Cover
Cover | 9 Months Ended |
Sep. 30, 2023 | |
Entity Addresses [Line Items] | |
Document Type | S-1/A |
Amendment Flag | true |
Amendment Description | AMENDMENT NO. 4 |
Entity Registrant Name | WETOUCH TECHNOLOGY INC. |
Entity Central Index Key | 0001826660 |
Entity Tax Identification Number | 20-4080330 |
Entity Incorporation, State or Country Code | NV |
Entity Address, Address Line One | No. 29, Third Main Avenue |
Entity Address, Address Line Two | Shigao Town, Renshou County |
Entity Address, Address Line Three | Meishan |
Entity Address, City or Town | Sichuan |
Entity Address, Postal Zip Code | 620500 |
City Area Code | 86 |
Local Phone Number | 028-37390666 |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | false |
Business Contact [Member] | |
Entity Addresses [Line Items] | |
Entity Address, Address Line One | VCorp Services, LLC |
Entity Address, Address Line Two | 701 S. Carson Street |
Entity Address, City or Town | Carson City |
Entity Address, State or Province | NV |
Entity Address, Postal Zip Code | 89701 |
City Area Code | 888 |
Local Phone Number | 528-2677 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
CURRENT ASSETS | |||||
Cash | $ 93,936,779 | $ 51,250,505 | $ 46,163,704 | ||
Accounts receivable, net | 13,931,782 | 9,057,741 | 7,991,037 | ||
Inventories | 203,922 | 423,276 | 244,381 | ||
Prepaid expenses and other current assets | 1,043,270 | 1,450,620 | 2,445,894 | ||
TOTAL CURRENT ASSETS | 109,115,753 | 62,182,142 | 56,845,016 | ||
Property, plant and equipment, net | 10,319,680 | 10,923,610 | 11,833,302 | ||
TOTAL ASSETS | 119,435,433 | 73,105,752 | 68,678,318 | ||
CURRENT LIABILITIES | |||||
Accounts payable | 1,502,743 | 1,383,094 | 800,586 | ||
Loan from a third party | 385,791 | 385,791 | |||
Income tax payable | 1,150,001 | 22,152 | 65,463 | ||
Accrued expenses and other current liabilities | 3,062,051 | 944,624 | 310,407 | ||
Convertible promissory notes payable | 1,234,355 | 1,277,282 | 2,030,550 | ||
TOTAL CURRENT LIABILITIES | 7,334,941 | 4,014,608 | 3,241,675 | ||
Common stock purchase warrants liability | 381,241 | 256,957 | 1,128,635 | ||
TOTAL LIABILITIES | 7,716,182 | 4,271,565 | 4,370,310 | ||
COMMITMENTS AND CONTINGENCIES (Note 13) | |||||
STOCKHOLDERS’ EQUITY | |||||
Common stock, $0.001 par value, 15,000,000 shares authorized, 1,680,248 and 1,590,576 issued and outstanding as of December 31, 2022 and 2021, respectively* | 9,733 | [1] | 1,680 | [1] | 1,591 |
Additional paid in capital | 43,514,125 | [1] | 3,402,178 | [1] | 2,363,842 |
Statutory reserve | 6,040,961 | 6,040,961 | 5,067,243 | ||
Retained earnings | 72,692,092 | 62,366,892 | 54,610,164 | ||
Accumulated other comprehensive income | (10,537,660) | (2,977,524) | 2,265,168 | ||
TOTAL STOCKHOLDERS’ EQUITY | 111,719,251 | 68,834,187 | 64,308,008 | ||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | 119,435,433 | 73,105,752 | 68,678,318 | ||
Related Party [Member] | |||||
CURRENT LIABILITIES | |||||
Due to related parties | $ 1,665 | $ 34,669 | |||
[1]Retrospectively restated for effect of reverse stock split (1-for-20) |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | 9 Months Ended | |||||
Sep. 06, 2023 | Sep. 30, 2023 | Sep. 10, 2023 | Sep. 08, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Financial Position [Abstract] | ||||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Common stock, shares authorized | 15,000,000 | 300,000,000 | 15,000,000 | 15,000,000 | 15,000,000 | |
Common stock, shares issued | 9,732,948 | 1,680,248 | ||||
Common stock, shares outstanding | 9,732,948 | 1,680,248 | 1,590,576 | |||
Reverse stock split | Wetouch Technology Inc. (the “Company”) filed a Certificate of Change Pursuant to Nevada Revised Statutes Section 78.209 with the Secretary of State of the State of Nevada to affect a 1-for-20 reverse stock split (the “Reverse Stock Split”). On September 11, 2023, the Financial Industry Regulatory Authority (“FINRA”) notified us that the Reverse Stock Split will become effective on the OTCQB marketplace of OTC Markets on September 12, 2023 (the “Effective Date”). At the opening of business on the Effective Date, the Company’s common stock began trading on a split-adjusted basis. In connection with the Reverse Stock Split, the CUSIP number for the common stock will change to 961881208. The Company’s shares of common stock will continue to trade on the OTCQB marketplace under the symbol “WETHD” for a period of 20 business days, and thereafter, the symbol will return to “WETH”. Pursuant to Nevada Revised Statutes Section 78.209, the reverse stock split does not have to be approved by the shareholders of the Company. Fractional shares resulting from the Reverse Stock Split will be rounded up to the nearest whole number | reverse stock split (1-for-20) |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income and Comprehensive Income - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |||||
REVENUES | ||||||||||
Revenues from related parties | $ 11,123,605 | $ 11,623,018 | $ 37,331,498 | $ 35,370,499 | $ 37,923,112 | $ 40,785,474 | ||||
Total Revenues | 11,123,605 | 11,623,018 | 37,331,498 | 35,370,499 | 37,923,112 | 40,785,474 | ||||
