Cover
Cover - shares | 9 Months Ended | |
Jun. 30, 2024 | Aug. 09, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2024 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2024 | |
Current Fiscal Year End Date | --09-30 | |
Entity File Number | 001-39338 | |
Entity Registrant Name | NUZEE, INC. | |
Entity Central Index Key | 0001527613 | |
Entity Tax Identification Number | 38-3849791 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 2865 Scott St. Suite 107 | |
Entity Address, City or Town | Vista | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92081 | |
City Area Code | (760) | |
Local Phone Number | 295-2408 | |
Title of 12(b) Security | Common Stock, $0.00001 par value | |
Trading Symbol | NUZE | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 5,005,170 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) | Jun. 30, 2024 | Sep. 30, 2023 |
Current assets: | ||
Cash | $ 374,458 | $ 982,869 |
Accounts receivable, net | 371,845 | 499,582 |
Inventories, net | 937,166 | 772,825 |
Current assets held for disposition | 706,925 | |
Prepaid expenses and other current assets | 240,906 | 414,048 |
Total current assets | 1,924,375 | 3,376,249 |
Property and equipment, net | 375,498 | 184,763 |
Other assets: | ||
Right-of-use asset - operating lease | 200,295 | 403,258 |
Investment in unconsolidated affiliate | 158,470 | 162,259 |
Intangible assets, net | 87,500 | 110,000 |
Long-term assets held for disposition | 197,409 | |
Other assets | 2,353 | 7,060 |
Total other assets | 448,618 | 879,986 |
Total assets | 2,748,491 | 4,440,998 |
Current liabilities: | ||
Accounts payable and accrued expenses | 2,378,370 | 1,814,035 |
Notes payable | 221,154 | 4,753 |
Lease liability - operating lease | 100,712 | 216,128 |
Lease liability - finance lease | 824 | 26,048 |
Deferred income | 25,127 | 379,795 |
Current liabilities held for disposition | 115,644 | |
Total current liabilities | 2,726,187 | 2,556,403 |
Non-current liabilities: | ||
Lease liability - operating lease, net of current portion | 162,301 | |
Non-current liabilities held for disposition | 47,937 | |
Other noncurrent liabilities | 215,917 | |
Total Non-current liabilities | 215,917 | 210,238 |
Total liabilities | 2,942,104 | 2,766,641 |
Stockholders’ equity: | ||
Common stock; 200,000,000 shares authorized, $0.00001 par value; 2,387,434 and 748,644 shares issued and outstanding as of June 30, 2024, and September 30, 2023, respectively | 24 | 8 |
Additional paid in capital | 78,266,339 | 74,925,843 |
Accumulated deficit | (78,614,726) | (73,371,987) |
Accumulated other comprehensive income | 154,750 | 120,493 |
Total stockholders’ (deficit) equity | (193,613) | 1,674,357 |
Total liabilities and stockholders’ equity | $ 2,748,491 | $ 4,440,998 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Jun. 30, 2024 | Sep. 30, 2023 |
Statement of Financial Position [Abstract] | ||
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares issued | 2,387,434 | 748,644 |
Common stock, shares outstanding | 2,387,434 | 748,644 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Income Statement [Abstract] | ||||
Revenues, net | $ 366,888 | $ 268,023 | $ 1,641,955 | $ 1,205,123 |
Cost of sales | 513,101 | 262,474 | 1,820,140 | 1,237,315 |
Gross profit | (146,213) | 5,549 | (178,185) | (32,192) |
Operating expenses | 1,335,371 | 1,882,269 | 4,748,076 | 5,794,126 |
Loss from operations | (1,481,584) | (1,876,720) | (4,926,261) | (5,826,318) |
Loss from equity method investment | (1,666) | (1,853) | (3,789) | (5,350) |
Other income | 335,838 | 49,338 | 412,580 | 139,601 |
Other expense | (44,913) | (60,353) | (145,140) | (181,667) |
Interest income (expense), net | (109) | 3,298 | (1,277) | 15,573 |
Net loss from continuing operations | (1,192,434) | (1,886,290) | (4,663,887) | (5,858,161) |
Loss from discontinued operations | (98,086) | (139,047) | (429,175) | (318,255) |
Loss from disposition of discontinued operations | (149,677) | (149,677) | ||
Net loss | $ (1,440,197) | $ (2,025,337) | $ (5,242,739) | $ (6,176,416) |
Per Share Information – basic and diluted | ||||
Loss from continuing operations - basic | $ (0.76) | $ (2.45) | $ (3.48) | $ (8.18) |
Loss from continuing operations - diluted | (0.76) | (2.45) | (3.48) | (8.18) |
Loss from discontinued operations - basic | (0.06) | (0.18) | (0.32) | (0.44) |
Loss from discontinued operations - diluted | (0.06) | (0.18) | (0.32) | (0.44) |
Basic net loss per share | (0.92) | (2.63) | (3.91) | (8.62) |
Diluted net loss per share | $ (0.92) | $ (2.63) | $ (3.91) | $ (8.62) |
Basic weighted average number of common stock outstanding | 1,561,410 | 770,063 | 1,341,059 | 716,388 |
Diluted weighted average number of common stock outstanding | 1,561,410 | 770,063 | 1,341,059 | 716,388 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Income Statement [Abstract] | ||||
Net loss | $ (1,440,197) | $ (2,025,337) | $ (5,242,739) | $ (6,176,416) |
Foreign currency translation | (16,309) | (19,331) | 34,257 | 53,287 |
Total other comprehensive income net of tax | (16,309) | (19,331) | 34,257 | 53,287 |
Comprehensive loss | $ (1,456,506) | $ (2,044,668) | $ (5,208,482) | $ (6,123,129) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total |
Beginning balance, value at Sep. 30, 2022 | $ 7 | $ 74,281,418 | $ (64,622,520) | $ 83,894 | $ 9,742,799 |
Balance, shares at Sep. 30, 2022 | 676,229 | ||||
Stock option expense | 197,108 | 197,108 | |||
Other comprehensive income (loss) | 115,583 | 115,583 | |||
Net loss | (2,183,206) | (2,183,206) | |||
Restricted stock compensation | 62,839 | 62,839 | |||
Restricted stock compensation, shares | |||||
Round-up shares issued in reverse split | |||||
Round-up shares issued in reverse split, shares | 8,859 | ||||
Ending balance, value at Dec. 31, 2022 | $ 7 | 74,541,365 | (66,805,726) | 199,477 | 7,935,123 |
Balance, shares at Dec. 31, 2022 | 685,088 | ||||
Beginning balance, value at Sep. 30, 2022 | $ 7 | 74,281,418 | (64,622,520) | 83,894 | 9,742,799 |
Balance, shares at Sep. 30, 2022 | 676,229 | ||||
Other comprehensive income (loss) | 53,287 | ||||
Net loss | (6,176,416) | ||||
Common stock issued for services, shares | 7,500 | ||||
Ending balance, value at Jun. 30, 2023 | $ 8 | 74,824,442 | (70,798,936) | 137,181 | 4,162,695 |
Balance, shares at Jun. 30, 2023 | 776,739 | ||||
Beginning balance, value at Dec. 31, 2022 | $ 7 | 74,541,365 | (66,805,726) | 199,477 | 7,935,123 |
Balance, shares at Dec. 31, 2022 | 685,088 | ||||
Stock option expense | (114,482) | (114,482) | |||
Other comprehensive income (loss) | (42,965) | (42,965) | |||
Net loss | (1,967,873) | (1,967,873) | |||
Restricted stock compensation | $ 1 | 51,939 | 51,940 | ||
Restricted stock compensation, shares | 78,151 | ||||
Common stock issued for services | 57,120 | 57,120 | |||
Common stock issued for services, shares | 6,000 | ||||
Forgiveness of stock issuance costs | 25,000 | 25,000 | |||
Ending balance, value at Mar. 31, 2023 | $ 8 | 74,560,942 | (68,773,599) | 156,512 | 5,943,863 |
Balance, shares at Mar. 31, 2023 | 769,239 | ||||
Stock option expense | 107,754 | 107,754 | |||
Other comprehensive income (loss) | (19,331) | (19,331) | |||
Net loss | (2,025,337) | (2,025,337) | |||
Restricted stock compensation | 61,996 | 61,996 | |||
Common stock issued for services | 78,750 | 78,750 | |||
Common stock issued for services, shares | 7,500 | ||||
Forgiveness of stock issuance costs | 15,000 | 15,000 | |||
Ending balance, value at Jun. 30, 2023 | $ 8 | 74,824,442 | (70,798,936) | 137,181 | 4,162,695 |
Balance, shares at Jun. 30, 2023 | 776,739 | ||||
Beginning balance, value at Sep. 30, 2023 | $ 8 | 74,925,843 | (73,371,987) | 120,493 | 1,674,357 |
Balance, shares at Sep. 30, 2023 | 748,644 | ||||
Common Stock issued for cash | $ 5 | 1,277,113 | 1,277,118 | ||
Common Stock issued for cash, shares | 488,750 | ||||
Stock option expense | 11,505 | 11,505 | |||
Issued private placement | 129,662 | 129,662 | |||
Issued private placement, shares | 46,800 | ||||
Other comprehensive income (loss) | 42,408 | 42,408 | |||
Net loss | (2,148,611) | (2,148,611) | |||
Ending balance, value at Dec. 31, 2023 | $ 13 | 76,344,123 | (75,520,598) | 162,901 | 986,439 |
Balance, shares at Dec. 31, 2023 | 1,284,194 | ||||
Beginning balance, value at Sep. 30, 2023 | $ 8 | 74,925,843 | (73,371,987) | 120,493 | 1,674,357 |
Balance, shares at Sep. 30, 2023 | 748,644 | ||||
Other comprehensive income (loss) | 34,257 | ||||
Net loss | (5,242,739) | ||||
Ending balance, value at Jun. 30, 2024 | $ 24 | 78,266,339 | (78,614,726) | 154,750 | (193,613) |
Balance, shares at Jun. 30, 2024 | 2,387,434 | ||||
Beginning balance, value at Dec. 31, 2023 | $ 13 | 76,344,123 | (75,520,598) | 162,901 | 986,439 |
Balance, shares at Dec. 31, 2023 | 1,284,194 | ||||
Stock option expense | 54,443 | 54,443 | |||
Issued private placement | 29,994 | 29,994 | |||
Issued private placement, shares | 14,220 | ||||
Other comprehensive income (loss) | 8,158 | 8,158 | |||
Net loss | (1,653,931) | (1,653,931) | |||
Ending balance, value at Mar. 31, 2024 | $ 13 | 76,428,560 | (77,174,529) | 171,059 | (574,897) |
Balance, shares at Mar. 31, 2024 | 1,298,414 | ||||
Common Stock issued for cash | $ 11 | 1,819,988 | 1,819,999 | ||
Common Stock issued for cash, shares | 1,089,020 | ||||
Stock option expense | 17,791 | 17,791 | |||
Other comprehensive income (loss) | (16,309) | (16,309) | |||
Net loss | (1,440,197) | (1,440,197) | |||
Ending balance, value at Jun. 30, 2024 | $ 24 | $ 78,266,339 | $ (78,614,726) | $ 154,750 | $ (193,613) |
Balance, shares at Jun. 30, 2024 | 2,387,434 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Operating activities: | ||
Net loss | $ (5,242,739) | $ (6,176,416) |
Net loss from discontinued operations | 429,175 | 318,255 |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 142,107 | 175,995 |
Noncash lease expense | 308,788 | 171,718 |
Stock option expense | 83,739 | 367,155 |
Issuance of common stock for services | 135,870 | |
Bad debt expense | 24,049 | 24,049 |
Loss on disposition of asset | 41,108 | |
Loss from equity method investment | 3,789 | 5,350 |
Change in operating assets and liabilities: | ||
Accounts receivable | 103,688 | 99,428 |
Inventories | (164,341) | (218,394) |
Prepaid expenses and other current assets | 173,142 | 218,271 |
Other assets | 4,707 | 7,061 |
Accounts payable, accrued expenses and other current liabilities | 564,335 | 390,793 |
Deferred income | (354,668) | 28,934 |
Lease liability – operating lease | (383,542) | (195,366) |
Other non-current liabilities | 37,229 | |
Net cash used in operating activities | (4,270,542) | (4,606,189) |
Investing activities: | ||
Purchase of equipment | (310,342) | (31,813) |
Net cash used in investing activities | (310,342) | (31,813) |
Financing activities: | ||
Repayment of loans | (429,933) | (5,932) |
