schedule of reconciles the statutory rates effective tax rates [Abstract] | ||
PRC Statutory rate | 25.00% | 25.00% |
Effect of different tax jurisdiction (in Dollars) | ||
Effect of tax and book difference | (16.50%) | (8.40%) |
(Over) Under-provision in previous year | ||
Change in valuation allowance | 77.50% | |
Effective income tax rate | 86.00% | 16.60% |
Stock Incentive Plans (Details)
Stock Incentive Plans (Details) - USD ($) | Apr. 02, 2020 | Nov. 12, 2021 | Oct. 31, 2019 |
2019 Incentive Stock Plan [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Number of shares | 2,000,000 | ||
Shares issued under incentive stock plan | 2,000,000 | ||
Total fair value of stock of grant (in Dollars) | $ 1,200,000 | ||
Share price (in Dollars per share) | $ 0.6 | ||
2021 Incentive Stock Plan [Member] | |||
Stock Incentive Plans (Details) [Line Items] | |||
Number of shares | 1,500,000 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) | Aug. 06, 2016 | Aug. 07, 2013 | Dec. 31, 2021USD ($)m² | Dec. 31, 2021CNY (¥)m² | Dec. 31, 2020USD ($) | Dec. 31, 2020CNY (¥) |
Commitments and Contingencies (Details) [Line Items] | ||||||
Cash prices, description | On August 7, 2013, the Company’s Audit Committee and the Board of Directors approved the sale of the land use right of the Headquarters Compound (the “LUR”), the office building and essentially all industrial-use buildings in the Headquarters Compound (the “Industrial Buildings”), and three employee dormitory buildings located within the Headquarters Compound (the “Dormitories”) to Hebei Fangsheng for cash prices of approximately $2.77 million, $1.15 million, and $4.31 million respectively. | |||||
Extend lease term | 4 years | |||||
Outstanding commitments amount | $ 4,700,927 | $ 4,570,331 | ||||
Performance holdback on new tissue paper payment, description | The Company expected to pay off all the balances within 1-3 years. | |||||
Long-term loan from financial institutions | $ 4,862,211 | ¥ 31,000,000 | $ 4,751,031 | ¥ 31,000,000 | ||
Local Government [Member] | ||||||
Commitments and Contingencies (Details) [Line Items] | ||||||
Area of land (in Square Meters) | m² | 32.95 | 32.95 | ||||
Lease expiration period | 30 years | |||||
Operating lease annual rental payment | $ 18,612 | |||||
Annual rental (in Yuan Renminbi) | ¥ | ¥ 120,000 | |||||
Hebei Fangsheng [Member] | ||||||
Commitments and Contingencies (Details) [Line Items] | ||||||
Annual rental total | $ 155,101 | ¥ 1,000,000 |
Commitments and Contingencies_3
Commitments and Contingencies (Details) - Schedule of future minimum lease payments | Dec. 31, 2021USD ($) |
Schedule of future minimum lease payments [Abstract] | |
2022 | $ 110,315 |
2023 | 18,821 |
2024 | 18,821 |
2025 | 18,821 |
2026 | 18,821 |
Thereafter | 94,107 |
Total operating lease payments | $ 279,708 |
Segment Reporting (Details)
Segment Reporting (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Number of business operating segments | 2 |
Number of reportable segment | 2 |
Segment Reporting (Details) - S
Segment Reporting (Details) - Schedule of financial information for reportable segments - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Dongfang Paper [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | $ 151,574,318 | $ 91,426,671 |
Gross profit | 12,138,849 | 7,000,150 |
Depreciation and amortization | 5,213,598 | 7,039,687 |
Interest income | 24,732 | 27,046 |
Interest expense | 717,265 | 683,605 |
Income tax expense(benefit) | 2,348,694 | 967,408 |
Net income (loss) | 6,744,417 | 2,849,742 |
Total assets | 109,369,167 | 79,206,447 |
Hebei Tengsheng [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 8,765,380 | 8,414,654 |
