Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Aug. 14, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | CHINA ENERGY TECHNOLOGY CORP., LTD. | |
Entity Central Index Key | 1,554,300 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 190,000,000 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Current assets | ||
Cash and cash equivalents | $ 4,867 | $ 26,870 |
Restricted cash | 564,516 | 1,772,878 |
Accounts receivable, net | 2,562,565 | 686,076 |
Advances to suppliers | 5,583,231 | 3,161,468 |
Due from related parties | 547,935 | 1,619,823 |
Inventory | 399,965 | 291,260 |
Deferred tax assets | 32,407 | 27,045 |
Other current assets | 572,496 | 1,391,767 |
Total current assets | 10,267,982 | 8,977,187 |
Property, plant and equipment, net | 1,384,691 | $ 1,485,248 |
Construction in progress | 2,922,903 | |
Intangible assets, net | 8,419 | $ 9,522 |
Advances to suppliers-non current | 1,470,703 | 1,250,067 |
Due from related parties-non current | 427,889 | 1,416,309 |
Total assets | 16,482,587 | 13,138,333 |
Current liabilities | ||
Short-term loans | 4,516,129 | 3,868,098 |
Notes payable | 483,871 | 2,578,732 |
Accounts payable | 3,290,727 | 529,666 |
Advance from customers | 995,802 | 912,367 |
Taxes payable | 2,095,177 | 1,244,734 |
Other current liabilities | 1,311,691 | 639,950 |
Total current liabilities | 12,693,397 | $ 9,773,547 |
Equity | ||
Common Stock ($0.001 par value; authorized - 200,000,000 shares; issued and outstanding - 190,000,000) | $ 190,000 | |
Paid in capital | $ 1,054,235 | |
Additional Paid in capital | $ 864,235 | |
Retained earnings | 2,317,976 | $ 1,955,238 |
Statutory reserve | 356,831 | 298,963 |
Accumulated other comprehensive income | 60,148 | 56,350 |
Total stockholders' equity | 3,789,190 | 3,364,786 |
Total liabilities and equity | $ 16,482,587 | $ 13,138,333 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares | Jun. 30, 2015 | Dec. 31, 2014 |
Balance Sheets [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 190,000,000 | 190,000,000 |
Common stock, shares outstanding | 190,000,000 | 190,000,000 |
Statements of Operations and Co
Statements of Operations and Comprehensive Income (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Statements of Operations [Abstract] | ||||
REVENUE | $ 4,133,875 | $ 334,630 | $ 4,157,215 | $ 362,649 |
COST OF GOODS SOLD | (3,111,221) | (191,391) | (3,139,800) | (215,928) |
GROSS PROFIT | 1,022,654 | 143,239 | 1,017,415 | 146,721 |
OPERATING EXPENSES | ||||
Selling expenses | (27,837) | (50,982) | (79,717) | (128,975) |
Administrative expenses | (53,328) | (107,439) | (232,545) | (192,135) |
Depreciation and amortization expenses | (8,139) | (12,759) | (18,424) | (25,778) |
Total operating expenses | (88,304) | (171,180) | (330,686) | (346,888) |
INCOME (LOSS) FROM OPERATIONS | 933,350 | (27,941) | 686,729 | (200,167) |
OTHER INCOME/(EXPENSES) | ||||
Interest income | 4,950 | 238 | 14,850 | 431 |
Interest expense | $ (90,397) | $ (28,899) | $ (174,101) | $ (58,439) |
Subsidy income | ||||
Other income/(expenses), net | $ (26,612) | $ (6,775) | $ (26,640) | $ (17,331) |
Total other income, net | (112,059) | (35,436) | (185,891) | (75,339) |
INCOME (LOSS) BEFORE INCOME TAXES | 821,291 | (63,377) | 500,838 | (275,506) |
Provision for income taxes | (125,052) | 7,572 | (80,232) | 32,530 |
NET INCOME (LOSS) | $ 696,239 | $ (55,805) | $ 420,606 | $ (242,976) |
Foreign currency translation gain(loss) | ||||
Comprehensive income/(loss) | $ 696,239 | $ (55,805) | $ 420,606 | $ (242,976) |
Weighted average number of shares outstanding: | ||||
Basic and diluted | 190,000,000 | 190,000,000 | ||
Earnings Per share | $ 0.004 | $ 0.002 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Cash Flows - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Cash Flows from Operating Activities | ||
Net (loss) income | $ 420,606 | $ (242,976) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization expenses | 102,452 | $ 112,515 |
Bad debt expense | (15,534) | |
Deferred tax benefit(expenses) | (5,325) | $ (397,357) |
Changes in operating assets and liabilities | ||
Account Receivable | (1,872,879) | 2,458,442 |
Advance to suppliers | (2,411,941) | (643,699) |
Due from related party | 1,069,773 | 1,063,552 |
Inventory | $ (108,154) | $ (221,532) |
Subsidy receivables | ||
Other current assets | $ 835,996 | $ (2,747,726) |
Other non-current assets | 767,383 | |
Notes payable | (2,090,295) | $ 1,296,963 |
Accounts Payable | 2,752,137 | $ (537,806) |
Advance from customers | $ 82,503 | |
Due to related party | $ (8,236) | |
Tax Payable | $ 846,895 | $ 256,410 |
Deferred tax liabilities | ||
Other current liabilities | $ 669,192 | $ (5,307) |
Net cash provided by (used in) operating activities | $ 1,042,809 | 383,243 |
Cash Flows from Investing Activities | ||
Purchases of property, plant and equipment | $ (56,416) | |
Purchase of Construction in progress | $ (2,913,871) | |
Purchases of intangible assets | ||
Net cash used in investing activities | $ (2,913,871) | $ (56,416) |
Cash Flows from Financing Activities | ||
Restricted cash | $ 1,205,939 | $ (648,482) |
Proceeds from sales of common stock | ||
Paid-in capital | ||
short-term loan | $ 643,168 | $ 162,120 |
Net cash provided/(used) by financing activities | 1,849,107 | (486,362) |
Effect of exchange rate changes on cash and cash equivalents | (48) | (3,411) |
Net increase/(decrease) in cash and cash equivalents | (22,003) | (162,946) |
Cash and cash equivalents, beginning balance | 26,870 | 178,775 |
Cash and cash equivalents, ending balance | $ 4,867 | 15,829 |
Supplemental cash flow information | ||
Cash paid for income taxes | 122,165 | |
Cash paid for interest expense | $ 174,101 | $ 58,439 |
Organization and Business Backg
Organization and Business Background | 6 Months Ended |
Jun. 30, 2015 | |
Organization and Business Background | |
ORGANIZATION AND BUSINESS BACKGROUND | NOTE 1 - ORGANIZATION AND BUSINESS BACKGROUND Organization and Business China Energy Technology Corp., Ltd. (the “Company”) was incorporated as Redfield Ventures Inc in Nevada on January 27, 2012. The Company’s original business plan was to engage in strategic marketing research and consultancy, marketing communications, and business alliance synergy providing clients with key solutions in achieving business objectives. Prior to the Share Exchange (as defined below), the Company’s Board of Directors (“Board”) determined to discontinue operations in this area and to seek a new business opportunity. On March 31, 2015, the Company entered into a Share Exchange Agreement (the “Share Exchange Agreement”) with Fine Progress Group Limited, a British Virgin Islands company (“FPG BVI”), and its shareholders, which closed on the same date. Pursuant to the terms of the Share Exchange Agreement, FPG BVI’s 100 shares of capital stock were exchanged for an aggregate of 180,500,000 shares of the Company’s common stock, $0.001 par value per share (the “Share Exchange”), and FPG BVI became the Company’s wholly-owned subsidiary. FPG BVI controls Anhui Renrenjia Solar Co., Ltd. (“Anhui Solar”), the Company’s operating company based in the People’s Republic of China (the “PRC”), through Ren Re Jia International Limited, FPG BVI’s 100% owned subsidiary organized in the Hong Kong Special Administrative Region (“RRJI (HK)”). RRJI (HK) is the 100% owner of Anhui Zhijia Cornerstone Electronics Technology Co., Ltd. (“Anhui Electronics”), the Company’s subsidiary organized in the PRC. Anhui Electronics controls Anhui Solar through contractual arrangements commonly known as “VIE” or “variable interest entity” arrangements on the mainland in the PRC. Pursuant to the Share Exchange, the Company acquired the business of Anhui Solar, which is the manufacture and sale of solar powered water heater systems in the PRC. As a result, the Company ceased to be a “shell company” (as such term is defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended. The Company has changed its business focus to the business ofAnhui Solar, and will continue the existing business operations of Anhui Solar as a publicly-traded company under the name China Energy Technology Corp., Ltd. The Share Exchange has been treated as a recapitalization of the Company for financial accounting purposes. FPG BVI is considered the acquirer for accounting purposes, and the historical financial statements of China Energy Technology Corp., Ltd. (formerly known as Redfield Ventures Inc.) before the Share Exchange will be replaced with the historical financial statements of FPG BVI and its consolidated entities before the Share Exchange in all future filings with the Securities and Exchange Commission. Basis of Presentation The accompanying condensed consolidated financial statements include the activities of China Energy Technology Corp., Ltd. and its wholly owned subsidiary, FPG BVI, and its consolidated subsidiaries. All intercompany transactions have been eliminated in these consolidated financial statements. The financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete consolidated financial statements. In the opinion of the Company's management, the financial statements include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company's financial position for the periods presented. Certain information in footnote disclosures normally included in the financial statements were prepared in conformity with accounting principles generally accepted in the United States of America and have been condensed or omitted pursuant to such principles and the financial results for the periods presented may not be indicative of the full year’s results. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s audited financial statements in Amendment No. 3 to the Current Report on Form 8-K the Company filed with the Securities and Exchange Commission on August 6, 2015. |
Significant Accounting Policies
Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2015 | |
Significant Accounting Policies | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to U.S. GAAP and have been consistently applied in the preparation of the financial statements. Fair Value of Financial Instruments The Company applies the provisions of accounting guidance, FASB ASC Topic 820 that requires the Company to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. Fair Value Measurements FASB ASC Topic 820, Fair Value Measurements and Disclosures Various inputs are considered when determining the fair value of the Company’s debt. These inputs are summarized in the three broad levels listed below. Level 1 – observable market inputs that are unadjusted quoted prices for identical assets or liabilities in active markets. Level 2 – other significant observable inputs (including quoted prices for interest rates, credit risk, etc.). Level 3 – significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments). The carrying value of financial assets and liabilities recorded at fair value is measured on a recurring or nonrecurring basis. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. The Company had no financial assets or liabilities carried and measured on a nonrecurring basis during the reporting periods. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. The Company had no financial assets or liabilities carried and measured on a recurring basis during the reporting periods. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment. Translation of Foreign Currencies The Company’s principal country of operations is the PRC. The Company maintains their books and accounting records in PRC currency “Renminbi” (“RMB”), which has been determined as the functional currency. Transactions denominated in currencies other than RMB are translated into RMB at the exchange rates prevailing on the date of the transactions, as quoted by the Federal Reserve Board. Foreign currency exchange gains and losses resulting from these transactions are included in operations. The Company’s financial statements are translated into the reporting currency, the United States Dollar (“USD”). Assets and liabilities of the entity are translated at the prevailing exchange rate at each reporting period end date. Contributed capital accounts are translated using the historical rate of exchange when capital is injected. Income and expense accounts are translated at the average rate of exchange during the reporting period. Translation adjustments resulting from the translation of these financial statements are reflected as accumulated other comprehensive income in shareholders’ equity. Statement of Cash Flows In accordance with Statement FASB ASC Topic 230, Statement of Cash Flows, cash flow from the Company's operations is calculated based upon the local currencies and translated to the reporting currency using an average foreign exchange rate for the reporting period. As a result, amounts related to assets and liabilities reported in the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet. Use of Estimates and Assumptions The preparation of financial statements in conformity with US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as our operating environment changes. Significant estimates and assumptions by management include: useful lives of long-lived assets and intangible assets, valuation of inventory, accounts receivable, notes receivable and deferred taxes. While the Company believes that the estimates and assumptions used in the preparation of the financial statements are appropriate, actual results could differ from those estimates. Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the financial statements in the period they are determined to be necessary. Cash and Cash Equivalents Cash and cash equivalents represent cash on hand and interest-bearing deposits held at call with banks. The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. Restricted cash Restricted cash represents deposits held at banks with restrictions imposed since the Company uses the restricted cash to pledge with banks for the purpose of issuing bank acceptances. The restricted cash could not be readily useable until the pledge is retired. Accounts Receivable Accounts receivable are recorded at the sales amount and do not bear interest. The Company extends unsecured credit to its customers in the ordinary course of business and the credit policy is decided by its senior management. An allowance for doubtful accounts is established and determined based on management’s assessment of known requirements, aging of receivables, payment and bad debt history, the customer’s current credit worthiness, changes in customer payment patterns and the economic environment. Advance to Suppliers The Company periodically makes advances to vendors for purchases of raw materials and fixed assets, and records these purchases as advance to suppliers. Inventory Inventory consists of raw materials, finished goods of manufactured products and low-value suppliers. Inventory is stated at lower of cost or market and consists of materials, labor and overhead. The Company uses the weighted average method for inventory valuation. Overhead costs included in finished goods include direct labor cost and other costs directly applicable to the manufacturing process. The Company evaluates inventory for excess, slow moving, and obsolete inventory as well as inventory the volume of which is in excess of its net realizable value. This evaluation includes analysis of sales levels by product and projections of future demand. If future demand or market conditions are less favorable than the Company’s projections, a write-down of inventory may be required, and would be reflected in cost of goods sold in the period the revision is made. There was no inventory allowance provided for the years ended December 31, 2014 and 2013, respectively. Property, Plant and Equipment Property, plant and equipment are carried at the lower of cost or fair value. Maintenance, repairs and minor renewals are expensed as incurred; major renewals and improvements that extend the lives or increase the capacity of plant assets are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in the results of operations in the reporting period of disposition. Depreciation is calculated on a straight-line basis over the estimated useful life of the assets. The depreciable lives applied are: Buildings 20 years Machinery Equipment 10 years Motor Vehicles 5 years Electronic Equipment 5 years Leasehold Improvement Less of the lease term or 5 years Revenue Recognition The Company recognizes revenue when it is both earned and realized or realizable. The Company’s policy is to recognize revenue when title to the product, ownership and risk of loss have transferred to the customer, persuasive evidence of an arrangement exits and collection of the sales proceeds is reasonably assured, all of which generally occur upon products have been provided or installing service has been provided. The majority of the Company’s revenue relates to the sale of inventory to customers and engineering project installing, and revenue is recognized when title and the risks and rewards of ownership pass to the customer, as well as engineering projects finished completion acceptance. Cost of Goods Sold Cost of goods sold consists primarily of the costs of raw materials, direct labor, depreciation of plants and machinery, and overhead costs associated with the manufacturing process and installing service provided to customers. Income Taxes The Company adopts FASB ASC Topic 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. In July 2006 the FASB issued FIN 48(ASC 740-10), “Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109 (ASC 740)”, which requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under FIN 48(ASC 740-10), tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met. As a result of the implementation of FIN 48 (ASC 740-10), the Company undertook a comprehensive review of its portfolio of tax positions in accordance with recognition standards established by FIN 48 (ASC 740-10). The Company recognized no material adjustments to liabilities or stockholders’ equity as a result of the implementation. The adoption of FIN 48 did not have a material impact on the Company’s financial statements. The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability may be materially different from our estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities or deferred tax asset valuation allowance. Enterprise Income Tax Under the Provisional Regulations of PRC Concerning Income Tax on Enterprises promulgated by the PRC (the “EIT Law”), the Company was recognized as a government-certified high technology company on July 2, 2014, and income tax is payable by enterprise at a rate of 15% of its taxable income. This qualification certificate will be effective and the applicable income tax rate maintains 15% until the certificate expires on July 2, 2017. Value Added Tax The Provisional Regulations of PRC Concerning Value Added Tax promulgated by the State Council came into effect on January 1, 1994. Under these regulations and the Implementing Rules of the Provisional Regulations of the PRC Concerning Value Added Tax, value added tax is imposed on goods sold in, or imported into, the PRC and on processing, repair and replacement services provided within the PRC. Value added tax payable in the PRC is charged on an aggregated basis at a rate of 17% (depending on the type of goods involved) on the full price collected for the goods sold or, in the case of taxable services provided, at a rate of 17% on the charges for the taxable services provided, but excluding, in respect of both goods and services, any amount paid in respect of value added tax included in the price or charges, and less any deductible value added tax already paid by the taxpayer on purchases of goods and services in the same financial year. Sales Taxes and Sales-Related Taxes Pursuant to the tax law and regulations of the PRC, the Company is obligated to pay 7% and 5% of the annual VAT paid as taxes on maintaining and building cities and education additional fees, both of which belong to sales-related taxes. Sales-related taxes are recorded when sales revenue is recognized. Government Grants Government grants are recognized as income over the periods necessary to match them with the related costs. If the grants do not relate to any specific expenditure incurred by the Company, they are reported separately as other income. Government grants are recognized until there is reasonable assurance that both the Company will comply with the conditions attaching to the grant and the grant will be received. Government grants to the Company are primarily for its Huimin solar water heater expanding project for the year ending December 31, 2013. Concentrations of Business and Credit Risks All of the Company’s manufacturing is located in the PRC. There can be no assurance that the Company will be able to successfully continue to manufacture its products and failure to do so would have a material adverse effect on the Company’s financial position, results of operations and cash flows. Also, the success of the Company’s operations is subject to numerous contingencies, some of which are beyond management’s control. These contingencies include general economic conditions, prices of raw materials, competition, governmental and political conditions, and changes in regulations. Since the Company is dependent on trade in the PRC, the Company is subject to various additional political, economic and other uncertainties. Among other risks, the Company’s operations will be subject to the risks of restrictions on transfer of funds, domestic customs, changing taxation policies, foreign exchange restrictions, and political and governmental regulations. The Company operates in the PRC, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility of foreign exchange rates between USD and RMB. The results of operations denominated in foreign currency are translated at the average rate of exchange during the reporting periods. Recent Accounting Pronouncements In August 2014, the FASB has issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014-15 is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. The amendments are effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early application is permitted for annual or interim reporting periods for which the financial statements have not previously been issued statements. The Company does not expect the adoption to have a significant impact on its consolidated financial statements. |
Restricted Cash
Restricted Cash | 6 Months Ended |
Jun. 30, 2015 | |
Restricted Cash [Abstract] | |
RESTRICTED CASH | NOTE 3 - RESTRICTED CASH Restricted cash consists of following: June 30, December 31, (Unaudited) Pledged for bank drafts $ 564,516 $ 1,772,878 Total $ 564,516 $ 1,772,878 Restricted cash is pledged with banks for the purpose issuing bank drafts. Banks require the Company to deposit a pledged amount of cash as a percentage of the bank draft amount the Company applied into the bank. The percentage required is 50% to 100% for each bank draft. The Company is not able to withdraw or use the pledged cash deposit until the bank draft expires. The Company applied for the bank drafts in the Bengbu branch of Shanghai Pudong Bank. The guarantee deposits were recorded under the accounting subject of other monetary funds. |
Accounts Receivable
Accounts Receivable | 6 Months Ended |
Jun. 30, 2015 | |
Accounts Receivable [Abstract] | |
ACCOUNTS RECEIVABLE | NOTE 4 - ACCOUNTS RECEIVABLE Accounts receivable consisted of the following at June 30, 2015 and December 31, 2014: June 30, December 31, (Unaudited) Accounts receivable $ 2,607,880 $ 728,656 Less: allowance for doubtful accounts (45,315 ) (42,580 ) Total $ 2,562,565 $ 686,076 The Company’s accounts receivable amounted to $2,607,880and $728,656, respectively, net of allowance for doubtful accounts amounting to $45,315 and $42,580 as of June 30, 2015 and December 31, 2014, respectively. The credit term given to customers is within 1 year, 99.52% and 97.43% of the balance were within 1 year as of June 30, 2015 and December 31, 2014 respectively. There was no change of payment term and collectability from prior year. The Company's accounting method of estimating uncollectible accounts receivable, is adopted by both specific identification and the method of aging accounts. For obvious sign of uncollectible accounts of certain customers, specific identification is used to accrue allowance for doubtful accounts, while different percentage to accrue allowance is distributed to other customers with different aging. |
Advances to Suppliers
Advances to Suppliers | 6 Months Ended |
Jun. 30, 2015 | |
Advances to Suppliers [Abstract] | |
ADVANCES TO SUPPLIERS | NOTE 5 - ADVANCES TO SUPPLIERS The Company is required to pay deposits to the suppliers for the full amount of certain raw materials and equipments ordered. The amount was $5,583,231 and $3,161,468 as of June 30, 2015 and December 31, 2014, respectively. |
Due from Related Parties
Due from Related Parties | 6 Months Ended |
Jun. 30, 2015 | |
Related Party Transactions [Abstract] | |
DUE FROM RELATED PARTIES | NOTE 6 - DUE FROM RELATED PARTIES Due from related parties consists of the following: June 30, December 31, (Unaudited) Li Qimei 391,131 1,022,025 Bengbu Boyuan Real Estate Co.,ltd 156,804 597,798 Total $ 547,935 $ 1,619,823 Due from related parties includes receivable from the owner and the related parties. Li Qimei is the 40% owner of the Company. Li Qimei received payments from customers on behalf of the Company, and such funds have not yet been remitted to the Company. Li Qimei has a signed funds agreement with the Company agreeing to fully repay the funds by December 31, 2016. Bengbu Boyuanzhiye Co., Ltd., or BBC Ltd., is a real estate company owned by Li Qimei. Since 2012, BBC Ltd. has leased to the Company a 1,139 square meters (12,260 square feet) office building in Guzhen County, Bengbu City. The Company built an approximately 3,000 square meter (32,000 square foot) four story addition to this office building at a cost of approximately RMB 4,000,000 (US $604,285). BBC Ltd. agreed to be responsible for the cost of this construction and, as a result, has signed a loan agreement agreeing to repay the $604,285 construction cost amount to the Company by January 1, 2016. |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2015 | |
Inventory [Abstract] | |
INVENTORY | NOTE 7 - INVENTORY Inventory consists of the following: June 30, December 31, 2014 (Unaudited) Raw Materials $ 211,656 $ 65,497 Finished Goods 124,967 225,360 Goods in transit 62,939 - Supplies 403 403 Total $ 399,965 $ 291,260 For the six months ended Jun 30, 2015 and the year ended December 31,2014, the Company has not made provision for inventory in regards to slow moving or obsolete items. |
Other Current Assets
Other Current Assets | 6 Months Ended |
Jun. 30, 2015 | |
Other Current Assets [Abstract] | |
Other Current Assets | NOTE 8 - OTHER CURRENT ASSETS Other current asset consists of the following: March 31, 2015 December 31, 2014 (Unaudited) Other receivables $ 565,620 $ 1,387,230 Prepaid expenses 6,876 4,537 Total $ 572,496 $ 1,391,767 Other receivables mainly include cash advance of employee, deposit and inter-company borrowing. Cash advance is necessary for salesman to expand business and establish business relationship. Inter-company borrowing includes borrowings without interest and prepaid charges paid by the Company. |
Construction in Progress
Construction in Progress | 6 Months Ended |
Jun. 30, 2015 | |
Construction In Progress Disclosure [Abstract] | |
CONSTRUCTION IN PROGRESS | NOTE 9 - CONSTRUCTION IN PROGRESS The company has purchased an office building near Bengbu World Trade Center in April 2015. The gross area of the building totals 1,902.41 square meters (20,473 square feet), the company bought the office building with an amount of $2,922,903. |
Property, Plant and Equipment
Property, Plant and Equipment | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | NOTE 10 - PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment of the Company consist of the following: June 30, December 31, (Unaudited) Machinery equipment $ 1,769,088 $ 1,767,777 Motor Vehicles 266,974 266,776 Electronic equipment 42,589 42,557 Furniture and office equipment 30,713 30,690 Leasehold Improvement 3,771 3,768 Less Accumulated Depreciation (728,444 ) (626,320 ) Total $ 1,384,691 $ 1,485,248 Depreciation expense is $101,659 and $243,988 for the six months ended June 30, 2015 and year ended December 31, 2014, respectively. |
Advances to Suppliers-Non-Curre
Advances to Suppliers-Non-Current | 6 Months Ended |
Jun. 30, 2015 | |
Advances to Suppliers-Non-Current [Abstract] | |
ADVANCES TO SUPPLIERS-NON-CURRENT | NOTE 11 - ADVANCES TO SUPPLIERS-NON-CURRENT Advances to suppliers- non-current of the company consist of $1,470,703 of advances to suppliers for equipment and properties. |
Due From Related Parties-Non-Cu
Due From Related Parties-Non-Current | 6 Months Ended |
Jun. 30, 2015 | |
Due From Related Parties-Non-Current [Abstract] | |
DUE FROM RELATED PARTIES-NON-CURRENT | NOTE 12 - DUE FROM RELATED PARTIES-NON-CURRENT Due from related parties- non-current of the company consist of $427,889 from due from related party Bengbu Boyuanzhiye Co., Ltd that would not be received in one year. Ms. Li had paid off all payment ahead of Roll-forward schedule ended June 30, 2015. |
Short-Term Loan
Short-Term Loan | 6 Months Ended |
Jun. 30, 2015 | |
Short Term Loan/ Notes Payable [Abstract] | |
SHORT-TERM LOAN | NOTE 13 - SHORT-TERM LOAN Short-term loans of the Company consist of the following: June 30, December 31, Huishang Bank Bengbu Branch $ 806,452 $ 805,854 Bank of Communications Bengbu Branch 806,452 805,854 The Xuehua branch of Bengbu Rural Commercial Bank 1,612,903 967,024 The Bengbu branch of Shanghai Pudong Bank 1,290,322 1,289,366 Total $ 4,516,129 $ 3,868,098 In January 2015, the Company renewed the loan agreement with the Xuehua branch of Bengbu Rural Commercial Bank for a one-year loan due January 9, 2016, in amount of RMB 5,000,000 (approximately $806,452). The interest on the loan is a fixed interest floating 60% on base annual interest of value date. In connection with the loan agreement, the Company entered into a cooperation agreement with individuals (Na Wei, Bin Wei). The loan was guaranteed by these individuals. In May 2015, the Company renewed the loan agreement with the Huishang Bank Bengbu Branch for a one-year loan due May 14, 2016, in amount of RMB 5,000,000 (approximately $806,452). The interest on the loan is a fixed interest floating 36.39% on base annual interest of value date. In connection with the loan agreement, the Company entered into a cooperation agreement with Bengbu High-tech SMEs Credit Guarantee Co. LTD. The loan was guaranteed by the guarantee company. |
Notes Payable
Notes Payable | 6 Months Ended |
Jun. 30, 2015 | |
Short Term Loan/ Notes Payable [Abstract] | |