COST OF REVENUES | ||||||||||
Cost of revenues from customers | (23,872,632) | (22,256,642) | ||||||||
Cost of revenues related parties | (97,850) | |||||||||
Total Cost of revenues | (6,346,079) | (6,561,166) | (20,261,755) | (20,946,893) | (23,872,632) | (22,354,492) | ||||
GROSS PROFIT | 4,777,526 | 5,061,852 | 17,069,743 | 14,423,606 | 14,050,480 | 18,430,982 | ||||
OPERATING EXPENSES | ||||||||||
Selling expenses | (265,526) | (214,719) | (397,591) | (1,231,967) | (1,288,467) | (630,503) | ||||
General and administrative expenses | (205,940) | (88,063) | (1,929,603) | (903,547) | (1,262,093) | (1,937,374) | ||||
Research and development expenses | (20,580) | (20,737) | (61,849) | (65,307) | (85,251) | (89,477) | ||||
Share-based compensation | (3,149,106) | |||||||||
Total operating expenses | (492,046) | (323,519) | (2,389,043) | (2,200,821) | (2,635,811) | (5,806,460) | ||||
INCOME FROM OPERATIONS | 4,285,480 | 4,738,333 | 14,680,700 | 12,222,785 | 11,414,669 | 12,624,522 | ||||
OTHER INCOME (EXPENSES) | ||||||||||
Interest income | 30,616 | 29,621 | 89,845 | 89,257 | 118,714 | 95,534 | ||||
Interest expense | (139,876) | (58,692) | (211,383) | (172,255) | (224,885) | (27,450) | ||||
Government grant | 695,055 | |||||||||
Gain on asset disposal | 7,648,423 | |||||||||
Loss on conversion of convertible promissory notes payable | (96,927) | |||||||||
Gain on changes in fair value of common stock purchase warrants liability | (169,067) | (187,109) | (124,283) | 35,542 | 871,677 | 759,471 | ||||
TOTAL OTHER INCOME, NET | (278,327) | (216,180) | (245,821) | (47,456) | 668,579 | 9,171,033 | ||||
INCOME BEFORE INCOME TAX EXPENSE | 4,007,153 | 4,522,153 | 14,434,879 | 12,175,329 | 12,083,248 | 21,795,555 | ||||
INCOME TAX EXPENSE | (1,148,185) | (1,232,629) | (4,109,679) | (3,392,587) | (3,352,802) | (4,409,589) | ||||
NET INCOME | 2,858,968 | 3,289,524 | 10,325,200 | 8,782,742 | 8,730,446 | 17,385,966 | ||||
OTHER COMPREHENSIVE INCOME (LOSS) | ||||||||||
Foreign currency translation adjustment | (674,209) | (4,195,353) | (7,560,136) | (7,597,937) | (5,242,692) | 1,307,260 | ||||
COMPREHENSIVE INCOME | $ 2,184,759 | $ (905,829) | $ 2,765,064 | $ 1,184,805 | $ 3,487,754 | $ 18,693,226 | ||||
EARNINGS PER COMMON SHARE* | ||||||||||
Basic | $ 0.29 | [1] | $ 2.01 | [1] | $ 1.13 | [1] | $ 5.47 | [1] | $ 5.38 | $ 10.93 |
Diluted | $ 0.29 | [1] | $ 2.01 | [1] | $ 1.13 | [1] | $ 5.12 | [1] | $ 4.73 | $ 10.65 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING* | ||||||||||
Basic | 9,712,404 | [1] | 1,639,881 | [1] | 9,135,132 | [1] | 1,604,328 | [1] | 1,620,511 | 1,590,576 |
Diluted | 9,794,357 | [1] | 1,637,024 | [1] | 9,224,423 | [1] | 1,715,956 | [1] | 1,843,767 | 1,632,658 |
Customers [Member] | ||||||||||
REVENUES | ||||||||||
Revenues from related parties | $ 37,923,112 | $ 40,687,624 | ||||||||
Total Revenues | 37,923,112 | 40,687,624 | ||||||||
Related Party [Member] | ||||||||||
REVENUES | ||||||||||
Revenues from related parties | 97,850 | |||||||||
Total Revenues | $ 97,850 | |||||||||
[1]Retrospectively restated for effect of reverse stock split (1-for-20) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Income and Comprehensive Income (Parenthetical) | 9 Months Ended | |
Sep. 06, 2023 | Sep. 30, 2023 | |
Income Statement [Abstract] | ||
Reverse stock split | Wetouch Technology Inc. (the “Company”) filed a Certificate of Change Pursuant to Nevada Revised Statutes Section 78.209 with the Secretary of State of the State of Nevada to affect a 1-for-20 reverse stock split (the “Reverse Stock Split”). On September 11, 2023, the Financial Industry Regulatory Authority (“FINRA”) notified us that the Reverse Stock Split will become effective on the OTCQB marketplace of OTC Markets on September 12, 2023 (the “Effective Date”). At the opening of business on the Effective Date, the Company’s common stock began trading on a split-adjusted basis. In connection with the Reverse Stock Split, the CUSIP number for the common stock will change to 961881208. The Company’s shares of common stock will continue to trade on the OTCQB marketplace under the symbol “WETHD” for a period of 20 business days, and thereafter, the symbol will return to “WETH”. Pursuant to Nevada Revised Statutes Section 78.209, the reverse stock split does not have to be approved by the shareholders of the Company. Fractional shares resulting from the Reverse Stock Split will be rounded up to the nearest whole number | reverse stock split (1-for-20) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | StatutoryReserve[Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total | |
Balance at December 31, 2021* at Dec. 31, 2020 | $ 1,575 | $ 1,102,858 | $ 3,062,159 | $ 39,229,282 | $ 957,908 | $ 44,353,782 | |
Beginning balance, shares at Dec. 31, 2020 | 1,575,035 | ||||||
Net income | 17,385,966 | 17,385,966 | |||||
Foreign currency translation adjustment | 1,307,260 | 1,307,260 | |||||
Appropriation to statutory reserve | 2,005,084 | (2,005,084) | |||||
Share-based compensation | $ 16 | 3,149,090 | 3,149,106 | ||||
Share-based compensation, shares | 15,541 | ||||||
Warrants issued to third parties in conjunction with debt issuance | (1,888,106) | (1,888,106) | |||||
Balance at December 31 2022* at Dec. 31, 2021 | $ 1,591 | 2,363,842 | 5,067,243 | 54,610,164 | 2,265,168 | 64,308,008 | |
Ending balance, shares at Dec. 31, 2021 | [1] | 1,590,576 | |||||
Shares issued cashless for warrants | $ 76 | (76) | |||||
Shares issued cashless for warrants, shares | 76,701 | ||||||
Net income | 8,782,742 | 8,782,742 | |||||
Foreign currency translation adjustment | (7,597,937) | (7,597,937) | |||||
Balance at December 31 2022* at Sep. 30, 2022 | $ 1,667 | 2,363,766 | 5,067,243 | 63,392,906 | (5,332,769) | 65,492,813 | |
Ending balance, shares at Sep. 30, 2022 | [1] | 1,667,277 | |||||
Balance at December 31, 2021* at Dec. 31, 2021 | $ 1,591 | 2,363,842 | 5,067,243 | 54,610,164 | 2,265,168 | 64,308,008 | |
Beginning balance, shares at Dec. 31, 2021 | [1] | 1,590,576 | |||||
Net income | 8,730,446 | 8,730,446 | |||||
Foreign currency translation adjustment | (5,242,692) | (5,242,692) | |||||
Stock issued during period, shares, conversion of units | 1,384,564 | ||||||
Appropriation to statutory reserve | 973,718 | (973,718) | |||||
Exercise of warrants issued in conjunction with legal services in 2020 | $ 6 | (6) | |||||
Exercise of warrants issued in conjunction with legal services, shares | 6,211 | ||||||
Exercise of warrants issued to third parties in conjunction with debt issuance in 2021 | $ 14 | (14) | |||||
Exercise of warrants issued to third parties in conjunction with debt issuance, shares | 14,233 | ||||||
Stock issuance for convertible promissory notes payable | $ 69 | 1,038,356 | 1,038,425 | ||||
Stock issuance for convertible promissory notes payable, shares | 69,228 | ||||||
Balance at December 31 2022* at Dec. 31, 2022 | $ 1,680 | 3,402,178 | 6,040,961 | 62,366,892 | (2,977,524) | 68,834,187 | |
Ending balance, shares at Dec. 31, 2022 | [1] | 1,680,248 | |||||
Balance at December 31, 2021* at Jun. 30, 2022 | [1] | $ 1,602 | 2,363,831 | 5,067,243 | 60,103,382 | (1,137,416) | 66,398,642 |
Beginning balance, shares at Jun. 30, 2022 | [1] | 1,601,952 | |||||
Shares issued cashless for warrants | $ 65 | (65) | |||||
Shares issued cashless for warrants, shares | 65,325 | ||||||
Net income | 3,289,524 | 3,289,524 | |||||
Foreign currency translation adjustment | (4,195,353) | (4,195,353) | |||||
Balance at December 31 2022* at Sep. 30, 2022 | $ 1,667 | 2,363,766 | 5,067,243 | 63,392,906 | (5,332,769) | 65,492,813 | |
Ending balance, shares at Sep. 30, 2022 | [1] | 1,667,277 | |||||
Balance at December 31, 2021* at Dec. 31, 2022 | $ 1,680 | 3,402,178 | 6,040,961 | 62,366,892 | (2,977,524) | 68,834,187 | |
Beginning balance, shares at Dec. 31, 2022 | [1] | 1,680,248 | |||||
Net income | 10,325,200 | 10,325,200 | |||||
Foreign currency translation adjustment | (7,560,136) | (7,560,136) | |||||
Fraction shares issued due to reverse stock split | $ 6 | (6) | |||||
Fraction shares issued due to reverse stock split,shares | 5,362 | ||||||
Exercise of warrants issued to third parties in conjunction with debt issuance in 2021 | $ 22 | (22) | |||||
Exercise of warrants issued to third parties in conjunction with debt issuance shares | 22,338 | ||||||
Stock issuance for convertible promissory notes payable | $ 25 | 119,975 | 120,000 | ||||
Stock issued during period, shares, conversion of units | 25,000 | ||||||
Shares issued to private placement | $ 8,000 | 39,992,000 | 40,000,000 | ||||
Shares issued to private placement,shares | 8,000,000 | ||||||
Balance at December 31 2022* at Sep. 30, 2023 | $ 9,733 | 43,514,125 | 6,040,961 | 72,692,092 | (10,537,600) | 111,719,251 | |
Ending balance, shares at Sep. 30, 2023 | [1] | 9,732,948 | |||||
Balance at December 31, 2021* at Jun. 30, 2023 | $ 9,695 | 43,394,163 | 6,040,961 | 69,833,124 | (9,863,451) | 109,414,492 | |
Beginning balance, shares at Jun. 30, 2023 | [1] | 9,695,248 | |||||
Net income | 2,858,968 | 2,858,968 | |||||
Foreign currency translation adjustment | (674,209) | (674,209) | |||||
Fraction shares issued due to reverse stock split | $ 6 | (6) | |||||
Fraction shares issued due to reverse stock split,shares | 5,362 | ||||||
Exercise of warrants issued to third parties in conjunction with debt issuance in 2021 | $ 7 | (7) | |||||
Exercise of warrants issued to third parties in conjunction with debt issuance shares | 7,338 | ||||||
Stock issuance for convertible promissory notes payable | $ 25 | 119,975 | 120,000 | ||||
Stock issued during period, shares, conversion of units | 25,000 | ||||||
Balance at December 31 2022* at Sep. 30, 2023 | $ 9,733 | $ 43,514,125 | $ 6,040,961 | $ 72,692,092 | $ (10,537,600) | $ 111,719,251 | |
Ending balance, shares at Sep. 30, 2023 | [1] | 9,732,948 | |||||
[1]Retrospectively restated for effect of reverse stock split (1-for-20), see Note 10 (2) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities | ||||
Net income | $ 10,325,200 | $ 8,782,742 | $ 8,730,446 | $ 17,385,966 |
Adjustments to reconcile net income to cash provided by operating activities | ||||
Bad debts reversal | (76,492) | |||
Inventory write-off | 74,100 | |||
Depreciation and amortization | 9,465 | 12,494 | 9,891 | 381,167 |
Asset disposal gain | (7,648,423) | |||
Loss of input VAT credits | 356,073 | |||
Share-based compensation | 3,149,106 | |||
Loss on convertible promissory notes payable | 96,927 | |||
Amortization of discounts and issuance cost of the notes | 24,121 | 39,774 | 148,368 | 8,550 |
(Gain) loss on changes in fair value of common stock purchase warrants liability | 124,284 | (35,542) | (871,677) | (759,471) |
Changes in operating assets and liabilities: | ||||
Accounts receivable | (5,568,912) | (7,451,004) | (1,497,237) | 4,994,861 |
Amounts due from related parties | (98) | 83,849 | ||
Inventories | 199,566 | (194,529) | (197,453) | 190,490 |
Prepaid expenses and other current assets | 335,230 | 1,168,383 | 853,426 | (2,258,602) |
Accounts payable | 202,514 | 723,723 | 637,372 | (167,186) |
Amounts due to related parties | (1,665) | 7,366 | (18,055) | (575,329) |
Income tax payable | 1,171,069 | 1,208,810 | (41,068) | (50,424) |
Accrued expenses and other current liabilities | 2,187,200 | 506,706 | 661,203 | (233,882) |
Deferred grants | (728,818) | |||
Net cash provided by operating activities | 9,007,974 | 4,768,923 | 8,586,243 | 14,051,434 |
Cash flows from investing activities | ||||
Purchase of property and equipment | (11,695,448) | |||
Proceeds from assets disposal | 17,859,076 | |||
Net cash provided by investing activities | 6,163,628 | |||
Cash flows from financing activities | ||||
Proceeds from issuance of convertible promissory notes payable | 2,025,000 | |||
Payments of issue costs of convertible promissory note | (162,000) | |||
Proceeds from stock issuance of private placement | 40,000,000 | |||
Proceeds from interest-free advances from a third party | 385,791 | |||
Repayments of convertible promissory notes payable | (55,000) | (1,038,426) | ||
Net cash provided by (used in) financing activities | 39,945,000 | (652,635) | 1,863,000 | |
Effect of changes of foreign exchange rates on cash | (6,266,700) | (5,383,354) | (2,846,807) | 121,781 |
Net increase in cash | 42,686,274 | (614,431) | 5,086,801 | 22,199,843 |
Cash, beginning of year | 51,250,505 | 46,163,704 | 46,163,704 | 23,963,861 |
Cash, end of year | 93,936,779 | 45,549,273 | 51,250,505 | 46,163,704 |
Supplemental disclosures of cash flow information | ||||
Interest paid | 10,000 | |||
Income taxes paid | 2,938,610 | 2,181,273 | 3,391,137 | 3,774,917 |
Non-cash financing activities | ||||
Warrants issued to third parties in conjunction with debt issuance | 1,888,106 | |||
Cashless stock issuance for convertible promissory notes payable | 22,338 | 284,654 | ||
Gain on changes in fair value of common stock purchase warrants liability | $ 124,283 | $ (35,542) | $ (871,677) | $ (759,471) |
BUSINESS DESCRIPTION
BUSINESS DESCRIPTION | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
BUSINESS DESCRIPTION | NOTE 1 — BUSINESS DESCRIPTION Wetouch Technology Inc. (“Wetouch”, or the “Company”), formerly known as Gulf West Investment Properties, Inc., was originally incorporated in August 1992, under the laws of the state of Nevada. On October 9, 2020, the Company entered into a share exchange agreement (the “Share Exchange Agreement”) with Wetouch Holding Group Limited (“BVI Wetouch”) and all the shareholders of BVI Wetouch (each, a “BVI Shareholder” and collectively the “BVI Shareholders”), to acquire all the issued and outstanding capital stock of BVI Wetouch in exchange for the issuance to the BVI Shareholders an aggregate of 28,000,000 1,400,000 2,800 140 31,396,394 1,569,820 Wetouch Holding Group Limited (“BVI Wetouch”), is a holding company whose only asset, held through a subsidiary, is 100 The Reverse Merger was accounted for as a recapitalization effected by a share exchange, wherein BVI Wetouch is considered the acquirer for accounting and financial reporting purposes. The assets and liabilities of BVI Wetouch have been brought forward at their book value and no goodwill has been recognized. The number of shares, par value amount, and additional paid-in capital in the prior years are retrospectively adjusted accordingly. Corporate History of BVI Wetouch Wetouch Holding Group Limited (“BVI Wetouch”) was incorporated under the laws of British Virgin Islands on August 14, 2020. It became the holding company of Hong Kong Wetouch Electronics Technology Limited (“Hong Kong Wetouch”) on September 11, 2020. Hong Kong Wetouch Technology Limited (“HK Wetouch”), was incorporated as a holding company under the laws of Hong Kong Special Administrative Region (“SAR”) on December 3, 2020. On March 2, 2021, HK Wetouch acquired all shares of Hong Kong Vtouch. Due to the fact that Hong Kong Wetouch and HK Wetouch are both under the same sole stockholder, the acquisition is accounted for under common control. In June 2021, Hong Kong Wetouch completed its dissolution process pursuant to the minutes of its special shareholder meeting. Sichuan Wetouch Technology Co. Ltd. (“Sichuan Wetouch”) was formed on May 6, 2011 in the People’s Republic of China (“PRC”) and became Wholly Foreign-Owned Enterprise in PRC on February 23, 2017. On July 19, 2016, Sichuan Wetouch was 100 On December 30, 2020, Sichuan Vtouch Technology Co., Ltd. (“Sichuan Vtouch”) was incorporated in Chengdu, Sichuan, under the laws of the People’s Republic of China. In March 2021, pursuant to local PRC government guidelines on local environmental issues and the national overall plan, Sichuan Wetouch was under the government directed relocation order. Sichuan Vtouch took over the operating business of Sichuan Wetouch. On March 30, 2023, an independent third party acquired all shares of Sichuan Wetouch in a nominal amount. As a result of the above restructuring, HK Wetouch became the sole shareholder of Sichuan Vtouch. The following diagram illustrates our current corporate structure: | NOTE 1 — BUSINESS DESCRIPTION Business Wetouch Technology Inc. (“Wetouch”, or the “Company”), formerly known as Gulf West Investment Properties, Inc., was originally incorporated in August 1992, under the laws of the state of Nevada. On October 9, 2020, the Company entered into a share exchange agreement (the “Share Exchange Agreement”) with Wetouch Holding Group Limited (“BVI Wetouch”) and all the shareholders of BVI Wetouch (each, a “BVI Shareholder” and collectively the “BVI Shareholders”), to acquire all the issued and outstanding capital stock of BVI Wetouch in exchange for the issuance to the BVI Shareholders an aggregate of 28,000,000 1,400,000 2,800 31,396,394 1,569,820 Wetouch Holding Group Limited (“BVI Wetouch”), is a holding company whose only asset, held through a subsidiary, is 100 The Reverse Merger was accounted for as a recapitalization effected by a share exchange, wherein BVI Wetouch is considered the acquirer for accounting and financial reporting purposes. The assets and liabilities of BVI Wetouch have been brought forward at their book value and no goodwill has been recognized. The number of shares, par value amount, and additional paid-in capital in the prior years are retrospectively adjusted according. Corporate History of BVI Wetouch Wetouch Holding Group Limited (“BVI Wetouch”) was incorporated under the laws of British Virgin Islands on August 14, 2020. It became the holding company of Hong Kong Wetouch Electronics Technology Limited (“Hong Kong Wetouch”) on September 11, 2020. Hong Kong Wetouch Technology Limited (“HK Wetouch”), was incorporated as a holding company under the laws of Hong Kong Special Administrative Region (“SAR”) on December 3, 2020. On March 2, 2021, HK Wetouch acquired all shares of Hong Kong Vtouch. Due to the fact that Hong Kong Wetouch and HK Wetouch are both under the same sole stockholder, the acquisition is accounted for under common control. In June, 2021, Hong Kong Wetouch completed its dissolution process pursuant to the minutes of its special shareholder meeting. Sichuan Wetouch Technology Co. Ltd. (“Sichuan Wetouch”) was formed on May 6, 2011 in the People’s Republic of China (“PRC”) and became Wholly Foreign-Owned Enterprise in PRC on February 23, 2017. On July 19, 2016, Sichuan Wetouch was 100 On December 30, 2020, Sichuan Vtouch Technology Co., Ltd. (“Sichuan Vtouch”) was incorporated in Chengdu, Sichuan, under the laws of the People’s Republic of China. In March 2021, pursuant to local PRC government guidelines on local environmental issues and the national overall plan, Sichuan Wetouch was under the government directed relocation order, and started its dissolution process which is estimated to be completed by the end of 2023. Sichuan Vtouch took over the operating business of Sichuan Wetouch. As a result of the above restructuring, HK Wetouch became the sole shareholder of Sichuan Vtouch. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Note 2 — BASIS OF PRESENTATION SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted as permitted by rules and regulations of the United States Securities and Exchange Commission (“SEC”). The condensed consolidated balance sheet as of December 31, 2022 was derived from the audited consolidated financial statements of Wetouch. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated balance sheet of the Company as of December 31, 2022, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended. In the opinion of the management, all adjustments (which include normal recurring adjustments) necessary to present a fair statement of the financial position as of September 30, 2023, the results of operations and cash flows for the nine-month periods ended September 30, 2023 and 2022 have been made. However, the results of operations included in such financial statements may not necessarily be indicative of annual results. (g) Common stock purchase warrants 871,677 256,957 Use of Estimates The preparation of condensed financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosure of contingent assets and liabilities. Actual results could differ from those estimates. On an ongoing basis, management evaluates the Company’s estimates, including those related to the bad debt allowance, fair values of financial instruments, intangible assets and property and equipment, income taxes, and contingent liabilities, among others. The Company bases its estimates on assumptions, both historical and forward looking, that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. SCHEDULE OF ESTIMATED USEFUL LIFE OF PROPERTY PLANT AND EQUIPMENT Significant Accounting Policies For a detailed discussion about Wetouch’s significant accounting policies, refer to Note 2 — “Summary of Significant Accounting Policies,” in Wetouch’s consolidated financial statements included in Company’s 2022 audited consolidated financial statements. During the nine-month periods ended September 30, 2023, there were no significant changes made to Wetouch significant accounting policies. | Note 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The accompanying consolidated financial statements include the financial statements of Wetouch and its wholly owned subsidiaries. All significant intercompany transactions and balances have been eliminated upon consolidation. (b) Uses of estimates In preparing the consolidated financial statements in conformity with US GAAP, management makes 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. These estimates are based on information as of the date of the consolidated financial statements. Significant estimates required to be made by management include, but are not limited to, the allowance for estimated uncollectible receivables, fair values of financial instruments, (c) Cash and cash equivalents Cash includes currency on hand and deposits held by banks that can be added or withdrawn without limitation. (d) Accounts receivables, net Accounts receivables are presented net of allowance for doubtful accounts. The Company determines the adequacy of reserves for doubtful accounts based on individual account analysis and historical collection trend. The Company establishes a provision for doubtful receivables when there is objective evidence that the Company may not be able to collect amounts due. The allowance is based on management’s best estimate of specific losses on individual exposures, as well as a provision on historical trends of collections. Actual amounts received may differ from management’s estimate of credit worthiness and the economic environment. Delinquent account balances are written-off against the allowance for doubtful accounts after management has determined that the collection is not probable. (e) Inventory Inventory consists of raw materials, work-in-process and finished goods and is stated at the lower of cost or net realizable value. Cost is determined using a weighted average. For work-in-process and manufactured inventories, cost consists of raw materials, direct labor and an allocated portion of the Company’s production overhead. The Company writes down excess and obsolete inventory to its estimated net realizable value based upon assumptions about future demand and market conditions. For finished goods and work-in-process, if the estimated net realizable value for an inventory item, which is the estimated selling price in the ordinary course of business, less reasonably predicable costs to completion and disposal, is lower than its cost, the specific inventory item is written down to its estimated net realizable value. Net realizable value for raw materials is based on replacement cost. Provisions for inventory write-downs are included in the cost of revenues in the consolidated statements of operations. Inventories are carried at this lower cost basis until sold or scrapped. $ 74,100 nil (f) Convertible Promissory Notes The Company accounts for its convertible promissory notes according to guidance of ASU 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”, which simplifies the accounting for convertible instruments by eliminating the requirement to separate embedded conversion features from the host contract when the conversion features are not required to be accounted for as derivatives under Topic 815. We analyze the convertible notes for the existence of a beneficial conversion feature. the Company considered the three characteristics of a derivative instrument listed in ASC 815-10-15-83: (i) having one or more underlyings and one or more notional amounts or payment provisions or both; (ii) requiring no initial net investment; (iii) permitting net settlement; Since the Company’s notes have fixed interest rate, specified notional principal and settlement date, which no other events would affect specified settlement, and the Company received net proceeds after issuance costs and discount, which the Company recorded as the net proceeds or net settled investment, the management assessed that the Notes did not do not meet the definition of a derivative instruments and an embedded feature would not be bifurcated. The discounts on the convertible notes, are amortized to interest expense, using the effective interest method, over the terms of the related convertible notes. (g) Common stock purchase warrants The Company also analyzed the Warrants in accordance with ASC 815, to determine whether the Warrants meet the definition of a derivative and, if so, whether the Warrants meet the scope exception of ASC 815-40, which is that contracts issued or held by the reporting entity that are both (1) indexed to its own stock and (2) classified in stockholders’ equity shall not be considered to be derivative instruments for purposes of ASC 815-40. The Company concluded that the Warrants issued in November and December 2021 financing should be treated as a derivative liability because the Warrants are entitled to a price adjustment provision to allow the exercise price to be increased or reduced in the event the Company issues or sells any additional shares of common stock at a price per share more or less than the then-applicable exercise price or without consideration, which is typically referred to as a “Down-round protection” or “anti-dilution” provision. According to ASC 815-40, the “Down-round protection” provision is not considered to be an input to the fair value of a fixed-for-fixed option on equity shares which leads the Warrants to fail to be qualified as indexed to the Company’s own stock and then to fail to meet the scope exceptions of ASC 815. Therefore, the Company accounted for the Warrants as derivative liabilities under ASC 815. Pursuant to ASC 815, derivatives are measured at fair value and re-measured at fair value with changes in fair value recorded in earnings at each reporting period. The Company used a black-scholes-pricing model to estimate the fair values of common stock purchase warrants at the balance sheet dates. As of December 31, 2022 and 2021, the Company recorded $ 256,957 1,128,635 871,677 759,471 (h) Fair value of financial instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: ● Level 1 — inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 — inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted market prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable and inputs derived from or corroborated by observable market data. ● Level 3 — inputs to the valuation methodology are unobservable. Unless otherwise disclosed, the fair value of the Company’s financial instruments, including cash, accounts receivable, prepaid expenses and other current assets, accounts payable, short-term bank loans, accrued expenses and other current liabilities, taxes payable and due to related parties, common stock purchase warrants liability, approximate the fair value of the respective assets and liabilities as of December 31, 2022 and 2021 based upon the nature of the assets and liabilities. (i) Property, plant and equipment, net Property, plant and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization of property and equipment is provided using the straight-line method over their expected useful lives, as follows: SCHEDULE OF ESTIMATED USEFUL LIFE OF PROPERTY PLANT AND EQUIPMENT Useful life Buildings 20 Machinery and equipment 10 Office and electric equipment 3 Expenditures for maintenance and repairs, which do not materially extend the useful lives of the assets, are charged to expense as incurred. Expenditures for major renewals and betterments which substantially extend the useful life of assets are capitalized. The cost and related accumulated depreciation of assets retired or sold are removed from the respective accounts, and any gain or loss is recognized in the consolidated statements of income and other comprehensive income in other income or expenses. (l) Impairment of long-lived Assets Long-lived assets, such as property, plant and equipment, land use rights, are reviewed for impairment when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Recoverability of a long-lived asset or asset group to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying value of an asset or asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount that the carrying value exceeds the estimated fair value of the asset or asset group. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third party independent appraisals, as considered necessary. Assets to be disposed are reported at the lower of carrying amount or fair value less costs to sell, and are no longer depreciated. There were nil impairment of intangible assets recognized for the years ended December 31, 2022 and 2021. (m) Foreign Currency Translation The Company uses US dollars as the reporting currency. The Company’s subsidiary HK Wetouch’s functional currency for HK Wetouch is Hong Kong dollar. The functional currency of Sichuan Wetouch is the Chinese Yuan (“RMB”). The Company’s consolidated financial statements have been translated into US$. Assets and liabilities accounts are translated using the exchange rate at each reporting period end date. Equity accounts are translated at historical rates. Income and expense accounts are translated at the average rate of exchange during the reporting period. The resulting translation adjustments are reported under other comprehensive income (loss). Gains and losses resulting from the translations of foreign currency transactions and balances are reflected in the results of operations. The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into US$ at the rates used in translation. The following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report: SCHEDULE OF CURRENT EXCHANGE RATES December 31, December 31, Year-end spot rate US$1=RMB 6.8972 US$1=RMB 6.3726 Average rate US$1=RMB 6.7312 US$1=RMB 6.4505 (n) Revenue recognition The Company adopted Accounting Standards Codification (“ASC”) 606 using the modified retrospective approach. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements. Therefore, no adjustments to opening retained earnings were necessary. ASC 606, Revenue from Contracts with customers, establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. ASC 606 requires the use of a five-step model to recognize revenue from customer contracts. The five-step model requires that the Company (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies the performance obligation. The application of the five-step model to the revenue streams compared to the prior guidance did not result in significant changes in the way the Company records its revenue. The Company has assessed the impact of the guidance by reviewing its existing customer contracts and current accounting policies and practices to identify differences that would result from applying the new requirements, including the evaluation of its performance obligations, transaction price, customer payments, transfer of control and principal versus agent considerations. Based on the assessment, the Company concluded that there was no change to the timing and pattern of revenue recognition for its current revenue streams. In accordance with ASC 606, the Company recognizes revenue when it transfers its goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. The Company accounts for the revenue generated from sales of its products primarily to its customers in PRC and overseas, as the Company is acting as a principal in these transactions, is subject to inventory risk, has latitude in establishing prices, and is responsible for fulfilling the promise to provide customers the specified goods, which the Company has control of the goods and has the ability to direct the use of goods to obtain substantially all the benefits. All of the Company’s contracts have one single performance obligation as the promise is to transfer the individual goods to customers, and there is no separately identifiable other promises in the contracts. The Company’s revenue streams are recognized at a point in time when title and risk of loss passes and the customer accepts the goods, which generally occurs at delivery. The Company’s products are sold with no right of return and the Company does not provide other credits or sales incentive to customers. The Company’s sales are net of value added tax (“VAT”) and business tax and surcharges collected on behalf of tax authorities in respect of product sales. Contract Assets and Liabilities Payment terms are established on the Company’s pre-established credit requirements based upon an evaluation of customers’ credit quality. Contract assets are recognized for in related accounts receivable. Contract liabilities are recognized for contracts where payment has been received in advance of delivery. The contract liability balance can vary significantly depending on the timing when an order is placed and when shipment or delivery occurs. As of December 31, 2022 and 2021, other than accounts receivable and advances from customers, the Company had no other material contract assets, contract liabilities or deferred contract costs recorded on its consolidated balance sheet. Costs of fulfilling customers’ purchase orders, such as shipping, handling and delivery, which occur prior to the transfer of control, are recognized in selling, general and administrative expense when incurred. Disaggregation of Revenues The Company disaggregates its revenue from contracts by geography, as the Company believes it best depicts how the nature, amount, timing and uncertainty of the revenue and cash flows are affected by economic factors. The Company’s disaggregation of revenues for the years ended December 31, 2022 and 2021 are disclosed in Note 14 to the financial statements. (o) Selling, General and Administrative Expenses Selling expenses represents primarily costs of payroll, benefits, commissions for sales representatives and advertising expenses. General and administrative expenses represents primarily payroll and benefits costs for administrative employees, rent and operating costs of office premises, depreciation and amortization of office facilities, professional fees and other administrative expenses. (p) Research and Development Expense Research and development costs are expensed as incurred. (q) Share-Based Compensation The Company awards share options and other equity-based instruments to its employees, directors and third party service providers (collectively “share-based payments”). Compensation cost related to such awards is measured based on the fair value of the instrument on the grant date. The Company recognizes the compensation cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The amount of cost recognized is adjusted to reflect the expected forfeiture prior to vesting. When no future services are required to be performed by the employee in exchange for an award of equity instruments, and if such award does not contain a performance or market condition, the cost of the award is expensed on the grant date. The Company recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant-date value of such award that is vested at that date. (r) Government grant The Company follows other authoritative accounting guidance since there is no clear guidance with regard to government grants. