Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Apr. 30, 2021 | Jun. 14, 2021 | |
Document And Entity Information | ||
Entity Registrant Name | World Scan Project, Inc. | |
Entity Central Index Key | 0001813744 | |
Document Type | 10-Q | |
Document Period End Date | Apr. 30, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --10-31 | |
Smaller Reporting Company | true | |
Entity Emerging Growth Company | true | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Shell Company | false | |
Entity Common Stock Shares Outstanding | 10,647,350 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2021 | |
State of Incorporation | DE | |
Transition Period | false | |
Entity Small Business | true | |
Interactive Data Current | Yes | |
Entity File Number | 000-56208 |
Consolidated Balance Sheets (Ap
Consolidated Balance Sheets (April 30, 2021 Unaudited) - USD ($) | Apr. 30, 2021 | Oct. 31, 2020 |
Current Assets | ||
Cash and cash equivalents | $ 918,698 | $ 974,606 |
Accounts receivable, trade | 1,086,886 | 874,365 |
Advance payments and prepaid expenses | 1,120,092 | 540,286 |
Inventories | 613,786 | 8,809 |
TOTAL CURRENT ASSETS | 3,739,462 | 2,398,066 |
Non-current assets | ||
Furniture, fixtures and equipment | 106,422 | |
Lease asset long | 86,596 | |
Long term prepaid expenses and security deposits, net | 14,813 | 5,789 |
TOTAL NON-CURRENT ASSETS | 207,831 | 5,789 |
TOTAL ASSETS | 3,947,293 | 2,403,855 |
Current Liabilities | ||
Accrued expenses and other payables | 276,715 | 141,205 |
Income tax payables | 1,036,336 | 527,283 |
Short-term lease liability | 50,788 | |
Other current liabilities | 13,112 | |
Total Current Liabilities | 1,363,839 | 681,600 |
Non Current Liabilities | ||
Lease liability long term | 35,808 | |
TOTAL LIABILITIES | 1,399,647 | 681,600 |
Shareholders' Equity | ||
Preferred stock ($.0001 par value, 200,000,000 shares authorized; 10,000,000 shares issued and outstanding as of April 30, 2021 and October 31, 2020) | 1,000 | 1,000 |
Common stock ($.0001 par value, 200,000,000 shares authorized, 10,647,350 shares issued and outstanding as of April 30, 2021 and October 31, 2020) | 1,065 | 1,065 |
Additional Paid In Capital | 323,987 | 323,987 |
Accumulated earnings | 2,232,025 | 1,313,909 |
Accumulated other comprehensive income | (10,431) | 82,294 |
Total Stockholders' Equity | 2,547,646 | 1,722,255 |
Total Liabilities & Stockholders' Equity | $ 3,947,293 | $ 2,403,855 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Apr. 30, 2021 | Oct. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred Stock Par Or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Preferred Stock Shares Authorized | 200,000,000 | 200,000,000 |
Preferred Stock Shares Issued | 10,000,000 | 10,000,000 |
Preferred Stock Shares Outstanding | 10,000,000 | 10,000,000 |
Common Stock Par Or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock Shares Authorized | 200,000,000 | 200,000,000 |
Common Stock Shares Issued | 10,647,350 | 10,647,350 |
Common Stock Shares Outstanding | 10,647,350 | 10,647,350 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Apr. 30, 2021 | Apr. 30, 2020 | |
Income Statement [Abstract] | ||||
Revenues | $ 2,483,924 | $ 25,306 | $ 4,570,702 | $ 25,306 |
Cost of revenues | 836,959 | 22,929 | 1,598,866 | 22,929 |
Gross profit | 1,646,965 | 2,377 | 2,971,836 | 2,377 |
Operating Expense | ||||
General and administrative expenses | 932,257 | 283,753 | 1,635,346 | 370,846 |
Total Operating Expenses | 932,257 | 283,753 | 1,635,346 | 370,846 |
Income (loss) from operations | 714,708 | (281,376) | 1,336,490 | (368,469) |
Other income (expense) | ||||
Other income | 116,429 | 3 | 223,715 | 3 |
Translation income (expense) | (354) | (1,527) | (431) | (2,240) |
Total other income (expenses) | 116,075 | (1,524) | 223,284 | (2,237) |
Net income (loss) before tax | 830,783 | (282,900) | 1,559,774 | (370,706) |
Income tax expense | 265,094 | 641,658 | ||
NET INCOME (LOSS) | 565,689 | (282,900) | 918,116 | (370,706) |
OTHER COMPREHENSIVE INCOME (LOSS) | ||||
Foreign currency translation adjustment | (93,253) | 23,030 | (92,725) | 22,450 |
TOTAL COMPREHENSIVE INCOME (LOSS) | $ 472,436 | $ (259,870) | $ 825,391 | $ (348,256) |
Income per common share (basic) | $ 0.11 | $ (0.03) | $ .09 | $ (.04) |
Income per common share (diluted) | $ 0.04 | $ (0.03) | $ .04 | $ (.04) |
Weighted average common shares outstanding (basic) | 10,647,350 | 10,000,000 | 10,647,350 | 10,000,000 |
Weighted average common shares outstanding (diluted) | 10,647,350 | 10,000,000 | 20,647,350 | 10,000,000 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders Equity/ Deficit (Unaudited) - USD ($) | Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated other Comprehensive Income / Loss | Accumulated Earnings / Deficit | Total |
Beginning Balance (Value) at Oct. 31, 2019 | $ 1,000 | $ 1,000 | $ (2,000) | $ (189) | $ (189) | |
Beginning Balance (Shares) at Oct. 31, 2019 | 10,000,000 | 10,000,000 | ||||
Net income | 1,314,098 | 1,314,098 | ||||
Imputed interest | 2,377 | 2,377 | ||||
Stock issuance September of year twenty twenty (Value) | $ 65 | 323,610 | 323,675 | |||
Stock issuance September of year twenty twenty (Shares) | 647,350 | |||||
Foreign currency translation | 82,294 | 82,294 | ||||
Ending Balance (Value) at Oct. 31, 2020 | $ 1,000 | $ 1,065 | 323,987 | 82,294 | 1,313,909 | 1,722,255 |
Ending Balance (Shares) at Oct. 31, 2020 | 10,000,000 | 10,647,350 | ||||
Net income | 918,116 | 918,116 | ||||
Imputed interest | ||||||
Foreign currency translation | (92,725) | (92,725) | ||||
Ending Balance (Value) at Apr. 30, 2021 | $ 1,000 | $ 1,065 | $ 323,987 | $ (10,431) | $ 2,232,025 | $ 2,547,646 |
Ending Balance (Shares) at Apr. 30, 2021 | 10,000,000 | 10,647,350 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Apr. 30, 2020 | Oct. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net Income | $ 918,116 | $ (370,706) | $ 1,314,098 |
Depreciation and amortization | 16 | ||
Imputed interest | 2,240 | 2,377 | |
Lease expense | 25,037 | ||
Accounts receivable, trade | (253,929) | (27,122) | |
Advance payments and prepaid expense | (618,056) | (464,479) | |
Inventories | (622,416) | ||
Other long-term and intangible assets | (6,159) | ||
Other current assets | (9,513) | ||
Accounts payable | 265,988 | ||
Accrued expenses and other payables | (120,935) | 46,910 | |
Income tax payables | 544,778 | ||
Lease liability | (25,037) | ||
Deferred revenues | 781,935 | ||
Other current liabilities | (12,951) | 9,401 | |
Net cash provided by (used in) operating activities | 91,082 | (27,964) | |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Cash paid for purchase of fixed assets | (109,426) | ||
Net cash used in investing activities | (109,426) | ||
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Stock issuance | 323,675 | ||
Proceeds from due to related party | 141,892 | ||
Repayment of due to related party | (95,048) | ||
Net cash provided by (used in) financing activities | 46,844 | ||
Net effect of exchange rate changes on cash | (37,564) | 22,450 | |
Net Change in Cash and Cash Equivalents | (55,908) | 41,330 | |
Cash and cash equivalents - beginning of period | 974,606 | ||
Cash and cash equivalents - end of period | 918,698 | 41,330 | $ 974,606 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||
Interest paid | |||
Income taxes paid | |||
NON-CASH INVESTING AND FINANCING TRANSACTIONS | |||
ROU Asset/Liability | $ 110,119 |
Note 1 - Organization and Descr
Note 1 - Organization and Description of Business | 6 Months Ended |
Apr. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS World Scan Project, Inc., a Delaware corporation (“the Company”) was incorporated under the laws of the State of Delaware on October 25, 2019. On October 25, 2019, Ryohei Uetaki, our officer and director, paid for expenses involved with the incorporation of the Company with personal funds on behalf of the Company, in exchange for 10,000,000 shares of Common Stock, par value $0.0001 per share and 10,000,000 shares of Series A Preferred stock, par value $0.0001 per share, which issuance was exempt from the registration provisions of Section 5 of the Securities Act under Section 4(2) of such same said act. The value of the stock provided to Mr. Uetaki, based on the par value of $.0001 per share of common stock and Series A Preferred Stock, is valued at $2,000. On October 25, 2019, Ryohei Uetaki was appointed as Chief Executive Officer, Chief Financial Officer, President, Director, Secretary, and Treasurer. On November 18, 2019, Yasumasa Ichikawa was appointed as Chief Technology Officer. On January 25, 2020, the Company entered into and consummated a Share Contribution Agreement with Ryohei Uetaki. Pursuant to this agreement Mr. Uetaki gifted to the Company, at no cost, 300 shares of common stock of World Scan Project Corporation, a Japan corporation (“WSP Japan”), which represented all of its issued and outstanding shares. The Company has since gained a 100% interest in the issued and outstanding shares of WSP Japan’s common stock and WSP Japan is now a wholly owned subsidiary of the Company. The Company and WSP Japan were under common control at the time of the acquisition. WSP Japan was incorporated under the laws of Japan on January 22, 2020. Currently, WSP Japan is headquartered in Tokyo, Japan. The Company’s primary business is focused on developing and manufacturing of autonomous aerial vehicles including drones. On February 19, 2020, Ryohei Uetaki gifted 7,000,000 shares of our Common Stock and 10,000,000 shares of our Series A Preferred Stock, which represented all of our issued and outstanding shares of Preferred Stock at the time, to SKYPR LLC, a Delaware Limited Liability Company (referred to herein as “SKYPR LLC”). Our CEO Ryohei Uetaki owns and controls 100% of the membership interests in SKYPR LLC. In September, 2020, the Company entered into subscription agreements with 41 shareholders. Pursuant to these agreements, the Company issued 647,350 shares of common stock in total to these shareholders and received $323,675 as aggregate consideration. At the time of purchase the price paid per share by each shareholder was the equivalent of about 0.50 USD. These shares were sold pursuant to the Company’s effective S-1 Registration Statement deemed effective on August 28, 2020 at 4pm EST. We operate through our wholly owned subsidiary, World Scan Project Corporation, a Japanese Company. We are a start-up stage company currently focused on developing, designing and selling small sized drones which may be used for a variety of purposes. Our principal executive offices are located at 2-18-23, Nishiwaseda, Shinjuku-Ku, Tokyo, 162-0051, Japan. The Company has elected October 31st as its year end. |
Note 2 - Summary of Significant
Note 2 - Summary of Significant Accounting Policies | 6 Months Ended |
Apr. 30, 2021 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidations The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Basis of Presentation This summary of significant accounting policies is presented to assist in understanding the Company's financial statements. These accounting policies conform to accounting principles, generally accepted in the United States of America, and have been consistently applied in the preparation of the financial statements. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In the opinion of management, all adjustments necessary in order to make the financial statements not misleading have been included. Actual results could differ from those estimates. Related party transaction A related party is generally defined as (i) any person that holds 10% or more of the Company’s securities and their immediate families, (ii) the Company’s management, (iii) someone that directly or indirectly controls, is controlled by or is under common control with the Company, or (iv) anyone who can significantly influence the financial and operating decisions of the Company. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. The Company conducts business with its related parties in the ordinary course of business. 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. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of six months or less when purchased to be cash equivalents. Accounts Receivable and Credit Policies Accounts receivable are recognized and carried at the original invoice amount less allowance for any uncollectible amounts. An estimate for doubtful accounts is made when collection of the full amount is no longer probable. Bad debts are written off as incurred. If there is a claim for a defect of product within four days after arrival of goods, the Company shall accept a goods return. Advance payments and prepaid expenses Advance payments and prepaid expenses are cash paid amounts that represent costs incurred from which a service or benefit is expected to be derived in the future. Inventory Inventories, consisting of products available for sale, are primarily accounted for using the first-in, first-out ("FIFO") method, and are valued at the lower of cost or market value. This valuation requires the Company to make judgments, based on currently-available information, about the likely method of disposition, such as through sales to individual customers, returns to product vendors, or liquidations, and expected recoverable values of each disposition category. Fixed assets and depreciation The company recognizes purchased assets with a useful life longer than one year as fixed or non-current assets. These assets are depreciated using the straight-line method of depreciation over the estimated useful life of the assets. Foreign currency translation The Company maintains its books and records in its local currency, Japanese YEN (“JPY”), which is a functional currency as being the primary currency of the economic environment in which its operation is conducted. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statements of operations. The reporting currency of the Company is the United States Dollars (“US$”) and the accompanying consolidated financial statements have been expressed in US$. In accordance with ASC Topic 830-30, “Translation of Financial Statement”, assets and liabilities of the Company whose functional currency is not US$ are translated into US$, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements are recorded as a separate component of accumulated other comprehensive income within the statements of shareholders’ equity. Translation of amounts from the local currency of the Company into US$1 has been made at the following exchange rates: April 30, 2021 Current JPY: US$1 exchange rate 108.93 Average JPY: US$1 exchange rate 105.94 Comprehensive income or loss ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income or loss, its components and accumulated balances. Comprehensive income or loss as defined includes all changes in equity during a period from non-owner sources. Accumulated comprehensive income, as presented in the accompanying consolidated statements of shareholders’ equity consists of changes in unrealized gains and losses on foreign currency translation. Revenue recognition The Company adopted ASC 606 - Revenue from contracts with Customers: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. Revenue for products is recognized when the product are delivered to the customer and the customer complete the product inspection. Cash receipts for undelivered products are recorded as deferred revenues. As of April 30, 2021, the Company had no deferred revenues. Income Taxes The Company accounts for income taxes under ASC 740, “ Income Taxes Basic Earnings (Loss) Per Share The Company computes basic and diluted earnings (loss) per share in accordance with ASC Topic 260, Earnings per Share Fair Value of Financial Instruments The Company’s balance sheet includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization. ASC 820, Fair Value Measurements and Disclosures - Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. - Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. - Level 3 - Inputs that are both significant to the fair value measurement and unobservable. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of April 30, 2021. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments. As of April 30, 2021 and October 31, 2020, the Company had no financial instruments. Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)” and issued subsequent amendments to the initial guidance or implementation guidance including ASU 2017-13, 2018-01, 2018-10, 2018-11, 2018-20 and 2019-01 (collectively, including ASU 2016-02, “ASC 842”). Under ASC 842, lessees will be required to recognize all leases at the commencement date including a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use (ROU) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The standard was effective for the Company beginning November 1, 2019, with early adoption permitted. The Company adopted the standard on November 1, 2019 on a modified retrospective basis and will not restate comparable periods. The Company elected the package of practical expedients permitted under the transition guidance, which allows the Company to carry forward the historical lease classification, the assessment whether a contract is or contains a lease and initial direct costs for any leases that exist prior to adoption of the new standard. The Company also elected the practical expedient not to separate lease and non-lease components for certain classes of underlying assets and the short-term lease exemption for contracts with lease terms of 12 months or less at October 31, 2010. But the office rent contract is automatically renewed. The Company applied this standard to the Company’s consolidated financial statements at this period. |
Note 3 - Going Concern
Note 3 - Going Concern | 6 Months Ended |
Apr. 30, 2021 | |
Going Concern | |
Going Concern | NOTE 3 - GOING CONCERN The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern that contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company demonstrates adverse conditions that raise substantial doubt about the Company's ability to continue as a going concern for one year following the issuance of these financial statements. These adverse conditions are negative financial trends, dependency on a major customer, and other adverse key financial ratios. The Company has established a source of revenue to cover its operating costs but it has depended primarily upon one customer and the sale of one type of product to this primary customer. If our relationship with this primary customer is terminated, we will struggle to continue with our current business plan. In that case, we may be forced to alter, cease, or suspend our business operations entirely in a worst case scenario. Currently, the Company is developing new products and these will be sold to new customers. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event that the Company cannot continue as a going concern. |
Note 4 - Advance Payments and P
Note 4 - Advance Payments and Prepaid Expenses | 6 Months Ended |
Apr. 30, 2021 | |
Debt Disclosure [Abstract] | |
Advance Payments and Prepaid Expenses | NOTE 4 – ADVANCE PAYMENTS AND PREPAID EXPENSES Advance payments are comprised of the payments for the undelivered products. As of April 30, 2021 and October 31, 2020, the Company had advance payments of $1,120,092 and $540,286. Details of the advance payments as of April 30, 2021 and October 31, 2020 are as follows: April 30, 2021 October 31, 2020 Purchase of products from G-Force Inc. $ 689,204 $ 402,408 Purchase of products from Jumper Technology - 73,736 Purchase of products from Radio Maker 38,045 30,297 Purchase of parts from Solar Samba 155,764 - Purchase of parts from Bluish Co., Ltd 71,193 Purchase of parts from Team M 50,491 Other 1,115,395 33,845 Totals $ 1,120,092 $ 540,286 |
Note 5 - Fixed Assets
Note 5 - Fixed Assets | 6 Months Ended |
Apr. 30, 2021 | |
Notes to Financial Statements | |
Fixed Assets | NOTE 5 – FIXED ASSETS The company recognizes purchased assets with a useful life longer than one year as fixed or non-current assets. These assets are depreciated using the straight-line method of depreciation over the estimated useful life of the assets. During the six months ended April 30, 2021, the Company purchased long-term assets, including a 360 laser scanner and various tools, furniture and fixtures, totaling $106,422. The Company will be depreciating these assets over a five year period once they are put into use. |
Note 6 - Income Taxes
Note 6 - Income Taxes | 6 Months Ended |
Apr. 30, 2021 | |
Schedule of Investments [Abstract] | |
Income Taxes | NOTE 6 - INCOME TAXES For the six months ended April 30, 2021, the Company had income tax expense in the amount of $641,658. Japan The Company conducts its major businesses in Japan and is subject to tax in this jurisdiction. As a result of its business activities, the Company files tax returns that are subject to examination by the local tax authority. The Company is subject to a number of income taxes, which, in aggregate, represent a statutory tax rate approximately as follows: Company’s assessable profit For the year ended October 31, Up to JPY 8 million Over JPY 8 million 2021 15.0% 23.2% As of April 30, 2021 and October 31, 2020, the Company had the income tax payable amount of $1,036,336 and $527,283. |
Note 7 - Shareholders Equity
Note 7 - Shareholders Equity | 6 Months Ended |
Apr. 30, 2021 | |
Equity [Abstract] | |
Shareholders Equity | NOTE 7 - SHAREHOLDERS’ EQUITY Preferred Stock The authorized preferred stock of the Company consists of 200,000,000 shares with a par value of $0.0001. The authorized Series A Preferred Stock of the Company consists of 100,000,000. There were 10,000,000 shares of Series A Preferred Stock issued and outstanding as of April 30, 2021 and October 31, 2020. The rights, preferences, privileges, restrictions and other matters relating to the Series A Preferred Stock are as follows: (a) Each share of Series A Preferred Stock shall have no voting rights; (b) Each shareholder of Series A Preferred Stock may convert their shares at the option of the holder thereof into an equal amount of shares of any other class or series of the Company’s stock on a one to one basis. Common Stock The authorized common stock of the Company consists of 200,000,000 shares with a par value of $0.0001. There were 10,647,350 shares of common stock issued and outstanding as of April 30, 2021 and October 31, 2020. On October 25, 2019, 10,000,000 shares of common stock and 10,000,000 shares of Series A Preferred Stock were issued to Ryohei Uetaki. In September, 2020, the Company entered into subscription agreements with 41 shareholders. Pursuant to these agreements, the Company issued 647,350 shares of common stock in total to these shareholders and received $323,675 as aggregate consideration. At the time of purchase the price paid per share by each shareholder was the equivalent of about 0.50 USD. These shares were sold pursuant to the Company’s effective S-1 Registration Statement deemed effective on August 28, 2020 at 4pm EST. |
Note 8 - Related Party Transact
Note 8 - Related Party Transactions | 6 Months Ended |
Apr. 30, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 8 - RELATED-PARTY TRANSACTIONS Equity On October 25, 2019, 10,000,000 shares of common stock and 10,000,000 shares of Series A Preferred Stock were issued to Ryohei Uetaki. These shares are considered to be founder shares and were issued for services rendered to the Company. Ryohei Uetaki is our CEO and director. Due to related party For the six months ended April 30, 2021, the Company did not have any related party borrowing. |
Note 9 - VAT Tax Credit
Note 9 - VAT Tax Credit | 6 Months Ended |
