Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Aug. 31, 2020 | Dec. 16, 2020 | Feb. 29, 2020 | |
Document Information Line Items | |||
Entity Registrant Name | Bespoke Extracts, Inc. | ||
Document Type | 10-K | ||
Current Fiscal Year End Date | --08-31 | ||
Entity Common Stock, Shares Outstanding | 229,389,621 | ||
Entity Public Float | $ 549,924 | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001409197 | ||
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 | Aug. 31, 2020 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Shell Company | false | ||
Entity Ex Transition Period | false | ||
Entity File Number | 000-52759 | ||
Entity Incorporation, State or Country Code | NV | ||
Entity Interactive Data Current | Yes |
Balance Sheets
Balance Sheets - USD ($) | Aug. 31, 2020 | Aug. 31, 2019 |
Current assets | ||
Cash | $ 126,603 | $ 10,343 |
Accounts receivable, net | 3,585 | 6,452 |
Prepaid expense | 2,319 | 17,637 |
Inventory, net | 3,171 | |
Total current assets | 132,507 | 37,603 |
Domain names, net of amortization of $10,872 and $8,364, respectively | 33,741 | 41,821 |
Total assets | 166,248 | 79,424 |
Current liabilities | ||
Accounts payable and accrued liabilities | 59,913 | 111,056 |
Note payable - related party | 120,000 | |
Convertible notes | 500,000 | |
Total current liabilities | 679,913 | 111,056 |
Commitments and contingencies (Note 7) | ||
Stockholders' Deficit | ||
Preferred stock, value | ||
Common stock, $0.001 par value: 3,000,000,000 authorized; 194,388,426 and 78,155,093 shares issued and outstanding as of August 31, 2020 and August 31, 2019, respectively | 194,389 | 78,156 |
Additional paid-in capital | 17,992,635 | 13,950,095 |
Common stock payable | 76,000 | 76,000 |
Accumulated deficit | (18,776,689) | (14,135,883) |
Total stockholders' deficit | (513,665) | (31,632) |
Total liabilities and stockholders' deficit | 166,248 | 79,424 |
Series A Convertible Preferred Stock | ||
Stockholders' Deficit | ||
Preferred stock, value | ||
Total stockholders' deficit |
Balance Sheets (Parentheticals)
Balance Sheets (Parentheticals) - USD ($) | Aug. 31, 2020 | Aug. 31, 2019 |
Net of amortization cost (in Dollars) | $ 10,872 | $ 8,364 |
Preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 1 | 1 |
Preferred stock, shares outstanding | 1 | 1 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 3,000,000,000 | 3,000,000,000 |
Common stock, shares issued | 194,388,426 | 78,155,093 |
Common stock, shares outstanding | 194,388,426 | 78,155,093 |
Series A Convertible Preferred Stock | ||
Preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Preferred stock, designated shares | 1,000 | 1,000 |
Series C Convertible Preferred Stock | ||
Preferred stock, par value (in Dollars per share) | $ 1 | $ 1 |
Preferred stock, shares issued | 1 | 0 |
Preferred stock, shares outstanding | 1 | 0 |
Preferred stock, designated shares | 1 | 1 |
Statements of Operations
Statements of Operations - USD ($) | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Income Statement [Abstract] | ||
Sales | $ 8,054 | $ 62,103 |
Cost of products sold | 3,505 | 71,413 |
Gross Profit / (Loss) | 4,549 | (9,310) |
Operating expenses: | ||
Selling, general and administrative expenses | 3,647,610 | (3,510,759) |
Professional fees | 185,603 | 200,720 |
Consulting | 184,062 | 283,150 |
Amortization expense and impairment of domain name | 2,797 | 3,345 |
Total operating expenses | 4,020,072 | (3,023,544) |
(Loss) / Income from operations | (4,015,523) | 3,014,234 |
Other expense | ||
Financing common share expense | (76,000) | |
Loss on settlement of debt | (89,595) | |
Interest expense and amortization of debt discount | (535,688) | (357,473) |
Total other expense | (625,283) | (433,473) |
(Loss) / Income before income tax | (4,640,806) | 2,580,761 |
Provision for income tax | ||
Net (Loss) / Income | $ (4,640,806) | $ 2,580,761 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | ||
Basic and Diluted (in Shares) | 118,851,176 | 60,588,674 |
NET (LOSS) / INCOME PER COMMON SHARE OUTSTANDING | ||
Basic and Diluted (in Dollars per share) | $ (0.04) | $ 0.04 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Cash flows from operating activities | ||
Net (Loss) / Income | $ (4,640,806) | $ 2,580,761 |
Adjustments to reconcile net (loss) / income to net cash used in operating activities | ||
Amortization and impairment expense of domain names | 2,797 | 3,345 |
Inventory reserve | 52,332 | |
Amortization of debt discounts | 535,688 | 298,147 |
Bad debt expense | 2,981 | 3,304 |
Loss on settlement of debt | 89,595 | |
Forfeited unvested employee stock award (net of cash paid of $1,600) | (2,440,768) | |
Option and warrant expense | 3,467,440 | (1,403,625) |
Common stock issued for services | 40,500 | 181,950 |
Financing common share expense | 76,000 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (114) | (7,752) |
Inventory | 3,171 | 6,354 |
Prepaid expense | 15,318 | 13,339 |
Accounts payable and accrued liabilities | 18,190 | 143,922 |
Net Cash used in operating activities | (465,240) | (492,691) |
Cash flow from financing activities | ||
Payment of note payable - related party | 120,000 | |
Proceeds from the issuance of convertible debt | 400,000 | |
Proceeds from exercise of warrants and options for cash | 84,000 | 2,000 |
Repayment of debt | (120,000) | |
Repurchase of common stock | (27,500) | |
Sale of common stock | 125,000 | 421,250 |
Net cash provided by financing activities | 581,500 | 423,250 |
Net increase / (decrease) in cash and cash equivalents | 116,260 | (69,441) |
Cash and cash equivalents at beginning of year | 10,343 | 79,784 |
Cash and cash equivalents at end of year | 126,603 | 10,343 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | ||
Cash paid for income taxes | ||
Noncash investing and financing activities: | ||
Beneficial conversion feature | 281,300 | |
Stock issued with convertible debt | 118,700 | |
Stock issued for conversion of debt - related party | 978,430 | |
Preferred stock issued for the conversion of accrued salary | 24,000 | |
Capital contribution of accrued salary - related party | 45,333 | |
Assignment of URL for settlement of debt | $ 5,282 |
Statement of Stockholders_ Defi
Statement of Stockholders’ Deficit - USD ($) | Series A Preferred Shares | Series C Preferred Shares | Common Shares | APIC | Common Stock Payable | Accumulated Deficit | Total |
Balance at Aug. 31, 2018 | $ 42,903 | $ 16,246,201 | $ (16,716,644) | $ (427,540) | |||
Balance (in Shares) at Aug. 31, 2018 | 42,902,712 | ||||||
Preferred stock issued for the conversion of accrued salary | |||||||
Sale of common stock | $ 15,253 | 405,997 | 421,250 | ||||
Sale of common stock (in Shares) | 15,252,381 | ||||||
Forfeiture of stock issued through warrant exercise, net of cash paid | $ (16,000) | (2,424,768) | (2,440,768) | ||||
Forfeiture of stock issued through warrant exercise, net of cash paid (in Shares) | (16,000,000) | ||||||
Common stock issued for the exercise of warrants | $ 20,000 | (18,000) | 2,000 | ||||
Common stock issued for the exercise of warrants (in Shares) | 20,000,000 | ||||||
Common stock issued for services | $ 2,000 | 179,950 | 181,950 | ||||
Common stock issued for services (in Shares) | 2,000,000 | ||||||
Options and warrant expense | (1,403,625) | (1,403,625) | |||||
Conversion of debt and accrued interest to common stock - related party | $ 14,000 | 964,340 | 978,340 | ||||
Conversion of debt and accrued interest to common stock - related party (in Shares) | 14,000,000 | ||||||
Financing common share expense | 76,000 | 76,000 | |||||
Net income/loss | 2,580,761 | 2,580,761 | |||||
Balance August 31, 20 at Aug. 31, 2019 | $ 78,156 | 13,950,095 | 76,000 | (14,135,883) | (31,632) | ||
Balance August 31, 20 (in Shares) at Aug. 31, 2019 | 78,155,093 | ||||||
Preferred stock issued for the conversion of accrued salary | 24,000 | 24,000 | |||||
Preferred stock issued for the conversion of accrued salary (in Shares) | 1 | ||||||
Sale of common stock | $ 20,833 | 104,167 | 125,000 | ||||
Sale of common stock (in Shares) | 20,833,333 | ||||||
Exercise of stock options | $ 84,000 | 84,000 | |||||
Exercise of stock options (in Shares) | 84,000,000 | ||||||
Exchange of preferred stock | $ 1 | ||||||
Exchange of preferred stock (in Shares) | 1 | ||||||
Common stock issued for services | $ 4,500 | 36,000 | 40,500 | ||||
Common stock issued for services (in Shares) | 4,500,000 | ||||||
Options and warrant expense | 3,467,440 | 3,467,440 | |||||
Capital contribution of accrued salary - related party | 45,333 | 45,333 | |||||
Common stock issued with debt | $ 9,900 | 108,800 | 118,700 | ||||
Common stock issued with debt (in Shares) | 9,900,000 | ||||||
Repurchase of common stock | $ (3,000) | (24,500) | (27,500) | ||||
Repurchase of common stock (in Shares) | (3,000,000) | ||||||
Beneficial conversion feature | 281,300 | 281,300 | |||||
Net income/loss | (4,640,806) | (4,640,806) | |||||
Balance August 31, 20 at Aug. 31, 2020 | $ 1 | $ 194,389 | $ 17,992,635 | $ 76,000 | $ (18,776,689) | $ (513,665) | |
Balance August 31, 20 (in Shares) at Aug. 31, 2020 | 1 | 194,388,426 |
Nature of Operations, Significa
Nature of Operations, Significant Accounting Policies and Going Concern | 12 Months Ended |
Aug. 31, 2020 | |
Accounting Policies [Abstract] | |
NATURE OF OPERATIONS, SIGNIFICANT ACCOUNTING POLICIES AND GOING CONCERN | 1. NATURE OF OPERATIONS, SIGNIFICANT ACCOUNTING POLICIES AND GOING CONCERN Nature of Business Operations Bespoke Extracts, Inc. (the “Company”) is a Nevada corporation focused on selling its proprietary line of specially-formulated, premium quality, hemp-derived CBD products. The Company introduced its original line of CBD products in 2018; however, in the fall of 2020, we unveiled a new brand image, new website and ecommerce store and a new line-up of seven hemp-derived CBD formulations available for purchase in the form of tinctures and softgels. Going Concern The accompanying financial statements have been prepared assuming a continuation of the Company as a going concern. The Company had negative cash flows from operations, a working capital deficit and an accumulated deficit as of and for the year ended August 31, 2020. This raises substantial doubt about our ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repaying its liabilities arising from normal business operations when they come due. There is no assurance that this series of events will be satisfactorily completed. Further, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. If additional financing is not available or is not available on acceptable terms, we will have to curtail or cease our operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. These financial statements do not include any adjustments that might arise from this uncertainty. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the accompanying financial statements and accompanying notes. Significant estimates include the assumption used in the valuation of equity-based transactions, valuation of intangible assets, allowance for doubtful accounts and inventory valuation and reserves. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents include all highly liquid investments with original maturities of three months or less at the time of purchase. At August 31, 2020 and August 31, 2019, the Company did not have any cash equivalents. Fair Value of Financial Instruments The carrying amounts of cash, accounts receivable, prepaid expenses and other assets, accounts payable, accrued liabilities, note payable and convertible note payable approximate their fair values as of August 31, 2020 and August 31, 2019, respectively, because of their short-term natures and the Company’s borrowing rate of interest. Accounts Receivable Accounts receivable are recorded at fair value on the date revenue is recognized. The Company provides allowances for doubtful accounts for estimated losses resulting from the inability of its customers to repay their obligation. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to repay, additional allowances may be required. The Company provides for potential uncollectible accounts receivable based on specific customer identification and historical collection experience adjusted for existing market conditions. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense. The policy for determining past due status is based on the contractual payment terms of each customer, which are generally net 30 or net 60 days. Once collection efforts by the Company and its collection agency are exhausted, the determination for charging off uncollectible receivables is made. At August 31, 2020 and August 31, 2019 the Company has recorded an allowance for doubtful accounts of $2,981 and $0, respectively. Included in the accounts receivable is the merchant holdback receivable balance of $3,585 which will be remitted to the Company in the future. Inventory Inventories are stated at the lower of cost or net realizable value. Cost is determined by the first-in, first-out basis and net realizable value. Net realizable value is defined as sales price less cost of completion, disposition and transportation and a normal profit margin. As of August 31, 2020 and August 31, 2019, inventory amounted to $0 and $3,171, respectively, which consisted of finished goods. During the year ended August 31, 2020 the Company adjusted the reserves by $8,424 for products sold. As of August 31, 2020 and 2019 inventory reserves were $40,252 and $48,676, respectively. Revenue Recognition We account the revenue in accordance with ASC Topic 606. Net revenue is measured based on the amount of consideration that we expect to receive, reduced by discounts and estimates for credits and returns (calculated based upon previous experience and management’s evaluation). Outbound shipping charged to customers is recognized at the time the related merchandise revenues are recognized and are included in net revenues. Inbound and outbound shipping and delivery costs are included in cost of revenues. Net revenues exclude sales and other similar taxes collected from customers. Our products are sold through our online and telephonic channels. Revenue is recognized when control of the merchandise is transferred to the customer, which generally occurs upon shipment. Payment is typically due on the date of shipment. The Company offers a 14 day return policy on sales. Stock Option Plans Stock options and warrants issued to consultants and other non-employees as compensation for services provided to the Company are accounted for based on the fair value of the services provided or the estimated fair market value of the option or warrant, whichever is more reliably measurable, and in accordance FASB ASC 718 , Compensation-Stock Compensation, Net Income / (Loss) per Share Basic income / (loss) per share amounts are computed based on net income / (loss) divided by the weighted average number of common shares outstanding. Diluted earnings per share reflect the potential dilution that could occur if potentially dilutive securities were exercised or converted to common stock. The dilutive effect of options and warrants and their equivalent is computed by application of the treasury stock method and the effect of convertible securities by the “if converted” method. The effect of 3,450,000 warrants and 16,000,000 options is anti-dilutive for the year ended August 31, 2020 as well as 500,000,000 shares issuable upon the conversion of a convertible note. The effect of 3,330,000 warrants and 1,200,000 options is anti-dilutive for the year ended August 31, 2019. Change of Control On April 16, 2020, Niquana Noel sold 1 outstanding share of Series C Preferred Stock of the Company to Danil Pollack for $24,000 in a private transaction. The Series C Preferred Stock entitles the holder to 51% of the voting power of the Company’s stockholders, and the stock sale thus resulted in a change in control of the Company. Recent Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases The adoption of ASU 2016-02 did not have an impact on our balance sheet, results of operations or balance sheets as we currently do not have any long term corporate office and equipment leases. |
Asset Purchase Agreement
Asset Purchase Agreement | 12 Months Ended |
Aug. 31, 2020 | |
Asset Purchase Agreement [Abstract] | |
ASSET PURCHASE AGREEMENT | 2. ASSET PURCHASE AGREEMENT On February 21, 2017, the Company purchased all right, title, interest and goodwill in or associated with certain domain names set forth in an asset purchase agreement for a total of $20,185 in cash and 200,000 shares of the Company’s common stock valued at $30,000. For the years ended August 31, 2020 and 2019 amortization expense was $2,508 and $3,445, respectively. The domain names are being amortized over a 15 year period. During the years ended August 31, 2020 and 2019, the Company recorded an impairment expense of $289 and $0, respectively for expired domain names. On December 24, 2019, the Company repaid a note holder $120,000, and transferred certain URLs valued at $5,282 to the holder (See note 4.) |
Note Payable - Related Party
Note Payable - Related Party | 12 Months Ended |
Aug. 31, 2020 | |
Debt Disclosure [Abstract] | |
NOTE PAYABLE - RELATED PARTY | 3. NOTE PAYABLE - RELATED PARTY On August 31, 2020, the Company issued a promissory note in the principal amount of $150,000, to Danil Pollack, the Company’s chief executive officer. Upon execution of the note, $120,000 was remitted and the remaining $30,000 was paid on September 22, 2020. The note does not bear interest and matures on November 30, 2020. |
Convertible Note Payable
Convertible Note Payable | 12 Months Ended |
Aug. 31, 2020 | |
Convertible Debenture Related Party [Abstract] | |
CONVERTIBLE NOTE PAYABLE | 4. CONVERTIBLE NOTE PAYABLE On November 6, 2019, the Company entered into and closed a securities purchase agreement with an accredited investor, pursuant to which, the Company issued and sold to the investor an original issue discount convertible debenture (which was amended and restated on November 11, 2019) in the principal amount of $200,000, for a purchase price of $100,000, resulting in an original issue discount of $100,000. The Company also issued to the investor 4,900,000 shares of common stock valued at $63,700 ($0.013 per share). As amended, the debenture had a maturity date of August 1, 2020 and was convertible into shares of common stock of the Company at a conversion price of $0.006, provided that, if the Company failed to repay the debenture upon maturity, the conversion price would be reduced to $0.001 (subject to adjustment for stock splits, stock dividends and similar transactions) and the debenture would bear interest at the rate of 9% per year. The Company recorded beneficial conversion of $36,300 due to the conversion feature. The debenture could not be converted to common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock. The Company’s obligation to repay the debenture upon maturity was secured by a security interest in the Company’s URLs pursuant to a security agreement between the Company and the investor. On December 24, 2019, the Company entered into an agreement (the “Repayment Agreement”) with the holder of the amended and restated original issue discount convertible debenture issued by the Company on November 11, 2019, in the original principal amount of $200,000 (the “November 2019 Debenture”). Pursuant to the Repayment Agreement, the Company paid the holder $120,000, and transferred certain URLs valued at $5,282 to the holder, and the November 2019 Debenture was deemed paid in full. The amortization of debt discount of $35,688 was recorded during the year ended August 31, 2020. The Company recognized a loss on settlement of debt of $89,595, during the year ended August 31, 2020. On December 24, 2019, the Company entered into and closed a securities purchase agreement with an accredited investor, pursuant to which, the Company issued and sold to the investor an original issue discount convertible debenture in the principal amount of $500,000, for a purchase price of $300,000. The Company also issued to the investor 5,000,000 shares of common stock valued at $55,000 ($.005 per share). The Company recorded beneficial conversion of $245,000 due to the conversion feature. The debenture may not be converted to common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock. The debenture had an original maturity date of April 30, 2020 and is convertible into shares of common stock of the Company at a conversion price of $0.001, except that, if the Company fails to repay the debenture upon maturity, the conversion price will be reduced to $0.0004 (subject to adjustment for stock splits, stock dividends, and similar transactions) and the debenture will bear interest at the rate of 9% per year. The Company’s obligation to repay the debenture upon maturity was initially secured by a security interest in the Company’s inventory pursuant to a security agreement between the Company and the investor. For the year ended August 31, 2020 the Company recorded amortization of debt discount of $500,000. On April 23, 2020, the Company entered into an amendment to the security agreement, dated December 24, 2019 between the Company and the holder of the Company’s original issue discount convertible debenture, dated December 24, 2019. Pursuant to the security agreement amendment, the collateral under the security agreement was amended to be the Company’s URLs. The security agreement amendment was entered into with The Vantage Group Ltd., as the purchaser of the debenture from the original holder. Vantage is owned by Lyle Hauser, formerly a significant stockholder of the Company. On May 28, 2020, the Company entered into an amendment to the debenture, pursuant to which the maturity date of the debenture was extended to August 31, 2020. On August 21, 2020, the Company entered into a second amendment to the debenture, pursuant to which the maturity date of the debenture was extended to November 30, 2020. The maturity date was further extended on December 10, 2020. See Note 10. |
Equity
Equity | 12 Months Ended |
Aug. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
EQUITY | 5. EQUITY Common Stock and Preferred Stock As of August 31, 2020, the Company had authorized capital of 800,000,000 shares of common stock with a par value of $0.001, and 50,000,000 shares of preferred stock with a par value of $0.001. On October 2, 2020, the Company filed a certificate of amendment to the Company’s articles of incorporation with the Secretary of State of Nevada, pursuant to which the Company increased its authorized shares of common stock from 800,000,000 to 3,000,000,000. 1,000 shares of preferred stock are designated as Series A Convertible Preferred Stock. No shares of Series A Preferred Stock are issued and outstanding as of August 31, 2020 and August 31, 2019, respectively. The Company’s Certificate of Designation of Series B Preferred Stock was withdrawn by the Company on June 30, 2020. 1 share of preferred stock is designated Series C Preferred Stock. 1 share and 0 shares of Series C Preferred Stock are issued and outstanding as of August 31, 2020 and August 31, 2019, respectively. The Series C Preferred Stock has a stated value of $24,000 and entitles the holder to 51% of the total voting power of the Company’s stockholders. The Company may, in its sole discretion, redeem the Series C Preferred Stock at any time for a redemption price equal to the stated value. Upon payment of the redemption price by the Company, the Series C Preferred Stock will revert to the status of authorized but unissued preferred stock. On October 30, 2018, the Company entered into an employment agreement with Niquana Noel pursuant to which Ms. Noel would serve as the Company’s Chief Executive Officer and president for a term of four years, unless earlier terminated pursuant to the terms of the employment agreement. Pursuant to the terms of the employment agreement, Ms. Noel’s annual salary was $96,000 and she received a warrant to purchase up to 20,000,000 shares of the Company’s common stock at an exercise price of $0.0001 per share. Ms. Noel exercised the warrant for $2,000 and was issued the 20,000,000 shares on October 31, 2018. The shares received upon the exercise of the warrants were subject to forfeiture over a service period of four years. See “Warrants” below. Pursuant to a securities purchase agreement entered into on June 6, 2018 the Company was obligated to issue additional shares of common stock if the Company sold common stock at a price lower than $0.10 per share (or common stock equivalents with an exercise price less than $0.10 per share) during the six month period following the closing of the purchase agreement, in which event the Company was required to issue additional shares to the purchaser for no additional consideration, such that the total number of common stock received by the purchaser will be equal to $50,000 divided by lower financing price. As of August 31, 2020, the Company was obligated to issue 500,000 shares of common stock valued at $76,000. On October 3, 2019, the Company entered into a letter agreement with Niquana Noel, the Company’s then-chief executive officer. Pursuant to the agreement, Ms. Noel exchanged $24,000 in accrued but unpaid compensation owed to her by the Company for one share of newly created Series B Preferred Stock of the Company. Ms. Noel subsequently exchanged this one share of Series B Preferred for 1 one share of newly created Series C Preferred Stock. See Note 6. In connection with the letter agreement, on October 3, 2019, the Company filed a Certificate of Designation of Series B Preferred Stock with the Secretary of State of Nevada. Pursuant to the Certificate of Designation, the Company designated one share of its preferred stock as Series B Preferred Stock. On October 14, 2019, the Company entered into and closed a securities purchase agreement with an accredited investor pursuant to which the Company issued and sold to the investor 20,833,333 shares of common stock for a purchase price of $125,000. In November 2019, 3,000,000 shares of common stock were returned to the Company for cancellation and the Company paid $27,500 in connection with a settlement agreement. On November 6, 2019, the Company entered into and closed a securities purchase agreement with an accredited investor, pursuant to which, the Company issued and sold to the investor an original issue discount convertible debenture (which was amended and restated on November 11, 2019) in the principal amount of $200,000, for a purchase price of $100,000, resulting in an original issue discount of $100,000. The Company also issued to the investor 4,900,000 shares of common stock valued at $63,700, ($0.013 per share). See Note 3. Effective November 11, 2019, the Company issued 4,500,000 shares of common stock pursuant to a consulting agreement valued at $40,500 ($0.009 per share). On December 24, 2019, the Company entered into and closed a securities purchase agreement with an accredited investor, pursuant to which, the Company issued and sold to the investor an original issue discount convertible debenture in the principal amount of $500,000, for a purchase price of $300,000. The Company also issued to the investor 5,000,000 shares of common stock valued at $55,000 ($0.005 per share). On March 25, 2020, Company entered into a letter agreement with Niquana Noel, the Company’s then-chief executive officer. Pursuant to the agreement, Ms. Noel exchanged 1 share of Series B Preferred Stock of the Company for one share of newly created Series C Preferred Stock of the Company. In connection with the letter agreement, on March 25, 2020, the Company filed a Certificate of Designation of Series C Preferred Stock with the Secretary of State of Nevada. Pursuant to the Certificate of Designation, the Company designated one share of its preferred stock as Series C Preferred Stock. The Series C Preferred Stock has a stated value of $24,000 and entitles the holder to 51% of the total voting power of the Company’s stockholders. The Company may, in its sole discretion, redeem the Series C Preferred Stock at any time for a redemption price equal to the stated value. The Series C Preferred Stock has a liquidation preference equal to the stated value, does not provide the holder with any dividend rights and is not convertible to common stock. On April 16, 2020, Niquana Noel sold 1 outstanding share of Series C Preferred Stock of the Company to Danil Pollack for $24,000 in a private transaction. The Series C Preferred Stock entitles the holder to 51% of the voting power of the Company’s stockholders, and the stock sale thus resulted in a change in control of the Company. On June 30, 2020, the Company filed a Certificate of Withdrawal of Certificate of Designation with the Secretary of State of Nevada, pursuant to which the Company withdrew its Series B Preferred Stock. During the year ended August 31, 2020, the Company issued 84,000,000 shares of common stock, for the exercise of options with an exercise price of $0.001 per share to Danil Pollack, the Company’s chief executive officer, for aggregate gross proceeds of $84,000. Warrants On May 22, 2017, the Company entered into an employment agreement with Marc Yahr to serve as President and Chief Executive Officer of the Company for a term of three years, unless earlier terminated pursuant to the terms of the employment agreement. Pursuant to the terms of the employment agreement, Mr. Yahr received a warrant to purchase up to 20,000,000 shares of the Company’s common stock at an exercise price of $0.0001 per share. The warrants were exercised in full on May 31, 2017; however, the 20,000,000 shares of the Company’s common stock were not issued to Mr. Yahr until June 10, 2017. The shares received upon the exercise of the warrants were subject to forfeiture over a service period of three years. The fair value of the award was determined to be $10,998,105 which would be recognized as compensation expense over the three year service period. Effective October 30, 2018, Marc Yahr resigned from all positions with the Company including as President and Chief Executive Officer of the Company (except as director, which he resigned as on November 25, 2018). Pursuant to the agreement, Mr. Yahr agreed to return 80% of the warrant shares to the Company if he served as CEO of the Company pursuant to the employment agreement for a period of more than 12 months but less than 18 months. Therefore, 16,000,000 shares of common stock were forfeited to the Company, and the Company recognized a gain on the forfeited common shares of ($2,440,768) net of $1,600 paid by the Company during the year ended August 31, 2019. As of August 31, 2019, $0 remains to be expensed over the remaining vesting period. On March 2, 2018, the Company entered into a management agreement with Global Corporate Management, LLC. Pursuant to this agreement, the Company agreed to pay $4,000 and to issue 150,000 common stock purchase warrants with an exercise price of $0.50, exercisable commencing six months after issuance for a period of 5 years. The fair value of this award was determined to be $3,419,925 of which $1,457,561 was recognized during the year ended August 31, 2018. During the years ended August 31, 2020 and 2019 the Company recognized a gain of ($3,378) and ($1,332,332), respectively due to a remeasurement of this nonemployee award. On March 2, 2019 the agreement was terminated. On April 16, 2018, the Company entered into a consulting agreement with Dr. David Hellman for marketing and promotion services. The term was 1 year with payment of 50,000 warrants each month to purchase common stock with an exercise price of $0.60. However, if the consultant generates more than $10,000 in monthly sales, the warrants would have an exercise price of $.30, and if the consultant generates more than $20,000 in monthly sales, the warrants could be exercised on a cashless basis. Additionally, the Company agreed to pay 10% of retail sales and 5% of wholesale sales. On July 11, 2018 the Company terminated the agreement. On August 1, 2018 the Company entered into a new consulting agreement with Dr. Hellman. The term was 1 year with payment of 60,000 warrants each month to purchase common stock with an exercise price of $0.60. The warrants may be exercised on a cashless basis. A total of $256,038 warrant expense in relation to this award was recognized during the year ended August 31, 2018. During the years ended August 31, 2020 the Company recognized a gain of ($1,905) due to a remeasurement of this nonemployee award. The warrants may be exercised on a cashless basis. During the year ended August 31, 2020 and 2019 the Company recognized a gain of ($1,905) and ($217,402), respectively due to a remeasurement of this nonemployee award. On October 30, 2018, the Company entered into an employment agreement with Niquana Noel pursuant to which Ms. Noel would serve as the Company’s Chief Executive Officer and president for a term of four years, unless earlier terminated pursuant to the terms of the employment agreement. Pursuant to the terms of the employment agreement, Ms. Noel’s annual salary was $96,000 and she received a warrant to purchase up to 20,000,000 shares of the Company’s common stock at an exercise price of $0.0001 per share. Ms. Noel exercised the warrant and was issued the 20,000,000 shares on October 31, 2018. The fair value of this award was determined to be $2,598,138 of which $2,055,748 and $542,390 were recognized during the years ended August 31, 2020 and 2019, respectively. Unamortized expense at August 31, 2020 and 2019 is $0 and $2,055,748, respectively On April 20, 2020, the Company entered into a letter agreement with Niquana Noel, the Company’s then-chief executive officer. Pursuant to the letter agreement, Ms. Noel waived $45,333 of accrued but unpaid compensation owed to her in exchange for the right to retain all 20,000,000 shares of common stock of the Company Ms. Noel had acquired upon exercise of warrants, notwithstanding provisions of the warrant agreement that would have required her to return certain shares to the Company in the event of her resignation. The following table summarizes the warrant activities during the years ended August 31, 2019 and 2020: Number of Weighted- Weighted- Outstanding at August 31, 2018 2,830,000 $ 0.79 2.9 years Granted 21,800,000 0.04 Cancelled or expired (1,300,000 ) 1.00 Exercised (20,000,000 ) 0.00 Outstanding at August 31, 2019 3,330,000 $ 0.56 3.8 years Granted 120,000 0.60 Canceled or expired - - Exercised / Exchanged - - Outstanding at August 31, 2020 3,450,000 $ 0.56 2.8 years Exercisable at August 31, 2020 3,450,000 $ 0.56 2.8 years