Gross profit | (1,255,190) | (1,828,214) |
Depreciation and amortization | 8,408,713 | 8,613,750 |
Interest income | 1,703 | 1,770 |
Interest expense | 71,798 | 28,083 |
Income tax expense(benefit) | 3,197,629 | (2,140,532) |
Net income (loss) | (10,620,350) | (5,837,914) |
Total assets | 93,841,874 | 102,056,291 |
Baoding Shengde [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 5,878,568 | 1,101,944 |
Gross profit | 133,900 | 530,049 |
Depreciation and amortization | 1,736,141 | 140,417 |
Interest income | 12,331 | 3,217 |
Interest expense | 335,639 | 314,824 |
Income tax expense(benefit) | (14,086) | 56,550 |
Net income (loss) | (322,525) | (42,250) |
Total assets | 29,181,392 | 18,589,570 |
Not Attributable to Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | ||
Gross profit | ||
Depreciation and amortization | ||
Interest income | ||
Interest expense | ||
Income tax expense(benefit) | 14,717 | 14,717 |
Net income (loss) | 5,103,993 | (2,523,580) |
Total assets | 9,142,769 | 22,166 |
Elimination of Inter-Segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | (5,336,546) | |
Gross profit | ||
Depreciation and amortization | ||
Interest income | ||
Interest expense | ||
Income tax expense(benefit) | ||
Net income (loss) | ||
Total assets | ||
Enterprise-Wide, Consolidated [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 160,881,720 | 100,943,269 |
Gross profit | 11,017,559 | 5,701,985 |
Depreciation and amortization | 15,358,452 | 15,793,854 |
Interest income | 38,766 | 32,033 |
Interest expense | 1,124,702 | 1,026,512 |
Income tax expense(benefit) | 5,546,954 | (1,101,857) |
Net income (loss) | 905,535 | (5,554,002) |
Total assets | $ 241,535,202 | $ 199,874,474 |
Concentration and Major Custo_2
Concentration and Major Customers and Suppliers (Details) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Total Sales [Member] | ||
Concentration and Major Customers and Suppliers (Details) [Line Items] | ||
Concentration credit risk, percentage | 10.00% | |
Total Purchases [Member] | ||
Concentration and Major Customers and Suppliers (Details) [Line Items] | ||
Number of major supplier | 2 | 2 |
Supplier One [Member] | Total Purchases [Member] | ||
Concentration and Major Customers and Suppliers (Details) [Line Items] | ||
Concentration credit risk, percentage | 78.00% | 72.00% |
Supplier Two [Member] | Total Purchases [Member] | ||
Concentration and Major Customers and Suppliers (Details) [Line Items] | ||
Concentration credit risk, percentage | 11.00% | 12.00% |
Concentration of Credit Risk (D
Concentration of Credit Risk (Details) | 1 Months Ended | |||
May 01, 2015USD ($) | May 01, 2015CNY (¥) | Dec. 31, 2021USD ($) | Dec. 31, 2021CNY (¥) | |
Concentration of Credit Risk (Details) [Line Items] | ||||
Federal deposit insurance corporation | $ 78,423 | ¥ 500,000 | ||
Maximum coverage from FDIC | $ 1,806,869 | ¥ 11,520,053 | ||
Minimum [Member] | ||||
Concentration of Credit Risk (Details) [Line Items] | ||||
Maximum coverage from FDIC | ¥ 500,000 |
Subsequent Event (Details)
Subsequent Event (Details) | 1 Months Ended |
Feb. 23, 2022 | |
Subsequent Event [Member] | |
Subsequent Event (Details) [Line Items] | |
Subsequent event description | Dongfang Paper fully paid the RMB320 million (approximately $45million) as the consideration for the acquisition per agreement that Dongfang Paper had entered into with the shareholder of Hebei Tengsheng Paper Co., Ltd. |
Summarized Quarterly Financia_3
Summarized Quarterly Financial Data (Unaudited) (Details) - Schedule of Quarterly financial information - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Schedule of Quarterly financial information [Abstract] | ||||||||||
Revenues | $ 45,049,707 | $ 45,087,671 | $ 46,534,915 | $ 24,209,427 | $ 32,479,694 | $ 33,357,451 | $ 26,362,273 | $ 8,743,851 | $ 160,881,720 | $ 100,943,269 |
Gross profit | 4,335,998 | 1,821,536 | 3,029,020 | 1,831,005 | 745,323 | 2,567,551 | 2,558,829 | (169,719) | 11,017,559 | 5,701,985 |
(Loss) income from operations | 1,950,303 | (198,029) | 431,408 | (724,313) | (1,967,110) | 176,631 | (798,643) | (2,866,682) | 1,459,369 | (5,455,804) |
Net (loss) income | $ 4,155,063 | $ 1,542,576 | $ (453,248) | $ (4,338,856) | $ (1,616,710) | $ (520,974) | $ (980,031) | $ (2,436,287) | $ 905,535 | $ (5,554,002) |
Basic (in Dollars per share) | $ 0.07 | $ 0.03 | $ (0.01) | $ (0.12) | $ (0.06) | $ (0.02) | $ (0.04) | $ (0.11) | ||
Diluted (in Dollars per share) | $ 0.07 | $ 0.03 | $ (0.01) | $ (0.12) | $ (0.06) | $ (0.02) | $ (0.04) | $ (0.11) |
Condensed Financial Informati_3
Condensed Financial Information of the Parent Company (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Condensed Financial Information Disclosure [Abstract] | ||
Restricted including paid-in capital, capital surplus and statutory reserves | $ 79,641,643 | $ 47,589,643 |
Condensed Financial Informati_4
Condensed Financial Information of the Parent Company (Details) - Schedule of condensed unconsolidated financial information - Parent Company [Member] - USD ($) | Dec. 31, 2021 | Dec. 31, 2020 |
ASSETS | ||
Cash and cash equivalents | $ 9,135,996 | $ 16,172 |
Total current assets | 9,135,996 | 16,172 |
Investment in subsidiaries | 213,804,439 | 181,194,669 |
Total Assets | 222,940,435 | 181,210,840 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Inter-company payable | 4,399,560 | 4,287,974 |
Due to related parties | 727,433 | 727,433 |
Total current liabilities | 5,126,993 | 5,015,407 |
Derivative liability | 2,063,534 | 1,115,260 |
Total liabilities | 7,190,527 | 6,130,667 |
Total stockholders’ equity | 215,749,908 | 175,080,173 |
Total Liabilities and Stockholders’ Equity | $ 222,940,435 | $ 181,210,840 |
Condensed Financial Informati_5
Condensed Financial Information of the Parent Company (Details) - Schedule of condensed statements of income and comprehensive income (loss) - Parent Company [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Condensed Statement of Income Captions [Line Items] | ||
Revenue | ||
Selling, general and administrative expenses | 761,596 | 2,082,743 |
Loss from Operations | (761,596) | (2,082,743) |
Equity in earnings of unconsolidated subsidiaries | (4,198,678) | (3,030,487) |
Loss on derivative liability | 5,880,526 | (426,055) |
Other Income (Expense) | ||
Income before Income Taxes | 920,252 | (5,539,285) |
Provision for Income Taxes | (14,717) | (14,717) |
Net Income | 905,535 | (5,554,002) |
Other comprehensive income /(loss) | 4,755,446 | 11,798,259 |
Total Comprehensive Income (loss) | $ 5,660,981 | $ 6,244,257 |
Condensed Financial Informati_6
Condensed Financial Information of the Parent Company (Details) - Schedule of condensed cash flow statement - Parent Company [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Condensed Cash Flow Statements, Captions [Line Items] | ||
Net Cash Used in Operating Activities | $ (776,313) | $ (846,820) |
Net Cash Used in Investing Activities | (32,053,000) | (2,000,000) |
Net Cash Provided by Financing Activities | 41,949,138 | 2,791,000 |
Net Increase (Decrease) in Cash and Cash Equivalents | 9,119,824 | (55,820) |
Cash and Cash Equivalents - Beginning of Year | 16,172 | 71,991 |
Cash and Cash Equivalents - End of Year | $ 9,135,996 | $ 16,172 |