Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 14, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2023 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2023 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 000-55555 | |
Entity Registrant Name | Fortune Valley Treasures, Inc. | |
Entity Central Index Key | 0001626745 | |
Entity Tax Identification Number | 32-0439333 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | B1601 Donogfang Yinxiang Building | |
Entity Address, Address Line Two | No. 139 Liansheng Road | |
Entity Address, Address Line Three | Humen Town | |
Entity Address, City or Town | Dongguan | |
Entity Address, Country | CN | |
Entity Address, Postal Zip Code | 523000 | |
City Area Code | (86) | |
Local Phone Number | 769-85729133 | |
Title of 12(g) Security | Common stock, par value $0.001 per share | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 15,655,038 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 75,950 | $ 165,685 |
Accounts receivable, net (including $72,372 and $146,087 from related parties as of June 30, 2023 and December 31, 2022, respectively) | 5,101,721 | 4,797,564 |
Inventories | 76,795 | 148,925 |
Prepayments and other current assets, net (including $1,162,622 and $1,102,861 to related parties as of June 30, 2023 and December 31, 2022, respectively) | 1,537,639 | 1,758,917 |
Total current assets | 6,792,105 | 6,871,091 |
Non-current assets | ||
Deposits paid, net (including $573,584 and $758,445 to related parties as of June 30, 2023 and December 31, 2022, respectively) | 673,561 | 1,121,302 |
Property and equipment, net | 112,461 | 97,890 |
Intangible assets, net | 252,148 | 370,926 |
Goodwill | 435,562 | 454,201 |
Total Assets | 8,575,106 | 9,287,942 |
Current liabilities | ||
Accounts payable (including $107,454 and $80,426 to related parties as of June 30, 2023 and December 31, 2022, respectively) | 692,035 | 688,822 |
Accrued liabilities | 553,026 | 502,389 |
Bank and other borrowings - current | 483,233 | 422,653 |
Income tax payable | 20,116 | 38,879 |
Customer advances | 116,769 | 139,334 |
Total current liabilities | 2,738,979 | 2,484,582 |
Non-current liabilities | ||
Bank and other borrowings | 46,356 | 58,438 |
Total Liabilities | 2,986,163 | 2,788,033 |
Stockholders’ Equity | ||
Common stock (150,000,000 shares authorized, 15,655,038 shares issued and outstanding as of June 30, 2023 and December 31, 2022) | 15,655 | 15,655 |
Additional paid-in capital | 11,061,233 | 11,061,233 |
Accumulated deficit and statutory reserves | (4,980,048) | (4,504,404) |
Accumulated other comprehensive loss | (516,590) | (180,826) |
Total Fortune Valley Treasures, Inc. stockholders’ equity | 5,580,250 | 6,391,658 |
Noncontrolling interests | 8,693 | 108,251 |
Total Stockholders’ Equity | 5,588,943 | 6,499,909 |
Total Liabilities and Stockholders’ Equity | 8,575,106 | 9,287,942 |
Nonrelated Party [Member] | ||
Non-current assets | ||
Operating lease right-of-use assets | 244,027 | 297,232 |
Current liabilities | ||
Operating lease obligations - current | 112,632 | 110,201 |
Non-current liabilities | ||
Operating lease obligations – non-current | 155,593 | 189,957 |
Related Party [Member] | ||
Non-current assets | ||
Operating lease right-of-use assets | 65,242 | 75,300 |
Current liabilities | ||
Operating lease obligations - current | 12,625 | 16,629 |
Due to related parties | 748,543 | 565,675 |
Non-current liabilities | ||
Operating lease obligations – non-current | $ 45,235 | $ 55,056 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Defined Benefit Plan Disclosure [Line Items] | ||
Deposit paid, related parties | $ 573,584 | $ 758,445 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 15,655,038 | 15,655,038 |
Common stock, shares outstanding | 15,655,038 | 15,655,038 |
Related Party [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Accounts receivable | $ 72,372 | $ 146,087 |
Prepayments and other current assets, net | 1,162,622 | 1,102,861 |
Accounts payable | $ 107,454 | $ 80,426 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Income Statement [Abstract] | ||||
Net revenues (including $42,848 and $40,770 from related parties for the three months ended June 30, 2023 and 2022, respectively; $69,598 and $41,495 from related parties for the six months ended June 30, 2023 and 2022, respectively) | $ 1,272,597 | $ 2,336,459 | $ 2,907,886 | $ 3,598,269 |
Cost of revenues (including $133,114 and $249,468 from related parties for the three months ended June 30, 2023 and 2022, respectively; $362,096 and $386,380 from related parties for the six months ended June 30, 2023 and 2022, respectively) | 652,798 | 1,099,523 | 1,330,165 | 1,617,985 |
Gross profit | 619,799 | 1,236,936 | 1,577,721 | 1,980,284 |
Operating expenses: | ||||
Selling and distribution expenses | 13,016 | 15,929 | 26,258 | 34,084 |
General and administrative expenses | 1,027,572 | 347,657 | 1,978,967 | 874,943 |
Operating income (loss) | (420,789) | 873,350 | (427,504) | 1,071,257 |
Other income (expense): | ||||
Other income | 6,436 | 1,995 | 8,210 | 8,202 |
Interest income | 16 | 16 | 47 | 93 |
Interest expense | (8,964) | (4,864) | (18,256) | (10,689) |
Other expense, net | (2,512) | (2,853) | (9,999) | (2,394) |
Income (loss) before income tax | (423,301) | 870,497 | (437,503) | 1,068,863 |
Income tax expense | 21,528 | 81,514 | 96,502 | 103,921 |
Net income (loss) | (444,829) | 788,983 | (534,005) | 964,942 |
Less: Net income (loss) attributable to noncontrolling interests | (58,004) | 41,250 | (58,361) | 68,533 |
Net income (loss) attributable to Fortune Valley Treasures, Inc. | (386,825) | 747,733 | (475,644) | 896,409 |
Other comprehensive income: | ||||
Foreign currency translation loss | (422,433) | (602,321) | (376,961) | (591,601) |
Total comprehensive income (loss) | (867,262) | 186,662 | (910,966) | 373,341 |
Less: comprehensive income (loss) attributable to noncontrolling interests | (99,383) | (4,305) | (99,558) | 24,726 |
Comprehensive income (loss) attributable to Fortune Valley Treasures, Inc. | $ (767,879) | $ 190,967 | $ (811,408) | $ 348,615 |
Earnings (loss) per share | ||||
Basic earnings (loss) per share | $ (0.02) | $ 0.05 | $ (0.03) | $ 0.06 |
Diluted earnings (loss) per share | $ (0.02) | $ 0.05 | $ (0.03) | $ 0.06 |
Basic weighted average shares outstanding | 15,655,038 | 15,655,038 | 15,655,038 | 15,655,038 |
Diluted weighted average shares outstanding | 15,655,038 | 15,655,038 | 15,655,038 | 15,655,038 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) (Parenthetical) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Revenue from related parties | $ 1,272,597 | $ 2,336,459 | $ 2,907,886 | $ 3,598,269 |
Cost of revenue from related parties | 133,114 | 249,468 | 362,096 | 386,380 |
Related Party [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Revenue from related parties | $ 42,848 | $ 40,770 | $ 69,598 | $ 41,495 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Noncontrolling Interest [Member] | Total |
Balance at Dec. 31, 2021 | $ 15,655 | $ 11,061,233 | $ 544,305 | $ (2,561,681) | $ 404,842 | $ 9,464,354 |
Balance, shares at Dec. 31, 2021 | 15,655,038 | |||||
Net income (loss) | 148,676 | 27,283 | 175,959 | |||
Foreign currency translation adjustment | 8,972 | 1,748 | 10,720 | |||
Balance at Mar. 31, 2022 | $ 15,655 | 11,061,233 | 553,277 | (2,413,005) | 433,873 | 9,651,033 |
Balance, shares at Mar. 31, 2022 | 15,655,038 | |||||
Balance at Dec. 31, 2021 | $ 15,655 | 11,061,233 | 544,305 | (2,561,681) | 404,842 | 9,464,354 |
Balance, shares at Dec. 31, 2021 | 15,655,038 | |||||
Net income (loss) | 964,942 | |||||
Foreign currency translation adjustment | (591,601) | |||||
Balance at Jun. 30, 2022 | $ 15,655 | 11,061,233 | (3,489) | (1,665,272) | 429,568 | 9,837,695 |
Balance, shares at Jun. 30, 2022 | 15,655,038 | |||||
Balance at Mar. 31, 2022 | $ 15,655 | 11,061,233 | 553,277 | (2,413,005) | 433,873 | 9,651,033 |
Balance, shares at Mar. 31, 2022 | 15,655,038 | |||||
Net income (loss) | 747,733 | 41,250 | 788,983 | |||
Foreign currency translation adjustment | (556,766) | (45,555) | (602,321) | |||
Balance at Jun. 30, 2022 | $ 15,655 | 11,061,233 | (3,489) | (1,665,272) | 429,568 | 9,837,695 |
Balance, shares at Jun. 30, 2022 | 15,655,038 | |||||
Balance at Dec. 31, 2022 | $ 15,655 | 11,061,233 | (180,826) | (4,504,404) | 108,251 | 6,499,909 |
Balance, shares at Dec. 31, 2022 | 15,655,038 | |||||
Net income (loss) | (88,819) | (357) | (89,176) | |||
Foreign currency translation adjustment | 45,290 | 182 | 45,472 | |||
Balance at Mar. 31, 2023 | $ 15,655 | 11,061,233 | (135,536) | (4,593,223) | 108,076 | 6,456,205 |
Balance, shares at Mar. 31, 2023 | 15,655,038 | |||||
Balance at Dec. 31, 2022 | $ 15,655 | 11,061,233 | (180,826) | (4,504,404) | 108,251 | 6,499,909 |
Balance, shares at Dec. 31, 2022 | 15,655,038 | |||||
Net income (loss) | (534,005) | |||||
Foreign currency translation adjustment | (376,961) | |||||
Balance at Jun. 30, 2023 | $ 15,655 | 11,061,233 | (516,590) | (4,980,048) | 8,693 | 5,588,943 |
Balance, shares at Jun. 30, 2023 | 15,655,038 | |||||
Balance at Mar. 31, 2023 | $ 15,655 | 11,061,233 | (135,536) | (4,593,223) | 108,076 | 6,456,205 |
Balance, shares at Mar. 31, 2023 | 15,655,038 | |||||
Net income (loss) | (386,825) | (58,004) | (444,829) | |||
Foreign currency translation adjustment | (381,054) | (41,379) | (422,433) | |||
Balance at Jun. 30, 2023 | $ 15,655 | $ 11,061,233 | $ (516,590) | $ (4,980,048) | $ 8,693 | $ 5,588,943 |
Balance, shares at Jun. 30, 2023 | 15,655,038 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash flows from operating activities | ||
Net income (loss) | $ (534,005) | $ 964,942 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization expense | 124,680 | 433,417 |
Non-cash lease expense | 91,369 | 85,628 |
Allowance for credit losses | 960,144 | |
Loss on disposal of intangible asset | 1,855 | |
Changes in operating assets and liabilities | ||
Accounts receivable, net | (896,403) | (185,856) |
Inventories | 68,723 | (64,826) |
Prepayments and other current assets, net | 232 | (385,553) |
Due from related parties | 25,887 | |
Deposits paid, net | (12,080) | (583,325) |
Accounts payable | 32,763 | (37,455) |
Due to related parties | 111,324 | (122,702) |
Customer advances | (17,538) | (110,633) |
Accrued liabilities | 74,167 | 56,060 |
Income tax payable | (17,871) | 19,354 |
Operating lease obligations | (73,176) | (77,497) |
Net cash provided by (used in) operating activities | (85,816) | 17,441 |
Cash flows from investing activities | ||
Acquisition of property and equipment | (4,786) | |
Acquisition of intangible asset | (702) | |
Net cash used in investing activities | (5,488) | |
Cash flows from financing activities | ||
Borrowings from and repayments to revolving credit lines, net | 7,224 | 148,606 |
Borrowings from bank loans | 113,418 | 10,352 |
Borrowings from a third party | 24,154 | |
Repayments to related parties | (154,510) | |
Repayments to bank loans | (58,299) | (11,763) |
Repayments to a third party | (19,541) | (66,379) |
Net cash provided by (used in) financing activities | 42,802 | (49,540) |
Effect of exchange rate changes on cash and cash equivalents | (41,233) | (5,738) |
Net changes in cash and cash equivalents | (89,735) | (37,837) |
Cash and cash equivalents–beginning of the period | 165,685 | 123,163 |
Cash and cash equivalents–end of the period | 75,950 | 85,326 |
Supplementary cash flow information: | ||
Interest paid | 18,378 | 10,191 |
Income taxes paid | 152,140 | 86,546 |
Non-cash investing and financing activities | ||
Expenses paid by related parties on behalf of the Company | 38,627 | |
Operating lease right-of-use assets obtained in exchange for operating lease obligations | 39,797 | |
Liabilities assumed in connection with purchase of property and equipment | $ 28,234 |
ORGANIZATION AND SUMMARY OF SIG
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Fortune Valley Treasures, Inc. (formerly Crypto-Services, Inc.) (“FVTI” or the “Company”) was incorporated in the State of Nevada on March 21, 2014. The Company’s current primary business operations of wholesale distribution and retail sales of alcoholic beverages of wine and distilled liquors, and drinking water distribution and delivery are conducted through its subsidiaries in the People’s Republic of China (“PRC”). On April 11, 2018, the Company entered into a share exchange agreement by and among DaXingHuaShang Investment Group Limited (“DIGLS”) and its shareholders: 1.) Yumin Lin, 2.) Gaosheng Group Co., Ltd. and 3.) China Kaipeng Group Co., Ltd. whereby the Company newly issued 15,000,000 On March 1, 2019, the Company entered into a sale and purchase agreement (the “SP Agreement”) to acquire 100 5 100 150 On June 22, 2020, the Company entered into a sale and purchase agreement along with Qianhai DaXingHuaShang Investment (Shenzhen) Co., Ltd., a company incorporated in China and a wholly-owned subsidiary of FVTI (“QHDX”), to acquire 90 243,134 Basis of presentation The accompanying unaudited condensed consolidated financial statements as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) that permit reduced disclosure for interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. In the opinion of management, all adjustments consisting of normal recurring entries considered necessary for a fair presentation have been included. The results of operations for these periods are not necessarily comparable to, or indicative of, results of any other interim period or for the fiscal year taken as a whole. The condensed consolidated balance sheet information as of December 31, 2022 was derived from the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10-K, for the year ended December 31, 2022, filed with the SEC on March 31, 2023 (the “report”). These unaudited condensed consolidated financial statements should be read in conjunction with the report. Basis of consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. The results of subsidiaries acquired during the respective periods are included in the consolidated statements of operations from the effective date of acquisition or up to the effective date of disposal, as appropriate. The portion of the income or loss applicable to noncontrolling interests in subsidiaries is reflected in the unaudited condensed consolidated statements of operations. As of June 30, 2023, details of the Company’s major subsidiaries were as follows: SCHEDULE OF ENTITIES AND ITS SUBSIDIARIES Entity Name Date of Incorporation Parent Entity Nature of Operation Place of Incorporation DIGLS July 4, 2016 FVTI Investment holding Republic of Seychelles DILHK June 22, 2016 DIGLS Investment holding Hong Kong, PRC QHDX November 3, 2016 DILHK Investment holding PRC FVTL May 31, 2011 QHDX Trading of food and platform PRC JJGS August 17, 2017 FVTI Investment holding Republic of Seychelles JJHK August 24, 2017 JJGS Investment holding Hong Kong, PRC JJSZ November 16, 2018 JJHK Trading of food PRC Xixingdao August 28, 2019 QHDX Drinking water distribution and delivery PRC Dongguan City Fu La Tu Trade Ltd (“FLTT”) September 27, 2020 FVTL Trading of alcoholic beverages PRC Dongguan City Fu Xin Gu Trade Ltd (“FXGT”) December 2, 2020 FVTL Trading of alcoholic beverages PRC Dongguan City Fu Xin Technology Ltd (“FXTL”) November 12, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Guan Healthy Industry Technology Ltd (“FGHL”) December 21, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Jing Technology Ltd (“FJTL”) November 17, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Xiang Technology Ltd (“FGTL”) November 16, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Ji Food & Beverage Ltd (“FJFL”) November 9, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Lai Food Ltd (“FLFL”) September 27, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Yi Beverage Ltd (“FYBL”) November 12, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Xi Drinking Water Company Ltd (“FXWL”) March 17, 2021 Xixingdao Drinking water distribution and delivery, sales of alcoholic beverages and water purifier PRC Dongguan City Fu Jia Drinking Water Company Ltd (“FJWL”) March 29, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Dongguan City Fu Sheng Drinking Water Company Ltd (“FSWL”) March 29, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Shenzhen Fu Jin Trading Technology Company Ltd (“FJSTL”) June 7, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Dongguan City Fu Li Trading Ltd (“FLTL”) September 10, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Guangdong Fu Gu Supply Chain Group Ltd (“FGGC”) September 13, 2021 QHDX Trading of alcoholic beverages PRC Dongguan City Fu Zhi Gu Trading Ltd (“FZGTL”) September 9, 2022 FVTL Trading of alcoholic beverages PRC Dongguan City Chang Fu Trading Ltd (“CFTL”) September 9, 2022 FVTL Trading of alcoholic beverages PRC Dongguan City La Tong Trading Ltd (“LTTL”) August 8, 2022 FVTL Trading of alcoholic beverages PRC Dongguan City Kai Fu Trading Ltd (“KFTL”) September 8, 2022 FVTL Trading of alcoholic beverages PRC Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant accounting estimates include certain assumptions related to going concern, allowance of credit losses, allowance of deferred tax asset and uncertain tax position, implicit interest rate of operating leases, useful lives and impairment of long-lived assets, and impairment of goodwill. Actual results may differ from these estimates. Foreign currency translation and re-measurement The Company translates its foreign operations to the U.S. dollar in accordance with ASC 830, “ Foreign Currency Matters The reporting currency for the Company and its subsidiaries is the U.S. dollar. The Company, DIGLS, DILHK, JJGS and JJHK’s functional currency is the U.S. dollar; QHDX, JJSZ and their subsidiaries which are incorporated in PRC use the Chinese Renminbi (“RMB”) as their functional currency. The Company’s subsidiaries, whose records are not maintained in that company’s functional currency, re-measure their records into their functional currency as follows: ● Monetary assets and liabilities at exchange rates in effect at the end of each period ● Nonmonetary assets and liabilities at historical rates ● Revenue and expense items at the average rate of exchange prevailing during the period Gains and losses from these re-measurements were not significant and have been included in the Company’s results of operations. The Company’s subsidiaries, whose functional currency is not the U.S. dollar, translate their records into the U.S. dollar as follows: ● Assets and liabilities at the rate of exchange in effect at the balance sheet date ● Equities at the historical rate ● Revenue and expense items at the average rate of exchange prevailing during the period Translation of amounts from the local currencies of the Company into US$ has been made at the following exchange rates for the respective periods: SCHEDULE OF FOREIGN CURRENCY EXCHANGE RATE TRANSLATION 2023 2022 As of and for the 2023 2022 Period-end RMB:US$1 exchange rate 0.13880 0.14927 Period-average RMB:US$1 exchange rate 0.14448 0.15451 The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into U.S. dollars at the rates used in translation. Impairment of long-lived assets other than goodwill The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. Impairment may be the result of becoming obsolete from a change in the industry or new technologies. Impairment is present if the carrying amount of an asset is less than its undiscounted cash flows to be generated. If an asset is considered impaired, a loss is recognized based on the amount by which the carrying amount exceeds the fair market value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. The Company did not recognize any impairment of long-lived assets during the six months ended June 30, 2023 and 2022. Goodwill Goodwill represents the excess of the purchase price over the fair value of the net identifiable assets acquired in a business combination. In accordance with FASB ASC Topic 350, “Intangibles-Goodwill and Others”, goodwill is subject to at least an annual assessment for impairment or more frequently if events or changes in circumstances indicate that an impairment may exist, applying a fair-value based test. Fair value is generally determined using a discounted cash flow analysis. The Company would recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds its fair value up to the amount of goodwill allocated to that reporting unit. During the six months ended June 30, 2023 and 2022, the Company did not record any impairment of goodwill. Revenue recognition The Company follows the guidance of ASC 606, revenue from contracts with customers is recognized using the following 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. Under Topic 606, revenues are recognized when the promised products have been confirmed of delivery or services have been transferred to the consumers in amounts that reflect the consideration the customer expects to be entitled to in exchange for those services. The Company presents value added taxes (“VAT”) as reductions of revenues. The Company recognizes revenues net of value added taxes (“VAT”) and relevant charges. We generate revenue primarily from the sales of liquor, water, water purifier and other products directly to agents, wholesalers and end users, with majority of sales transactions were conducted offline. We recognize product revenue at a point in time when the control of the products has been transferred to customers. The transfer of control is considered complete when products have been picked up by or delivered to our customers. We account for shipping and handling fees as a fulfillment cost. The following table provides information about disaggregated revenue based on revenue by product types: SCHEDULE OF DISAGGREGATION REVENUE 2023 2022 2023 2022 Three months ended Six months ended 2023 2022 2023 2022 Sales of liquor $ 878,952 $ 1,203,484 $ 1,782,672 $ 1,833,946 Sales of water 213,582 808,648 633,202 1,338,092 Sales of water purifier 114,714 310,807 367,837 395,548 Others 65,349 13,520 124,175 30,683 Total $ 1,272,597 $ 2,336,459 $ 2,907,886 $ 3,598,269 Contract liabilities Contract liabilities consist mainly of customer advances. On certain occasions, the Company may receive prepayments from downstream retailers or wholesales customers for liquors, water and other products prior to them taking possession of the Company’s products. The Company records these receipts as customer advances until the control of the products has been transferred the customers. As of June 30, 2023 and December 31, 2022, the Company had customer advances of $ 116,769 139,334 24,707 Related party transaction Transactions involving related parties cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated. Recently adopted accounting pronouncements In June 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. ASU No. 2016-13 was further amended in November 2020 by ASU No. 2020-10, Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842). As a result, ASC Topic 326, Financial Instruments – Credit Losses is effective for smaller reporting companies for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted ASU No. 2016-13 on January 1, 2023 and the adoption did not have a material impact on the Company’s unaudited condensed consolidated financial statements. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASC Topic 606, “Revenue from Contracts with Customers”. This ASU is expected to improve comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. The new guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted ASU No. 2021-08 on January 1, 2023 and the adoption did not have a material impact on the Company’s unaudited condensed consolidated financial statements. |
ACCOUNTS RECEIVABLE, NET
ACCOUNTS RECEIVABLE, NET | 6 Months Ended |
Jun. 30, 2023 | |
Credit Loss [Abstract] | |
ACCOUNTS RECEIVABLE, NET | NOTE 2 – ACCOUNTS RECEIVABLE, NET Accounts receivable consisted of the following as of June 30, 2023 and December 31, 2022: SCHEDULE OF ACCOUNTS RECEIVABLE June 30, December 31, Accounts receivable (including $ 73,096 nil $ 5,461,870 $ 4,797,564 Less: Doubtful allowance (including $ 724 nil (360,149 ) - Accounts receivable, net $ 5,101,721 $ 4,797,564 Allowance for doubtful accounts movement is as follows: SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS June 30, December 31, Beginning balance $ - $ - Additions to allowance 374,894 - Foreign currency translation adjustment (14,745 ) - Ending balance $ 360,149 $ - |
PREPAYMENTS AND OTHER CURRENT A
PREPAYMENTS AND OTHER CURRENT ASSETS, NET | 6 Months Ended |