Intrinsic value at August 31, 2020 $ - The fair value of the warrants was estimated using the Black-Scholes option pricing model and the following range of assumptions: Grant Date For the years ended August 31, 2020 Risk-free interest rate at grant date 1.30% - 1.62% Expected stock price volatility 314% - 394% Expected dividend payout - Expected life (in years) 2.50 – 4.50 Grant Date and Re-measurement Date For the year ended August 31, 2019 Risk-free interest rate at grant date 1.45% - 2.99% Expected stock price volatility 330% - 788% Expected dividend payout - Expected life in years 2.5 - 6.0 years OPTIONS On July 26, 2017 the Company granted a nonemployee options to purchase 2,200,000 shares of common stock. The options have a three year term. 1,000,000 options were immediately exercisable on the date of issuance with an exercise price of $0.001 and the remaining 1,200,000 options vest over a period of four (4) semiannual installments or every six (6) months until July 26, 2019 at an exercise price of $1.00. As of August 31, 2020 all the options were expired. During the year ended August 31, 2019 the Company recognized a gain of $(310,119) due to the re-measurement of this non employee award. Number of Weighted- Weighted- Outstanding at August 31, 2018 1,200,000 $ 1.00 1.9 years Granted - - Canceled or expired - - Exercised - - Outstanding at August 31, 2019 1,200,000 $ 1.00 0.9 years Granted 100,000,000 .001 Canceled or expired (1,200,000 ) 1.000 Exercised (84,000,000 ) .001 Outstanding at August 31, 2020 16,000,000 $ .001 0.4 years Exercisable at August 31, 2020 16,000,000 $ .001 0.4 years Intrinsic value at August 31, 2020 $ 240,000 The fair value of the warrants was estimated using the Black-Scholes option pricing model and the following range of assumptions: Grant Date For the year ended August 31, 2020 Risk-free interest rate at grant date .15% Expected stock price volatility 262% Expected dividend payout - Expected life (in years) .25 Grant Date and Re-measurement Date For the year ended August 31, 2019 Risk-free interest rate at grant date 1.45% - 2.99% Expected stock price volatility 330% - 788% Expected dividend payout - Expected life in years 2.5 - 6.0 years |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Aug. 31, 2020 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 6. RELATED PARTY TRANSACTIONS On May 22, 2017, the Company entered into an employment agreement with Marc Yahr to serve as President and Chief Executive Officer of the Company for a term of three years, unless earlier terminated pursuant to the terms of the employment agreement. See Note 5. On October 3, 2019, the Company entered into a letter agreement with Niquana Noel, the Company’s then-chief executive officer. Pursuant to the agreement, Ms. Noel exchanged $24,000 in accrued but unpaid compensation owed to her by the Company for one share of newly created Series B Preferred Stock of the Company. Ms. Noel subsequently exchanged this one share of Series B Preferred for 1 one share of newly created Series C Preferred Stock. See Note 5. On October 30, 2018, the Company entered into an employment agreement with Niquana Noel pursuant to which Ms. Noel would serve as the Company’s Chief Executive Officer and president for a term of four years, unless earlier terminated pursuant to the terms of the employment agreement. See Note 5. On April 21, 2020, Danil Pollack was appointed president, chief executive officer, and chief financial officer of the Company. In connection with Mr. Pollack’s appointment, the Company entered into an employment agreement with Mr. Pollack. Pursuant to the employment agreement, Mr. Pollack will serve as the Company’s chief executive officer and president for a period of one year, which term will renew automatically for successive one year terms, subject to the right of either party to terminate the agreement at any time upon written notice. Mr. Pollack was granted the right, for a period of six months, to purchase up to 100,000,000 shares of common stock of the Company for a purchase price of $0.001 per share. During the year ended August 31, 2020 Mr. Pollack exercised 84,000,000 stock options for $84,000. See Note 5. On March 25, 2020, Company entered into a letter agreement with Niquana Noel, the Company’s then-chief executive officer. Pursuant to the agreement, Ms. Noel exchanged 1 share of Series B Preferred Stock of the Company for one share of newly created Series C Preferred Stock of the Company. See Note 5. In connection with the letter agreement, on March 25, 2020, the Company filed a Certificate of Designation of Series C Preferred Stock with the Secretary of State of Nevada. Pursuant to the Certificate of Designation, the Company designated one share of its preferred stock as Series C Preferred Stock. See Note 5. On August 31, 2020, the Company issued a promissory note in the principal amount of $150,000, to Danil Pollack, the Company’s chief executive officer. Upon execution of the note, $120,000 was remitted and the remaining $30,000 was paid on September 22, 2020. The note did not bear interest and had a maturity date of November 30, 2020. The note was subsequently exchanged for common stock. See note 10. On September 30, 2020, the Company entered into an amendment to the Company’s employment agreement, dated April 22, 2020, with Danil Pollack, the Company’s chief executive officer. Pursuant to the amendment, the Company will pay Mr. Pollack an annual salary of $48,000. The Company may also in its discretion pay additional compensation to Mr. Pollack at any time as a bonus. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Aug. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 7. COMMITMENTS AND CONTINGENCIES Pursuant to a securities purchase agreement entered into on June 6, 2018 the Company was obligated to issue additional shares of common stock if the Company sold common stock at a price lower than $0.10 per share (or common stock equivalents with an exercise price less than $0.10 per share) during the six month period following the closing of the purchase agreement, in which event the Company was required to issue additional shares to the purchaser for no additional consideration, such that the total number of common stock received by the purchaser will be equal to $50,000 divided by lower financing price. As of August 31, 2020 and 2019, the Company was obligated to issue 500,000 shares of common stock valued at $76,000 which is included in the common stock payable in the accompanying balance sheet. On April 21, 2020, Danil Pollack was appointed president, chief executive officer, and chief financial officer of the Company. In connection with Mr. Pollack’s appointment, the Company entered into an employment agreement with Mr. Pollack. On September 30, 2020, the Company entered into an amendment to the Company’s employment agreement, dated April 22, 2020, with Danil Pollack, the Company’s chief executive officer. Pursuant to the amendment, the Company will pay Mr. Pollack an annual salary of $48,000. The Company may also in its discretion pay additional compensation to Mr. Pollack at any time as a bonus. See Note 5. The COVID-19 pandemic may negatively affect our operations, including by limiting access to our facilities, customers, management, and professional advisors, and causing delays and constraints in manufacturing and shipping of our products. These factors, in turn, may negatively impact our operations, financial condition and demand for our products, and our ability to raise capital on acceptable terms, or at all. |
Major Customers
Major Customers | 12 Months Ended |
Aug. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
MAJOR CUSTOMERS | 8. MAJOR CUSTOMERS At August 31, 2020, no individual customer amounted to over 10%. There are concentrations of credit risk with respect to accounts receivables due to the amounts owed by one customer at August 31, 2019 whose balance represented approximately 28%, of total accounts receivables. During the years ended August 31, 2020 and 2019 no individual customer amounted to over 10% of total sales. |
Income Taxes
Income Taxes | 12 Months Ended |
Aug. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 9. INCOME TAXES FASB ASC 740, Income Taxes, At August 31, 2020 and August 31, 2019, respectively, the Company had approximately $3,156,000 of U.S. net operating loss carryforwards remaining, which expire beginning in 2032. At August 31, 2020 and August 31, 2019, the Company had approximately $1,120,000 and $655,000, respectively that can be forward indefinitely. Tax returns for the years ended August 31, 2020, 2019, 2018, 2017, and 2016 are subject to examination by the Internal Revenue Service. A reconciliation of the Company’s income taxes to amounts calculated at the federal statutory rate is as follows for the years ended August 31: 2020 2019 Federal and state statutory taxes (25.00 )% (25.00 )% Change in tax rate estimate - % - % Permanent differences 22.50 % 20,00 % Change in valuation allowance 2.50 % 5.00 % - % - % In assessing the recovery of the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled reversals of future deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. As a result, management determined it was more likely than not the deferred tax assets would not be realized as of August 31, 2020 and 2019 and recorded a full valuation allowance. Components of net deferred tax assets, including a valuation allowance, are as follows at August 31: 2020 2019 Deferred tax assets: Inventory impairment 11,129 13,264 Bad debt expense 756 - Net operating loss 946,775 828,901 Valuation allowance (958,660 ) (842,165 ) Total deferred tax assets $ - $ - A reconciliation of the expected income tax benefit at the U.S. Federal income tax rate to the income tax benefit actually recognized for the years ended August 31, 2020 and 2019 is set forth below: 2020 2019 Net (loss) / income (1,176,212 ) 654,094 Non-deductible expenses and other 1,059,717 (833,419 ) Effect due to decrease in tax rates - - Change in valuation allowance 116,495 179,325 Benefit from income taxes $ - $ - As a result of certain ownership changes, the Company may be subject to an annual limitation on the utilization of its U.S. net operating loss carryforwards pursuant to Section 382 of the Internal Revenue Code. A study to determine the effect, if any, of this change, has not been undertaken. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Aug. 31, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 10. SUBSEQUENT EVENTS On September 22, 2020, the Company received $30,000 from Danil Pollack, the Company’s chief executive officer, representing the remaining amount owed for sale of a promissory note in the principal amount of $150,000. See note 6. On October 2, 2020, the Company filed a certificate of amendment to the Company’s articles of incorporation with the Secretary of State of Nevada, pursuant to which the Company increased its authorized shares of common stock from 800,000,000 to 3,000,000,000. On October 13, 2020, the Company entered into a consulting agreement with Yaniv Rozen pursuant to which the Company engaged Mr. Rozen to serve as the Company’s chief operating officer on a consultant/independent contractor basis. Mr. Rozen may engage in other business activities while serving as the Company’s chief operating officer. Pursuant to the consulting agreement, the Company will pay Mr. Rozen a fee of $3,000 per month. The Company will also issue to Mr. Rozen shares of common stock, and increase such monthly fee, as follows: ● Within five business day of the end of the fourth quarter of 2020, (i) if the Company’s average sales were at least $50,000 per month, for such quarter, the Company will issue to Mr. Rozen 500,000 shares of common stock; or (ii) if the Company’s average sales were at least $100,000 per month for such quarter, the Company will issue to Mr. Rozen 750,000 shares of common stock; ● Within five business day of the end of the first quarter of 2021, (i) if the Company’s average sales were at least $100,000 per month for such quarter, the Company will issue to Mr. Rozen 750,000 shares of common stock, or (ii) if the Company’s average sales were at least $150,000 per month for such quarter, the Company will issue to Mr. Rozen 1,000,000 shares of common stock, and will increase Mr. Rozen’s fee to $5,000 per month effective commencing at the end such quarter; ● Within five business days of the end of the second quarter of 2021, (i) if the Company’s average sales were at least $200,000 per month, for such quarter, the Company will issue to Mr. Rozen 1,500,000 shares of common stock, or (ii) if the Company’s average sales were at least $300,000 per month, for such quarter, the Company will issue to Mr. Rozen 2,000,000 shares of common stock; and ● Within five business days of the end of the third quarter of 2021, (i) if the Company’s average sales were at least $300,000 per month, for such quarter, the Company will issue to Mr. Rozen 2,000,000 shares of common stock; or (ii) if the Company’s average sales were at least $500,000 per month, for such quarter, the Company will issue to Mr. Rozen 3,000,000 shares of common stock, and will increase Mr. Rozen’s fee to $7,000 per month effective commencing at the end such quarter. On November 10, 2020, the Company entered into an exchange agreement with Danil Pollack, the Company’s chief executive officer. Pursuant to the exchange agreement, Mr. Pollack exchanged an outstanding promissory note of the Company in the outstanding principal amount of $150,000 (See note 3) for 15,000,000 newly issued shares of common stock of the Company. On December 1, 2020, the Company entered into a securities purchase agreement with Danil Pollack, the Company’s chief executive officer. Pursuant to the purchase agreement, the Company issued and sold to Mr. Pollack 20,000,000 shares of common stock for an aggregate purchase price of $200,000. On December 10, 2020 the Company entered into amendments (“Amendment No. 3”) with the holders of the Company’s original issue discount convertible debentures, with an original issuance date of December 24, 2019, as amended by amendment No. 1 thereto, dated May 28, 2020, and amendment No. 2 thereto, dated August 21, 2020, in the aggregate outstanding principal amount of $500,000 (See note 4). Pursuant to Amendment No. 3, the maturity date of the debentures was extended to February 28, 2021. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Aug. 31, 2020 | |
Accounting Policies [Abstract] | |
Nature of Business Operations | Nature of Business Operations Bespoke Extracts, Inc. (the “Company”) is a Nevada corporation focused on selling its proprietary line of specially-formulated, premium quality, hemp-derived CBD products. The Company introduced its original line of CBD products in 2018; however, in the fall of 2020, we unveiled a new brand image, new website and ecommerce store and a new line-up of seven hemp-derived CBD formulations available for purchase in the form of tinctures and softgels. |
Going Concern | Going Concern The accompanying financial statements have been prepared assuming a continuation of the Company as a going concern. The Company had negative cash flows from operations, a working capital deficit and an accumulated deficit as of and for the year ended August 31, 2020. This raises substantial doubt about our ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repaying its liabilities arising from normal business operations when they come due. There is no assurance that this series of events will be satisfactorily completed. Further, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. If additional financing is not available or is not available on acceptable terms, we will have to curtail or cease our operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence. These financial statements do not include any adjustments that might arise from this uncertainty. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the accompanying financial statements and accompanying notes. Significant estimates include the assumption used in the valuation of equity-based transactions, valuation of intangible assets, allowance for doubtful accounts and inventory valuation and reserves. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include all highly liquid investments with original maturities of three months or less at the time of purchase. At August 31, 2020 and August 31, 2019, the Company did not have any cash equivalents. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of cash, accounts receivable, prepaid expenses and other assets, accounts payable, accrued liabilities, note payable and convertible note payable approximate their fair values as of August 31, 2020 and August 31, 2019, respectively, because of their short-term natures and the Company’s borrowing rate of interest. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded at fair value on the date revenue is recognized. The Company provides allowances for doubtful accounts for estimated losses resulting from the inability of its customers to repay their obligation. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to repay, additional allowances may be required. The Company provides for potential uncollectible accounts receivable based on specific customer identification and historical collection experience adjusted for existing market conditions. If market conditions decline, actual collection experience may not meet expectations and may result in decreased cash flows and increased bad debt expense. The policy for determining past due status is based on the contractual payment terms of each customer, which are generally net 30 or net 60 days. Once collection efforts by the Company and its collection agency are exhausted, the determination for charging off uncollectible receivables is made. At August 31, 2020 and August 31, 2019 the Company has recorded an allowance for doubtful accounts of $2,981 and $0, respectively. Included in the accounts receivable is the merchant holdback receivable balance of $3,585 which will be remitted to the Company in the future. |
Inventory | Inventory Inventories are stated at the lower of cost or net realizable value. Cost is determined by the first-in, first-out basis and net realizable value. Net realizable value is defined as sales price less cost of completion, disposition and transportation and a normal profit margin. As of August 31, 2020 and August 31, 2019, inventory amounted to $0 and $3,171, respectively, which consisted of finished goods. During the year ended August 31, 2020 the Company adjusted the reserves by $8,424 for products sold. As of August 31, 2020 and 2019 inventory reserves were $40,252 and $48,676, respectively. |
Revenue Recognition | Revenue Recognition We account the revenue in accordance with ASC Topic 606. Net revenue is measured based on the amount of consideration that we expect to receive, reduced by discounts and estimates for credits and returns (calculated based upon previous experience and management’s evaluation). Outbound shipping charged to customers is recognized at the time the related merchandise revenues are recognized and are included in net revenues. Inbound and outbound shipping and delivery costs are included in cost of revenues. Net revenues exclude sales and other similar taxes collected from customers. Our products are sold through our online and telephonic channels. Revenue is recognized when control of the merchandise is transferred to the customer, which generally occurs upon shipment. Payment is typically due on the date of shipment. The Company offers a 14 day return policy on sales. |
Stock Option Plans | Stock Option Plans Stock options and warrants issued to consultants and other non-employees as compensation for services provided to the Company are accounted for based on the fair value of the services provided or the estimated fair market value of the option or warrant, whichever is more reliably measurable, and in accordance FASB ASC 718 , Compensation-Stock Compensation, |
Net Income / (Loss) per Share | Net Income / (Loss) per Share Basic income / (loss) per share amounts are computed based on net income / (loss) divided by the weighted average number of common shares outstanding. Diluted earnings per share reflect the potential dilution that could occur if potentially dilutive securities were exercised or converted to common stock. The dilutive effect of options and warrants and their equivalent is computed by application of the treasury stock method and the effect of convertible securities by the “if converted” method. The effect of 3,450,000 warrants and 16,000,000 options is anti-dilutive for the year ended August 31, 2020 as well as 500,000,000 shares issuable upon the conversion of a convertible note. The effect of 3,330,000 warrants and 1,200,000 options is anti-dilutive for the year ended August 31, 2019. |
Change of Control | Change of Control On April 16, 2020, Niquana Noel sold 1 outstanding share of Series C Preferred Stock of the Company to Danil Pollack for $24,000 in a private transaction. The Series C Preferred Stock entitles the holder to 51% of the voting power of the Company’s stockholders, and the stock sale thus resulted in a change in control of the Company. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases The adoption of ASU 2016-02 did not have an impact on our balance sheet, results of operations or balance sheets as we currently do not have any long term corporate office and equipment leases. |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of warrants | Number of Weighted- Weighted- Outstanding at August 31, 2018 2,830,000 $ 0.79 2.9 years Granted 21,800,000 0.04 Cancelled or expired (1,300,000 ) 1.00 Exercised (20,000,000 ) 0.00 Outstanding at August 31, 2019 3,330,000 $ 0.56 3.8 years Granted 120,000 0.60 Canceled or expired - - Exercised / Exchanged - - Outstanding at August 31, 2020 3,450,000 $ 0.56 2.8 years Exercisable at August 31, 2020 3,450,000 $ 0.56 2.8 years Intrinsic value at August 31, 2020 $ - |
Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model | Grant Date For the years ended August 31, 2020 Risk-free interest rate at grant date 1.30% - 1.62% Expected stock price volatility 314% - 394% Expected dividend payout - Expected life (in years) 2.50 – 4.50 Grant Date and Re-measurement Date For the year ended August 31, 2019 Risk-free interest rate at grant date 1.45% - 2.99% Expected stock price volatility 330% - 788% Expected dividend payout - Expected life in years 2.5 - 6.0 years |
Schedule of stock options | Number of Weighted- Weighted- Outstanding at August 31, 2018 1,200,000 $ 1.00 1.9 years Granted - - Canceled or expired - - Exercised - - Outstanding at August 31, 2019 1,200,000 $ 1.00 0.9 years Granted 100,000,000 .001 Canceled or expired (1,200,000 ) 1.000 Exercised (84,000,000 ) .001 Outstanding at August 31, 2020 16,000,000 $ .001 0.4 years Exercisable at August 31, 2020 16,000,000 $ .001 0.4 years Intrinsic value at August 31, 2020 $ 240,000 |
Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model of stock options | Grant Date For the year ended August 31, 2020 Risk-free interest rate at grant date .15% Expected stock price volatility 262% Expected dividend payout - Expected life (in years) .25 Grant Date and Re-measurement Date For the year ended August 31, 2019 Risk-free interest rate at grant date 1.45% - 2.99% Expected stock price volatility 330% - 788% Expected dividend payout - Expected life in years 2.5 - 6.0 years |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of federal statutory rate | 2020 2019 Federal and state statutory taxes (25.00 )% (25.00 )% Change in tax rate estimate - % - % Permanent differences 22.50 % 20,00 % Change in valuation allowance 2.50 % 5.00 % - % - % |
Schedule of net deferred tax assets | 2020 2019 Deferred tax assets: Inventory impairment 11,129 13,264 Bad debt expense 756 - Net operating loss 946,775 828,901 Valuation allowance (958,660 ) (842,165 ) Total deferred tax assets $ - $ - |
Schedule of U.S. Federal income tax rate | 2020 2019 Net (loss) / income (1,176,212 ) 654,094 Non-deductible expenses and other 1,059,717 (833,419 ) Effect due to decrease in tax rates - - Change in valuation allowance 116,495 179,325 Benefit from income taxes $ - $ - |
Nature of Operations, Signifi_2
Nature of Operations, Significant Accounting Policies and Going Concern (Details) - USD ($) | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Apr. 16, 2020 | |
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items] | |||
Allowance for doubtful accounts | $ 2,981 | $ 0 | |
Accounts receivable | 3,585 | ||
Inventory finished goods | 0 | 3,171 | |
Adjusted the reserved | 8,424 | ||
Inventory reserves | $ 40,252 | $ 48,676 | |
Shares issuable conversion of a convertible note (in Shares) | 500,000,000 | ||
Voting power | 51.00% | ||
Options [Member] | |||
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items] | |||
Anti-dilutive shares of warrants and options (in Shares) | 16,000,000 | 1,200,000 | |
Warrant [Member] | |||
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items] | |||
Anti-dilutive shares of warrants and options (in Shares) | 3,450,000 | 3,330,000 | |
Series C Preferred Stock [Member] | |||
Nature of Operations, Significant Accounting Policies and Going Concern (Details) [Line Items] | |||
Private transaction | $ 24,000 |
Asset Purchase Agreement (Detai
Asset Purchase Agreement (Details) - USD ($) | Dec. 24, 2019 | Aug. 31, 2020 | Aug. 31, 2019 | Feb. 21, 2017 |
Asset Purchase Agreement [Abstract] | ||||
Total approximate amount include in asset purchase agreement | $ 20,185 | |||
Number of common stock (in Shares) | 200,000 | |||
Common stock value | $ 30,000 | |||
Amortization expense | $ 2,508 | $ 3,445 | ||
Amortized over period | 15 years | |||
Impairment expense | $ 289 | $ 0 | ||
Repaid of note holder | $ 120,000 | |||
Transferred certain URLs values to holder | $ 5,282 |
Note Payable - Related Party (D
Note Payable - Related Party (Details) | 12 Months Ended |
Aug. 31, 2020USD ($) | |
Debt Disclosure [Abstract] | |
Principal amount | $ 150,000 |
Related party, description | Upon execution of the note, $120,000 was remitted and the remaining $30,000 was paid on September 22, 2020. The note does not bear interest and matures on November 30, 2020. |
Convertible Note Payable (Detai
Convertible Note Payable (Details) - USD ($) | Nov. 06, 2019 | Dec. 24, 2019 | Aug. 31, 2020 |
Convertible Note Payable (Details) [Line Items] | |||
Securities purchase agreements, description | the Company entered into and closed a securities purchase agreement with an accredited investor, pursuant to which, the Company issued and sold to the investor an original issue discount convertible debenture (which was amended and restated on November 11, 2019) in the principal amount of $200,000, for a purchase price of $100,000, resulting in an original issue discount of $100,000. The Company also issued to the investor 4,900,000 shares of common stock valued at $63,700 ($0.013 per share). As amended, the debenture had a maturity date of August 1, 2020 and was convertible into shares of common stock of the Company at a conversion price of $0.006, provided that, if the Company failed to repay the debenture upon maturity, the conversion price would be reduced to $0.001 (subject to adjustment for stock splits, stock dividends and similar transactions) and the debenture would bear interest at the rate of 9% per year. The Company recorded beneficial conversion of $36,300 due to the conversion feature. The debenture could not be converted to common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock. | ||
Securities purchase agreement, description | the Company entered into and closed a securities purchase agreement with an accredited investor, pursuant to which, the Company issued and sold to the investor an original issue discount convertible debenture in the principal amount of $500,000, for a purchase price of $300,000. The Company also issued to the investor 5,000,000 shares of common stock valued at $55,000 ($.005 per share). The Company recorded beneficial conversion of $245,000 due to the conversion feature. The debenture may not be converted to common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock. The debenture had an original maturity date of April 30, 2020 and is convertible into shares of common stock of the Company at a conversion price of $0.001, except that, if the Company fails to repay the debenture upon maturity, the conversion price will be reduced to $0.0004 (subject to adjustment for stock splits, stock dividends, and similar transactions) and the debenture will bear interest at the rate of 9% per year. | the Company sold common stock at a price lower than $0.10 per share (or common stock equivalents with an exercise price less than $0.10 per share) during the six month period following the closing of the purchase agreement, in which event the Company was required to issue additional shares to the purchaser for no additional consideration, such that the total number of common stock received by the purchaser will be equal to $50,000 divided by lower financing price. As of August 31, 2020, the Company was obligated to issue 500,000 shares of common stock valued at $76,000. | |
Amortization of debt discount | $ 35,688 | ||
Recognized loss on settlement of debt | 89,595 | ||
Repayment Agreement [Member] | |||
Convertible Note Payable (Details) [Line Items] | |||
Securities purchase agreement, description | the Company entered into an agreement (the “Repayment Agreement”) with the holder of the amended and restated original issue discount convertible debenture issued by the Company on November 11, 2019, in the original principal amount of $200,000 (the “November 2019 Debenture”). Pursuant to the Repayment Agreement, the Company paid the holder $120,000, and transferred certain URLs valued at $5,282 to the holder, and the November 2019 Debenture was deemed paid in full. | ||
Securities Purchase Agreement [Member] | |||
Convertible Note Payable (Details) [Line Items] | |||
Amortization of debt discount | $ 500,000 |
Equity (Details)
Equity (Details) - USD ($) | Oct. 02, 2020 | Apr. 21, 2020 | Apr. 20, 2020 | Nov. 30, 2019 | Nov. 11, 2019 | Nov. 06, 2019 | Oct. 14, 2019 | Oct. 03, 2019 | Apr. 16, 2018 | Mar. 02, 2018 | Jul. 26, 2017 | May 25, 2020 | Apr. 16, 2020 | Mar. 25, 2020 | Dec. 24, 2019 | Oct. 31, 2018 | Oct. 30, 2018 | May 22, 2017 | Aug. 31, 2020 | Aug. 31, 2019 |
Equity (Details) [Line Items] | ||||||||||||||||||||
Common stock, shares authorized | 3,000,000,000 | 3,000,000,000 | ||||||||||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | ||||||||||||||||||
Preferred stock, shares authorized | 50,000,000 | 50,000,000 | ||||||||||||||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | ||||||||||||||||||
Preferred stock, shares issued | 1 | 1 | ||||||||||||||||||
Preferred stock, shares outstanding | 1 | 1 | ||||||||||||||||||
Purchase agreement, description | the Company entered into and closed a securities purchase agreement with an accredited investor, pursuant to which, the Company issued and sold to the investor an original issue discount convertible debenture in the principal amount of $500,000, for a purchase price of $300,000. The Company also issued to the investor 5,000,000 shares of common stock valued at $55,000 ($.005 per share). The Company recorded beneficial conversion of $245,000 due to the conversion feature. The debenture may not be converted to common stock to the extent such conversion would result in the holder beneficially owning more than 4.99% of the Company’s outstanding common stock. The debenture had an original maturity date of April 30, 2020 and is convertible into shares of common stock of the Company at a conversion price of $0.001, except that, if the Company fails to repay the debenture upon maturity, the conversion price will be reduced to $0.0004 (subject to adjustment for stock splits, stock dividends, and similar transactions) and the debenture will bear interest at the rate of 9% per year. | the Company sold common stock at a price lower than $0.10 per share (or common stock equivalents with an exercise price less than $0.10 per share) during the six month period following the closing of the purchase agreement, in which event the Company was required to issue additional shares to the purchaser for no additional consideration, such that the total number of common stock received by the purchaser will be equal to $50,000 divided by lower financing price. As of August 31, 2020, the Company was obligated to issue 500,000 shares of common stock valued at $76,000. | ||||||||||||||||||
Letter agreement, description | Pursuant to the Certificate of Designation, the Company designated one share of its preferred stock as Series C Preferred Stock. | |||||||||||||||||||
Description of common stock | During the year ended August 31, 2020, the Company issued 84,000,000 shares of common stock, for the exercise of options with an exercise price of $0.001 per share to Danil Pollack, the Company’s chief executive officer, for aggregate gross proceeds of $84,000. | |||||||||||||||||||
Common stock for services, value | $ 40,500 | $ 181,950 | ||||||||||||||||||
Stock per share | $ 0.005 | |||||||||||||||||||
Debt instrument, annual principal amount | $ 500,000 | |||||||||||||||||||
Purchase price | $ 300,000 | |||||||||||||||||||
Employment agreement, description | the Company entered into an employment agreement with Marc Yahr to serve as President and Chief Executive Officer of the Company for a term of three years, unless earlier terminated pursuant to the terms of the employment agreement. Pursuant to the terms of the employment agreement, Mr. Yahr received a warrant to purchase up to 20,000,000 shares of the Company’s common stock at an exercise price of $0.0001 per share. The warrants were exercised in full on May 31, 2017; however, the 20,000,000 shares of the Company’s common stock were not issued to Mr. Yahr until June 10, 2017. The shares received upon the exercise of the warrants were subject to forfeiture over a service period of three years. The fair value of the award was determined to be $10,998,105 which would be recognized as compensation expense over the three year service period. Effective October 30, 2018, Marc Yahr resigned from all positions with the Company including as President and Chief Executive Officer of the Company (except as director, which he resigned as on November 25, 2018). Pursuant to the agreement, Mr. Yahr agreed to return 80% of the warrant shares to the Company if he served as CEO of the Company pursuant to the employment agreement for a period of more than 12 months but less than 18 months. Therefore, 16,000,000 shares of common stock were forfeited to the Company, and the Company recognized a gain on the forfeited common shares of ($2,440,768) net of $1,600 paid by the Company during the year ended August 31, 2019. As of August 31, 2019, $0 remains to be expensed over the remaining vesting period. | |||||||||||||||||||