NOTES PAYABLE | NOTE 14 - NOTES PAYABLE Notes payable of the Company consists of the following: Origination Maturity Jun 30, Dec 31, Beneficiary Endorser date date 2015 2014 (Unaudited) Anhui Jiangnan Trade Co. Ltd Bank of communications 2014/7/18 2015/1/17 $ 483,512 Anhui FeiteFule&Equipment Manufacture Co. Ltd Bengbu BRC bank 2014/7/8 2015/1/8 1,289,366 Bengbu Hongyang Trade Co. Ltd Bengbu BRC bank 2014/12/17 2015/6/17 805,854 Hefei Yushi Trade Co. Ltd Pudong Development Bank 2015/6/30 2015/12/30 $ 483,871 Total $ 483,871 $ 2,578,732 Notes payable represents all bank acceptances. The Company had notes payables of $483,871 as of June 30, 2015, represented the outstanding and used notes are guaranteed to be paid by bank and matured within a short-term period of six months. The company is required to maintain cash deposits at 100% of the balance of note payables in bank account. And the outstanding amount consisted of $483,871 will mature on December 30, 2015. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2015 | |
Income Taxes [Abstract] | |
INCOME TAXES | NOTE 15 - INCOME TAXES Under the EIT Law, the standard EIT rate is 25%. The PRC subsidiaries of the Company are subject to PRC income taxes on an entity basis on income arising in or derived from the tax jurisdiction in which they operate. Provision for income taxes consists of: For the six months ended For the three months ended 2015 2014 2015 2014 Current provision: 85,557 364,827 (262,461 ) $ (15,502 ) Deferred provision: (5,325 ) (397,357 ) 387,513 7,930 Total provision for income taxes $ 80,232 $ (32,530 ) $ 125,052 $ (7,572 ) The Company was recognized as a government-certified high technology company on June 23, 2011 and was subject to an income tax rate of 15% for calendar year 2012 and 2013. This qualification certificate will be effective and the applicable income tax rate is 15% until the certificate expires on July 2, 2017. Significant components of deferred tax assets are as follows: Jun 30, December 31, (Unaudited) Deferred tax assets Allowance for doubtful accounts $ 16,374 $ 18,697 Accrued payroll expenses 16,034 8,348 Deferred tax assets, net $ 32,407 $ 27,045 The Company has deferred tax assets of $32,407 and $27,045 as of the six months ended Jun 30, 2015 and the year ended December 31, 2014. The allowance for doubtful accounts, led to a deferred tax assets of $16,374 and $18,697 as of the six months ended Jun 30, 2015 and the year ended December 31, 2014. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 16 - COMMITMENTS AND CONTINGENCIES There were no significant commitments or contracts entered into by the Company during the six months ended Jun 30, 2015 and the year ended December 31, 2014. |
Major Suppliers and Customers
Major Suppliers and Customers | 6 Months Ended |
Jun. 30, 2015 | |
Major Suppliers and Customers [Abstract] | |
MAJOR SUPPLIERS AND CUSTOMERS | NOTE 17 - MAJOR SUPPLIERS AND CUSTOMERS The Company had three customers that in the aggregate accounted for 24% of the Company’s total sales for the 6 months ended June 30, 2015, with each accounting for 9%, 8% and 7%, respectively. The Company had one supplier that in the aggregate accounted for 14% of the Company’s total purchases payable for the 6 months ended June 30, 2015. The Company had three major suppliers which received 59% of the advances for 6 months ended June 30, 2015. None of the suppliers was a related party. |
Significant Accounting Polici23
Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
Significant Accounting Policies | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company applies the provisions of accounting guidance, FASB ASC Topic 820 that requires the Company to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. |
Fair Value Measurements | Fair Value Measurements FASB ASC Topic 820, Fair Value Measurements and Disclosures Various inputs are considered when determining the fair value of the Company’s debt. These inputs are summarized in the three broad levels listed below. Level 1 – observable market inputs that are unadjusted quoted prices for identical assets or liabilities in active markets. Level 2 – other significant observable inputs (including quoted prices for interest rates, credit risk, etc.). Level 3 – significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments). The carrying value of financial assets and liabilities recorded at fair value is measured on a recurring or nonrecurring basis. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. The Company had no financial assets or liabilities carried and measured on a nonrecurring basis during the reporting periods. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. The Company had no financial assets or liabilities carried and measured on a recurring basis during the reporting periods. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment. |
Translation of Foreign Currencies | Translation of Foreign Currencies The Company’s principal country of operations is the PRC. The Company maintains their books and accounting records in PRC currency “Renminbi” (“RMB”), which has been determined as the functional currency. Transactions denominated in currencies other than RMB are translated into RMB at the exchange rates prevailing on the date of the transactions, as quoted by the Federal Reserve Board. Foreign currency exchange gains and losses resulting from these transactions are included in operations. The Company’s financial statements are translated into the reporting currency, the United States Dollar (“USD”). Assets and liabilities of the entity are translated at the prevailing exchange rate at each reporting period end date. Contributed capital accounts are translated using the historical rate of exchange when capital is injected. Income and expense accounts are translated at the average rate of exchange during the reporting period. Translation adjustments resulting from the translation of these financial statements are reflected as accumulated other comprehensive income in shareholders’ equity. |
Statement of Cash Flows | Statement of Cash Flows In accordance with Statement FASB ASC Topic 230, Statement of Cash Flows, cash flow from the Company's operations is calculated based upon the local currencies and translated to the reporting currency using an average foreign exchange rate for the reporting period. As a result, amounts related to assets and liabilities reported in the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions The preparation of financial statements in conformity with US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as our operating environment changes. Significant estimates and assumptions by management include: useful lives of long-lived assets and intangible assets, valuation of inventory, accounts receivable, notes receivable and deferred taxes. While the Company believes that the estimates and assumptions used in the preparation of the financial statements are appropriate, actual results could differ from those estimates. Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the financial statements in the period they are determined to be necessary. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents represent cash on hand and interest-bearing deposits held at call with banks. The Company considers all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents. |
Restricted cash | Restricted cash Restricted cash represents deposits held at banks with restrictions imposed since the Company uses the restricted cash to pledge with banks for the purpose of issuing bank acceptances. The restricted cash could not be readily useable until the pledge is retired. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded at the sales amount and do not bear interest. The Company extends unsecured credit to its customers in the ordinary course of business and the credit policy is decided by its senior management. An allowance for doubtful accounts is established and determined based on management’s assessment of known requirements, aging of receivables, payment and bad debt history, the customer’s current credit worthiness, changes in customer payment patterns and the economic environment. |
Advance to Suppliers | Advance to Suppliers The Company periodically makes advances to vendors for purchases of raw materials and fixed assets, and records these purchases as advance to suppliers. |
Inventory | Inventory Inventory consists of raw materials, finished goods of manufactured products and low-value suppliers. Inventory is stated at lower of cost or market and consists of materials, labor and overhead. The Company uses the weighted average method for inventory valuation. Overhead costs included in finished goods include direct labor cost and other costs directly applicable to the manufacturing process. The Company evaluates inventory for excess, slow moving, and obsolete inventory as well as inventory the volume of which is in excess of its net realizable value. This evaluation includes analysis of sales levels by product and projections of future demand. If future demand or market conditions are less favorable than the Company’s projections, a write-down of inventory may be required, and would be reflected in cost of goods sold in the period the revision is made. There was no inventory allowance provided for the years ended December 31, 2014 and 2013, respectively. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are carried at the lower of cost or fair value. Maintenance, repairs and minor renewals are expensed as incurred; major renewals and improvements that extend the lives or increase the capacity of plant assets are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in the results of operations in the reporting period of disposition. Depreciation is calculated on a straight-line basis over the estimated useful life of the assets. The depreciable lives applied are: Buildings 20 years Machinery Equipment 10 years Motor Vehicles 5 years Electronic Equipment 5 years Leasehold Improvement Less of the lease term or 5 years |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when it is both earned and realized or realizable. The Company’s policy is to recognize revenue when title to the product, ownership and risk of loss have transferred to the customer, persuasive evidence of an arrangement exits and collection of the sales proceeds is reasonably assured, all of which generally occur upon products have been provided or installing service has been provided. The majority of the Company’s revenue relates to the sale of inventory to customers and engineering project installing, and revenue is recognized when title and the risks and rewards of ownership pass to the customer, as well as engineering projects finished completion acceptance. |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold consists primarily of the costs of raw materials, direct labor, depreciation of plants and machinery, and overhead costs associated with the manufacturing process and installing service provided to customers. |
Income Taxes | Income Taxes The Company adopts FASB ASC Topic 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. In July 2006 the FASB issued FIN 48(ASC 740-10), “Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109 (ASC 740)”, which requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under FIN 48(ASC 740-10), tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met. As a result of the implementation of FIN 48 (ASC 740-10), the Company undertook a comprehensive review of its portfolio of tax positions in accordance with recognition standards established by FIN 48 (ASC 740-10). The Company recognized no material adjustments to liabilities or stockholders’ equity as a result of the implementation. The adoption of FIN 48 did not have a material impact on the Company’s financial statements. The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability may be materially different from our estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities or deferred tax asset valuation allowance. |
Enterprise Income Tax | Enterprise Income Tax Under the Provisional Regulations of PRC Concerning Income Tax on Enterprises promulgated by the PRC (the “EIT Law”), the Company was recognized as a government-certified high technology company on July 2, 2014, and income tax is payable by enterprise at a rate of 15% of its taxable income. This qualification certificate will be effective and the applicable income tax rate maintains 15% until the certificate expires on July 2, 2017. |
Value Added Tax | Value Added Tax The Provisional Regulations of PRC Concerning Value Added Tax promulgated by the State Council came into effect on January 1, 1994. Under these regulations and the Implementing Rules of the Provisional Regulations of the PRC Concerning Value Added Tax, value added tax is imposed on goods sold in, or imported into, the PRC and on processing, repair and replacement services provided within the PRC. Value added tax payable in the PRC is charged on an aggregated basis at a rate of 17% (depending on the type of goods involved) on the full price collected for the goods sold or, in the case of taxable services provided, at a rate of 17% on the charges for the taxable services provided, but excluding, in respect of both goods and services, any amount paid in respect of value added tax included in the price or charges, and less any deductible value added tax already paid by the taxpayer on purchases of goods and services in the same financial year. |
Sales Taxes and Sales-Related Taxes | Sales Taxes and Sales-Related Taxes Pursuant to the tax law and regulations of the PRC, the Company is obligated to pay 7% and 5% of the annual VAT paid as taxes on maintaining and building cities and education additional fees, both of which belong to sales-related taxes. Sales-related taxes are recorded when sales revenue is recognized. |
Government Grants | Government Grants Government grants are recognized as income over the periods necessary to match them with the related costs. If the grants do not relate to any specific expenditure incurred by the Company, they are reported separately as other income. Government grants are recognized until there is reasonable assurance that both the Company will comply with the conditions attaching to the grant and the grant will be received. Government grants to the Company are primarily for its Huimin solar water heater expanding project for the year ending December 31, 2013. |
Concentrations of Business and Credit Risks | Concentrations of Business and Credit Risks All of the Company’s manufacturing is located in the PRC. There can be no assurance that the Company will be able to successfully continue to manufacture its products and failure to do so would have a material adverse effect on the Company’s financial position, results of operations and cash flows. Also, the success of the Company’s operations is subject to numerous contingencies, some of which are beyond management’s control. These contingencies include general economic conditions, prices of raw materials, competition, governmental and political conditions, and changes in regulations. Since the Company is dependent on trade in the PRC, the Company is subject to various additional political, economic and other uncertainties. Among other risks, the Company’s operations will be subject to the risks of restrictions on transfer of funds, domestic customs, changing taxation policies, foreign exchange restrictions, and political and governmental regulations. The Company operates in the PRC, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility of foreign exchange rates between USD and RMB. The results of operations denominated in foreign currency are translated at the average rate of exchange during the reporting periods. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2014, the FASB has issued ASU No. 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. ASU 2014-15 is intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. The amendments are effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. Early application is permitted for annual or interim reporting periods for which the financial statements have not previously been issued statements. The Company does not expect the adoption to have a significant impact on its consolidated financial statements. |
Significant Accounting Polici24
Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Significant Accounting Policies | |
Schedule of estimated useful life of assets | Buildings 20 years Machinery Equipment 10 years Motor Vehicles 5 years Electronic Equipment 5 years Leasehold Improvement Less of the lease term or 5 years |
Restricted Cash (Tables)
Restricted Cash (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Restricted Cash [Abstract] | |
Schedule of restricted cash | June 30, December 31, (Unaudited) Pledged for bank drafts $ 564,516 $ 1,772,878 Total $ 564,516 $ 1,772,878 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Accounts Receivable [Abstract] | |
Schedule of accounts receivable | June 30, December 31, (Unaudited) Accounts receivable $ 2,607,880 $ 728,656 Less: allowance for doubtful accounts (45,315 ) (42,580 ) Total $ 2,562,565 $ 686,076 |
Due from Related Parties (Table
Due from Related Parties (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Related Party Transactions [Abstract] | |
Schedule of due from related parties | June 30, December 31, (Unaudited) Li Qimei 391,131 1,022,025 Bengbu Boyuan Real Estate Co.,ltd 156,804 597,798 Total $ 547,935 $ 1,619,823 |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Inventory [Abstract] | |
Schedule of inventory | June 30, December 31, 2014 (Unaudited) Raw Materials $ 211,656 $ 65,497 Finished Goods 124,967 225,360 Goods in transit 62,939 - Supplies 403 403 Total $ 399,965 $ 291,260 |
Other Current Assets (Tables)
Other Current Assets (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Other Current Assets [Abstract] | |
Schedule of other current assets | March 31, 2015 December 31, 2014 (Unaudited) Other receivables $ 565,620 $ 1,387,230 Prepaid expenses 6,876 4,537 Total $ 572,496 $ 1,391,767 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, Plant and equipment | June 30, December 31, (Unaudited) Machinery equipment $ 1,769,088 $ 1,767,777 Motor Vehicles 266,974 266,776 Electronic equipment 42,589 42,557 Furniture and office equipment 30,713 30,690 Leasehold Improvement 3,771 3,768 Less Accumulated Depreciation (728,444 ) (626,320 ) Total $ 1,384,691 $ 1,485,248 |
Short-Term Loan (Tables)
Short-Term Loan (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Short Term Loan/ Notes Payable [Abstract] | |
Schedule of Short-term debt | June 30, December 31, Huishang Bank Bengbu Branch $ 806,452 $ 805,854 Bank of Communications Bengbu Branch 806,452 805,854 The Xuehua branch of Bengbu Rural Commercial Bank 1,612,903 967,024 The Bengbu branch of Shanghai Pudong Bank 1,290,322 1,289,366 Total $ 4,516,129 $ 3,868,098 |
Notes Payable (Tables)
Notes Payable (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Short Term Loan/ Notes Payable [Abstract] | |
Schedule of note payable | Origination Maturity Jun 30, Dec 31, Beneficiary Endorser date date 2015 2014 (Unaudited) Anhui Jiangnan Trade Co. Ltd Bank of communications 2014/7/18 2015/1/17 $ 483,512 Anhui FeiteFule&Equipment Manufacture Co. Ltd Bengbu BRC bank 2014/7/8 2015/1/8 1,289,366 Bengbu Hongyang Trade Co. Ltd Bengbu BRC bank 2014/12/17 2015/6/17 805,854 Hefei Yushi Trade Co. Ltd Pudong Development Bank 2015/6/30 2015/12/30 $ 483,871 Total $ 483,871 $ 2,578,732 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Income Taxes [Abstract] | |
Components for provision for income taxes | For the six months ended For the three months ended 2015 2014 2015 2014 Current provision: 85,557 364,827 (262,461 ) $ (15,502 ) Deferred provision: (5,325 ) (397,357 ) 387,513 7,930 Total provision for income taxes $ 80,232 $ (32,530 ) $ 125,052 $ (7,572 ) |
Schedule of components of deferred tax assets | Jun 30, December 31, (Unaudited) Deferred tax assets Allowance for doubtful accounts $ 16,374 $ 18,697 Accrued payroll expenses 16,034 8,348 Deferred tax assets, net $ 32,407 $ 27,045 |
Organization and Business Bac34
Organization and Business Background (Details) - $ / shares | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | |
Organization and Business Background (Textual) | |||
Entity Incorporation, Date of Incorporation | Jan. 27, 2012 | ||
Number of shares exchanged | 100 | ||
Capital stock exchanged for Company's common stock | 180,500,000 | ||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 |
Ownership percentage | 100.00% |
Significant Accounting Polici35
Significant Accounting Policies (Details) | 6 Months Ended |
Jun. 30, 2015 | |
Building [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of the assets | 20 years |
Machinery Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of the assets | 10 years |
Motor Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of the assets | 5 years |
Electronic Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of the assets | 5 years |
Leasehold Improvement [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of the assets | Less of the lease term or 5 years |
Significant Accounting Polici36
Significant Accounting Policies (Details Textual) | Jul. 02, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Significant Accounting Policies (Textual) | |||||
Value added tax payable | 17.00% | ||||
Value added taxable services provided | 15.00% | 25.00% | 15.00% | 15.00% | |
Sales Tax | 7.00% | 5.00% | |||
Service Tax [Member] | |||||
Significant Accounting Policies (Textual) | |||||
Value added taxable services provided | 17.00% | ||||
EIT Law [Member] | |||||
Significant Accounting Policies (Textual) | |||||
Value added taxable services provided | 15.00% | ||||
Income tax, Expiration date | Jul. 2, 2017 |
Restricted Cash (Details)
Restricted Cash (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Restricted Cash [Abstract] | ||
Pledged for bank drafts | $ 564,516 | $ 1,772,878 |
Total | $ 564,516 | $ 1,772,878 |
Restricted Cash (Details Textua
Restricted Cash (Details Textual) | Jun. 30, 2015 |
Maximum [Member] | |
Restricted Cash (Textual) | |
Restricted cash pledged for issuing bank drafts | 100.00% |
Minimum [Member] | |
Restricted Cash (Textual) | |
Restricted cash pledged for issuing bank drafts | 50.00% |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Accounts Receivable [Abstract] | ||
Accounts receivable | $ 2,607,880 | $ 728,656 |
Less: allowance for doubtful accounts | (45,315) | (42,580) |
Total | $ 2,562,565 | $ 686,076 |
Accounts Receivable (Details Te
Accounts Receivable (Details Textual) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2015 | Dec. 31, 2014 | |
Accounts Receivable (Textual) | ||
Accounts receivable | $ 2,607,880 | $ 728,656 |
Allowance for doubtful accounts | $ 45,315 | $ 42,580 |
Interest rate of credit term | 99.52% | 97.43% |
Description of payment term | The credit term given to customers is within 1 year, 99.52% and 97.43% of the balance were within 1 year as of June 30, 2015 and December 31, 2014 respectively. There was no change of payment term and collectability from prior year. |
Advances to Suppliers (Details)
Advances to Suppliers (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Advances to Suppliers (Textual) | ||
Advances to suppliers | $ 5,583,231 | $ 3,161,468 |
Due from Related Parties (Detai
Due from Related Parties (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Related Party Transaction [Line Items] | ||
Due from Related Parties, Total | $ 547,935 | $ 1,619,823 |
Li Qimei [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Total | 391,131 | 1,022,025 |
Bengbu Boyuan Real Estate Co.,ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Due from Related Parties, Total | $ 156,804 | $ 597,798 |
Due from Related Parties (Det43
Due from Related Parties (Details Textual) | 6 Months Ended | ||
Jun. 30, 2015USD ($) | Jun. 30, 2015CNY (¥) | Dec. 31, 2014USD ($) | |
Due from Related Parties (Textual) | |||
Ownership percentage | 100.00% | 100.00% | |
Area of leased and building description | Company a 1,139 square meters (12,260 square feet) office building in Guzhen County, Bengbu City. The Company built an approximately 3,000 square meter (32,000 square foot) four story addition to this office building | ||
Property, plant and equipment, net | $ 1,384,691 | $ 1,485,248 | |
Repayments of debt | $ 604,285 | ||
Li Qimei [Member] | |||
Due from Related Parties (Textual) | |||
Ownership percentage | 40.00% | 40.00% | |
Office Building [Member] | |||
Due from Related Parties (Textual) | |||
Property, plant and equipment, net | $ 604,285 | ¥ 4,000,000 |
Inventory (Details)
Inventory (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Inventory [Abstract] | ||
Raw Materials | $ 211,656 | $ 65,497 |
Finished Goods | 124,967 | $ 225,360 |
Goods in transit | 62,939 | |
Supplies | 403 | $ 403 |
Total | $ 399,965 | $ 291,260 |
Inventory (Details Textual)
Inventory (Details Textual) - USD ($) None in scaling factor is -9223372036854775296 | Jun. 30, 2015 | Dec. 31, 2014 |
Inventory (Textual) | ||
Provision for inventory |
Other Current Assets (Details)
Other Current Assets (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Other Current Assets [Abstract] | ||
Other receivables | $ 565,620 | $ 1,387,230 |
Prepaid expenses | 6,876 | 4,537 |
Total | $ 572,496 | $ 1,391,767 |
Construction in Progress (Detai
Construction in Progress (Details) - Jun. 30, 2015 | USD ($)m²ft² |
Construction in Progress (Textual) | |
Office building amount | $ 2,922,903 |
Building area square meters | m² | 1,902.41 |
Building area square feet | ft² | 20,473 |
Property, Plant and Equipment48
Property, Plant and Equipment (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment [Line Items] | ||
Less Accumulated Depreciation | $ (728,444) | $ (626,320) |
Total | 1,384,691 | 1,485,248 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 1,769,088 | 1,767,777 |
Motor Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 266,974 | 266,776 |
Electronic equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 42,589 | 42,557 |
Furniture and office equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 30,713 | 30,690 |
Leasehold Improvement [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | $ 3,771 | $ 3,768 |
Property, Plant and Equipment49
Property, Plant and Equipment (Details Textual) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Property, Plant and Equipment (Textual) | ||
Depreciation expense | $ 101,659 | $ 243,988 |
Advances to Suppliers-Non-Cur50
Advances to Suppliers-Non-Current (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Advances to Suppliers-Non-Current [Abstract] | ||
Advances to suppliers-non current | $ 1,470,703 | $ 1,250,067 |
Due From Related Parties-Non-51
Due From Related Parties-Non-Current (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Due From Related Parties Non Current (Textual) | ||
Due from related parties-non current | $ 427,889 | $ 1,416,309 |
Short-Term Loan (Details)
Short-Term Loan (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Short-term Debt [Line Items] | ||
Short-term loan, Total | $ 4,516,129 | $ 3,868,098 |
Huishang Bank Bengbu Branch [Member] | ||
Short-term Debt [Line Items] | ||
Short-term loan, Total | 806,452 | 805,854 |
Bank of Communications Bengbu Branch [Member] | ||
Short-term Debt [Line Items] | ||
Short-term loan, Total | 806,452 | 805,854 |
The Xuehua branch of Bengbu Rural Commercial Bank [Member] | ||
Short-term Debt [Line Items] | ||
Short-term loan, Total | 1,612,903 | 967,024 |
The Bengbu branch of Shanghai Pudong Bank [Member] | ||
Short-term Debt [Line Items] | ||
Short-term loan, Total | $ 1,290,322 | $ 1,289,366 |
Short-Term Loan (Details Textua
Short-Term Loan (Details Textual) | 1 Months Ended | 6 Months Ended | |||
May. 31, 2015USD ($) | Jan. 31, 2015USD ($) | Jun. 30, 2015 | May. 31, 2015CNY (¥) | Jan. 31, 2015CNY (¥) | |
Short Term Loan (Textual) | |||||
Maturity date | Dec. 30, 2015 | ||||
The Xuehua branch of Bengbu Rural Commercial Bank [Member] | |||||
Short Term Loan (Textual) | |||||
Short-term loan | $ 806,452 | $ 806,452 | ¥ 5,000,000 | ¥ 5,000,000 | |
Maturity date | May 14, 2016 | Jan. 9, 2016 | |||
Interest on loan | 36.39% | 60.00% | 36.39% | 60.00% |
Notes Payable (Details)
Notes Payable (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | |
Maturity date | Dec. 30, 2015 | |
Notes payable | $ 483,871 | $ 2,578,732 |
Anhui Jiangnan Trade Co. Ltd [Member] | ||
Endorser | Bank of communications | |
Origination date | Jul. 18, 2014 | |
Maturity date | Jan. 17, 2015 | |
Notes payable | 483,512 | |
Anhui Feite Fule & Equipment Manufacture Co. Ltd [Member] | ||
Endorser | Bengbu BRC bank | |
Origination date | Jul. 8, 2014 | |
Maturity date | Jan. 8, 2015 | |
Notes payable | 1,289,366 | |
Bengbu Hongyang Trade Co. Ltd [Member] | ||
Endorser | Bengbu BRC bank | |
Origination date | Dec. 17, 2014 | |
Maturity date | Jun. 17, 2015 | |
Notes payable | $ 805,854 | |
Hefei Yushi Trade Co. Ltd [Member] | ||
Endorser | Pudong Development Bank | |
Origination date | Jun. 30, 2015 | |
Maturity date | Dec. 30, 2015 | |
Notes payable | $ 483,871 |
Notes Payable (Details Textual)
Notes Payable (Details Textual) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | |
Notes Payable (Textual) | ||
Notes payable | $ 483,871 | $ 2,578,732 |
Cash deposits, Percentage | 100.00% | |
Maturity date | Dec. 30, 2015 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Taxes [Abstract] | ||||
Current provision: | $ (262,461) | $ (15,502) | $ 85,557 | $ 364,827 |
Deferred provision: | 387,513 | 7,930 | (5,325) | (397,357) |
Total provision for income taxes | $ 125,052 | $ (7,572) | $ 80,232 | $ (32,530) |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Deferred tax assets | ||
Allowance for doubtful accounts | $ 16,374 | $ 18,697 |
Accrued payroll expenses | 16,034 | 8,348 |
Deferred tax assets, net | $ 32,407 | $ 27,045 |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | Jul. 02, 2014 | Jun. 30, 2015 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 |
Income Taxes (Textual) | |||||
Expected income tax rate | 15.00% | 25.00% | 15.00% | 15.00% | |
Deferred tax assets | $ 32,407 | $ 27,045 | |||
Allowance for doubtful accounts | $ 16,374 | $ 18,697 |
Major Suppliers and Customers (
Major Suppliers and Customers (Details) - 6 months ended Jun. 30, 2015 | CustomerSupplier |
Total Sales [Member] | |
Major Suppliers and Customers (Textual) | |
Number of customers | Customer | 3 |
Concentration risk, Percentage | 24.00% |
Total Sales [Member] | Customer [Member] | |
Major Suppliers and Customers (Textual) | |
Concentration risk, Percentage | 9.00% |
Total Sales [Member] | Customer One [Member] | |
Major Suppliers and Customers (Textual) | |
Concentration risk, Percentage | 8.00% |
Total Sales [Member] | Customer Two [Member] | |
Major Suppliers and Customers (Textual) | |
Concentration risk, Percentage | 7.00% |
Total Purcahses [Member] | Supplier [Member] | |
Major Suppliers and Customers (Textual) | |
Number of customers | 1 |
Concentration risk, Percentage | 14.00% |
Advances [Member] | Supplier [Member] | |
Major Suppliers and Customers (Textual) | |
Concentration risk, Percentage | 59.00% |
Number of suppliers | 3 |