Jun. 30, 2023 | |
Prepayments And Other Current Assets Net | |
PREPAYMENTS AND OTHER CURRENT ASSETS, NET | NOTE 3 – PREPAYMENTS AND OTHER CURRENT ASSETS, NET Prepayments and other current assets consisted of the following as of June 30, 2023 and December 31, 2022: SCHEDULE OF PREPAYMENT AND OTHER CURRENT ASSETS June 30, 2023 December 31, 2022 Prepayments (including $ 2,394,062 2,255,288 $ 2,875,927 $ 3,001,866 Other current assets 6,995 4,631 Total prepayments and other current assets 2,882,922 3,006,497 Less: Allowance for doubtful accounts (including $ 1,231,440 1,152,427 (1,345,283 ) (1,247,580 ) Prepayments and other current assets, net $ 1,537,639 $ 1,758,917 Balance of prepayments represented the advanced payments to suppliers including related party suppliers. Allowance for doubtful accounts movements is as follows: SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS June 30, 2023 December 31, 2022 Beginning balance $ 1,247,580 $ - Additions to allowance 154,985 1,284,005 Foreign currency translation adjustment (57,282 ) (36,425 ) Ending balance $ 1,345,283 $ 1,247,580 |
DEPOSITS PAID, NET
DEPOSITS PAID, NET | 6 Months Ended |
Jun. 30, 2023 | |
Deposits Paid Net | |
DEPOSITS PAID, NET | NOTE 4 – DEPOSITS PAID, NET Deposits paid consisted of the following as of June 30, 2023 and December 31, 2022: SCHEDULE OF DEPOSITS PAID June 30, 2023 December 31, 2022 Deposits paid (including $ 1,573,209 1,628,511 $ 2,280,196 $ 2,365,652 Less: Allowance for doubtful accounts (including $ 999,625 870,066 (1,606,635 ) (1,244,350 ) Deposits paid, net $ 673,561 $ 1,121,302 Allowance for doubtful accounts movement is as follows: SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS OF DEPOSITS PAID June 30, 2023 December 31, 2022 Beginning balance $ 1,244,350 $ - Additions to allowance 430,265 1,280,681 Foreign currency translation adjustment (67,980 ) (36,331 ) Ending balance $ 1,606,635 $ 1,244,350 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 6 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 5 – PROPERTY AND EQUIPMENT, NET Property and equipment consisted of the following as of June 30, 2023 and December 31, 2022: SCHEDULE OF PROPERTY AND EQUIPMENT June 30, 2023 December 31, 2022 Office equipment $ 116,520 $ 116,520 Leasehold improvement 126,386 126,386 Vehicle 31,910 - Property and equipment 274,816 242,906 Less: Accumulated depreciation (162,355 ) (145,016 ) Property and equipment, net $ 112,461 $ 97,890 Depreciation expense, which was included in general and administrative expenses, for the six months ended June 30, 2023 and 2022 was $ 18,046 15,647 |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | NOTE 6 – INTANGIBLE ASSETS, NET Intangible assets and related accumulated amortization were as follows : SCHEDULE OF INTANGIBLE ASSETS June 30, 2023 December 31, 2022 Distribution channel $ 2,989,709 $ 3,117,635 Others 25,553 27,809 Total intangible assets 3,015,262 3,145,444 Less: Accumulated amortization (1,850,517 ) (1,822,875 ) Less: Accumulated impairment (912,597 ) (951,643 ) Intangible assets, net $ 252,148 $ 370,926 Amortization expense for the six months ended June 30, 2023 and 2022 was $ 106,634 417,770 As of June 30, 2023, the future estimated amortization costs for intangible assets are as follows: SCHEDULE OF FUTURE AMORTIZATION EXPENSES FOR DISTRIBUTION CHANNELS Year ending December 31, 2023 (remaining) $ 102,773 2024 138,256 2025 5,010 2026 5,010 2027 1,099 Total $ 252,148 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 7 - RELATED PARTY TRANSACTIONS Amounts due to related parties as of June 30, 2023 and December 31, 2022 are as follows: SCHEDULE OF AMOUNT DUE FROM AND DUE TO RELATED PARTIES June 30, 2023 December 31, 2022 Mr. Yumin Lin President, Chief Executive Officer, Secretary, Director and majority shareholder $ 517,426 $ 389,051 Ms. Xiulan Zhou Manager of a subsidiary, Mr. Yumin Lin’s wife 1,287 508 Mr. Huagen Li Manager of a subsidiary 2,221 2,316 Mr. Guodong Jia Manager of a subsidiary 4,462 2,342 Mr. Hongwei Ye Manager of a subsidiary, Shareholder 15 16 Mr. Anping Chen Manager of a subsidiary 5,424 1,290 Mr. Jiangwei Jia Manager of a subsidiary 6,497 3,678 Mr. Yuwen Li Vice President 69,925 64,924 Ms. Lihua Li Manager of a subsidiary 3,376 - Shenzhen DaXingHuaShang Industrial Group Ltd. (fka Shenzhen DaXingHuaShang Industry Development Ltd.) Mr. Yumin Lin is the supervisor of Shenzhen DaXingHuaShang Industrial Group Ltd. 83,279 86,842 Ms. Chunxiang Zhang Manager of a subsidiary 3,168 998 Mr. Meng Xue Manager of a subsidiary 7,359 5,449 Ms. Shuqin Chen Manager of a subsidiary 5,400 1,358 Mr. Zhipeng Zuo Manager of a subsidiary 16,762 59 Mr. Deqin Ke Manager of a subsidiary - 724 Mr. Aisheng Zhang Manager of a subsidiary 15,982 2,320 Mr. Zhihua Liao Manager of a subsidiary 5,960 3,800 $ 748,543 $ 565,675 Revenues generated from related parties during the six months ended June 30, 2023 and 2022 are as follows: SCHEDULE OF REVENUE GENERATED FROM RELATED PARTIES Six months ended 2023 2022 Mr. Kaihong Lin Chief Financial Officer and Treasurer $ 278 $ 652 Mr. Yumin Lin President, Chief Executive Officer, Secretary, Director and majority shareholder - 438 Mr. Zihao Ye Manager of a subsidiary - 262 Ms. Xiulan Zhou Manager of a subsidiary, Mr. Yumin Lin’s wife 14 - Dongguan Huanhai Trading Co., Ltd. Mr. Hongwei Ye, a shareholder of the Company and a manager of a subsidiary, is the controlling shareholder of Dongguan Huanhai Trading Co., Ltd. 10,886 13,553 Guangdong Yuexin Jiaotong Construction Co., Ltd. Mr. Naiyong Luo, a manager of a subsidiary, is the controlling shareholder of Guangdong Yuexin Jiaotong Construction Co., Ltd. 10,578 7,581 Dongguan City Hualianguan Chemical Co., Ltd. Mr. Hongwei Ye, a shareholder of the Company and a manager of a subsidiary, is the controlling shareholder of Dongguan City Hualianguan Chemical Co., Ltd. 14,808 19,009 Dongguan Humen Shuiyan Drinking Water Store Ms. Shuiyan Li, a shareholder of the Company, is the controlling shareholder of Dongguan Humen Shuiyan Drinking Water Store 33,034 - Revenues generated from related parties $ 69,598 $ 41,495 Cost of revenues from related parties during the six months ended June 30, 2023 and 2022 is as follows: SCHEDULE OF COST OF REVENUES FROM RELATED PARTIES Six months ended 2023 2022 Dongguan Baxi Food Distribution Co., Ltd. Significantly influenced by the Company $ 57,509 $ 15,899 Dongguan Dalingshan Xinwenhua Drinking Water Store Significantly influenced by the Company 23,614 43,759 Dongguan Pengqin Drinking Water Co., Ltd. Significantly influenced by the Company 23,433 33,836 Dongguan Dengqinghu Drinking Water Store Significantly influenced by the Company 2,934 1,475 Dongguan Tailai Trading Co., Ltd. Significantly influenced by the Company 52,324 34,519 Dongguan Anxiang Technology Co., Ltd. Significantly influenced by the Company 56,704 64,639 Guangdong Jiaduonuo Shengshi Trading Co., Ltd. Significantly influenced by the Company 90,355 64,565 Dongguan Dalingshan Runxin Drinking Water Store Significantly influenced by the Company 11,473 16,312 Dongguan City Yijia Trading Co., Ltd. Mr. Yongming Li, a shareholder of the Company, is the controlling shareholder of Dongguan City Yijia Trading Co., Ltd. 43,750 111,376 Cost of revenues from related parties $ 362,096 $ 386,380 Purchases from related parties during the six months ended June 30, 2023 and 2022 are as follows: SCHEDULE OF PURCHASES FROM RELATED PARTIES Six months ended 2023 2022 Dongguan Baxi Food Distribution Co., Ltd. Significantly influenced by the Company $ 61,259 $ 19,406 Dongguan Dalingshan Xinwenhua Drinking Water Store Significantly influenced by the Company 25,221 56,842 Dongguan Pengqin Drinking Water Co., Ltd. Significantly influenced by the Company 25,416 37,266 Dongguan Dengqinghu Drinking Water Store Significantly influenced by the Company 3,124 1,659 Dongguan Tailai Trading Co., Ltd. Significantly influenced by the Company 55,999 33,634 Dongguan Anxiang Technology Co., Ltd. Significantly influenced by the Company 56,965 66,220 Guangdong Jiaduonuo Shengshi Trading Co., Ltd. Significantly influenced by the Company 90,430 69,407 Dongguan Dalingshan Runxin Drinking Water Store Significantly influenced by the Company 12,522 16,374 Dongguan City Yijia Trading Co., Ltd. Mr. Yongming Li, a shareholder of the Company, is the controlling shareholder of Dongguan City Yijia Trading Co., Ltd. 43,750 48,579 Purchase from related party $ 374,686 $ 349,387 Due to related parties mainly consists of borrowings for working capital purpose, the balances are unsecured, non-interest bearing and due on demand. Mr. Yuwen Li, the Vice President of the Company, authorized the Company to use trademarks that were owned by him for ten years from October 5, 2019 to October 4, 2029 at no cost. Also see Note 2, 3, 4, 9 and 10 for more transactions with related parties. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 8 - INCOME TAXES United States of America The Company is registered in the State of Nevada and is subject to United States of America tax law. The U.S. federal income tax rate is 21 Seychelles Under the current laws of the Seychelles, DIGLS and JJGS are registered as an international business company governed by the International Business Companies Act of Seychelles and there is no income tax charged in Seychelles. Hong Kong From year of assessment of 2018/2019 onwards, Hong Kong profit tax rates are 8.25 2,000,000 255,112 16.5 2,000,000 The PRC The Company’s subsidiaries are incorporated in the PRC, and are subject to the PRC Enterprise Income Tax Laws (“EIT Laws”) with the statutory income tax rate of 25 On April 2, 2021, the State Taxation Administration issued the notice of the Ministry of Finance and the State Administration of Taxation (“MOF and SAT”) [2021] No.12 to provide an enterprise income tax rate of 2.5% on small-scale and low-profit enterprises whose annual taxable income is less than RMB1,000,000, approximately $142,209, from January 1, 2021 to December 31, 2022. MOF and SAT [2022] No.13 also provides an enterprise income tax rate of 5% on small-scale and low-profit enterprises whose annual taxable income is more than RMB1,000,000, approximately $144,482, but less than RMB3,000,000, approximately $433,445, from January 1, 2022 to December 31, 2024. The qualifications of small-scale and low-profit enterprises were examined annually by the Tax Bureau. All of the Company’s PRC subsidiaries met the criteria of small-scale and low-profit enterprises, except for Xixingdao, FVT Supply Chain and FLTT The components of the income tax provision are as follows: SCHEDULE OF COMPONENTS OF INCOME TAX PROVISION Six months ended June 30, 2023 2022 Current: – United States of America $ 41,444 $ 45,562 – Seychelles - - – Hong Kong - - – The PRC 55,058 58,359 Current income tax expense Deferred – United States of America - - – Seychelles - - – Hong Kong - - – The PRC - - Deferred income tax expense Total $ 96,502 $ 103,921 The effective tax rate was -22.1 9.7 |
OPERATING LEASES
OPERATING LEASES | 6 Months Ended |
Jun. 30, 2023 | |
Operating Leases | |
OPERATING LEASES | NOTE 9 - OPERATING LEASES As of June 30, 2023, the Company has nineteen separate operating lease agreements for three office spaces, one warehouse and fifteen stores in PRC with remaining lease terms of from 1 month to 46 months Two of the leases described above were entered with related parties. The operating lease entered with Ms. Qingmei Lin, a related party, is for the premises in Dongguan City, PRC. The agreement covers the period from January 1, 2019 to April 30, 2027 10,000 1,445 The agreement covers the period from September 27, 2020 to September 30, 2023 960 138 The components of lease expense and supplemental cash flow information related to leases for the six months ended June 30, 2023 and 2022 are as follows: SCHEDULE OF COMPONENTS OF LEASE EXPENSE AND SUPPLEMENTAL CASH FLOW INFORMATION Operating lease cost (included in general and administrative expenses in the Company’s unaudited condensed consolidated statements of operations) Six months ended 2023 2022 Related parties $ 9,501 $ 11,347 Non-related parties 63,683 74,009 Total $ 73,184 $ 85,356 Operating Lease Cost $ 73,184 $ 85,356 Other information for the six months ended June 30, June 30, Cash paid for amounts included in the measurement of lease obligations $ 77,612 $ 78,215 Weighted average remaining lease term (in years) 2.72 3.55 Weighted average discount rate 3.23 % 3.23 % Maturities of the Company’s lease obligations as of June 30, 2023 are as follows: SCHEDULE OF MATURITIES OF LEASE OBLIGATIONS Year ending December 31, 2023 (remaining) $ 65,998 2024 121,342 2025 103,943 2026 40,951 2027 5,552 Total lease payment 337,786 Less: Imputed interest (11,701 ) Operating lease obligations $ 326,085 |
BANK AND OTHER BORROWINGS
BANK AND OTHER BORROWINGS | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
BANK AND OTHER BORROWINGS | NOTE 10 – BANK AND OTHER BORROWINGS In August 2020, the Company obtained a revolving credit line in the principal amount of RMB 910,000 139,000 4.10 August 7, 2023 In November 2021, the Company obtained a bank loan in the principal amount of RMB 500,000 79,000 3.6 December 11, 2021 500,750 79,000 10.71 In May 2022, the Company obtained a revolving credit line in the principal amount of RMB 1,000,000 (approximately $ 149,000 when borrowed) from China Construction Bank, which bears interest at 4.45 %. The credit line is guaranteed by Xiulan Zhou, a related party. May 26, 2023 . In May 2022, the Company obtained a loan in the principal amount of RMB 161,000 24,000 11.34 May 21, 2024 In May 2022, the Company obtained a bank loan in the principal amount of RMB 69,000 10,000 11.34 May 21, 2024 In July 2022, the Company obtained two loans in the principal amount of RMB 99,000 15,000 231,000 34,000 14.4 July 8, 2024 In July 2022, the Company obtained two loans in the principal amount of RMB 153,000 23,000 357,000 53,000 14.4 July 13, 2024 In July 2022, the Company obtained a loan in the principal amount of RMB 380,000 57,000 12.6 July 21, 2024 In February 2023, the Company obtained a revolving credit line in the principal amount of RMB 465,000 68,000 4.00 February 11, 2024 In April 2023, the Company obtained two bank loans in the principal amount of RMB 224,000 (approximately $ 31,000 when borrowed) and RMB 96,000 (approximately $ 13,000 when borrowed) from Bank of Ningbo and 12.24 %. The loans are guaranteed by Falan Zhou, a manager of subsidiaries. The maturity date is April 7, 2025 . In April 2023, the Company obtained a mortgage loan in the principal amount of RMB 195,415 27,000 6.54 April 10, 2028 In May 2023, the Company obtained a revolving credit line in the principal amount of RMB 1,050,000 146,000 4.20 May 26, 2024 The balance of the loans borrowed as of June 30, 2023 and December 31, 2022 were as follows: SCHEDULE OF BALANCE OF LOAN BORROWED UNDER CREDIT LINES June 30, December 31, Loans from a trust in PRC $ 38,810 $ 60,049 China Construction Bank 336,585 276,447 WeBank 81,488 77,220 Guangdong Nanyue Bank 44,207 67,375 Bank of Ningbo 28,499 - Aggregate outstanding principal balances 529,589 481,091 Less: current portion 483,233 422,653 Non-current portion $ 46,356 $ 58,438 The total interest expense was $ 18,256 10,689 Future minimum loan payments as of June 30, 2023 are as follows: SCHEDULE OF FUTURE MINIMUM LOAN PAYMENTS Year ending December 31, 2023 (remaining) $ 210,155 2024 293,951 2025 12,826 2026 5,425 2027 5,425 Thereafter 1,807 Total $ 529,589 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 11 - SUBSEQUENT EVENTS In July 2023, the Company obtained a bank loan in the principal amount of RMB 817,000 (approximately $ 114,000 when borrowed) from China Construction Bank, which bears interest at 3.85 % with the maturity date on July 22, 2024. |
ORGANIZATION AND SUMMARY OF S_2
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying unaudited condensed consolidated financial statements as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) that permit reduced disclosure for interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. In the opinion of management, all adjustments consisting of normal recurring entries considered necessary for a fair presentation have been included. The results of operations for these periods are not necessarily comparable to, or indicative of, results of any other interim period or for the fiscal year taken as a whole. The condensed consolidated balance sheet information as of December 31, 2022 was derived from the Company’s audited consolidated financial statements included in the Company’s Annual Report on Form 10-K, for the year ended December 31, 2022, filed with the SEC on March 31, 2023 (the “report”). These unaudited condensed consolidated financial statements should be read in conjunction with the report. |
Basis of consolidation | Basis of consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. The results of subsidiaries acquired during the respective periods are included in the consolidated statements of operations from the effective date of acquisition or up to the effective date of disposal, as appropriate. The portion of the income or loss applicable to noncontrolling interests in subsidiaries is reflected in the unaudited condensed consolidated statements of operations. As of June 30, 2023, details of the Company’s major subsidiaries were as follows: SCHEDULE OF ENTITIES AND ITS SUBSIDIARIES Entity Name Date of Incorporation Parent Entity Nature of Operation Place of Incorporation DIGLS July 4, 2016 FVTI Investment holding Republic of Seychelles DILHK June 22, 2016 DIGLS Investment holding Hong Kong, PRC QHDX November 3, 2016 DILHK Investment holding PRC FVTL May 31, 2011 QHDX Trading of food and platform PRC JJGS August 17, 2017 FVTI Investment holding Republic of Seychelles JJHK August 24, 2017 JJGS Investment holding Hong Kong, PRC JJSZ November 16, 2018 JJHK Trading of food PRC Xixingdao August 28, 2019 QHDX Drinking water distribution and delivery PRC Dongguan City Fu La Tu Trade Ltd (“FLTT”) September 27, 2020 FVTL Trading of alcoholic beverages PRC Dongguan City Fu Xin Gu Trade Ltd (“FXGT”) December 2, 2020 FVTL Trading of alcoholic beverages PRC Dongguan City Fu Xin Technology Ltd (“FXTL”) November 12, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Guan Healthy Industry Technology Ltd (“FGHL”) December 21, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Jing Technology Ltd (“FJTL”) November 17, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Xiang Technology Ltd (“FGTL”) November 16, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Ji Food & Beverage Ltd (“FJFL”) November 9, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Lai Food Ltd (“FLFL”) September 27, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Yi Beverage Ltd (“FYBL”) November 12, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Xi Drinking Water Company Ltd (“FXWL”) March 17, 2021 Xixingdao Drinking water distribution and delivery, sales of alcoholic beverages and water purifier PRC Dongguan City Fu Jia Drinking Water Company Ltd (“FJWL”) March 29, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Dongguan City Fu Sheng Drinking Water Company Ltd (“FSWL”) March 29, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Shenzhen Fu Jin Trading Technology Company Ltd (“FJSTL”) June 7, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Dongguan City Fu Li Trading Ltd (“FLTL”) September 10, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Guangdong Fu Gu Supply Chain Group Ltd (“FGGC”) September 13, 2021 QHDX Trading of alcoholic beverages PRC Dongguan City Fu Zhi Gu Trading Ltd (“FZGTL”) September 9, 2022 FVTL Trading of alcoholic beverages PRC Dongguan City Chang Fu Trading Ltd (“CFTL”) September 9, 2022 FVTL Trading of alcoholic beverages PRC Dongguan City La Tong Trading Ltd (“LTTL”) August 8, 2022 FVTL Trading of alcoholic beverages PRC Dongguan City Kai Fu Trading Ltd (“KFTL”) September 8, 2022 FVTL Trading of alcoholic beverages PRC |
Use of estimates | Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant accounting estimates include certain assumptions related to going concern, allowance of credit losses, allowance of deferred tax asset and uncertain tax position, implicit interest rate of operating leases, useful lives and impairment of long-lived assets, and impairment of goodwill. Actual results may differ from these estimates. |
Foreign currency translation and re-measurement | Foreign currency translation and re-measurement The Company translates its foreign operations to the U.S. dollar in accordance with ASC 830, “ Foreign Currency Matters The reporting currency for the Company and its subsidiaries is the U.S. dollar. The Company, DIGLS, DILHK, JJGS and JJHK’s functional currency is the U.S. dollar; QHDX, JJSZ and their subsidiaries which are incorporated in PRC use the Chinese Renminbi (“RMB”) as their functional currency. The Company’s subsidiaries, whose records are not maintained in that company’s functional currency, re-measure their records into their functional currency as follows: ● Monetary assets and liabilities at exchange rates in effect at the end of each period ● Nonmonetary assets and liabilities at historical rates ● Revenue and expense items at the average rate of exchange prevailing during the period Gains and losses from these re-measurements were not significant and have been included in the Company’s results of operations. The Company’s subsidiaries, whose functional currency is not the U.S. dollar, translate their records into the U.S. dollar as follows: ● Assets and liabilities at the rate of exchange in effect at the balance sheet date ● Equities at the historical rate ● Revenue and expense items at the average rate of exchange prevailing during the period Translation of amounts from the local currencies of the Company into US$ has been made at the following exchange rates for the respective periods: SCHEDULE OF FOREIGN CURRENCY EXCHANGE RATE TRANSLATION 2023 2022 As of and for the 2023 2022 Period-end RMB:US$1 exchange rate 0.13880 0.14927 Period-average RMB:US$1 exchange rate 0.14448 0.15451 The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into U.S. dollars at the rates used in translation. |
Impairment of long-lived assets other than goodwill | Impairment of long-lived assets other than goodwill The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. Impairment may be the result of becoming obsolete from a change in the industry or new technologies. Impairment is present if the carrying amount of an asset is less than its undiscounted cash flows to be generated. If an asset is considered impaired, a loss is recognized based on the amount by which the carrying amount exceeds the fair market value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. The Company did not recognize any impairment of long-lived assets during the six months ended June 30, 2023 and 2022. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of the net identifiable assets acquired in a business combination. In accordance with FASB ASC Topic 350, “Intangibles-Goodwill and Others”, goodwill is subject to at least an annual assessment for impairment or more frequently if events or changes in circumstances indicate that an impairment may exist, applying a fair-value based test. Fair value is generally determined using a discounted cash flow analysis. The Company would recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds its fair value up to the amount of goodwill allocated to that reporting unit. During the six months ended June 30, 2023 and 2022, the Company did not record any impairment of goodwill. |
Revenue recognition | Revenue recognition The Company follows the guidance of ASC 606, revenue from contracts with customers is recognized using the following 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. Under Topic 606, revenues are recognized when the promised products have been confirmed of delivery or services have been transferred to the consumers in amounts that reflect the consideration the customer expects to be entitled to in exchange for those services. The Company presents value added taxes (“VAT”) as reductions of revenues. The Company recognizes revenues net of value added taxes (“VAT”) and relevant charges. We generate revenue primarily from the sales of liquor, water, water purifier and other products directly to agents, wholesalers and end users, with majority of sales transactions were conducted offline. We recognize product revenue at a point in time when the control of the products has been transferred to customers. The transfer of control is considered complete when products have been picked up by or delivered to our customers. We account for shipping and handling fees as a fulfillment cost. The following table provides information about disaggregated revenue based on revenue by product types: SCHEDULE OF DISAGGREGATION REVENUE 2023 2022 2023 2022 Three months ended Six months ended 2023 2022 2023 2022 Sales of liquor $ 878,952 $ 1,203,484 $ 1,782,672 $ 1,833,946 Sales of water 213,582 808,648 633,202 1,338,092 Sales of water purifier 114,714 310,807 367,837 395,548 Others 65,349 13,520 124,175 30,683 Total $ 1,272,597 $ 2,336,459 $ 2,907,886 $ 3,598,269 |
Contract liabilities | Contract liabilities Contract liabilities consist mainly of customer advances. On certain occasions, the Company may receive prepayments from downstream retailers or wholesales customers for liquors, water and other products prior to them taking possession of the Company’s products. The Company records these receipts as customer advances until the control of the products has been transferred the customers. As of June 30, 2023 and December 31, 2022, the Company had customer advances of $ 116,769 139,334 24,707 |
Related party transaction | Related party transaction Transactions involving related parties cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated. |
Recently adopted accounting pronouncements | Recently adopted accounting pronouncements In June 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. ASU No. 2016-13 was further amended in November 2020 by ASU No. 2020-10, Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842). As a result, ASC Topic 326, Financial Instruments – Credit Losses is effective for smaller reporting companies for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted ASU No. 2016-13 on January 1, 2023 and the adoption did not have a material impact on the Company’s unaudited condensed consolidated financial statements. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASC Topic 606, “Revenue from Contracts with Customers”. This ASU is expected to improve comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. The new guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company adopted ASU No. 2021-08 on January 1, 2023 and the adoption did not have a material impact on the Company’s unaudited condensed consolidated financial statements. |
ORGANIZATION AND SUMMARY OF S_3
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
SCHEDULE OF ENTITIES AND ITS SUBSIDIARIES | As of June 30, 2023, details of the Company’s major subsidiaries were as follows: SCHEDULE OF ENTITIES AND ITS SUBSIDIARIES Entity Name Date of Incorporation Parent Entity Nature of Operation Place of Incorporation DIGLS July 4, 2016 FVTI Investment holding Republic of Seychelles DILHK June 22, 2016 DIGLS Investment holding Hong Kong, PRC QHDX November 3, 2016 DILHK Investment holding PRC FVTL May 31, 2011 QHDX Trading of food and platform PRC JJGS August 17, 2017 FVTI Investment holding Republic of Seychelles JJHK August 24, 2017 JJGS Investment holding Hong Kong, PRC JJSZ November 16, 2018 JJHK Trading of food PRC Xixingdao August 28, 2019 QHDX Drinking water distribution and delivery PRC Dongguan City Fu La Tu Trade Ltd (“FLTT”) September 27, 2020 FVTL Trading of alcoholic beverages PRC Dongguan City Fu Xin Gu Trade Ltd (“FXGT”) December 2, 2020 FVTL Trading of alcoholic beverages PRC Dongguan City Fu Xin Technology Ltd (“FXTL”) November 12, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Guan Healthy Industry Technology Ltd (“FGHL”) December 21, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Jing Technology Ltd (“FJTL”) November 17, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Xiang Technology Ltd (“FGTL”) November 16, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Ji Food & Beverage Ltd (“FJFL”) November 9, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Lai Food Ltd (“FLFL”) September 27, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Yi Beverage Ltd (“FYBL”) November 12, 2020 Xixingdao Drinking water distribution and delivery PRC Dongguan City Fu Xi Drinking Water Company Ltd (“FXWL”) March 17, 2021 Xixingdao Drinking water distribution and delivery, sales of alcoholic beverages and water purifier PRC Dongguan City Fu Jia Drinking Water Company Ltd (“FJWL”) March 29, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Dongguan City Fu Sheng Drinking Water Company Ltd (“FSWL”) March 29, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Shenzhen Fu Jin Trading Technology Company Ltd (“FJSTL”) June 7, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Dongguan City Fu Li Trading Ltd (“FLTL”) September 10, 2021 Xixingdao Drinking water distribution and delivery, sales of water purifier PRC Guangdong Fu Gu Supply Chain Group Ltd (“FGGC”) September 13, 2021 QHDX Trading of alcoholic beverages PRC Dongguan City Fu Zhi Gu Trading Ltd (“FZGTL”) September 9, 2022 FVTL Trading of alcoholic beverages PRC Dongguan City Chang Fu Trading Ltd (“CFTL”) September 9, 2022 FVTL Trading of alcoholic beverages PRC Dongguan City La Tong Trading Ltd (“LTTL”) August 8, 2022 FVTL Trading of alcoholic beverages PRC Dongguan City Kai Fu Trading Ltd (“KFTL”) September 8, 2022 FVTL Trading of alcoholic beverages PRC |
SCHEDULE OF FOREIGN CURRENCY EXCHANGE RATE TRANSLATION | Translation of amounts from the local currencies of the Company into US$ has been made at the following exchange rates for the respective periods: SCHEDULE OF FOREIGN CURRENCY EXCHANGE RATE TRANSLATION 2023 2022 As of and for the 2023 2022 Period-end RMB:US$1 exchange rate 0.13880 0.14927 Period-average RMB:US$1 exchange rate 0.14448 0.15451 |
SCHEDULE OF DISAGGREGATION REVENUE | The following table provides information about disaggregated revenue based on revenue by product types: SCHEDULE OF DISAGGREGATION REVENUE 2023 2022 2023 2022 Three months ended Six months ended 2023 2022 2023 2022 Sales of liquor $ 878,952 $ 1,203,484 $ 1,782,672 $ 1,833,946 Sales of water 213,582 808,648 633,202 1,338,092 Sales of water purifier 114,714 310,807 367,837 395,548 Others 65,349 13,520 124,175 30,683 Total $ 1,272,597 $ 2,336,459 $ 2,907,886 $ 3,598,269 |
ACCOUNTS RECEIVABLE, NET (Table
ACCOUNTS RECEIVABLE, NET (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Credit Loss [Abstract] | |
SCHEDULE OF ACCOUNTS RECEIVABLE | Accounts receivable consisted of the following as of June 30, 2023 and December 31, 2022: SCHEDULE OF ACCOUNTS RECEIVABLE June 30, December 31, Accounts receivable (including $ 73,096 nil $ 5,461,870 $ 4,797,564 Less: Doubtful allowance (including $ 724 nil (360,149 ) - Accounts receivable, net $ 5,101,721 $ 4,797,564 |
SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS | Allowance for doubtful accounts movement is as follows: SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS June 30, December 31, Beginning balance $ - $ - Additions to allowance 374,894 - Foreign currency translation adjustment (14,745 ) - Ending balance $ 360,149 $ - |
PREPAYMENTS AND OTHER CURRENT_2
PREPAYMENTS AND OTHER CURRENT ASSETS, NET (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Prepayments And Other Current Assets Net | |
SCHEDULE OF PREPAYMENT AND OTHER CURRENT ASSETS | Prepayments and other current assets consisted of the following as of June 30, 2023 and December 31, 2022: SCHEDULE OF PREPAYMENT AND OTHER CURRENT ASSETS June 30, 2023 December 31, 2022 Prepayments (including $ 2,394,062 2,255,288 $ 2,875,927 $ 3,001,866 Other current assets 6,995 4,631 Total prepayments and other current assets 2,882,922 3,006,497 Less: Allowance for doubtful accounts (including $ 1,231,440 1,152,427 (1,345,283 ) (1,247,580 ) Prepayments and other current assets, net $ 1,537,639 $ 1,758,917 |
SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS | Allowance for doubtful accounts movements is as follows: SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS June 30, 2023 December 31, 2022 Beginning balance $ 1,247,580 $ - Additions to allowance 154,985 1,284,005 Foreign currency translation adjustment (57,282 ) (36,425 ) Ending balance $ 1,345,283 $ 1,247,580 |
DEPOSITS PAID, NET (Tables)
DEPOSITS PAID, NET (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Deposits Paid Net | |
SCHEDULE OF DEPOSITS PAID | Deposits paid consisted of the following as of June 30, 2023 and December 31, 2022: SCHEDULE OF DEPOSITS PAID June 30, 2023 December 31, 2022 Deposits paid (including $ 1,573,209 1,628,511 $ 2,280,196 $ 2,365,652 Less: Allowance for doubtful accounts (including $ 999,625 870,066 (1,606,635 ) (1,244,350 ) Deposits paid, net $ 673,561 $ 1,121,302 |
SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS OF DEPOSITS PAID | Allowance for doubtful accounts movement is as follows: SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS OF DEPOSITS PAID June 30, 2023 December 31, 2022 Beginning balance $ 1,244,350 $ - Additions to allowance 430,265 1,280,681 Foreign currency translation adjustment (67,980 ) (36,331 ) Ending balance $ 1,606,635 $ 1,244,350 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY AND EQUIPMENT | Property and equipment consisted of the following as of June 30, 2023 and December 31, 2022: SCHEDULE OF PROPERTY AND EQUIPMENT June 30, 2023 December 31, 2022 Office equipment $ 116,520 $ 116,520 Leasehold improvement 126,386 126,386 Vehicle 31,910 - Property and equipment 274,816 242,906 Less: Accumulated depreciation (162,355 ) (145,016 ) Property and equipment, net $ 112,461 $ 97,890 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF INTANGIBLE ASSETS | Intangible assets and related accumulated amortization were as follows : SCHEDULE OF INTANGIBLE ASSETS June 30, 2023 December 31, 2022 Distribution channel $ 2,989,709 $ 3,117,635 Others 25,553 27,809 Total intangible assets 3,015,262 3,145,444 Less: Accumulated amortization (1,850,517 ) (1,822,875 ) Less: Accumulated impairment (912,597 ) (951,643 ) Intangible assets, net $ 252,148 $ 370,926 |
SCHEDULE OF FUTURE AMORTIZATION EXPENSES FOR DISTRIBUTION CHANNELS | As of June 30, 2023, the future estimated amortization costs for intangible assets are as follows: SCHEDULE OF FUTURE AMORTIZATION EXPENSES FOR DISTRIBUTION CHANNELS Year ending December 31, 2023 (remaining) $ 102,773 2024 138,256 2025 5,010 2026 5,010 2027 1,099 Total $ 252,148 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
SCHEDULE OF AMOUNT DUE FROM AND DUE TO RELATED PARTIES | Amounts due to related parties as of June 30, 2023 and December 31, 2022 are as follows: SCHEDULE OF AMOUNT DUE FROM AND DUE TO RELATED PARTIES June 30, 2023 December 31, 2022 Mr. Yumin Lin President, Chief Executive Officer, Secretary, Director and majority shareholder $ 517,426 $ 389,051 Ms. Xiulan Zhou Manager of a subsidiary, Mr. Yumin Lin’s wife 1,287 508 Mr. Huagen Li Manager of a subsidiary 2,221 2,316 Mr. Guodong Jia Manager of a subsidiary 4,462 2,342 Mr. Hongwei Ye Manager of a subsidiary, Shareholder 15 16 Mr. Anping Chen Manager of a subsidiary 5,424 1,290 Mr. Jiangwei Jia Manager of a subsidiary 6,497 3,678 Mr. Yuwen Li Vice President 69,925 64,924 Ms. Lihua Li Manager of a subsidiary 3,376 - Shenzhen DaXingHuaShang Industrial Group Ltd. (fka Shenzhen DaXingHuaShang Industry Development Ltd.) Mr. Yumin Lin is the supervisor of Shenzhen DaXingHuaShang Industrial Group Ltd. 83,279 86,842 Ms. Chunxiang Zhang Manager of a subsidiary 3,168 998 Mr. Meng Xue Manager of a subsidiary 7,359 5,449 Ms. Shuqin Chen Manager of a subsidiary 5,400 1,358 Mr. Zhipeng Zuo Manager of a subsidiary 16,762 59 Mr. Deqin Ke Manager of a subsidiary - 724 Mr. Aisheng Zhang Manager of a subsidiary 15,982 2,320 Mr. Zhihua Liao Manager of a subsidiary 5,960 3,800 $ 748,543 $ 565,675 |
SCHEDULE OF REVENUE GENERATED FROM RELATED PARTIES | Revenues generated from related parties during the six months ended June 30, 2023 and 2022 are as follows: SCHEDULE OF REVENUE GENERATED FROM RELATED PARTIES Six months ended 2023 2022 Mr. Kaihong Lin Chief Financial Officer and Treasurer $ 278 $ 652 Mr. Yumin Lin President, Chief Executive Officer, Secretary, Director and majority shareholder - 438 Mr. Zihao Ye Manager of a subsidiary - 262 Ms. Xiulan Zhou Manager of a subsidiary, Mr. Yumin Lin’s wife 14 - Dongguan Huanhai Trading Co., Ltd. Mr. Hongwei Ye, a shareholder of the Company and a manager of a subsidiary, is the controlling shareholder of Dongguan Huanhai Trading Co., Ltd. 10,886 13,553 Guangdong Yuexin Jiaotong Construction Co., Ltd. Mr. Naiyong Luo, a manager of a subsidiary, is the controlling shareholder of Guangdong Yuexin Jiaotong Construction Co., Ltd. 10,578 7,581 Dongguan City Hualianguan Chemical Co., Ltd. Mr. Hongwei Ye, a shareholder of the Company and a manager of a subsidiary, is the controlling shareholder of Dongguan City Hualianguan Chemical Co., Ltd. 14,808 19,009 Dongguan Humen Shuiyan Drinking Water Store Ms. Shuiyan Li, a shareholder of the Company, is the controlling shareholder of Dongguan Humen Shuiyan Drinking Water Store 33,034 - Revenues generated from related parties $ 69,598 $ 41,495 |
SCHEDULE OF COST OF REVENUES FROM RELATED PARTIES | Cost of revenues from related parties during the six months ended June 30, 2023 and 2022 is as follows: SCHEDULE OF COST OF REVENUES FROM RELATED PARTIES Six months ended 2023 2022 Dongguan Baxi Food Distribution Co., Ltd. Significantly influenced by the Company $ 57,509 $ 15,899 Dongguan Dalingshan Xinwenhua Drinking Water Store Significantly influenced by the Company 23,614 43,759 Dongguan Pengqin Drinking Water Co., Ltd. Significantly influenced by the Company 23,433 33,836 Dongguan Dengqinghu Drinking Water Store Significantly influenced by the Company 2,934 1,475 Dongguan Tailai Trading Co., Ltd. Significantly influenced by the Company 52,324 34,519 Dongguan Anxiang Technology Co., Ltd. Significantly influenced by the Company 56,704 64,639 Guangdong Jiaduonuo Shengshi Trading Co., Ltd. Significantly influenced by the Company 90,355 64,565 Dongguan Dalingshan Runxin Drinking Water Store Significantly influenced by the Company 11,473 16,312 Dongguan City Yijia Trading Co., Ltd. Mr. Yongming Li, a shareholder of the Company, is the controlling shareholder of Dongguan City Yijia Trading Co., Ltd. 43,750 111,376 Cost of revenues from related parties $ 362,096 $ 386,380 |
SCHEDULE OF PURCHASES FROM RELATED PARTIES | Purchases from related parties during the six months ended June 30, 2023 and 2022 are as follows: SCHEDULE OF PURCHASES FROM RELATED PARTIES Six months ended 2023 2022 Dongguan Baxi Food Distribution Co., Ltd. Significantly influenced by the Company $ 61,259 $ 19,406 Dongguan Dalingshan Xinwenhua Drinking Water Store Significantly influenced by the Company 25,221 56,842 Dongguan Pengqin Drinking Water Co., Ltd. Significantly influenced by the Company 25,416 37,266 Dongguan Dengqinghu Drinking Water Store Significantly influenced by the Company 3,124 1,659 Dongguan Tailai Trading Co., Ltd. Significantly influenced by the Company 55,999 33,634 Dongguan Anxiang Technology Co., Ltd. Significantly influenced by the Company 56,965 66,220 Guangdong Jiaduonuo Shengshi Trading Co., Ltd. Significantly influenced by the Company 90,430 69,407 Dongguan Dalingshan Runxin Drinking Water Store Significantly influenced by the Company 12,522 16,374 Dongguan City Yijia Trading Co., Ltd. Mr. Yongming Li, a shareholder of the Company, is the controlling shareholder of Dongguan City Yijia Trading Co., Ltd. 43,750 48,579 Purchase from related party $ 374,686 $ 349,387 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
SCHEDULE OF COMPONENTS OF INCOME TAX PROVISION | The components of the income tax provision are as follows: SCHEDULE OF COMPONENTS OF INCOME TAX PROVISION Six months ended June 30, 2023 2022 Current: – United States of America $ 41,444 $ 45,562 – Seychelles - - – Hong Kong - - – The PRC 55,058 58,359 Current income tax expense Deferred – United States of America - - – Seychelles - - – Hong Kong - - – The PRC - - Deferred income tax expense Total $ 96,502 $ 103,921 |
OPERATING LEASES (Tables)
OPERATING LEASES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Operating Leases | |
SCHEDULE OF COMPONENTS OF LEASE EXPENSE AND SUPPLEMENTAL CASH FLOW INFORMATION | The components of lease expense and supplemental cash flow information related to leases for the six months ended June 30, 2023 and 2022 are as follows: SCHEDULE OF COMPONENTS OF LEASE EXPENSE AND SUPPLEMENTAL CASH FLOW INFORMATION Operating lease cost (included in general and administrative expenses in the Company’s unaudited condensed consolidated statements of operations) Six months ended 2023 2022 Related parties $ 9,501 $ 11,347 Non-related parties 63,683 74,009 Total $ 73,184 $ 85,356 Operating Lease Cost $ 73,184 $ 85,356 Other information for the six months ended June 30, June 30, Cash paid for amounts included in the measurement of lease obligations $ 77,612 $ 78,215 Weighted average remaining lease term (in years) 2.72 3.55 Weighted average discount rate 3.23 % 3.23 % |
SCHEDULE OF MATURITIES OF LEASE OBLIGATIONS | Maturities of the Company’s lease obligations as of June 30, 2023 are as follows: SCHEDULE OF MATURITIES OF LEASE OBLIGATIONS Year ending December 31, 2023 (remaining) $ 65,998 2024 121,342 2025 103,943 2026 40,951 2027 5,552 Total lease payment 337,786 Less: Imputed interest (11,701 ) Operating lease obligations $ 326,085 |
BANK AND OTHER BORROWINGS (Tabl
BANK AND OTHER BORROWINGS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
SCHEDULE OF BALANCE OF LOAN BORROWED UNDER CREDIT LINES | The balance of the loans borrowed as of June 30, 2023 and December 31, 2022 were as follows: SCHEDULE OF BALANCE OF LOAN BORROWED UNDER CREDIT LINES June 30, December 31, Loans from a trust in PRC $ 38,810 $ 60,049 China Construction Bank 336,585 276,447 WeBank 81,488 77,220 Guangdong Nanyue Bank 44,207 67,375 Bank of Ningbo 28,499 - Aggregate outstanding principal balances 529,589 481,091 Less: current portion 483,233 422,653 Non-current portion $ 46,356 $ 58,438 |
SCHEDULE OF FUTURE MINIMUM LOAN PAYMENTS | Future minimum loan payments as of June 30, 2023 are as follows: SCHEDULE OF FUTURE MINIMUM LOAN PAYMENTS Year ending December 31, 2023 (remaining) $ 210,155 2024 293,951 2025 12,826 2026 5,425 2027 5,425 Thereafter 1,807 Total $ 529,589 |
SCHEDULE OF ENTITIES AND ITS SU
SCHEDULE OF ENTITIES AND ITS SUBSIDIARIES (Details) | 6 Months Ended |
Jun. 30, 2023 | |
DIGLS [Member] | |
Entity Name | DIGLS |
Entity incorporation date | Jul. 04, 2016 |
Nature of operation | Investment holding |
Country of incorporation | Republic of Seychelles |
DILHK [Member] | |
Entity Name | DILHK |
Entity incorporation date | Jun. 22, 2016 |
Nature of operation | Investment holding |
Country of incorporation | Hong Kong, PRC |
QHDX [Member] | |
Entity Name | QHDX |
Entity incorporation date | Nov. 03, 2016 |
Nature of operation | Investment holding |
Country of incorporation | PRC |
FVTL [Member] | |
Entity Name | FVTL |
Entity incorporation date | May 31, 2011 |
Nature of operation | Trading of food and platform |
Country of incorporation | PRC |
JJGS [Member] | |
Entity Name | JJGS |
Entity incorporation date | Aug. 17, 2017 |
Nature of operation | Investment holding |
Country of incorporation | Republic of Seychelles |
JJHK [Member] | |
Entity Name | JJHK |
Entity incorporation date | Aug. 24, 2017 |
Nature of operation | Investment holding |
Country of incorporation | Hong Kong, PRC |
JJSZ [Member] | |
Entity Name | JJSZ |
Entity incorporation date | Nov. 16, 2018 |
Nature of operation | Trading of food |
Country of incorporation | PRC |
Xixingdao [Member] | |
Entity Name | Xixingdao |
Entity incorporation date | Aug. 28, 2019 |
Nature of operation | Drinking water distribution and delivery |
Country of incorporation | PRC |
FLTT [Member] | |
Entity Name | Dongguan City Fu La Tu Trade Ltd (“FLTT”) |
Entity incorporation date | Sep. 27, 2020 |
Nature of operation | Trading of alcoholic beverages |
Country of incorporation | PRC |
FXGT [Member] | |
Entity Name | Dongguan City Fu Xin Gu Trade Ltd (“FXGT”) |
Entity incorporation date | Dec. 02, 2020 |
Nature of operation | Trading of alcoholic beverages |
Country of incorporation | PRC |
FXTL [Member] | |
Entity Name | Dongguan City Fu Xin Technology Ltd (“FXTL”) |
Entity incorporation date | Nov. 12, 2020 |
Nature of operation | Drinking water distribution and delivery |
Country of incorporation | PRC |
FGHL [Member] | |
Entity Name | Dongguan City Fu Guan Healthy Industry Technology Ltd (“FGHL”) |
Entity incorporation date | Dec. 21, 2020 |
Nature of operation | Drinking water distribution and delivery |
Country of incorporation | PRC |
FJTL [Member] | |
Entity Name | Dongguan City Fu Jing Technology Ltd (“FJTL”) |
Entity incorporation date | Nov. 17, 2020 |
Nature of operation | Drinking water distribution and delivery |
Country of incorporation | PRC |
FGTL [Member] | |
Entity Name | Dongguan City Fu Xiang Technology Ltd (“FGTL”) |
Entity incorporation date | Nov. 16, 2020 |
Nature of operation | Drinking water distribution and delivery |
Country of incorporation | PRC |
FJFL [Member] | |
Entity Name | Dongguan City Fu Ji Food & Beverage Ltd (“FJFL”) |
Entity incorporation date | Nov. 09, 2020 |
Nature of operation | Drinking water distribution and delivery |
Country of incorporation | PRC |
FLFL [Member] | |
Entity Name | Dongguan City Fu Lai Food Ltd (“FLFL”) |
Entity incorporation date | Sep. 27, 2020 |
Nature of operation | Drinking water distribution and delivery |
Country of incorporation | PRC |
FYBL [Member] | |
Entity Name | Dongguan City Fu Yi Beverage Ltd (“FYBL”) |
Entity incorporation date | Nov. 12, 2020 |
Nature of operation | Drinking water distribution and delivery |
Country of incorporation | PRC |
FXWL [Member] | |
Entity Name | Dongguan City Fu Xi Drinking Water Company Ltd (“FXWL”) |
Entity incorporation date | Mar. 17, 2021 |
Nature of operation | Drinking water distribution and delivery, sales of alcoholic beverages and water purifier |
Country of incorporation | PRC |
FJWL [Member] | |
Entity Name | Dongguan City Fu Jia Drinking Water Company Ltd (“FJWL”) |
Entity incorporation date | Mar. 29, 2021 |
Nature of operation | Drinking water distribution and delivery, sales of water purifier |
Country of incorporation | PRC |
FSWL [Member] | |
Entity Name | Dongguan City Fu Sheng Drinking Water Company Ltd (“FSWL”) |
Entity incorporation date | Mar. 29, 2021 |
Nature of operation | Drinking water distribution and delivery, sales of water purifier |
Country of incorporation | PRC |
FJSTL [Member] | |
Entity Name | Shenzhen Fu Jin Trading Technology Company Ltd (“FJSTL”) |
Entity incorporation date | Jun. 07, 2021 |
Nature of operation | Drinking water distribution and delivery, sales of water purifier |
Country of incorporation | PRC |
FLTL [Member] | |
Entity Name | Dongguan City Fu Li Trading Ltd (“FLTL”) |
Entity incorporation date | Sep. 10, 2021 |
Nature of operation | Drinking water distribution and delivery, sales of water purifier |
Country of incorporation | PRC |
FGGC [Member] | |
Entity Name | Guangdong Fu Gu Supply Chain Group Ltd (“FGGC”) |
Entity incorporation date | Sep. 13, 2021 |
Nature of operation | Trading of alcoholic beverages |
Country of incorporation | PRC |
FZGTL [Member] | |
Entity Name | Dongguan City Fu Zhi Gu Trading Ltd (“FZGTL”) |
Entity incorporation date | Sep. 09, 2022 |
Nature of operation | Trading of alcoholic beverages |
Country of incorporation | PRC |
CFTL [Member] | |
Entity Name | Dongguan City Chang Fu Trading Ltd (“CFTL”) |
Entity incorporation date | Sep. 09, 2022 |
Nature of operation | Trading of alcoholic beverages |
Country of incorporation | PRC |
LTTL [Member] | |
Entity Name | Dongguan City La Tong Trading Ltd (“LTTL”) |
Entity incorporation date | Aug. 08, 2022 |
Nature of operation | Trading of alcoholic beverages |
Country of incorporation | PRC |
KFTL [Member] | |
Entity Name | Dongguan City Kai Fu Trading Ltd (“KFTL”) |
Entity incorporation date | Sep. 08, 2022 |
Nature of operation | Trading of alcoholic beverages |
Country of incorporation | PRC |
SCHEDULE OF FOREIGN CURRENCY EX
SCHEDULE OF FOREIGN CURRENCY EXCHANGE RATE TRANSLATION (Details) | Jun. 30, 2023 | Jun. 30, 2022 |
Period-end RMB [Member] | ||
Offsetting Assets [Line Items] | ||
Period-average RMB:US$1 exchange rate | 0.13880 | 0.14927 |
Period-average RMB [Member] | ||
Offsetting Assets [Line Items] | ||
Period-average RMB:US$1 exchange rate | 0.14448 | 0.15451 |
SCHEDULE OF DISAGGREGATION REVE
SCHEDULE OF DISAGGREGATION REVENUE (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Product Information [Line Items] | ||||
Total | $ 1,272,597 | $ 2,336,459 | $ 2,907,886 | $ 3,598,269 |
Sales of Liquor [Member] | ||||
Product Information [Line Items] | ||||
Total | 878,952 | 1,203,484 | 1,782,672 | 1,833,946 |
Sales of Water [Member] | ||||
Product Information [Line Items] | ||||
Total | 213,582 | 808,648 | 633,202 | 1,338,092 |
Sales of Water Purifier [Member] | ||||
Product Information [Line Items] | ||||
Total | 114,714 | 310,807 | 367,837 | 395,548 |
Others [Member] | ||||
Product Information [Line Items] | ||||
Total | $ 65,349 | $ 13,520 | $ 124,175 | $ 30,683 |
ORGANIZATION AND SUMMARY OF S_4
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 6 Months Ended | ||||
Jun. 22, 2020 | Mar. 01, 2019 | Apr. 11, 2018 | Jun. 30, 2023 | Dec. 31, 2022 | |
Contract with customer advance | $ 116,769 | $ 139,334 | |||
Amount of customer advances in opening balance | $ 24,707 | ||||
Share Exchange Agreement [Member] | DaXingHuaShang Investment Group Limited [Member] | |||||
Number of shares exchanged | 15,000,000 | ||||
Sale and Purchase Agreement [Member] | Jiujiu Group Stock Co., Ltd [Member] | |||||
Number of shares exchanged | 5 | ||||
Ownership percentage | 100% | ||||
Value shares issued in exchange | $ 150 | ||||
Xixingdao Agreement [Member] | QHDX [Member] | |||||
Number of shares exchanged | 243,134 | ||||
Ownership percentage | 90% |
SCHEDULE OF ACCOUNTS RECEIVABLE
SCHEDULE OF ACCOUNTS RECEIVABLE (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Credit Loss [Abstract] | ||
Accounts receivable (including $73,096 and $nil to related parties as of June 30, 2023 and December 31, 2022, respectively) | $ 5,461,870 | $ 4,797,564 |
Less: Doubtful allowance (including $724 and $nil to related parties as of June 30, 2023 and December 31, 2022, respectively) | (360,149) | |
Accounts receivable, net | $ 5,101,721 | $ 4,797,564 |
SCHEDULE OF ACCOUNTS RECEIVAB_2
SCHEDULE OF ACCOUNTS RECEIVABLE (Details) (Parenthetical) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Defined Benefit Plan Disclosure [Line Items] | ||
Accounts receivable | $ 5,461,870 | $ 4,797,564 |
Doubtful allowance | 360,149 | |
Related Party [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Accounts receivable | 73,096 | |
Doubtful allowance | $ 724 |
SCHEDULE OF ALLOWANCE FOR DOUBT
SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Credit Loss [Abstract] | ||
Beginning balance | ||
Additions to allowance | 374,894 | |
Foreign currency translation adjustment | (14,745) | |
Ending balance | 360,149 | |
Beginning balance | 1,247,580 | |
Additions to allowance | 154,985 | 1,284,005 |
Foreign currency translation adjustment | (57,282) | (36,425) |
Ending balance | $ 1,345,283 | $ 1,247,580 |
SCHEDULE OF PREPAYMENT AND OTHE
SCHEDULE OF PREPAYMENT AND OTHER CURRENT ASSETS (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Prepayments And Other Current Assets Net | |||
Prepayments (including $2,394,062 and $2,255,288 to related parties as of June 30, 2023 and December 31, 2022, respectively) | $ 2,875,927 | $ 3,001,866 | |
Other current assets | 6,995 | 4,631 | |
Total prepayments and other current assets | 2,882,922 | 3,006,497 | |
Less: Allowance for doubtful accounts (including $1,231,440 and $1,152,427 to related parties as of June 30, 2023 and December 31, 2022, respectively) | (1,345,283) | (1,247,580) | |
Prepayments and other current assets, net | $ 1,537,639 | $ 1,758,917 |
SCHEDULE OF PREPAYMENTS AND OTH
SCHEDULE OF PREPAYMENTS AND OTHER CURRENT ASSETS (Details) (Parenthetical) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Defined Benefit Plan Disclosure [Line Items] | |||
Prepayments to related parties | $ 2,875,927 | $ 3,001,866 | |
Allowance for doubtful accounts | 1,345,283 | 1,247,580 | |
Related Party [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Prepayments to related parties | 2,394,062 | 2,255,288 | |
Allowance for doubtful accounts | $ 1,231,440 | $ 1,152,427 |
SCHEDULE OF DEPOSITS PAID (Deta
SCHEDULE OF DEPOSITS PAID (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Deposits Paid Net | |||
Deposits paid (including $1,573,209 and $1,628,511 to related parties as of June 30, 2023 and December 31, 2022, respectively) | $ 2,280,196 | $ 2,365,652 | |
Less: Allowance for doubtful accounts (including $999,625 and $870,066 to related parties as of June 30, 2023 and December 31, 2022, respectively) | (1,606,635) | (1,244,350) | |
Deposits paid, net | $ 673,561 | $ 1,121,302 |
SCHEDULE OF DEPOSITS PAID (De_2
SCHEDULE OF DEPOSITS PAID (Details) (Parenthetical) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Defined Benefit Plan Disclosure [Line Items] | |||
Deposits paid | $ 2,280,196 | $ 2,365,652 | |
Deposits paid allowance for doubtful accounts | 1,606,635 | 1,244,350 | |
Related Party [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Deposits paid | 1,573,209 | 1,628,511 | |
Deposits paid allowance for doubtful accounts | $ 999,625 | $ 870,066 |
SCHEDULE OF ALLOWANCE FOR DOU_2
SCHEDULE OF ALLOWANCE FOR DOUBTFUL ACCOUNTS OF DEPOSITS PAID (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Deposits Paid Net | ||
Beginning balance | $ 1,244,350 | |
Additions to allowance | 430,265 | 1,280,681 |
Foreign currency translation adjustment | (67,980) | (36,331) |
Ending balance | $ 1,606,635 | $ 1,244,350 |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 274,816 | $ 242,906 |
Less: Accumulated depreciation | (162,355) | (145,016) |
Property and equipment, net | 112,461 | 97,890 |
Office Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 116,520 | 116,520 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 126,386 | 126,386 |
Vehicle [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 31,910 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 18,046 | $ 15,647 |
SCHEDULE OF INTANGIBLE ASSETS (
SCHEDULE OF INTANGIBLE ASSETS (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | $ 3,015,262 | $ 3,145,444 |
Less: Accumulated amortization | (1,850,517) | (1,822,875) |
Less: Accumulated impairment | (912,597) | (951,643) |
Intangible assets, net | 252,148 | 370,926 |
Distribution Channel [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | 2,989,709 | 3,117,635 |
Other Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total intangible assets | $ 25,553 | $ 27,809 |
SCHEDULE OF FUTURE AMORTIZATION
SCHEDULE OF FUTURE AMORTIZATION EXPENSES FOR DISTRIBUTION CHANNELS (Details) | Jun. 30, 2023 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2023 (remaining) | $ 102,773 |
2024 | 138,256 |
2025 | 5,010 |
2026 | 5,010 |
2027 | 1,099 |
Total | $ 252,148 |
INTANGIBLE ASSETS, NET (Details
INTANGIBLE ASSETS, NET (Details Narrative) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expenses | $ 106,634 | $ 417,770 |
SCHEDULE OF AMOUNT DUE FROM AND
SCHEDULE OF AMOUNT DUE FROM AND DUE TO RELATED PARTIES (Details) - Related Party [Member] - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Related Party Transaction [Line Items] | ||
Due to related parties | $ 748,543 | $ 565,675 |
President, Chief Executive Officer, Secretary, Director and Majority shareholder [Member] | Mr Yumin Lin [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 517,426 | 389,051 |
Manager of a Subsidiary, Mr. Yumin Lins Wife [Member] | Ms. Xiulan Zhou [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 1,287 | |
Manager of a Subsidiary [Member] | Ms. Xiulan Zhou [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 508 | |
Manager of a Subsidiary [Member] | Mr. Huagen Li [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 2,221 | 2,316 |
Manager of a Subsidiary [Member] | Mr. Guodong Jia [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 4,462 | 2,342 |
Manager of a Subsidiary [Member] | Mr. Anping Chen [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 5,424 | 1,290 |
Manager of a Subsidiary [Member] | Mr. Jiangwei Jia [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 6,497 | 3,678 |
Manager of a Subsidiary [Member] | Ms. Lihua Li [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 3,376 | |
Manager of a Subsidiary [Member] | Ms. Chunxiang Zhang [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 3,168 | 998 |
Manager of a Subsidiary [Member] | Mr. Meng Xue [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 7,359 | 5,449 |
Manager of a Subsidiary [Member] | Ms. Shuqin Chen [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 5,400 | 1,358 |
Manager of a Subsidiary [Member] | Mr. Zhipeng Zuo [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 16,762 | 59 |
Manager of a Subsidiary [Member] | Mr. Deqin ke [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 724 | |
Manager of a Subsidiary [Member] | Mr. Aisheng Zhang [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 15,982 | 2,320 |
Manager of a Subsidiary [Member] | Mr. Zhihua Liao [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 5,960 | 3,800 |
Manager of a Subsidiary, Shareholder [Member] | Mr. Hongwei Ye [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 15 | 16 |
Vice President [Member] | Mr. Yuwen Li [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | 69,925 | 64,924 |
Mr. Yumin Lin is the Supervisor of Shenzhen DaXingHuaShang Industry Development Ltd [Member] | Shenzhen Da Xing Hua Shang Industry Development Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Due to related parties | $ 83,279 | $ 86,842 |
SCHEDULE OF REVENUE GENERATED F
SCHEDULE OF REVENUE GENERATED FROM RELATED PARTIES (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Related Party Transaction [Line Items] | ||
Revenues generated from related parties | $ 69,598 | $ 41,495 |
Mr. Naiyong Luo a Manager [Member] | Related Party [Member] | Guangdong Yuexin Jiaotong Construction Co Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Revenues generated from related parties | 10,578 | 7,581 |
Mr. Kaihong Lin [Member] | Chief Financial Officer and Treasurer [Member] | Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Revenues generated from related parties | 278 | 652 |
Mr Yumin Lin [Member] | President, Chief Executive Officer, Secretary, Director and Majority shareholder [Member] | Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Revenues generated from related parties | 438 | |
Mr. ZihaoYe [Member] | Manager of a Subsidiary [Member] | Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Revenues generated from related parties | 262 | |
XiuLan Zhou [Member] | Manager of a Subsidiary, Mr. Yumin Lins Wife [Member] | Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Revenues generated from related parties | 14 | |
Dongguan Huanhai Trading Co., Ltd. [Member] | Mr. Hongwei Ye [Member] | Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Revenues generated from related parties | 10,886 | 13,553 |
Dongguan City Hualianguan Chemical [Member] | Mr. Hongwei Ye [Member] | Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Revenues generated from related parties | 14,808 | 19,009 |
Dongguan Humen Shuiyan Drinking Water [Member] | Shuiyan Li [Member] | Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Revenues generated from related parties | $ 33,034 |
SCHEDULE OF COST OF REVENUES FR
SCHEDULE OF COST OF REVENUES FROM RELATED PARTIES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | $ 652,798 | $ 1,099,523 | $ 1,330,165 | $ 1,617,985 |
Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | 362,096 | 386,380 | ||
Dongguan Baxi Food Distribution Co Ltd. [Member] | Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | 57,509 | 15,899 | ||
Dongguan Dalingshan Xinwenhua Drinking Water Store [Member] | Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | 23,614 | 43,759 | ||
Dongguan Pengqin Drinking Water Co Ltd. [Member] | Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | 23,433 | 33,836 | ||
Dongguan Dengqinghu Drinking Water Store [Member] | Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | 2,934 | 1,475 | ||
Dongguan Tailai Trading Co Ltd [Member] | Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | 52,324 | 34,519 | ||
Dongguan Anxiang Technology Co Ltd. [Member] | Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | 56,704 | 64,639 | ||
Guangdong Jiaduonuo Shengshi Trading Co Ltd. [Member] | Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | 90,355 | 64,565 | ||
Dongguan Dalingshan Runxin Drinking Water Store [Member] | Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | 11,473 | 16,312 | ||
Dongguan City Yijia Trading Co Ltd [Member] | Related Party [Member] | ||||
Related Party Transaction [Line Items] | ||||
Cost of revenues from related parties | $ 43,750 | $ 111,376 |
SCHEDULE OF PURCHASES FROM RELA
SCHEDULE OF PURCHASES FROM RELATED PARTIES (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Purchase from related party | $ 374,686 | $ 349,387 |
Dongguan Baxi Food Distribution Co Ltd. [Member] | ||
Purchase from related party | 61,259 | 19,406 |
Dongguan Dalingshan Xinwenhua Drinking Water Store [Member] | ||
Purchase from related party | 25,221 | 56,842 |
Dongguan Pengqin Drinking Water Co Ltd. [Member] | ||
Purchase from related party | 25,416 | 37,266 |
Dongguan Dengqinghu Drinking Water Store [Member] | ||
Purchase from related party | 3,124 | 1,659 |
Dongguan Tailai Trading Co Ltd [Member] | ||
Purchase from related party | 55,999 | 33,634 |
Dongguan Anxiang Technology Co Ltd. [Member] | ||
Purchase from related party | 56,965 | 66,220 |
Guangdong Jiaduonuo Shengshi Trading Co Ltd. [Member] | ||
Purchase from related party | 90,430 | 69,407 |
Dongguan Dalingshan Runxin Drinking Water Store [Member] | ||
Purchase from related party | 12,522 | 16,374 |
Dongguan City Yijia Trading Co Ltd [Member] | ||
Purchase from related party | $ 43,750 | $ 48,579 |
SCHEDULE OF COMPONENTS OF INCOM
SCHEDULE OF COMPONENTS OF INCOME TAX PROVISION (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Operating Loss Carryforwards [Line Items] | ||||
Total | $ 21,528 | $ 81,514 | $ 96,502 | $ 103,921 |
UNITED STATES | ||||
Operating Loss Carryforwards [Line Items] | ||||
Current income tax expense | 41,444 | 45,562 | ||
Deferred income tax expense | ||||
Seychelles [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Current income tax expense | ||||
Deferred income tax expense | ||||
HONG KONG | ||||
Operating Loss Carryforwards [Line Items] | ||||
Current income tax expense | ||||
Deferred income tax expense | ||||
CHINA | ||||
Operating Loss Carryforwards [Line Items] | ||||
Current income tax expense | 55,058 | 58,359 | ||
Deferred income tax expense |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) | 6 Months Ended | ||
Jun. 30, 2023 USD ($) | Jun. 30, 2023 HKD ($) | Jun. 30, 2022 | |
Operating Loss Carryforwards [Line Items] | |||
U.S federal income tax rate | 21% | 21% | |
Effective income tax rate reconciliation, foreign income tax rate differential, percent | (22.10%) | (22.10%) | 9.70% |
Effective income tax percentage | 25% | 25% | |
CHINA | |||
Operating Loss Carryforwards [Line Items] | |||
Income tax examination, description | On April 2, 2021, the State Taxation Administration issued the notice of the Ministry of Finance and the State Administration of Taxation (“MOF and SAT”) [2021] No.12 to provide an enterprise income tax rate of 2.5% on small-scale and low-profit enterprises whose annual taxable income is less than RMB1,000,000, approximately $142,209, from January 1, 2021 to December 31, 2022. MOF and SAT [2022] No.13 also provides an enterprise income tax rate of 5% on small-scale and low-profit enterprises whose annual taxable income is more than RMB1,000,000, approximately $144,482, but less than RMB3,000,000, approximately $433,445, from January 1, 2022 to December 31, 2024. The qualifications of small-scale and low-profit enterprises were examined annually by the Tax Bureau. All of the Company’s PRC subsidiaries met the criteria of small-scale and low-profit enterprises, except for Xixingdao, FVT Supply Chain and FLTT | On April 2, 2021, the State Taxation Administration issued the notice of the Ministry of Finance and the State Administration of Taxation (“MOF and SAT”) [2021] No.12 to provide an enterprise income tax rate of 2.5% on small-scale and low-profit enterprises whose annual taxable income is less than RMB1,000,000, approximately $142,209, from January 1, 2021 to December 31, 2022. MOF and SAT [2022] No.13 also provides an enterprise income tax rate of 5% on small-scale and low-profit enterprises whose annual taxable income is more than RMB1,000,000, approximately $144,482, but less than RMB3,000,000, approximately $433,445, from January 1, 2022 to December 31, 2024. The qualifications of small-scale and low-profit enterprises were examined annually by the Tax Bureau. All of the Company’s PRC subsidiaries met the criteria of small-scale and low-profit enterprises, except for Xixingdao, FVT Supply Chain and FLTT | |
Up To HK$2,000,000 [Member] | Inland Revenue, Hong Kong [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Effective income tax rate reconciliation, foreign income tax rate differential, percent | 8.25% | 8.25% | |
Income tax assessable profit | $ 255,112 | $ 2,000,000 | |
Over HK$2,000,000 [Member] | Inland Revenue, Hong Kong [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Effective income tax rate reconciliation, foreign income tax rate differential, percent | 16.50% | 16.50% | |
Income tax assessable profit | $ 2,000,000 |
SCHEDULE OF COMPONENTS OF LEASE
SCHEDULE OF COMPONENTS OF LEASE EXPENSE AND SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Operating Lease Cost | $ 73,184 | $ 85,356 |
Cash paid for amounts included in the measurement of lease obligations | $ 77,612 | $ 78,215 |
Weighted average remaining lease term (in years) | 2 years 8 months 19 days | 3 years 6 months 18 days |
Operating lease, weighted average discount rate, percent | 3.23% | 3.23% |
Related Parties [Member] | ||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Operating Lease Cost | $ 9,501 | $ 11,347 |
Non-Related Parties [Member] | ||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Operating Lease Cost | $ 63,683 | $ 74,009 |
SCHEDULE OF MATURITIES OF LEASE
SCHEDULE OF MATURITIES OF LEASE OBLIGATIONS (Details) | Jun. 30, 2023 USD ($) |
Operating Leases | |
2023 (remaining) | $ 65,998 |
2024 | 121,342 |
2025 | 103,943 |
2026 | 40,951 |
2027 | 5,552 |
Total lease payment | 337,786 |
Less: Imputed interest | (11,701) |
Operating lease obligations | $ 326,085 |
OPERATING LEASES (Details Narra
OPERATING LEASES (Details Narrative) | 6 Months Ended | |
Jun. 30, 2023 USD ($) | Jun. 30, 2023 CNY (¥) | |
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Operating lease description | the Company has nineteen separate operating lease agreements for three office spaces, one warehouse and fifteen stores in PRC with remaining lease terms of from 1 month to 46 months | the Company has nineteen separate operating lease agreements for three office spaces, one warehouse and fifteen stores in PRC with remaining lease terms of from 1 month to 46 months |
Qingmei Lin [Member] | Operating Lease Agreement [Member] | ||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Operating lease description | The agreement covers the period from January 1, 2019 to April 30, 2027 | The agreement covers the period from January 1, 2019 to April 30, 2027 |
Payments for rent | $ 1,445 | ¥ 10,000 |
Mr. Hongwei Ye [Member] | Operating Lease Agreement [Member] | ||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Operating lease description | The agreement covers the period from September 27, 2020 to September 30, 2023 | The agreement covers the period from September 27, 2020 to September 30, 2023 |
Payments for rent | $ 138 | ¥ 960 |
SCHEDULE OF BALANCE OF LOAN BOR
SCHEDULE OF BALANCE OF LOAN BORROWED UNDER CREDIT LINES (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Line of Credit Facility [Line Items] | ||
Aggregate outstanding principal balances | $ 529,589 | $ 481,091 |
Less: current portion | 483,233 | 422,653 |
Non-current portion | 46,356 | 58,438 |
Loans from a Trust in PRC [Member] | ||
Line of Credit Facility [Line Items] | ||
Aggregate outstanding principal balances | 38,810 | 60,049 |
China Construction Bank [Member] | ||
Line of Credit Facility [Line Items] | ||
Aggregate outstanding principal balances | 336,585 | 276,447 |
WeBank [Member] | ||
Line of Credit Facility [Line Items] | ||
Aggregate outstanding principal balances | 81,488 | 77,220 |
Guangdong Nanyue Bank [Member] | ||
Line of Credit Facility [Line Items] | ||
Aggregate outstanding principal balances | 44,207 | 67,375 |
Bank of Ningbo [Member] | ||
Line of Credit Facility [Line Items] | ||
Aggregate outstanding principal balances | $ 28,499 |
SCHEDULE OF FUTURE MINIMUM LOAN
SCHEDULE OF FUTURE MINIMUM LOAN PAYMENTS (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
2023 (remaining) | $ 210,155 | |
2024 | 293,951 | |
2025 | 12,826 | |
2026 | 5,425 | |
2027 | 5,425 | |
Thereafter | 1,807 | |
Total | $ 529,589 | $ 481,091 |
BANK AND OTHER BORROWINGS (Deta
BANK AND OTHER BORROWINGS (Details Narrative) | 1 Months Ended | 6 Months Ended | |||||||||||||||||||
Dec. 11, 2021 USD ($) | Jul. 30, 2023 USD ($) | May 31, 2023 USD ($) | Apr. 30, 2023 USD ($) | Feb. 28, 2023 | Jul. 31, 2022 USD ($) | May 31, 2022 USD ($) | Nov. 30, 2021 USD ($) | Aug. 31, 2020 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jul. 30, 2023 CNY (¥) | May 31, 2023 CNY (¥) | Apr. 30, 2023 CNY (¥) | Jul. 31, 2022 CNY (¥) | May 31, 2022 CNY (¥) | Feb. 28, 2022 USD ($) | Feb. 28, 2022 CNY (¥) | Dec. 11, 2021 CNY (¥) | Nov. 30, 2021 CNY (¥) | Aug. 31, 2020 CNY (¥) | |
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Interest expense | $ 18,256 | $ 10,689 | |||||||||||||||||||
China Construction Bank [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 114,000 | $ 149,000 | $ 139,000 | ¥ 817,000 | ¥ 1,000,000 | $ 68,000 | ¥ 465,000 | ¥ 910,000 | |||||||||||||
Interest rate | 3.85% | 4% | 4.45% | 4.10% | |||||||||||||||||
Maturity date | Feb. 11, 2024 | May 26, 2023 | Aug. 07, 2023 | ||||||||||||||||||
WeBank [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 79,000 | $ 13,000 | $ 10,000 | $ 79,000 | ¥ 96,000 | 69,000 | ¥ 500,750 | ¥ 500,000 | |||||||||||||
Interest rate | 10.71% | 11.34% | 3.60% | ||||||||||||||||||
Maturity date | May 21, 2024 | Dec. 11, 2021 | |||||||||||||||||||
Huaneng Guicheng Trust Co Ltd [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 24,000 | ¥ 161,000 | |||||||||||||||||||
Interest rate | 11.34% | ||||||||||||||||||||
Maturity date | May 21, 2024 | ||||||||||||||||||||
WeBank One [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 15,000 | ¥ 99,000 | |||||||||||||||||||
Guangdong Nanyue Bank [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 34,000 | 231,000 | |||||||||||||||||||
WeBank and Guangdong Nanyue Bank Co Ltd. [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Interest rate | 14.40% | ||||||||||||||||||||
Maturity date | Jul. 08, 2024 | ||||||||||||||||||||
WeBank Two [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 23,000 | 153,000 | |||||||||||||||||||
Nanyue Bank [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 53,000 | 357,000 | |||||||||||||||||||
WeBank and Nanyue Bank [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Interest rate | 14.40% | ||||||||||||||||||||
Maturity date | Jul. 13, 2024 | ||||||||||||||||||||
Huaneng Guicheng [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 57,000 | ¥ 380,000 | |||||||||||||||||||
Interest rate | 12.60% | ||||||||||||||||||||
Maturity date | Jul. 21, 2024 | ||||||||||||||||||||
Bank of Ningbo [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 31,000 | 224,000 | |||||||||||||||||||
Bank of Ningbo and WeBank [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Interest rate | 12.24% | ||||||||||||||||||||
Maturity date | Apr. 07, 2025 | ||||||||||||||||||||
Car Loan WeBank [Member] | |||||||||||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||||||||||
Principal amount | $ 146,000 | $ 27,000 | ¥ 1,050,000 | ¥ 195,415 | |||||||||||||||||
Interest rate | 4.20% | 6.54% | |||||||||||||||||||
Maturity date | May 26, 2024 | Apr. 10, 2028 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - China Construction Bank [Member] | 1 Months Ended | |||||||||
Jul. 30, 2023 USD ($) | Jul. 30, 2023 USD ($) | Feb. 28, 2023 | May 31, 2022 USD ($) | Aug. 31, 2020 USD ($) | Jul. 30, 2023 CNY (¥) | May 31, 2022 CNY (¥) | Feb. 28, 2022 USD ($) | Feb. 28, 2022 CNY (¥) | Aug. 31, 2020 CNY (¥) | |
Line of Credit Facility [Line Items] | ||||||||||
Long-Term Line of Credit | $ 114,000 | $ 114,000 | $ 149,000 | $ 139,000 | ¥ 817,000 | ¥ 1,000,000 | $ 68,000 | ¥ 465,000 | ¥ 910,000 | |
Line of Credit Facility, Interest Rate During Period | 3.85% | 4% | 4.45% | 4.10% | ||||||
Debt Instrument, Maturity Date | Jul. 22, 2024 |