Management agreement, description | the Company entered into a management agreement with Global Corporate Management, LLC. Pursuant to this agreement, the Company agreed to pay $4,000 and to issue 150,000 common stock purchase warrants with an exercise price of $0.50, exercisable commencing six months after issuance for a period of 5 years. The fair value of this award was determined to be $3,419,925 of which $1,457,561 was recognized during the year ended August 31, 2018. During the years ended August 31, 2020 and 2019 the Company recognized a gain of ($3,378) and ($1,332,332), respectively due to a remeasurement of this nonemployee award. On March 2, 2019 the agreement was terminated. | |||||||||||||||||||
Consulting agreement, description | David Hellman for marketing and promotion services. The term was 1 year with payment of 50,000 warrants each month to purchase common stock with an exercise price of $0.60. However, if the consultant generates more than $10,000 in monthly sales, the warrants would have an exercise price of $.30, and if the consultant generates more than $20,000 in monthly sales, the warrants could be exercised on a cashless basis. Additionally, the Company agreed to pay 10% of retail sales and 5% of wholesale sales. On July 11, 2018 the Company terminated the agreement. On August 1, 2018 the Company entered into a new consulting agreement with Dr. Hellman. The term was 1 year with payment of 60,000 warrants each month to purchase common stock with an exercise price of $0.60. The warrants may be exercised on a cashless basis. A total of $256,038 warrant expense in relation to this award was recognized during the year ended August 31, 2018. During the years ended August 31, 2020 the Company recognized a gain of ($1,905) due to a remeasurement of this nonemployee award. The warrants may be exercised on a cashless basis. During the year ended August 31, 2020 and 2019 the Company recognized a gain of ($1,905) and ($217,402), respectively due to a remeasurement of this nonemployee award. | |||||||||||||||||||
Terms of employment agreement, description | the Company entered into an employment agreement with Niquana Noel pursuant to which Ms. Noel would serve as the Company’s Chief Executive Officer and president for a term of four years, unless earlier terminated pursuant to the terms of the employment agreement. Pursuant to the terms of the employment agreement, Ms. Noel’s annual salary was $96,000 and she received a warrant to purchase up to 20,000,000 shares of the Company’s common stock at an exercise price of $0.0001 per share. Ms. Noel exercised the warrant and was issued the 20,000,000 shares on October 31, 2018. The fair value of this award was determined to be $2,598,138 of which $2,055,748 and $542,390 were recognized during the years ended August 31, 2020 and 2019, respectively. Unamortized expense at August 31, 2020 and 2019 is $0 and $2,055,748, respectively | |||||||||||||||||||
Common Stock [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Common stock, description | In November 2019, 3,000,000 shares of common stock were returned to the Company for cancellation and the Company paid $27,500 in connection with a settlement agreement. | |||||||||||||||||||
Common stock for services, shares | 4,500,000 | 4,500,000 | 2,000,000 | |||||||||||||||||
Common stock for services, value | $ 40,500 | $ 4,500 | $ 2,000 | |||||||||||||||||
Stock per share | $ 0.009 | |||||||||||||||||||
Securities Purchase Agreement [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Purchase agreement, description | the Company entered into and closed a securities purchase agreement with an accredited investor, pursuant to which, the Company issued and sold to the investor an original issue discount convertible debenture (which was amended and restated on November 11, 2019) in the principal amount of $200,000, for a purchase price of $100,000, resulting in an original issue discount of $100,000. The Company also issued to the investor 4,900,000 shares of common stock valued at $63,700, ($0.013 per share). See Note 3 | |||||||||||||||||||
Common stock shares issued | 500,000 | 500,000 | ||||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Description of stock | On October 2, 2020, the Company filed a certificate of amendment to the Company’s articles of incorporation with the Secretary of State of Nevada, pursuant to which the Company increased its authorized shares of common stock from 800,000,000 to 3,000,000,000. 1,000 shares of preferred stock are designated as Series A Convertible Preferred Stock. | |||||||||||||||||||
Non Employee Stock Option [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Description of common stock | the Company granted a nonemployee options to purchase 2,200,000 shares of common stock. The options have a three year term. 1,000,000 options were immediately exercisable on the date of issuance with an exercise price of $0.001 and the remaining 1,200,000 options vest over a period of four (4) semiannual installments or every six (6) months until July 26, 2019 at an exercise price of $1.00. As of August 31, 2020 all the options were expired. During the year ended August 31, 2019 the Company recognized a gain of $(310,119) due to the re-measurement of this non employee award. | |||||||||||||||||||
Investor [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Common stock shares issued | 5,000,000 | |||||||||||||||||||
Common stock issued value | $ 55,000 | |||||||||||||||||||
Investor [Member] | Securities Purchase Agreement [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Description of common stock | On October 14, 2019, the Company entered into and closed a securities purchase agreement with an accredited investor pursuant to which the Company issued and sold to the investor 20,833,333 shares of common stock for a purchase price of $125,000. | |||||||||||||||||||
Chief Executive Officer [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Letter agreement, description | Pursuant to the agreement, Ms. Noel exchanged 1 share of Series B Preferred Stock of the Company for one share of newly created Series C Preferred Stock of the Company. | |||||||||||||||||||
Employment agreement, description | On May 22, 2017, the Company entered into an employment agreement with Marc Yahr to serve as President and Chief Executive Officer of the Company for a term of three years, unless earlier terminated pursuant to the terms of the employment agreement. | |||||||||||||||||||
Chief Executive Officer [Member] | Common Stock [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Annual salary | $ 96,000 | |||||||||||||||||||
Warrant to purchase of common stock | 20,000,000 | 20,000,000 | ||||||||||||||||||
Common stock per share price | $ 0.0001 | |||||||||||||||||||
Proceeds from exercise of warrants | $ 2,000 | |||||||||||||||||||
Chief Executive Officer [Member] | Warrant [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Letter agreement, description | Pursuant to the letter agreement, Ms. Noel waived $45,333 of accrued but unpaid compensation owed to her in exchange for the right to retain all 20,000,000 shares of common stock of the Company Ms. Noel had acquired upon exercise of warrants, notwithstanding provisions of the warrant agreement that would have required her to return certain shares to the Company in the event of her resignation. | |||||||||||||||||||
Series C Preferred Stock [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Preferred stock, par value | $ 1 | $ 1 | ||||||||||||||||||
Preferred stock, designated shares | 1 | 1 | ||||||||||||||||||
Preferred stock, shares issued | 1 | 0 | ||||||||||||||||||
Preferred stock, shares outstanding | 1 | 0 | ||||||||||||||||||
Common stock for services, value | ||||||||||||||||||||
Holder voting power, description | On April 16, 2020, Niquana Noel sold 1 outstanding share of Series C Preferred Stock of the Company to Danil Pollack for $24,000 in a private transaction. The Series C Preferred Stock entitles the holder to 51% of the voting power of the Company’s stockholders, and the stock sale thus resulted in a change in control of the Company. | |||||||||||||||||||
Series B Preferred Stock [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Letter agreement, description | Pursuant to the agreement, Ms. Noel exchanged $24,000 in accrued but unpaid compensation owed to her by the Company for one share of newly created Series B Preferred Stock of the Company. Ms. Noel subsequently exchanged this one share of Series B Preferred for 1 one share of newly created Series C Preferred Stock. See Note 6. | |||||||||||||||||||
Options [Member] | Danil Pollack [Member] | ||||||||||||||||||||
Equity (Details) [Line Items] | ||||||||||||||||||||
Employment agreement, description | Pursuant to the employment agreement, Mr. Pollack will serve as the Company’s chief executive officer and president for a period of one year, which term will renew automatically for successive one year terms, subject to the right of either party to terminate the agreement at any time upon written notice. Mr. Pollack was granted the right, for a period of six months, to purchase up to 100,000,000 shares of common stock of the Company for a purchase price of $0.001 per share. The Company recognized option expense of $1,416,975 during the year ended August 31, 2020. During the year ended August 31, 2020, Mr. Pollack exercised 84,000,000 stock options for $84,000. |
Equity (Details) - Schedule of
Equity (Details) - Schedule of warrants - Warrants [Member] - USD ($) | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Class of Warrant or Right [Line Items] | ||
Number of Warrants, Outstanding Beginning balance | 3,330,000 | 2,830,000 |
Weighted-Average Price Per Share, Outstanding Beginning balance | $ 0.56 | $ 0.79 |
Weighted- Average Remaining Life, Outstanding Beginning years | 2 years 328 days | |
Number of Warrants, Granted | 120,000 | 21,800,000 |
Weighted-Average Price Per Share, Granted | $ 0.60 | $ 0.04 |
Number of Warrants, Cancelled or expired | (1,300,000) | |
Weighted-Average Price Per Share, Cancelled or expired | $ 1 | |
Number of Warrants, Exercised | (20,000,000) | |
Weighted-Average Price Per Share, Exercised / Exchanged | $ 0 | |
Number of Warrants, Outstanding Ending balance | 3,450,000 | 3,330,000 |
Weighted-Average Price Per Share, Outstanding Ending balance | $ 0.56 | $ 0.56 |
Weighted- Average Remaining Life, Outstanding Ending years | 2 years 292 days | 3 years 292 days |
Number of Warrants, Exercisable | 3,450,000 | |
Weighted-Average Price Per Share, Exercisable | $ 0.56 | |
Weighted- Average Remaining Life, Exercisable | 2 years 292 days | |
Weighted-Average Price Per Share Intrinsic value |
Equity (Details) - Schedule o_2
Equity (Details) - Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model - Warrant [Member] | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Equity (Details) - Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model [Line Items] | ||
Expected dividend payout | ||
Minimum [Member] | ||
Equity (Details) - Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model [Line Items] | ||
Risk-free interest rate at grant date | 1.30% | 1.45% |
Expected stock price volatility | 314.00% | 330.00% |
Expected life (in years) | 2 years 6 months | 2 years 6 months |
Maximum [Member] | ||
Equity (Details) - Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model [Line Items] | ||
Risk-free interest rate at grant date | 1.62% | 2.99% |
Expected stock price volatility | 394.00% | 788.00% |
Expected life (in years) | 4 years 6 months | 6 years |
Equity (Details) - Schedule o_3
Equity (Details) - Schedule of stock options - Options [Member] - USD ($) | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Equity (Details) - Schedule of stock options [Line Items] | ||
Number of Options, Outstanding Beginning balance | 1,200,000 | 1,200,000 |
Weighted-Average Price Per Share, Outstanding Beginning balance | $ 1 | $ 1 |
Weighted- Average Remaining Life, Outstanding Beginning yeas | 1 year 328 days | |
Number of Options, Granted | 100,000,000 | |
Weighted-Average Price Per Share, Granted | $ 0.001 | |
Number of Options, Canceled or expired | (1,200,000) | |
Weighted-Average Price Per Share, Canceled or expired | $ 1 | |
Number of Options, Exercised | (84,000,000) | |
Weighted-Average Price Per Share, Exercised | $ 0.001 | |
Number of Options, Outstanding Ending balance | 16,000,000 | 1,200,000 |
Weighted-Average Price Per Share, Outstanding Ending balance | $ 0.001 | $ 1 |
Weighted- Average Remaining Life, Outstanding ending years | 146 days | 328 days |
Number of Options, Exercisable | 16,000,000 | |
Weighted-Average Price Per Share, Exercisable | $ 0.001 | |
Weighted- Average Remaining Life, Exercisable | 146 days | |
Weighted-Average Price Per Share Intrinsic value | $ 240,000 |
Equity (Details) - Schedule o_4
Equity (Details) - Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model of stock options - Options [Member] | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Equity (Details) - Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model of stock options [Line Items] | ||
Risk-free interest rate at grant date | 15.00% | |
Expected stock price volatility | 262.00% | |
Expected dividend payout | ||
Expected life (in years) | 25 years | |
Minimum [Member] | ||
Equity (Details) - Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model of stock options [Line Items] | ||
Risk-free interest rate at grant date | 1.45% | |
Expected stock price volatility | 330.00% | |
Expected life (in years) | 2 years 6 months | |
Maximum [Member] | ||
Equity (Details) - Schedule of fair value of the warrants was estimated using the Black-Scholes option pricing model of stock options [Line Items] | ||
Risk-free interest rate at grant date | 2.99% | |
Expected stock price volatility | 788.00% | |
Expected life (in years) | 6 years |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 1 Months Ended | |||||||
Sep. 30, 2020 | Aug. 31, 2020 | May 25, 2020 | Apr. 21, 2020 | Mar. 25, 2020 | Oct. 03, 2019 | Oct. 30, 2018 | May 22, 2017 | |
Related Party Transactions (Details) [Line Items] | ||||||||
Letter agreement, description | Pursuant to the Certificate of Designation, the Company designated one share of its preferred stock as Series C Preferred Stock. | |||||||
Due to Officers or Stockholders, Noncurrent | $ 150,000 | |||||||
Employment Agreement [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Employment agreement, description | Pursuant to the employment agreement, Mr. Pollack will serve as the Company’s chief executive officer and president for a period of one year, which term will renew automatically for successive one year terms, subject to the right of either party to terminate the agreement at any time upon written notice. Mr. Pollack was granted the right, for a period of six months, to purchase up to 100,000,000 shares of common stock of the Company for a purchase price of $0.001 per share. During the year ended August 31, 2020 Mr. Pollack exercised 84,000,000 stock options for $84,000. | On October 30, 2018, the Company entered into an employment agreement with Niquana Noel pursuant to which Ms. Noel would serve as the Company’s Chief Executive Officer and president for a term of four years, unless earlier terminated pursuant to the terms of the employment agreement. | ||||||
Related party transaction, description | Pursuant to the agreement, Ms. Noel exchanged $24,000 in accrued but unpaid compensation owed to her by the Company for one share of newly created Series B Preferred Stock of the Company. Ms. Noel subsequently exchanged this one share of Series B Preferred for 1 one share of newly created Series C Preferred Stock. | |||||||
Promissory note, description | the Company issued a promissory note in the principal amount of $150,000, to Danil Pollack, the Company’s chief executive officer. Upon execution of the note, $120,000 was remitted and the remaining $30,000 was paid on September 22, 2020. The note did not bear interest and had a maturity date of November 30, 2020. | |||||||
Subsequent Event [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Mr. Pollack an annual salary | $ 48,000 | |||||||
Chief Executive Officer [Member] | ||||||||
Related Party Transactions (Details) [Line Items] | ||||||||
Employment agreement, description | On May 22, 2017, the Company entered into an employment agreement with Marc Yahr to serve as President and Chief Executive Officer of the Company for a term of three years, unless earlier terminated pursuant to the terms of the employment agreement. | |||||||
Letter agreement, description | Pursuant to the agreement, Ms. Noel exchanged 1 share of Series B Preferred Stock of the Company for one share of newly created Series C Preferred Stock of the Company. |
Commitments and Contingencies (
Commitments and Contingencies (Details) - Securities Purchase Agreement [Member] - USD ($) | Apr. 21, 2020 | Jun. 06, 2018 | Aug. 31, 2020 | Aug. 31, 2019 |
Commitments and Contingencies (Details) [Line Items] | ||||
Per share (in Dollars per share) | $ 0.10 | |||
Exercise price (in Dollars per share) | $ 0.10 | |||
Dividend | $ 50,000 | |||
Issuance of common stock (in Shares) | 500,000 | 500,000 | ||
Value of common stock | $ 76,000 | $ 76,000 | ||
Mr. Pollack an annual salary | $ 48,000 |
Major Customers (Details)
Major Customers (Details) | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Major Customers (Details) [Line Items] | ||
Concentrations of credit risk | 10.00% | |
Accounts Receivable [Member] | ||
Major Customers (Details) [Line Items] | ||
Concentrations of credit risk | 10.00% | |
Number of customers | 1 | |
Sales [Member] | ||
Major Customers (Details) [Line Items] | ||
Concentrations of credit risk | 28.00% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Valuation allowance for deferred tax assets | $ 947,000 | $ 842,000 |
Net operating loss carryforward | $ 3,156,000 | |
Description of expire year | expire beginning in 2032. | |
Operating loss carryforwards | $ 1,120,000 | $ 655,000 |
Income Taxes (Details) - Schedu
Income Taxes (Details) - Schedule of federal statutory rate | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Schedule of federal statutory rate [Abstract] | ||
Federal and state statutory taxes | (25.00%) | (25.00%) |
Change in tax rate estimate | ||
Permanent differences | 22.50% | 2000.00% |
Change in valuation allowance | 2.50% | 5.00% |
Total federal statutory rate |
Income Taxes (Details) - Sche_2
Income Taxes (Details) - Schedule of net deferred tax assets - USD ($) | Aug. 31, 2020 | Aug. 31, 2019 |
Schedule of net deferred tax assets [Abstract] | ||
Inventory impairment | $ 11,129 | $ 13,264 |
Bad debt expense | 756 | |
Net operating loss | 946,775 | 828,901 |
Valuation allowance | (958,660) | (842,165) |
Total deferred tax assets |
Income Taxes (Details) - Sche_3
Income Taxes (Details) - Schedule of U.S. Federal income tax rate - USD ($) | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Schedule of U.S. Federal income tax rate [Abstract] | ||
Net (loss) / income | $ (1,176,212) | $ 654,094 |
Non-deductible expenses and other | 1,059,717 | (833,419) |
Effect due to decrease in tax rates | ||
Change in valuation allowance | 116,495 | 179,325 |
Benefit from income taxes |
Subsequent Events (Details)
Subsequent Events (Details) | Dec. 10, 2020 | Dec. 02, 2020USD ($)shares | Oct. 13, 2020USD ($) | Sep. 22, 2020USD ($) | Nov. 10, 2020 | May 31, 2021USD ($)shares | Feb. 28, 2021USD ($)shares | Nov. 30, 2020USD ($)shares | Aug. 31, 2020USD ($)shares | Aug. 31, 2020USD ($)shares | Aug. 31, 2019USD ($)shares | Oct. 02, 2020shares |
Subsequent Events (Details) [Line Items] | ||||||||||||
Common stock, shares authorized (in Shares) | shares | 3,000,000,000 | 3,000,000,000 | 3,000,000,000 | |||||||||
Fees | $ 185,603 | $ 200,720 | ||||||||||
Business days | 5 | |||||||||||
Subsequent event [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Business days | 5 | 5 | 5 | |||||||||
Exchange agreement, description | Pursuant to the exchange agreement, Mr. Pollack exchanged an outstanding promissory note of the Company in the outstanding principal amount of $150,000 (See note 3) for 15,000,000 newly issued shares of common stock of the Company. | |||||||||||
Purchase agreement shares of common stock (in Shares) | shares | 20,000,000 | |||||||||||
Common stock for aggregate purchase price | $ 200,000 | |||||||||||
Subsequent event, description | the Company entered into amendments (“Amendment No. 3”) with the holders of the Company’s original issue discount convertible debentures, with an original issuance date of December 24, 2019, as amended by amendment No. 1 thereto, dated May 28, 2020, and amendment No. 2 thereto, dated August 21, 2020, in the aggregate outstanding principal amount of $500,000 (See note 4). Pursuant to Amendment No. 3, the maturity date of the debentures was extended to February 28, 2021. | |||||||||||
Minimum [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Monthly average sales | $ 50,000 | |||||||||||
Minimum [Member] | Subsequent event [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Common stock, shares authorized (in Shares) | shares | 800,000,000 | |||||||||||
Monthly average sales | $ 300,000 | $ 200,000 | $ 100,000 | |||||||||
Maximum [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Monthly average sales | $ 100,000 | |||||||||||
Maximum [Member] | Subsequent event [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Common stock, shares authorized (in Shares) | shares | 3,000,000,000 | |||||||||||
Monthly average sales | 500,000 | $ 300,000 | 150,000 | |||||||||
Consulting agreement [Member] | Subsequent event [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Fees | $ 3,000 | |||||||||||
Danil Pollack [Member] | Subsequent event [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Proceeds from promissory note | $ 30,000 | |||||||||||
Principal remaining amount | $ 150,000 | |||||||||||
Mr. Rozen [Member] | Subsequent event [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Fees | $ 7,000 | $ 5,000 | ||||||||||
Mr. Rozen [Member] | Minimum [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Common stock issued (in Shares) | shares | 500,000 | 500,000 | ||||||||||
Mr. Rozen [Member] | Minimum [Member] | Subsequent event [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Common stock issued (in Shares) | shares | 2,000,000 | 1,500,000 | 750,000 | |||||||||
Mr. Rozen [Member] | Maximum [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Common stock issued (in Shares) | shares | 750,000 | 750,000 | ||||||||||
Mr. Rozen [Member] | Maximum [Member] | Subsequent event [Member] | ||||||||||||
Subsequent Events (Details) [Line Items] | ||||||||||||
Common stock issued (in Shares) | shares | 3,000,000 | 2,000,000 | 1,000,000 |