Apr. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
VAT Tax Credit | NOTE 9 – VAT TAX CREDIT For the period ended April 30, 2021, VAT taxes collected on sales transactions were exempted from payment under the Japanese consumption tax rules, resulting in a gain on VAT tax is recognized as credited in the P&L total $223,715. |
Note 10 - Lease Assets and Liab
Note 10 - Lease Assets and Liabilities | 6 Months Ended |
Apr. 30, 2021 | |
Leases [Abstract] | |
Lease Assets and Liabilities | NOTE 10 – LEASE ASSETS AND LIABILITIES Our adoption of ASU 2016-02, Leases (Topic 842), and subsequent ASUs related to Topic 842, requires us to recognize substantially all leases on the balance sheet as an ROU asset and a corresponding lease liability. The new guidance also requires additional disclosures as detailed below. We adopted this standard on the effective date of November 1, 2020 and used this effective date as the date of initial application. Under this application method, we were not required to restate prior period financial information or provide Topic 842 disclosures for prior periods. We elected the ‘package of practical expedients,’ which permitted us to not reassess our prior conclusions related to lease identification, lease classification, and initial direct costs, and we did not elect the use of hindsight. We determine if a contract is a lease at the inception of the arrangement. We review all options to extend, terminate, or purchase the ROU assets, and when reasonably certain to exercise, we include the option in the determination of the lease term and lease liability. We have two operating leases related to our office space in Tokyo with a remaining lease terms of 2 years. We recognized $25,037 in operating lease costs for the six months ended April 30, 2021. Lease ROU assets and liabilities are recognized at commencement date of the lease, based on the present value of lease payments over the lease term. The lease ROU asset also includes any lease payments made and excludes any lease incentives. When readily determinable, we use the implicit rate in determining the present value of lease payments. When leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the lease commencement date, including the lease term. The tables below present financial information associated with our lease. This information is only presented as of, and for the six months ended, April 30, 2021. As noted above, we adopted Topic 842 using a transition method that does not require application to periods prior to adoption. Balance Sheet Classification April 30, 2021 October 31, 2020 Right-of-use assets Lease asset long $ 86,596 $ - Current lease liabilities Short-term lease liability 50,788 - Non-current lease liabilities Lease liability long term 35,808 - Maturities of lease liabilities as of April 30, 2021 are as follows: 2021 $36,052 2022 50,544 Total 91,801 Add(Less): Imputed interest 5,258 Present value of lease liabilities 86,596 |
Note 11 - Subsequent Events
Note 11 - Subsequent Events | 6 Months Ended |
Apr. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 11 - SUBSEQUENT EVENTS The Company has evaluated subsequent events through June 14, 2021, the date on which the consolidated financial statements were available to be issued. |
Note 2. Summary of Significant
Note 2. Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Apr. 30, 2021 | |
Accounting Policies [Abstract] | |
Principles of Consolidations | Principles of Consolidations The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. |
Basis of Presentation | Basis of Presentation This summary of significant accounting policies is presented to assist in understanding the Company's financial statements. These accounting policies conform to accounting principles, generally accepted in the United States of America, and have been consistently applied in the preparation of the financial statements. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In the opinion of management, all adjustments necessary in order to make the financial statements not misleading have been included. Actual results could differ from those estimates. |
Related party transaction | Related party transaction A related party is generally defined as (i) any person that holds 10% or more of the Company’s securities and their immediate families, (ii) the Company’s management, (iii) someone that directly or indirectly controls, is controlled by or is under common control with the Company, or (iv) anyone who can significantly influence the financial and operating decisions of the Company. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. The Company conducts business with its related parties in the ordinary course of business. 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. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of six months or less when purchased to be cash equivalents. |
Accounts Receivable and Credit Policies | Accounts Receivable and Credit Policies Accounts receivable are recognized and carried at the original invoice amount less allowance for any uncollectible amounts. An estimate for doubtful accounts is made when collection of the full amount is no longer probable. Bad debts are written off as incurred. If there is a claim for a defect of product after within four days after arrival of goods, the Company shall accept a goods return. |
Advance payments and prepaid expenses | Advance payments and prepaid expenses Advance payments and prepaid expenses are cash paid amounts that represent costs incurred from which a service or benefit is expected to be derived in the future. |
Inventory | Inventory Inventories, consisting of products available for sale, are primarily accounted for using the first-in, first-out ("FIFO") method, and are valued at the lower of cost or market value. This valuation requires the Company to make judgments, based on currently-available information, about the likely method of disposition, such as through sales to individual customers, returns to product vendors, or liquidations, and expected recoverable values of each disposition category. |
Foreign currency translation | Foreign currency translation The Company maintains its books and records in its local currency, Japanese YEN (“JPY”), which is a functional currency as being the primary currency of the economic environment in which its operation is conducted. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statements of operations. The reporting currency of the Company is the United States Dollars (“US$”) and the accompanying consolidated financial statements have been expressed in US$. In accordance with ASC Topic 830-30, “Translation of Financial Statement”, assets and liabilities of the Company whose functional currency is not US$ are translated into US$, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements are recorded as a separate component of accumulated other comprehensive income within the statements of shareholders’ equity. Translation of amounts from the local currency of the Company into US$1 has been made at the following exchange rates: April 30, 2021 Current JPY: US$1 exchange rate 108.93 Average JPY: US$1 exchange rate 105.94 |
Comprehensive income or loss | Comprehensive income or loss ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income or loss, its components and accumulated balances. Comprehensive income or loss as defined includes all changes in equity during a period from non-owner sources. Accumulated comprehensive income, as presented in the accompanying consolidated statements of shareholders’ equity consists of changes in unrealized gains and losses on foreign currency translation. |
Revenue recognition | Revenue recognition The Company adopted ASC 606 - Revenue from contracts with Customers: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied. Revenue for products is recognized when the product are delivered to the customer and the customer complete the product inspection. Cash receipts for undelivered products are recorded as deferred revenues. As of April 30, 2021, the Company had no deferred revenues. |
Income Taxes | Income Taxes The Company accounts for income taxes under ASC 740, “ Income Taxes |
Basic Earnings (Loss) Per Share | Basic Earnings (Loss) Per Share The Company computes basic and diluted earnings (loss) per share in accordance with ASC Topic 260, Earnings per Share |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s balance sheet includes certain financial instruments. The carrying amounts of current assets and current liabilities approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization. ASC 820, Fair Value Measurements and Disclosures - Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. - Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means. - Level 3 - Inputs that are both significant to the fair value measurement and unobservable. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of April 30, 2021. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments. As of April 30, 2021 and October 31, 2020, the Company had no financial instruments. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)” and issued subsequent amendments to the initial guidance or implementation guidance including ASU 2017-13, 2018-01, 2018-10, 2018-11, 2018-20 and 2019-01 (collectively, including ASU 2016-02, “ASC 842”). Under ASC 842, lessees will be required to recognize all leases at the commencement date including a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use (ROU) asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The standard was effective for the Company beginning November 1, 2019, with early adoption permitted. The Company adopted the standard on November 1, 2019 on a modified retrospective basis and will not restate comparable periods. The Company elected the package of practical expedients permitted under the transition guidance, which allows the Company to carry forward the historical lease classification, the assessment whether a contract is or contains a lease and initial direct costs for any leases that exist prior to adoption of the new standard. The Company also elected the practical expedient not to separate lease and non-lease components for certain classes of underlying assets and the short-term lease exemption for contracts with lease terms of 12 months or less at October 31, 2010. But the office rent contract is automatically renewed. The Company applied this standard to the Company’s consolidated financial statements at this period. |
Foreign Currency Translation (T
Foreign Currency Translation (Tables) | 6 Months Ended |
Apr. 30, 2021 | |
Relatedpartyloanforgiven | |
Foreign currency translation | Translation of amounts from the local currency of the Company into US$1 has been made at the following exchange rates: April 30, 2021 Current JPY: US$1 exchange rate 108.93 Average JPY: US$1 exchange rate 105.94 |
Advance Payments (Tables)
Advance Payments (Tables) | 6 Months Ended |
Apr. 30, 2021 | |
Balanceshares | |
Advance Payments | Advance payments are comprised of the payments for the undelivered products. As of April 30, 2021 and October 31, 2020, the Company had advance payments of $1,120,092 and $540,286. Details of the advance payments as of April 30, 2021 and October 31, 2020 are as follows: April 30, 2021 October 31, 2020 Purchase of products from G-Force Inc. $ 689,204 $ 402,408 Purchase of products from Jumper Technology - 73,736 Purchase of products from Radio Maker 38,045 30,297 Purchase of parts from Solar Samba 155,764 - Purchase of parts from Bluish Co., Ltd 71,193 Purchase of parts from Team M 50,491 Other 1,115,395 33,845 Totals $ 1,120,092 $ 540,286 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Apr. 30, 2021 | |
Income Taxes Tables Abstract | |
Income Taxes | For the six months ended April 30, 2021, the Company had income tax expense in the amount of $641,658. Japan The Company conducts its major businesses in Japan and is subject to tax in this jurisdiction. As a result of its business activities, the Company files tax returns that are subject to examination by the local tax authority. The Company is subject to a number of income taxes, which, in aggregate, represent a statutory tax rate approximately as follows: Company’s assessable profit For the year ended October 31, Up to JPY 8 million Over JPY 8 million 2021 15.0% 23.2% As of April 30, 2021 and October 31, 2020, the Company had the income tax payable amount of $1,036,336 and $527,283. |
Lease Assets and Liabilities (T
Lease Assets and Liabilities (Tables) | 6 Months Ended |
Apr. 30, 2021 | |
Lease Assets And Liabilities | |
Lease Assets and Liabilities | The tables below present financial information associated with our lease. This information is only presented as of, and for the six months ended, April 30, 2021. As noted above, we adopted Topic 842 using a transition method that does not require application to periods prior to adoption. Balance Sheet Classification April 30, 2021 October 31, 2020 Right-of-use assets Lease asset long $ 86,596 $ - Current lease liabilities Short-term lease liability 50,788 - Non-current lease liabilities Lease liability long term 35,808 - Maturities of lease liabilities as of April 30, 2021 are as follows: 2021 $36,052 2022 50,544 Total 91,801 Add(Less): Imputed interest 5,258 Present value of lease liabilities 86,596 |
Advance Payments (Details)
Advance Payments (Details) - USD ($) | Apr. 30, 2021 | Oct. 31, 2020 |
Balance | ||
Advance payments and prepaid expenses | $ 1,120,092 | $ 540,286 |
Income Tax Expense (Details)
Income Tax Expense (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Apr. 30, 2021 | Apr. 30, 2020 | Oct. 31, 2020 | |
Common stock receivable | |||||
Income tax expense | $ 265,094 | $ 641,658 | |||
Income tax payables | 544,778 | ||||
Income tax payables | $ 1,036,336 | $ 527,283 |
Proceeds from the Sale of Commo
Proceeds from the Sale of Common Stock (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Apr. 30, 2021 | Apr. 30, 2020 | Oct. 31, 2020 | |
Proceeds From Sale Of Common Stock | |||
Proceeds from the sale of 647,350 shares of common stock | $ 323,675 |
VAT Tax Credit (Details)
VAT Tax Credit (Details) | 6 Months Ended |
Apr. 30, 2021USD ($) | |
Vat Tax Credit | |
VAX Tax Credit | $ 223,715 |