Borrowings from loans | 398,754 | |
Proceeds from sale of future receipts | 195,001 | |
Repayment of finance lease | (25,224) | (21,729) |
Repayment of equipment finance | (31,626) | |
Proceeds from equipment finance | 262,893 | |
Proceeds from issuance of convertible note | 320,000 | |
Proceeds from issuance of common stock for cash | 1,277,118 | |
Proceeds from private placement | 1,659,655 | |
Net cash provided by (used in) financing activities | 3,626,638 | (27,661) |
Discontinued Operations: | ||
Net income (loss) from discontinued operations | (429,175) | (318,255) |
Adjustments to reconcile net income (loss) to net cash | ||
Depreciation from discontinued operations | 3,690 | 5,337 |
Changes in operating assets and liabilities | 737,063 | (403,545) |
Cash Flows from operating activities | 311,578 | (716,463) |
Cash Flows from investing activities | ||
Cash Flows from financing activities | ||
Effect of foreign exchange on cash | 34,257 | 53,287 |
Net change in cash | (608,411) | (5,328,839) |
Cash, beginning of period | 982,869 | 8,262,319 |
Cash, end of period | 374,458 | 2,933,480 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest-continuing operations | 1,416 | 3,760 |
Cash paid for taxes-continuing operations | 3,048 | 8,090 |
Cash paid for interest-discontinued operations | ||
Cash paid for taxes-discontinued operations | ||
Non-cash transactions: | ||
Forgiveness of stock issuance costs | 40,000 | |
ROU assets and liabilities added during the period | $ 105,825 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Jun. 30, 2024 | Mar. 31, 2024 | Dec. 31, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Jun. 30, 2024 | Jun. 30, 2023 | |
Pay vs Performance Disclosure [Table] | ||||||||
Net Income (Loss) | $ (1,440,197) | $ (1,653,931) | $ (2,148,611) | $ (2,025,337) | $ (1,967,873) | $ (2,183,206) | $ (5,242,739) | $ (6,176,416) |
Insider Trading Arrangements
Insider Trading Arrangements | 6 Months Ended |
Jun. 30, 2024 | |
Trading Arrangements, by Individual [Table] | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited interim consolidated financial statements of NuZee, Inc. (together with its subsidiaries, referred to herein as the “Company”, “we” or “NuZee”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), and rules of the Securities and Exchange Commission (the “SEC”), and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended September 30, 2023 as filed with the SEC on January 16, 2024. In the opinion of management, all adjustments, consisting of recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements as reported in the Annual Report on Form 10-K for the year ended September 30, 2023, have been omitted. Principles of Consolidation The Company prepares its financial statements on the accrual basis of accounting. The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts, balances and transactions have been eliminated upon consolidation. The Company had two wholly owned international subsidiaries in NuZee KOREA Ltd. “NuZee KR”) and NuZee Investment Co., Ltd. “NuZee INV”). Effective June 7, 2024 the Company entered into an agreement to sell both subsidiaries. Discontinued Operations On June 7, 2024, the Company consummated the sale of its subsidiaries, NuZee Korea and NuZee Investment, to its former CEO, Chairman and co-founder. The Company elected to focus its efforts and resources on its Dripkit investment, the single serve pour over and brew bag market in North America and its recently introduced bagged coffee processing services in North America. The transaction for the sale of the subsidiaries is accounted for as discontinued operations in accordance with ASC 205-20. The following table summarizes the major categories of income and expense for the discontinued operations sold on Jun 7, 2024. SCHEDULE OF INCOME AND EXPENSE FOR THE DISCONTINUED OPERATIONS Three Months Ended June 30, 2024 Three Months Ended June 30, 2023 Nine Months Ended June 30, 2024 Nine Months Ended June 30, 2023 Revenues, net $ 157,440 $ 380,584 $ 842,121 $ 1,360,998 Cost of sales 149,875 333,980 773,534 1,164,491 Gross profit 7,565 46,604 68,587 196,507 Operating expenses 106,480 185,646 476,532 533,918 Loss from operations (98,915 ) (139,042 ) (407,945 ) (337,411 ) Other income and (expense) 829 (5 ) (21,230 ) 19,156 Loss from discontinued operations (98,086 ) (139,047 ) (429,175 ) (318,255 ) Loss from disposition of discontinued operations (149,677 ) - (149,677 ) - Net loss $ (247,763 ) $ (139,047 ) $ (578,852 ) $ (318,255 ) Reclassifications of Prior Year Amounts Certain prior year amounts have been reclassified for consistency with the current year presentation. The reclassifications had no effect on the reported results of operations or net assets of the Company. 2022 Reverse Stock Split On December 9, 2022, our stockholders approved a proposal granting the board of directors of the Company (the “Board”) discretionary authority to file an amendment (the “Certificate of Amendment”) to our Articles of Incorporation, as amended (the “Articles”), which amends the Articles to add a Section 1A to effect a reverse stock split of our common stock, at any ratio from 1-for-10 to 1-for-50 1-for-35 Earnings per Share Basic earnings per common share is equal to net earnings or loss divided by the weighted average of shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options, warrants and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. As of June 30, 2024 and June 30, 2023, the total number of common stock equivalents was 225,225 and 253,862 , respectively, and composed of stock options and warrants. The Company incurred a net loss for the three and nine months ended June 30, 2024 and 2023, respectively and therefore, basic and diluted earnings per share for those periods are the same because all potential common equivalent shares would be antidilutive. Going Concern and Capital Resources Since its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, acquiring operating assets, raising capital and the commercialization and manufacture of its single serve coffee products. The Company has grown revenues from its principal operations; however, there is no assurance of future revenue growth similar to historical levels. As of June 30, 2024, the Company had cash of $ 374,458 801,812 Use of Estimates In preparing these consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. The Company had no Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents. The Company places its cash with high quality banking institutions. From time to time, the Company may or may not maintain cash balances at certain institutions in excess of the Federal Deposit Insurance Corporation limit. Accounts Receivable Trade accounts receivable are periodically evaluated for collectability based on past credit history with customers and their current financial condition. Bad debts expense or write offs of receivables are determined on the basis of loss experience, known and inherent risks in the receivable portfolio and current economic conditions. The Company had $ 82,685 of allowance for doubtful accounts as of June 30, 2024 and $ 58,636 allowance for doubtful accounts as of September 30, 2023. Major Customers In the nine months ended June 30, 2024 and 2023, revenue was primarily derived from major customers disclosed below. SCHEDULE OF REVENUE BY MAJOR CUSTOMERS Nine months ended June 30, 2024: Customer Name Sales Amount % of Total Revenue Accounts Receivable Amount % of Total Accounts Receivable Customer CL $ 1,142,865 70 % $ 138,246 37 % Nine months ended June 30, 2023: Customer Name Sales Amount % of Total Revenue Accounts Receivable Amount % of Total Accounts Receivable Customer CL $ 391,232 32 % $ 94,487 58 % Customer CN 426,748 35 % 22,064 13 % Lease In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), to provide guidance on recognizing lease assets and lease liabilities on the consolidated balance sheet and disclosing key information about leasing arrangements, specifically differentiating between different types of leases. The Company implemented ASU No. 2016-02 on October 1, 2019. The Company performs a quarterly analysis of leases to determine if there are any operating leases that require recognition under ASC 842. The Company had a long-term operating lease for office and manufacturing space in Plano, Texas. The leased property in Plano, Texas, had a lease term which expired on June 30, 2024. The lease has an option to extend beyond the stated termination date, but the option was not exercised. The Company is in the process of exiting the lease along with its subtenant. This lease was not included under ASC 842 because it is expired. In May 2022, the Company renewed the office and manufacturing space in Vista, California which was scheduled to expire on January 31, 2023 8,451 we leased an additional 1,796 2,514 2,111 As of June 30, 2024, our operating leases had a weighted average remaining lease term of 0.75 5 SCHEDULE OF OTHER INFORMATION RELATED TO OPERATING LEASE ROU Asset – October 1, 2023 $ 403,258 ROU Asset added during the period 105,825 Amortization and removal during the period (308,788 ) ROU Asset – June 30, 2024 $ 200,295 Lease Liability – October 1, 2023 $ 378,429 Lease Liability added during the period 105,825 Amortization and removal during the period (383,542 ) Lease Liability – June 30, 2024 $ 100,712 Lease Liability – Short-Term $ 100,712 Lease Liability – Long-Term - Lease Liability – Total $ 100,712 The table below reconciles the fixed component of the undiscounted cash flows for each of the first five years and the total remaining years to the lease liabilities recorded on the Consolidated Balance Sheet as of June 30, 2024: Amounts due within twelve months of June 30, SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS FOR OPERATING LEASES 2025 $ 100,712 2026 - Total Minimum Lease Payments 100,712 Less Effect of Discounting - Present Value of Future Minimum Lease Payments 100,712 Less Current Portion of Operating Lease Liabilities 100,712 Long-Term Operating Lease Liabilities $ - On October 9, 2019, the Company entered into a lease agreement with Alliance Funding Group which provided for a sale lease back on certain packing equipment. The terms of this agreement require us to pay $ 2,987 1,416 Lease expenses included in operating expense for the nine months ended June 30, 2024, and 2023 was $ 140,877 147,327 144,690 140,559 Cash and non-cash activities associated with the leases for the nine months ended June 30, 2024, are as follows: SCHEDULE OF CASH AND NON-CASH ACTIVITIES OF LEASES Operating cash outflows from operating leases: $ 140,877 Operating cash outflows from finance lease: $ 1,303 Financing cash outflows from finance lease: $ 15,297 In September 2020, we subleased the space at 1700 Capital Avenue in Plano, Texas, effective October 1, 2020 under favorable terms that are co-terminus with the original lease ending June 30, 2024. During the nine months ended June 30, 2024 and 2023, the Company recorded sublease income of $ 119,275 133,443 Foreign Currency Translation The financial position and results of operations of each of the Company’s foreign subsidiaries are measured using the foreign subsidiary’s local currency as the functional currency. Revenues and expenses of each such subsidiary have been translated into U.S. dollars at average exchange rates prevailing during the period. Assets and liabilities have been translated at the rates of exchange on the balance sheet date. The resulting translation gain and loss adjustments are recorded directly as a separate component of stockholders’ equity, unless there is a sale or complete liquidation of the underlying foreign investment. Foreign currency translation adjustment attributable to NuZee, Inc. recorded to other comprehensive loss 34,257 53,287 Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. Equity Method Investee companies that are not consolidated, but over which the Company exercises significant influence, are accounted for under the equity method of accounting. Whether or not the Company exercises significant influence with respect to an investee depends on an evaluation of several factors including, among others, representation on the investee company’s board of directors and ownership level, which is generally a 20 50 When the Company’s carrying value in an equity method investee company is reduced to zero, no further losses are recorded in the Company’s consolidated financial statements unless the Company guaranteed obligations of the investee company or has committed additional funding. When the investee company subsequently reports income, the Company will not record its share of such income until it equals the amount of its share of losses not previously recognized. On January 9, 2020, a joint venture agreement was signed between Industrial Marino, S.A. de C.V. ( 50 50 313,012 110,000 160,000 43,012 The Company accounts for NLA using the equity method of accounting since the management of day-to-day operations at NLA ultimately lies with the Company’s joint venture partner as the operations of NLA are based in its partners facilities as well as our partner appoints the Chairman of the joint Board. As of June 30, 2024, the activity in NLA consisted of the contribution of two machines as described above and other start up and initial sales and marketing related activities. $ 3,789 5,350 Revenue Recognition In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (Topic 606) “Revenue from Contracts with Customers.” Topic 606 supersedes the revenue recognition requirements in Topic 605 “Revenue Recognition” (Topic 605). The new standard’s core principle is that an entity will recognize revenue at an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring goods or services to a customer. The principles in the standard are applied in five steps: 1) Identify the contract(s) with a customer; 2) Identify the performance obligations in the contract; 3) Determine the transaction price; 4) Allocate the transaction price to the performance obligations in the contract; and 5) Recognize revenue when (or as) the entity satisfies a performance obligation. We adopted Topic 606 as of October 1, 2018 on a modified retrospective basis. The adoption of Topic 606 did not have a material impact on our consolidated financial statements, including the presentation of revenues in our Consolidated Statements of Operations. Return and Exchange Policy The Company provides a 30-day money-back guarantee if a buyer is not satisfied with a product. All products are thoroughly inspected and securely packaged before they are shipped to ensure buyers receive the best possible product. If for any reason buyers are unsatisfied with the products, they can return them and the Company will exchange or refund the purchase minus any shipping charges. For wholesale customers, return policies vary based on their specific agreements with customers. For the nine months ended June 30, 2024 and 2023, the Company had no Cost Recognition Cost of products sold is primarily comprised of direct materials consumed in the manufacturing of co-packing arrangements or the production of our own products for resale. Cost of products sold also includes directly related labor salaries and other overhead cost including depreciation, temporary labor and shipping costs for shipment of raw materials to our facilities. Selling, General and Administrative Expense Selling, general and administrative expense (SG&A) is primarily comprised of personnel costs, sales and marketing expenses, depreciation and amortization, insurance expenses, legal and professional services fees, travel and office expenses, and facilities costs. In some situations, the Company covers shipping fees for delivering customer orders, and the shipping and handling expenses are recorded under operating expenses in the consolidated statements of operations. Prepaid expenses and other current assets Prepaid expenses and other current assets as of June 30, 2024 and September 30, 2023 is as follows: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS June 30, 2024 September 30, 2023 Prepaid expenses and other current assets $ 240,906 $ 414,048 The Prepaid expenses and other current assets balance of $ 240,906 414,048 as of September 30, 2023 primarily consists of prepaid insurance, deposits for professional services, and rent. Inventory Inventory, consisting principally of raw materials, work in process and finished goods held for production and sale, is stated at the lower of cost or net realizable value, cost being determined using the weighted average cost method. The Company reviews inventory levels at least quarterly and records a valuation allowance when appropriate. At June 30, 2024 and September 30, 2023, the carrying value of inventory of $ 937,166 772,825 respectively, reflected on the consolidated balance sheets is net of this adjustment. SCHEDULE OF INVENTORY June 30, 2024 September 30, 2023 Raw materials $ 920,178 $ 766,916 Finished goods $ 16,988 5,909 Total $ 937,166 $ 772,825 Property and Equipment Property and equipment is stated at cost, net of accumulated depreciation. The Company generally depreciates property and equipment on a straight-line basis over the estimated useful lives of the assets after the assets are placed in service except for NuZee KR which uses the declining balance method. Office equipment is depreciated over a 3 7 5 119,607 153,495 Expenditures associated with upgrades and enhancements that improve, add functionality, or otherwise extend the life of property and equipment that exceed $1,000 are capitalized. SCHEDULE OF PROPERTY AND EQUIPMENT June 30, 2024 September 30, 2023 Machinery & Equipment 1,456,064 1,145,722 Vehicles 57,431 57,431 Leasehold Improvements - - Less - Accumulated Depreciation (1,137,997 ) (1,018,390 ) Net Property and Equipment $ 375,498 $ 184,763 The Company is required to make deposits or prepayments and progress payments on equipment purchases before the Company receives possession and title. As a result, the Company accounts for such payments as Other Assets until it has possession at which time the equipment is recorded as Property and Equipment. There were no Loans On April 1, 2019, the Company purchased a delivery van from Ford Motor Credit for $ 41,627 3,500 38,127 60 2.9 0 4,753 On March 1, 2024, the Company entered into an unsecured finance agreement in the amount of $ 200,000 23 195,000 4,730 4,730 The Company entered into a financing arrangement on February 15, 2024 with Bill.com wherein it has the option to finance certain accounts receivable at a 3 73,848 Other noncurrent liabilities On October 12, 2023, the Company entered into a finance agreement with a lender for the purchase of packaging equipment with future payments of $ 262,893 |
GEOGRAPHIC CONCENTRATION
GEOGRAPHIC CONCENTRATION | 9 Months Ended |
Jun. 30, 2024 | |
Risks and Uncertainties [Abstract] | |
GEOGRAPHIC CONCENTRATION | 2. GEOGRAPHIC CONCENTRATION The Company is organized based on fundamentally one business segment. Through June 7, 2024 it sold its products on a world-wide basis. The Company operated in in three geographical segments. The Company co-packed product for customers and produced and sold its products directly in North America and Korea. With the sale of its Korean subsidiary, the Company no longer sells products in Korea. The Company previously had a minimally staffed office in Japan that provided support for import and export of product and materials between the U.S. and Japan, as well as investor relations support to its stockholders based in Japan; these functions are now supported by the Company’s personnel residing in the United States, and the Japanese subsidiary was sold. As of June 7, 2024 all revenues are from North America, and all property and equipment is located in North America. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 9 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | 3. INTANGIBLE ASSETS Identifiable life intangible assets As of June 30, 2024, the Company’s intangible assets consisted of unamortized tradename asset of $ 87,500 30,000 Amortization expense was $ 22,500 Amortization expense for the next four fiscal years is as follows: SCHEDULE OF AMORTIZATION EXPENSE Tradename 2024 7,500 2025 30,000 2026 30,000 2027 20,000 Grand Total 87,500 |
ISSUANCE OF EQUITY SECURITIES
ISSUANCE OF EQUITY SECURITIES | 9 Months Ended |
Jun. 30, 2024 | |
Equity [Abstract] | |
ISSUANCE OF EQUITY SECURITIES | 4. ISSUANCE OF EQUITY SECURITIES Private Placement On June 4, 2024, the Company entered into a Securities Purchase Agreement (“SPA”) with certain investors providing for the sale of 866,048 1,500,000 On June 4, 2024 in connection with the SPA, the Company entered into a Registration Rights Agreement providing, among other things, that the Company would as soon as reasonably practicable, and no later than June 13, 2024, file with the SEC a registration statement registering the resale of the shares of common stock. Convertible Notes and Warrant Purchase Agreement On April 27, 2024, the Company entered into a convertible note and warrant purchase agreement with certain investors providing for the private placement of convertible promissory notes in the aggregate principal amount of $ 320,000 221,147 On April 27, 2024 in connection with the agreement, the Company entered into a Registration Rights Agreement providing, among other things, that the Company would as soon as reasonably practicable file with the SEC a registration statement registering the resale of the shares of common stock issuable upon the conversion of the notes and the shares of common stock issuable upon the exercise of the warrants. On June 12, 2024, the investors exercised their conversion option and converted the promissory notes to shares of commons stock. As a result of the conversion, 222,972 Registered Offering The Company offered in an underwritten public offering (the “Offering”), 425,000 0.00001 3.00 On October 18, 2023, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Maxim Group LLC, as the sole book-running manager and underwriter (the “Underwriter”), relating to the Offering. Pursuant to the Underwriting Agreement, the Company granted the Underwriter a 45-day option to purchase up to 63,750 1.0 178,000 Private Placement On November 9, 2023, the Company issued in a private placement to an accredited investor (“Shareholder”) 46,800 5,200 2.77 129,662 On January 19, 2024, the Company issued in a private placement to an accredited investor 14,220 1,279 2.11 30,004 Restricted Shares On August 11, 2023, the Compensation Committee (the “Compensation Committee”) of the Company’s Board of Directors granted to Randell Weaver, the Company’s newly appointed Chief Financial Officer, in connection with his employment agreement, an award of 6,000 2,000 2,000 2,000 3,751 On March 15, 2023, the Company granted 58,619 50 50 Restricted Stock Awards On March 17, 2022, pursuant to the Company’s non-employee director compensation policy, the Compensation Committee (the “Committee”) of the Company’s Board of Directors (the “Board”) granted 674 restricted shares (the “Restricted Shares”) of the Company’s common stock to each of the Company’s five independent directors pursuant to the NuZee, Inc. 2013 Stock Incentive Plan, totaling 3,370 Restricted Shares. The Restricted Shares are scheduled to vest in full on the one-year anniversary of the grant date, subject to each independent director’s continued service as a director of the Company. The Restricted Shares are valued using the closing stock price on the grant date and the Company is expensing these stock option awards on a straight-line basis over the requisite service period. On March 22, 2023, the Company granted 4,398 The Company recognized common stock compensation expense of $ 83,739 176,775 The following table summarizes the restricted common shares activities for the nine months ended June 30, 2024 and 2023: SCHEDULE OF RESTRICTED COMMON SHARES 2024 2023 Number of shares outstanding at September, 2023 and 2022 50,056 3,370 Restricted shares granted - 80,609 Restricted shares forfeited (13,561 ) (2,458 ) Restricted shares vested (17,592 ) (3,370 ) Number of shares outstanding at June 30, 2024 and 2023 18,903 78,151 During the nine months ended June 30, 2024, 13,561 During the nine months ended June 30, 2023, the Company issued 7,500 |
STOCK OPTIONS AND WARRANTS
STOCK OPTIONS AND WARRANTS | 9 Months Ended |
Jun. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK OPTIONS AND WARRANTS | 5. STOCK OPTIONS AND WARRANTS Options During the nine months ended June 30, 2024, the Company granted no new stock options. During the nine months ended June 30, 2024, 30,107 The following table summarizes stock option activity for the nine months ended June 30, 2024. SCHEDULE OF STOCK OPTION ACTIVITY Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (years) Aggregate Value Outstanding at September 30, 2023 96,458 $ 150.39 5.84 $ - Forfeited and expired (30,107 ) 93.07 - 0 - Outstanding at June 30, 2024 66,351 $ 175.24 2.27 $ - Exercisable at June 30, 2024 59,089 $ 193.51 1.48 $ - The Company is expensing these stock option awards on a straight-line basis over the requisite service period. The Company recognized stock option expense of $ 10,823 190,380 for the nine months ended June 30, 2024 and June 30, 2023, respectively. Unamortized option expense as of June 30, 2024, for all options outstanding amounted to $ 20,300 1.62 A summary of the status of the Company’s nonvested options as of June 30, 2024, is presented below: SCHEDULE OF NONVESTED OPTIONS Nonvested options Number of Nonvested Options Weighted Average Grant Date Fair Value Nonvested options at September 30, 2023 24,029 $ 80.73 Granted - - Forfeited (16,119 ) 103.83 Vested (648 ) 352.55 Nonvested options at June 30, 2024 7,262 $ 24.27 Warrants During the nine months ended June 30, 2024, the Company granted 6,476 The following table summarizes warrant activity for the nine months ended June 30, 2024: SCHEDULE OF WARRANT ACTIVITY Number of Shares Issuable Upon Exercise of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (years) Aggregate Intrinsic Value Outstanding at September 30, 2023 152,398 $ 158.24 2.65 $ - Issued 6,476 2.64 Exercised - - Expired - - Outstanding at June 30, 2024 158,874 $ 151.90 2.00 - Exercisable at June 30, 2024 158,874 $ 151.90 2.00 $ - |
CONTINGENCY
CONTINGENCY | 9 Months Ended |
Jun. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCY | 6. CONTINGENCY Steeped, Inc. Litigation As previously disclosed, on January 27, 2023, Steeped, Inc. d/b/a Steeped Coffee (“Steeped”) filed a complaint against the Company in the Superior Court of California, Santa Cruz County (Case No. 23CV00234) (the “Steeped Litigation”). The Steeped Litigation relates to Steeped’s claim that the Company breached a 2021 settlement agreement that resolved Steeped’s 2019 trademark infringement case against the Company. The earlier case involved Steeped’s purported trademark protection for “steeped coffee” and related phrases. Steeped’s operative complaint in the pending Steeped Litigation alleges breach of contract, intentional interference with contractual relations, intentional interference with prospective economic advantage, and fraud in the inducement of contract. Plaintiff seeks a trial by jury and relief in the form of a permanent injunction for use of “Steep Coffee” or any confusingly similar variant of “STEEPED COFFEE”; the impoundment and destruction of allegedly violating packaging materials and/or finished goods; a final judgment for all profits derived from the Company’s allegedly unlawful conduct, actual damages, damages to the Plaintiff’s reputation and goodwill among its customers and partners; and reasonable attorneys’ fees and costs. NuZee answered Steeped’s complaint with a general denial and asserted twenty-five affirmative defenses. On January 16, 2024, a mediation hearing was held. After the close of business, the mediator suggested a settlement amount of $ 500,000 500,000 100,000 200,000 200,000 Curtin Litigation As previously disclosed, on January 6, 2023, a former employee of the Company, Rosaline Curtin (“Ms. Curtin”), filed a complaint against the Company and another former employee of the Company, Jose Ramirez (“Mr. Ramirez”), in the Superior Court of California, County of San Diego (Case No. 37-2023-00000841-CU-WT-NC) (the “Curtin Complaint”). The Curtin Complaint alleges that Ms. Curtin was subject to harassment by her supervisor, Mr. Ramirez, and gender discrimination throughout her employment, that she reported this discrimination and harassment to the Company, and that the Company retaliated against her and wrongfully terminated her for whistleblowing and failed to prevent discrimination, harassment, and retaliation. The Curtin Complaint seeks compensatory damages, including loss of past, present and future earnings, and benefits, as well as punitive damages, penalties, attorney’s fees and costs and interest. The Company has responded to the complaint on behalf of the Company and Mr. Ramirez and prevailed on December 22, 2023, prevailed on its motion to compel. Arbitration proceedings have been initiated, and the parties have agreed on an arbitrator. On May 24, 2024, a management conference was held in the arbitration and a hearing date was scheduled for January 13-17, 2025. Discovery is underway and the Company’s responses and objections to Curtin’s discovery demands are due on August 9, 2024. Curtin’s discovery responses and objections to the Company’s discovery demands are due on August 23, 2024. The Company believes the allegations set forth in the Curtin Complaint are without merit and intends to defend vigorously against the allegations. However, the Company is not able to predict the outcome, and there is no assurance that the Company will be successful in its defense. From time to time, we may be subject to other legal proceedings and claims in the ordinary course of business. The results of any future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. Other On July 29, 2024, the Company received a letter from an investor alleging that the Company has breached a purported agreement by failing to satisfy certain alleged obligations. The investor has demanded fulfillment of the alleged obligations, undisclosed monetary damages, legal fees and interest. He has indicated he will seek Court intervention if the Company fails to adequately address his demands. The Company and its counsel are reviewing the matter. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Jun. 30, 2024 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 7 . SUBSEQUENT EVENTS Private Placement – Convertible Notes On July 24, 2024, the Company entered into a convertible note purchase agreement with certain investors to issue and sell convertible notes in the aggregate principal amount of approximately $ 300,000 0.52 On July 26, 2024, the investors exercised their option to convert the notes to common stock. NASDAQ Compliance As previously disclosed, the Company received a letter from NASDAQ on January 23, 2024 indicating that the Company was not in compliance with NASDAQ Listing Rule 5550(b)(1), the Stockholders’ Equity Requirement. NASDAQ stated that the Company failed to maintain a minimum of $ 2,500,000 On July 23, 2024, the Company received a letter from NASDAQ stating that based on the Form 8-K filed with the Commission on July 19, 2024, NASDAQ has determined that the Company has complied with Listing Rule 5550(b)(1). However, in the future, if the Company fails to evidence compliance upon filing its next periodic report, it may be subject to a delisting determination. Any such determination may be appealed to a Hearings Panel. Private Placement On July 11, 2024 the Company entered into a Securities Purchase Agreement (“SPA”) with certain investors providing for the sale of 2,040,814 3,000,000 The transaction closed on July 18, 2024. |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The Company prepares its financial statements on the accrual basis of accounting. The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts, balances and transactions have been eliminated upon consolidation. The Company had two wholly owned international subsidiaries in NuZee KOREA Ltd. “NuZee KR”) and NuZee Investment Co., Ltd. “NuZee INV”). Effective June 7, 2024 the Company entered into an agreement to sell both subsidiaries. |
Discontinued Operations | Discontinued Operations On June 7, 2024, the Company consummated the sale of its subsidiaries, NuZee Korea and NuZee Investment, to its former CEO, Chairman and co-founder. The Company elected to focus its efforts and resources on its Dripkit investment, the single serve pour over and brew bag market in North America and its recently introduced bagged coffee processing services in North America. The transaction for the sale of the subsidiaries is accounted for as discontinued operations in accordance with ASC 205-20. The following table summarizes the major categories of income and expense for the discontinued operations sold on Jun 7, 2024. SCHEDULE OF INCOME AND EXPENSE FOR THE DISCONTINUED OPERATIONS Three Months Ended June 30, 2024 Three Months Ended June 30, 2023 Nine Months Ended June 30, 2024 Nine Months Ended June 30, 2023 Revenues, net $ 157,440 $ 380,584 $ 842,121 $ 1,360,998 Cost of sales 149,875 333,980 773,534 1,164,491 Gross profit 7,565 46,604 68,587 196,507 Operating expenses 106,480 185,646 476,532 533,918 Loss from operations (98,915 ) (139,042 ) (407,945 ) (337,411 ) Other income and (expense) 829 (5 ) (21,230 ) 19,156 Loss from discontinued operations (98,086 ) (139,047 ) (429,175 ) (318,255 ) Loss from disposition of discontinued operations (149,677 ) - (149,677 ) - Net loss $ (247,763 ) $ (139,047 ) $ (578,852 ) $ (318,255 ) |
Reclassifications of Prior Year Amounts | Reclassifications of Prior Year Amounts Certain prior year amounts have been reclassified for consistency with the current year presentation. The reclassifications had no effect on the reported results of operations or net assets of the Company. |
2022 Reverse Stock Split | 2022 Reverse Stock Split On December 9, 2022, our stockholders approved a proposal granting the board of directors of the Company (the “Board”) discretionary authority to file an amendment (the “Certificate of Amendment”) to our Articles of Incorporation, as amended (the “Articles”), which amends the Articles to add a Section 1A to effect a reverse stock split of our common stock, at any ratio from 1-for-10 to 1-for-50 1-for-35 |
Earnings per Share | Earnings per Share Basic earnings per common share is equal to net earnings or loss divided by the weighted average of shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options, warrants and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. As of June 30, 2024 and June 30, 2023, the total number of common stock equivalents was 225,225 and 253,862 , respectively, and composed of stock options and warrants. The Company incurred a net loss for the three and nine months ended June 30, 2024 and 2023, respectively and therefore, basic and diluted earnings per share for those periods are the same because all potential common equivalent shares would be antidilutive. |
Going Concern and Capital Resources | Going Concern and Capital Resources Since its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff, acquiring operating assets, raising capital and the commercialization and manufacture of its single serve coffee products. The Company has grown revenues from its principal operations; however, there is no assurance of future revenue growth similar to historical levels. As of June 30, 2024, the Company had cash of $ 374,458 801,812 |
Use of Estimates | Use of Estimates In preparing these consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. The Company had no |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents. The Company places its cash with high quality banking institutions. From time to time, the Company may or may not maintain cash balances at certain institutions in excess of the Federal Deposit Insurance Corporation limit. |
Accounts Receivable | Accounts Receivable Trade accounts receivable are periodically evaluated for collectability based on past credit history with customers and their current financial condition. Bad debts expense or write offs of receivables are determined on the basis of loss experience, known and inherent risks in the receivable portfolio and current economic conditions. The Company had $ 82,685 of allowance for doubtful accounts as of June 30, 2024 and $ 58,636 allowance for doubtful accounts as of September 30, 2023. |
Major Customers | Major Customers In the nine months ended June 30, 2024 and 2023, revenue was primarily derived from major customers disclosed below. SCHEDULE OF REVENUE BY MAJOR CUSTOMERS Nine months ended June 30, 2024: Customer Name Sales Amount % of Total Revenue Accounts Receivable Amount % of Total Accounts Receivable Customer CL $ 1,142,865 70 % $ 138,246 37 % Nine months ended June 30, 2023: Customer Name Sales Amount % of Total Revenue Accounts Receivable Amount % of Total Accounts Receivable Customer CL $ 391,232 32 % $ 94,487 58 % Customer CN 426,748 35 % 22,064 13 % |
Lease | Lease In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), to provide guidance on recognizing lease assets and lease liabilities on the consolidated balance sheet and disclosing key information about leasing arrangements, specifically differentiating between different types of leases. The Company implemented ASU No. 2016-02 on October 1, 2019. The Company performs a quarterly analysis of leases to determine if there are any operating leases that require recognition under ASC 842. The Company had a long-term operating lease for office and manufacturing space in Plano, Texas. The leased property in Plano, Texas, had a lease term which expired on June 30, 2024. The lease has an option to extend beyond the stated termination date, but the option was not exercised. The Company is in the process of exiting the lease along with its subtenant. This lease was not included under ASC 842 because it is expired. In May 2022, the Company renewed the office and manufacturing space in Vista, California which was scheduled to expire on January 31, 2023 8,451 we leased an additional 1,796 2,514 2,111 As of June 30, 2024, our operating leases had a weighted average remaining lease term of 0.75 5 SCHEDULE OF OTHER INFORMATION RELATED TO OPERATING LEASE ROU Asset – October 1, 2023 $ 403,258 ROU Asset added during the period 105,825 Amortization and removal during the period (308,788 ) ROU Asset – June 30, 2024 $ 200,295 Lease Liability – October 1, 2023 $ 378,429 Lease Liability added during the period 105,825 Amortization and removal during the period (383,542 ) Lease Liability – June 30, 2024 $ 100,712 Lease Liability – Short-Term $ 100,712 Lease Liability – Long-Term - Lease Liability – Total $ 100,712 The table below reconciles the fixed component of the undiscounted cash flows for each of the first five years and the total remaining years to the lease liabilities recorded on the Consolidated Balance Sheet as of June 30, 2024: Amounts due within twelve months of June 30, SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS FOR OPERATING LEASES 2025 $ 100,712 2026 - Total Minimum Lease Payments 100,712 Less Effect of Discounting - Present Value of Future Minimum Lease Payments 100,712 Less Current Portion of Operating Lease Liabilities 100,712 Long-Term Operating Lease Liabilities $ - On October 9, 2019, the Company entered into a lease agreement with Alliance Funding Group which provided for a sale lease back on certain packing equipment. The terms of this agreement require us to pay $ 2,987 1,416 Lease expenses included in operating expense for the nine months ended June 30, 2024, and 2023 was $ 140,877 147,327 144,690 140,559 Cash and non-cash activities associated with the leases for the nine months ended June 30, 2024, are as follows: SCHEDULE OF CASH AND NON-CASH ACTIVITIES OF LEASES Operating cash outflows from operating leases: $ 140,877 Operating cash outflows from finance lease: $ 1,303 Financing cash outflows from finance lease: $ 15,297 In September 2020, we subleased the space at 1700 Capital Avenue in Plano, Texas, effective October 1, 2020 under favorable terms that are co-terminus with the original lease ending June 30, 2024. During the nine months ended June 30, 2024 and 2023, the Company recorded sublease income of $ 119,275 133,443 |
Foreign Currency Translation | Foreign Currency Translation The financial position and results of operations of each of the Company’s foreign subsidiaries are measured using the foreign subsidiary’s local currency as the functional currency. Revenues and expenses of each such subsidiary have been translated into U.S. dollars at average exchange rates prevailing during the period. Assets and liabilities have been translated at the rates of exchange on the balance sheet date. The resulting translation gain and loss adjustments are recorded directly as a separate component of stockholders’ equity, unless there is a sale or complete liquidation of the underlying foreign investment. Foreign currency translation adjustment attributable to NuZee, Inc. recorded to other comprehensive loss 34,257 53,287 Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. |
Equity Method | Equity Method Investee companies that are not consolidated, but over which the Company exercises significant influence, are accounted for under the equity method of accounting. Whether or not the Company exercises significant influence with respect to an investee depends on an evaluation of several factors including, among others, representation on the investee company’s board of directors and ownership level, which is generally a 20 50 When the Company’s carrying value in an equity method investee company is reduced to zero, no further losses are recorded in the Company’s consolidated financial statements unless the Company guaranteed obligations of the investee company or has committed additional funding. When the investee company subsequently reports income, the Company will not record its share of such income until it equals the amount of its share of losses not previously recognized. On January 9, 2020, a joint venture agreement was signed between Industrial Marino, S.A. de C.V. ( 50 50 313,012 110,000 160,000 43,012 The Company accounts for NLA using the equity method of accounting since the management of day-to-day operations at NLA ultimately lies with the Company’s joint venture partner as the operations of NLA are based in its partners facilities as well as our partner appoints the Chairman of the joint Board. As of June 30, 2024, the activity in NLA consisted of the contribution of two machines as described above and other start up and initial sales and marketing related activities. $ 3,789 5,350 |
Revenue Recognition | Revenue Recognition In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (Topic 606) “Revenue from Contracts with Customers.” Topic 606 supersedes the revenue recognition requirements in Topic 605 “Revenue Recognition” (Topic 605). The new standard’s core principle is that an entity will recognize revenue at an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring goods or services to a customer. The principles in the standard are applied in five steps: 1) Identify the contract(s) with a customer; 2) Identify the performance obligations in the contract; 3) Determine the transaction price; 4) Allocate the transaction price to the performance obligations in the contract; and 5) Recognize revenue when (or as) the entity satisfies a performance obligation. We adopted Topic 606 as of October 1, 2018 on a modified retrospective basis. The adoption of Topic 606 did not have a material impact on our consolidated financial statements, including the presentation of revenues in our Consolidated Statements of Operations. |
Return and Exchange Policy | Return and Exchange Policy The Company provides a 30-day money-back guarantee if a buyer is not satisfied with a product. All products are thoroughly inspected and securely packaged before they are shipped to ensure buyers receive the best possible product. If for any reason buyers are unsatisfied with the products, they can return them and the Company will exchange or refund the purchase minus any shipping charges. For wholesale customers, return policies vary based on their specific agreements with customers. For the nine months ended June 30, 2024 and 2023, the Company had no |
Cost Recognition | Cost Recognition Cost of products sold is primarily comprised of direct materials consumed in the manufacturing of co-packing arrangements or the production of our own products for resale. Cost of products sold also includes directly related labor salaries and other overhead cost including depreciation, temporary labor and shipping costs for shipment of raw materials to our facilities. |
Selling, General and Administrative Expense | Selling, General and Administrative Expense Selling, general and administrative expense (SG&A) is primarily comprised of personnel costs, sales and marketing expenses, depreciation and amortization, insurance expenses, legal and professional services fees, travel and office expenses, and facilities costs. In some situations, the Company covers shipping fees for delivering customer orders, and the shipping and handling expenses are recorded under operating expenses in the consolidated statements of operations. |
Prepaid expenses and other current assets | Prepaid expenses and other current assets Prepaid expenses and other current assets as of June 30, 2024 and September 30, 2023 is as follows: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS June 30, 2024 September 30, 2023 Prepaid expenses and other current assets $ 240,906 $ 414,048 The Prepaid expenses and other current assets balance of $ 240,906 414,048 as of September 30, 2023 primarily consists of prepaid insurance, deposits for professional services, and rent. |
Inventory | Inventory Inventory, consisting principally of raw materials, work in process and finished goods held for production and sale, is stated at the lower of cost or net realizable value, cost being determined using the weighted average cost method. The Company reviews inventory levels at least quarterly and records a valuation allowance when appropriate. At June 30, 2024 and September 30, 2023, the carrying value of inventory of $ 937,166 772,825 respectively, reflected on the consolidated balance sheets is net of this adjustment. SCHEDULE OF INVENTORY June 30, 2024 September 30, 2023 Raw materials $ 920,178 $ 766,916 Finished goods $ 16,988 5,909 Total $ 937,166 $ 772,825 |
Property and Equipment | Property and Equipment Property and equipment is stated at cost, net of accumulated depreciation. The Company generally depreciates property and equipment on a straight-line basis over the estimated useful lives of the assets after the assets are placed in service except for NuZee KR which uses the declining balance method. Office equipment is depreciated over a 3 7 5 119,607 153,495 Expenditures associated with upgrades and enhancements that improve, add functionality, or otherwise extend the life of property and equipment that exceed $1,000 are capitalized. SCHEDULE OF PROPERTY AND EQUIPMENT June 30, 2024 September 30, 2023 Machinery & Equipment 1,456,064 1,145,722 Vehicles 57,431 57,431 Leasehold Improvements - - Less - Accumulated Depreciation (1,137,997 ) (1,018,390 ) Net Property and Equipment $ 375,498 $ 184,763 The Company is required to make deposits or prepayments and progress payments on equipment purchases before the Company receives possession and title. As a result, the Company accounts for such payments as Other Assets until it has possession at which time the equipment is recorded as Property and Equipment. There were no |
Loans | Loans On April 1, 2019, the Company purchased a delivery van from Ford Motor Credit for $ 41,627 3,500 38,127 60 2.9 0 4,753 On March 1, 2024, the Company entered into an unsecured finance agreement in the amount of $ 200,000 23 195,000 4,730 4,730 The Company entered into a financing arrangement on February 15, 2024 with Bill.com wherein it has the option to finance certain accounts receivable at a 3 73,848 |
Other noncurrent liabilities | Other noncurrent liabilities On October 12, 2023, the Company entered into a finance agreement with a lender for the purchase of packaging equipment with future payments of $ 262,893 |
BASIS OF PRESENTATION AND SUM_3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
SCHEDULE OF INCOME AND EXPENSE FOR THE DISCONTINUED OPERATIONS | The following table summarizes the major categories of income and expense for the discontinued operations sold on Jun 7, 2024. SCHEDULE OF INCOME AND EXPENSE FOR THE DISCONTINUED OPERATIONS Three Months Ended June 30, 2024 Three Months Ended June 30, 2023 Nine Months Ended June 30, 2024 Nine Months Ended June 30, 2023 Revenues, net $ 157,440 $ 380,584 $ 842,121 $ 1,360,998 Cost of sales 149,875 333,980 773,534 1,164,491 Gross profit 7,565 46,604 68,587 196,507 Operating expenses 106,480 185,646 476,532 533,918 Loss from operations (98,915 ) (139,042 ) (407,945 ) (337,411 ) Other income and (expense) 829 (5 ) (21,230 ) 19,156 Loss from discontinued operations (98,086 ) (139,047 ) (429,175 ) (318,255 ) Loss from disposition of discontinued operations (149,677 ) - (149,677 ) - Net loss $ (247,763 ) $ (139,047 ) $ (578,852 ) $ (318,255 ) |
SCHEDULE OF REVENUE BY MAJOR CUSTOMERS | In the nine months ended June 30, 2024 and 2023, revenue was primarily derived from major customers disclosed below. SCHEDULE OF REVENUE BY MAJOR CUSTOMERS Nine months ended June 30, 2024: Customer Name Sales Amount % of Total Revenue Accounts Receivable Amount % of Total Accounts Receivable Customer CL $ 1,142,865 70 % $ 138,246 37 % Nine months ended June 30, 2023: Customer Name Sales Amount % of Total Revenue Accounts Receivable Amount % of Total Accounts Receivable Customer CL $ 391,232 32 % $ 94,487 58 % Customer CN 426,748 35 % 22,064 13 % |
SCHEDULE OF OTHER INFORMATION RELATED TO OPERATING LEASE | SCHEDULE OF OTHER INFORMATION RELATED TO OPERATING LEASE ROU Asset – October 1, 2023 $ 403,258 ROU Asset added during the period 105,825 Amortization and removal during the period (308,788 ) ROU Asset – June 30, 2024 $ 200,295 Lease Liability – October 1, 2023 $ 378,429 Lease Liability added during the period 105,825 Amortization and removal during the period (383,542 ) Lease Liability – June 30, 2024 $ 100,712 Lease Liability – Short-Term $ 100,712 Lease Liability – Long-Term - Lease Liability – Total $ 100,712 |
SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS FOR OPERATING LEASES | Amounts due within twelve months of June 30, SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS FOR OPERATING LEASES 2025 $ 100,712 2026 - Total Minimum Lease Payments 100,712 Less Effect of Discounting - Present Value of Future Minimum Lease Payments 100,712 Less Current Portion of Operating Lease Liabilities 100,712 Long-Term Operating Lease Liabilities $ - |
SCHEDULE OF CASH AND NON-CASH ACTIVITIES OF LEASES | Cash and non-cash activities associated with the leases for the nine months ended June 30, 2024, are as follows: SCHEDULE OF CASH AND NON-CASH ACTIVITIES OF LEASES Operating cash outflows from operating leases: $ 140,877 Operating cash outflows from finance lease: $ 1,303 Financing cash outflows from finance lease: $ 15,297 |
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS | Prepaid expenses and other current assets as of June 30, 2024 and September 30, 2023 is as follows: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS June 30, 2024 September 30, 2023 Prepaid expenses and other current assets $ 240,906 $ 414,048 |
SCHEDULE OF INVENTORY | SCHEDULE OF INVENTORY June 30, 2024 September 30, 2023 Raw materials $ 920,178 $ 766,916 Finished goods $ 16,988 5,909 Total $ 937,166 $ 772,825 |
SCHEDULE OF PROPERTY AND EQUIPMENT | SCHEDULE OF PROPERTY AND EQUIPMENT June 30, 2024 September 30, 2023 Machinery & Equipment 1,456,064 1,145,722 Vehicles 57,431 57,431 Leasehold Improvements - - Less - Accumulated Depreciation (1,137,997 ) (1,018,390 ) Net Property and Equipment $ 375,498 $ 184,763 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF AMORTIZATION EXPENSE | Amortization expense for the next four fiscal years is as follows: SCHEDULE OF AMORTIZATION EXPENSE Tradename 2024 7,500 2025 30,000 2026 30,000 2027 20,000 Grand Total 87,500 |
ISSUANCE OF EQUITY SECURITIES (
ISSUANCE OF EQUITY SECURITIES (Tables) | 9 Months Ended |
Jun. 30, 2024 | |
Equity [Abstract] | |
SCHEDULE OF RESTRICTED COMMON SHARES | The following table summarizes the restricted common shares activities for the nine months ended June 30, 2024 and 2023: SCHEDULE OF RESTRICTED COMMON SHARES 2024 2023 Number of shares outstanding at September, 2023 and 2022 50,056 3,370 Restricted shares granted - 80,609 Restricted shares forfeited (13,561 ) (2,458 ) Restricted shares vested (17,592 ) (3,370 ) Number of shares outstanding at June 30, 2024 and 2023 18,903 78,151 |
STOCK OPTIONS AND WARRANTS (Tab
STOCK OPTIONS AND WARRANTS (Tables) | 9 Months Ended |
Jun. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
SCHEDULE OF STOCK OPTION ACTIVITY | The following table summarizes stock option activity for the nine months ended June 30, 2024. SCHEDULE OF STOCK OPTION ACTIVITY Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (years) Aggregate Value Outstanding at September 30, 2023 96,458 $ 150.39 5.84 $ - Forfeited and expired (30,107 ) 93.07 - 0 - Outstanding at June 30, 2024 66,351 $ 175.24 2.27 $ - Exercisable at June 30, 2024 59,089 $ 193.51 1.48 $ - |
SCHEDULE OF NONVESTED OPTIONS | A summary of the status of the Company’s nonvested options as of June 30, 2024, is presented below: SCHEDULE OF NONVESTED OPTIONS Nonvested options Number of Nonvested Options Weighted Average Grant Date Fair Value Nonvested options at September 30, 2023 24,029 $ 80.73 Granted - - Forfeited (16,119 ) 103.83 Vested (648 ) 352.55 Nonvested options at June 30, 2024 7,262 $ 24.27 |
SCHEDULE OF WARRANT ACTIVITY | The following table summarizes warrant activity for the nine months ended June 30, 2024: SCHEDULE OF WARRANT ACTIVITY Number of Shares Issuable Upon Exercise of Warrants Weighted Average Exercise Price Weighted Average Remaining Contractual Life (years) Aggregate Intrinsic Value Outstanding at September 30, 2023 152,398 $ 158.24 2.65 $ - Issued 6,476 2.64 Exercised - - Expired - - Outstanding at June 30, 2024 158,874 $ 151.90 2.00 - Exercisable at June 30, 2024 158,874 $ 151.90 2.00 $ - |
SCHEDULE OF INCOME AND EXPENSE
SCHEDULE OF INCOME AND EXPENSE FOR THE DISCONTINUED OPERATIONS (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Accounting Policies [Abstract] | ||||
Revenues, net | $ 157,440 | $ 380,584 | $ 842,121 | $ 1,360,998 |
Cost of sales | 149,875 | 333,980 | 773,534 | 1,164,491 |
Gross profit | 7,565 | 46,604 | 68,587 | 196,507 |
Operating expenses | 106,480 | 185,646 | 476,532 | 533,918 |
Loss from operations | (98,915) | (139,042) | (407,945) | (337,411) |
Other income and (expense) | 829 | (5) | (21,230) | 19,156 |
Loss from discontinued operations | (98,086) | (139,047) | (429,175) | (318,255) |
Loss from disposition of discontinued operations | (149,677) | (149,677) | ||
Net loss | $ (247,763) | $ (139,047) | $ (578,852) | $ (318,255) |
SCHEDULE OF REVENUE BY MAJOR CU
SCHEDULE OF REVENUE BY MAJOR CUSTOMERS (Details) - Customer Concentration Risk [Member] - USD ($) | 9 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Revenue Benchmark [Member] | Customer CL [Member] | ||
Product Information [Line Items] | ||
Sales Amount | $ 1,142,865 | $ 391,232 |
Concentration risk percentage | 70% | 32% |
Revenue Benchmark [Member] | Customer CN [Member] | ||
Product Information [Line Items] | ||
Sales Amount | $ 426,748 | |
Concentration risk percentage | 35% | |
Accounts Receivable [Member] | Customer CL [Member] | ||
Product Information [Line Items] | ||
Concentration risk percentage | 37% | 58% |
Accounts receivable amount | $ 138,246 | $ 94,487 |
Accounts Receivable [Member] | Customer CN [Member] | ||
Product Information [Line Items] | ||
Concentration risk percentage | 13% | |
Accounts receivable amount | $ 22,064 |
SCHEDULE OF OTHER INFORMATION R
SCHEDULE OF OTHER INFORMATION RELATED TO OPERATING LEASE (Details) - USD ($) | 9 Months Ended | |
Jun. 30, 2024 | Sep. 30, 2023 | |
Accounting Policies [Abstract] | ||
ROU Asset – October 1, 2023 | $ 403,258 | |
ROU Asset added during the period | 105,825 | |
Amortization and removal during the period | (308,788) | |
ROU Asset – June 30, 2024 | 200,295 | |
Lease Liability – October 1, 2023 | 378,429 | |
Lease Liability added during the period | 105,825 | |
Amortization and removal during the period | (383,542) | |
Lease Liability – June 30, 2024 | 100,712 | |
Lease Liability - Short-Term | 100,712 | $ 216,128 |
Operating Lease, Liability, Noncurrent | 162,301 | |
Lease Liability - Total | $ 100,712 | $ 378,429 |
SCHEDULE OF FUTURE MINIMUM RENT
SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS FOR OPERATING LEASES (Details) - USD ($) | Jun. 30, 2024 | Sep. 30, 2023 |
Accounting Policies [Abstract] | ||
2025 | $ 100,712 | |
2026 | ||
Total Minimum Lease Payments | 100,712 | |
Less Effect of Discounting | ||
Present Value of Future Minimum Lease Payments | 100,712 | $ 378,429 |
Less Current Portion of Operating Lease Liabilities | 100,712 | 216,128 |
Long-Term Operating Lease Liabilities | $ 162,301 |
SCHEDULE OF CASH AND NON-CASH A
SCHEDULE OF CASH AND NON-CASH ACTIVITIES OF LEASES (Details) | 9 Months Ended |
Jun. 30, 2024 USD ($) | |
Accounting Policies [Abstract] | |
Operating cash outflows from operating leases: | $ 140,877 |
Operating cash outflows from finance lease: | 1,303 |
Financing cash outflows from finance lease: | $ 15,297 |
SCHEDULE OF PREPAID EXPENSES AN
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) | Jun. 30, 2024 | Sep. 30, 2023 |
Accounting Policies [Abstract] | ||
Prepaid expenses and other current assets | $ 240,906 | $ 414,048 |
SCHEDULE OF INVENTORY (Details)
SCHEDULE OF INVENTORY (Details) - USD ($) | Jun. 30, 2024 | Sep. 30, 2023 |
Accounting Policies [Abstract] | ||
Raw materials | $ 920,178 | $ 766,916 |
Finished goods | 16,988 | 5,909 |
Total | $ 937,166 | $ 772,825 |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) | Jun. 30, 2024 | Sep. 30, 2023 |
Accounting Policies [Abstract] | ||
Machinery & Equipment | $ 1,456,064 | $ 1,145,722 |
Vehicles | 57,431 | 57,431 |
Leasehold Improvements | ||
Less - Accumulated Depreciation | (1,137,997) | (1,018,390) |
Net Property and Equipment | $ 375,498 | $ 184,763 |
BASIS OF PRESENTATION AND SUM_4
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||
Mar. 01, 2024 USD ($) | Dec. 21, 2022 | Dec. 09, 2022 | Jan. 09, 2020 USD ($) | Apr. 01, 2019 USD ($) | May 31, 2022 USD ($) ft² | Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) shares | Jun. 30, 2023 USD ($) shares | Sep. 30, 2023 USD ($) | Mar. 31, 2024 USD ($) | Feb. 15, 2024 | Oct. 12, 2023 USD ($) | Oct. 09, 2019 USD ($) | |
Property, Plant and Equipment [Line Items] | |||||||||||||||
Reverse stock split, descrption | 1-for-35 | ratio from 1-for-10 to 1-for-50 | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | shares | 225,225 | 253,862 | |||||||||||||
Cash | $ 374,458 | $ 374,458 | $ 982,869 | ||||||||||||
Working capital | 801,812 | 801,812 | |||||||||||||
Cash equivalents | 0 | 0 | 0 | ||||||||||||
Accounts Receivable, Allowance for Credit Loss | $ 82,685 | 82,685 | 58,636 | ||||||||||||
Operating lease, expense | $ 308,788 | $ 171,718 | |||||||||||||
Operating leases weighted average remaining lease term | 9 months | 9 months | |||||||||||||
Operating lease weighted average discount rate percent | 5% | 5% | |||||||||||||
Interest expense | $ 1,416 | ||||||||||||||
Sublease income | 119,275 | 133,443 | |||||||||||||
Foreign currency translation adjustment | 34,257 | 53,287 | |||||||||||||
Loss from investment | $ (1,666) | $ (1,853) | (3,789) | (5,350) | |||||||||||
Deferred financing costs | 240,906 | 240,906 | 414,048 | ||||||||||||
Inventory | 937,166 | 937,166 | 772,825 | ||||||||||||
Depreciation expense | $ 119,607 | 153,495 | |||||||||||||
Property and equipment, description | Expenditures associated with upgrades and enhancements that improve, add functionality, or otherwise extend the life of property and equipment that exceed $1,000 are capitalized. | ||||||||||||||
Purchase of deposit equipment | $ 0 | 0 | |||||||||||||
Accounts receivable dicount percentage | 3% | ||||||||||||||
Outstanding advances | 73,848 | ||||||||||||||
Other noncurrent liabilities | $ 215,917 | 215,917 | $ 262,893 | ||||||||||||
Ford Motor Credit [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Outstanding balance, loan | $ 4,753 | $ 0 | |||||||||||||
Sales Returns and Allowances [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Sales allowances | $ 0 | 0 | |||||||||||||
Joint Venture Agreement [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Machine carrying cost | $ 313,012 | ||||||||||||||
Unsecured Finance Agreement [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Face amount | $ 200,000 | ||||||||||||||
Interest rate | 23% | ||||||||||||||
Proceeds received net of fees | $ 195,000 | ||||||||||||||
Repayments of Debt | $ 4,730 | ||||||||||||||
Other Investment [Member] | Minimum [Member] | Equity Method Investee [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Ownership percentage | 20% | 20% | |||||||||||||
Other Investment [Member] | Maximum [Member] | Equity Method Investee [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Ownership percentage | 50% | 50% | |||||||||||||
NuZee Latin America [Member] | Joint Venture Agreement [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Ownership percentage | 50% | ||||||||||||||
General and Administrative Expense [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Payments for rent | $ 140,877 | 147,327 | |||||||||||||
Other rent expense | $ 144,690 | $ 140,559 | |||||||||||||
Industrial Marino, S.A. de C.V. and NuZee Latin America, S.A. de C.V. [Member] | NuZee Latin America [Member] | Joint Venture Agreement [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Ownership percentage | 50% | ||||||||||||||
NLA [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Gain on investments | $ 110,000 | ||||||||||||||
Investment | 160,000 | ||||||||||||||
Loss on contribution on machines | $ 43,012 | ||||||||||||||
Lease Agreement [Member] | Alliance Funding Group [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Sale leaseback value | $ 2,987 | ||||||||||||||
Office Equipment [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Property, plant and equipment, useful life | 3 years | 3 years | |||||||||||||
Furniture [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Property, plant and equipment, useful life | 7 years | 7 years | |||||||||||||
Other Equipment [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Property, plant and equipment, useful life | 5 years | 5 years | |||||||||||||
Vehicles [Member] | Ford Motor Credit [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Supplemental deferred purchase price | $ 41,627 | ||||||||||||||
Payments to acquire machinery and equipment | 3,500 | ||||||||||||||
Face amount | $ 38,127 | ||||||||||||||
Debt instrument, term | 60 months | ||||||||||||||
Interest rate | 2.90% | ||||||||||||||
CALIFORNIA | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Lease expiration date | January 31, 2023 | ||||||||||||||
Payments for rent | $ 8,451 | ||||||||||||||
Sub-leased, option to extend description | we leased an additional 1,796 square feet that has a monthly base rent of $2,514 through March 31, 2025. | ||||||||||||||
CALIFORNIA | Additional Lease Area [Member] | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Area of Land | ft² | 1,796 | ||||||||||||||
Monthly base rent | $ 2,514 | ||||||||||||||
KOREA, REPUBLIC OF | |||||||||||||||
Property, Plant and Equipment [Line Items] | |||||||||||||||
Operating lease, expense | $ 2,111 |
SCHEDULE OF AMORTIZATION EXPENS
SCHEDULE OF AMORTIZATION EXPENSE (Details) | Jun. 30, 2024 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2024 | $ 7,500 |
2025 | 30,000 |
2026 | 30,000 |
2027 | 20,000 |
Grand Total | $ 87,500 |
INTANGIBLE ASSETS (Details Narr
INTANGIBLE ASSETS (Details Narrative) | 9 Months Ended |
Jun. 30, 2024 USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Unamortized tradename asset | $ 87,500 |
Acquisition rate per year | 30,000 |
Amortization of intangible assets | $ 22,500 |
SCHEDULE OF RESTRICTED COMMON S
SCHEDULE OF RESTRICTED COMMON SHARES (Details) - Restricted Stock [Member] - shares | 9 Months Ended | ||
Mar. 17, 2022 | Jun. 30, 2024 | Jun. 30, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of shares outstanding at September, 2023 and 2022 | 50,056 | 3,370 | |
Restricted shares granted | 674 | 80,609 | |
Restricted shares forfeited | (13,561) | (2,458) | |
Restricted shares vested | (17,592) | (3,370) | |
Number of shares outstanding at June 30, 2024 and 2023 | 18,903 | 78,151 |
ISSUANCE OF EQUITY SECURITIES_2
ISSUANCE OF EQUITY SECURITIES (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||
Jun. 12, 2024 | Jun. 04, 2024 | Apr. 27, 2024 | Jan. 19, 2024 | Dec. 05, 2023 | Nov. 09, 2023 | Oct. 18, 2023 | Aug. 11, 2023 | Mar. 22, 2023 | Mar. 15, 2023 | Mar. 17, 2022 | Jun. 30, 2024 | Dec. 31, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Sep. 30, 2023 | |
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Common stock, par value | $ 0.00001 | $ 0.00001 | $ 0.00001 | |||||||||||||||
Shares issued, value | $ 1,819,999 | $ 1,277,118 | ||||||||||||||||
Restricted Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of restricted stock, shares | 674 | 80,609 | ||||||||||||||||
Restricted shares vest | 17,592 | 3,370 | ||||||||||||||||
Share based compensation | $ 83,739 | $ 176,775 | ||||||||||||||||
Forfeited restricted shares | 13,561 | |||||||||||||||||
Performance Based Restricted Shares [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of restricted stock, shares | 58,619 | |||||||||||||||||
Percentage of performance-based restricted shares | 50% | |||||||||||||||||
Randell Weaver [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Share based compensation | $ 3,751 | |||||||||||||||||
Randell Weaver [Member] | Restricted Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of restricted stock, shares | 6,000 | |||||||||||||||||
Randell Weaver [Member] | First Anniversary [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Restricted shares vest | 2,000 | |||||||||||||||||
Randell Weaver [Member] | Second Anniversary [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Restricted shares vest | 2,000 | |||||||||||||||||
Randell Weaver [Member] | Third Anniversary [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Restricted shares vest | 2,000 | |||||||||||||||||
Five Independent Directors [Member] | 2013 Stock Incentive Plan [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of restricted stock, shares | 3,370 | |||||||||||||||||
Independent Director One [Member] | Restricted Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of restricted stock, shares | 4,398 | |||||||||||||||||
Independent Director Two [Member] | Restricted Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of restricted stock, shares | 4,398 | |||||||||||||||||
Independent Director Three [Member] | Restricted Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of restricted stock, shares | 4,398 | |||||||||||||||||
Independent Director Four [Member] | Restricted Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of restricted stock, shares | 4,398 | |||||||||||||||||
Independent Director Five [Member] | Restricted Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of restricted stock, shares | 4,398 | |||||||||||||||||
Common Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Shares issued | 1,089,020 | 488,750 | ||||||||||||||||
Shares issued, value | $ 11 | $ 5 | ||||||||||||||||
Number of common stock for services | 7,500 | 6,000 | 7,500 | |||||||||||||||
Investor [Member] | Common Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Conversion of shares issued | 222,972 | |||||||||||||||||
Private Placement [Member] | Common Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Shares issued | 14,220 | 46,800 | ||||||||||||||||
Exercise price | $ 2.11 | $ 2.77 | ||||||||||||||||
Shares issued, value | $ 30,004 | $ 129,662 | ||||||||||||||||
Private Placement [Member] | Warrant [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Warrants to purchase | 1,279 | 5,200 | ||||||||||||||||
IPO [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Common stock, par value | $ 0.00001 | $ 0.00001 | ||||||||||||||||
IPO [Member] | Common Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of additional shares issued | 425,000 | |||||||||||||||||
Sale of stock price per share | $ 3 | $ 3 | ||||||||||||||||
Securities Purchase Agreement [Member] | Private Placement [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of additional shares issued | 866,048 | |||||||||||||||||
Aggregate purchase price | $ 1,500,000 | |||||||||||||||||
Warrant Purchase Agreement [Member] | Private Placement [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of additional shares issued | 221,147 | |||||||||||||||||
Principal Amount | $ 320,000 | |||||||||||||||||
Underwriting Agreement [Member] | IPO [Member] | Common Stock [Member] | ||||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||||||||||||
Number of additional shares issued | 63,750 | |||||||||||||||||
Net proceeds from offering | $ 178,000 | $ 1,000,000 |
SCHEDULE OF STOCK OPTION ACTIVI
SCHEDULE OF STOCK OPTION ACTIVITY (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Jun. 30, 2024 | Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | ||
Number of Shares Outstanding, Beginning Balance | 96,458 | |
Weighted Average Exercise Price Outstanding, Beginning Balance | $ 150.39 | |
Weighted Average Remaining Contractual Life (years) Stock Options Exercised | 2 years 3 months 7 days | 5 years 10 months 2 days |
Aggregate Intrinsic Value Options Outstanding, Beginning | ||
Number of Options, Expired | (30,107) | |
Weighted Average Exercise Price, Expired | $ 93.07 | |
Weighted Average Remaining Contractual Life (years) Stock Options Exercised | 0 years | |
Number of Shares Outstanding, Ending Balance | 66,351 | 96,458 |
Weighted Average Exercise Price Outstanding, Ending Balance | $ 175.24 | $ 150.39 |
Aggregate Intrinsic Value Options Outstanding, Ending Balance | ||
Number of Shares, Exercisable | 59,089 | |
Weighted Average Exercise Price Outstanding, Ending Balance | $ 193.51 | |
Weighted Average Remaining Contractual Life (years) Stock Options, Exercisable | 1 year 5 months 23 days | |
Aggregate Intrinsic Value Options, Exercisable |
SCHEDULE OF NONVESTED OPTIONS (
SCHEDULE OF NONVESTED OPTIONS (Details) | 9 Months Ended |
Jun. 30, 2024 $ / shares shares | |
Share-Based Payment Arrangement [Abstract] | |
Number of Nonvested Shares, Beginning | shares | 24,029 |
Weighted Average Grant Date Fair Value Nonvested Shares Beginning | $ / shares | $ 80.73 |
Number of Nonvested Shares, Granted | shares | |
Weighted Average Grant Date Fair Value, Granted | $ / shares | |
Number of Nonvested Shares, Forfeited | shares | (16,119) |
Weighted Average Grant Date Fair Value, Forfeited | $ / shares | $ 103.83 |
Number of Nonvested Shares, Vested | shares | (648) |
Weighted Average Grant Date Fair Value, Vested | $ / shares | $ 352.55 |
Number of Nonvested Shares, End | shares | 7,262 |
Weighted Average Grant Date Fair Value Nonvested Shares End | $ / shares | $ 24.27 |
SCHEDULE OF WARRANT ACTIVITY (D
SCHEDULE OF WARRANT ACTIVITY (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Jun. 30, 2024 | Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | ||
Number of Warrants Outstanding, Beginning | 152,398 | |
Weighted Average Exercise Price, Beginning | $ 158.24 | |
Weighted Average Remaining Contractual Life (years), outstanding | 2 years | 2 years 7 months 24 days |
Aggregate Intrinsic Value Warrants Outstanding, Beginning | ||
Number of Warrants, Issued | 6,476 | |
Weighted Average Exercise Price, Issued | $ 2.64 | |
Number of Warrants, Exercised | ||
Weighted Average Exercise Price, Exercised | ||
Number of Warrants, Expired | ||
Weighted Average Exercise Price, Expired | ||
Number of Warrants Outstanding, Ending | 158,874 | 152,398 |
Weighted Average Exercise Price, Ending | $ 151.90 | $ 158.24 |
Aggregate Intrinsic Value Warrants Outstanding, Ending | ||
Number of Warrants Exercisable | 158,874 | |
Weighted Average Exercise Price, Exercisable | $ 151.90 | |
Weighted Average Remaining Contractual Life (years), Exercisable | 2 years | |
Aggregate Intrinsic Value Warrants, Exercisable |
STOCK OPTIONS AND WARRANTS (Det
STOCK OPTIONS AND WARRANTS (Details Narrative) - USD ($) | 9 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Stock option expense | $ 83,739 | $ 367,155 |
Warrant [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Purchase of warrant | 6,476 | |
New Stock Options [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Stock option forfeited or expired during period, shares | 30,107 | |
Stock Options [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Stock option expense | $ 10,823 | $ 190,380 |
Unamortized option expense | $ 20,300 | |
Weighted average period | 1 year 7 months 13 days |
CONTINGENCY (Details Narrative)
CONTINGENCY (Details Narrative) - USD ($) | Jun. 19, 2024 | Jan. 16, 2024 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Settlement amount | $ 500,000 | |
Settlement Agreement [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Settlement amount | $ 500,000 | |
Settlement Agreement [Member] | Within 20 Business Days [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Settlement amount | 100,000 | |
Settlement Agreement [Member] | Within 40 Business Days [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Settlement amount | 200,000 | |
Settlement Agreement [Member] | Within 80 Business Days [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Settlement amount | $ 200,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Jul. 11, 2024 | Jun. 04, 2024 | Jul. 24, 2024 | Jun. 30, 2024 | Mar. 31, 2024 | Jan. 23, 2024 | Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 |
Subsequent Event [Line Items] | ||||||||||||
Stockholders equity | $ (193,613) | $ (574,897) | $ 986,439 | $ 1,674,357 | $ 4,162,695 | $ 5,943,863 | $ 7,935,123 | $ 9,742,799 | ||||
Minimum [Member] | ||||||||||||
Subsequent Event [Line Items] | ||||||||||||
Stockholders equity | $ 2,500,000 | |||||||||||
Convertible Note Purchase Agreement [Member] | Private Placement [Member] | Subsequent Event [Member] | ||||||||||||
Subsequent Event [Line Items] | ||||||||||||
Principal Amount | $ 300,000 | |||||||||||
Unpaid interest | $ 0.52 | |||||||||||
Securities Purchase Agreement [Member] | Private Placement [Member] | ||||||||||||
Subsequent Event [Line Items] | ||||||||||||
Number of shares issued | 866,048 | |||||||||||
Aggregate purchase price | $ 1,500,000 | |||||||||||
Securities Purchase Agreement [Member] | Private Placement [Member] | Subsequent Event [Member] | ||||||||||||
Subsequent Event [Line Items] | ||||||||||||
Number of shares issued | 2,040,814 | |||||||||||
Aggregate purchase price | $ 3,000,000 |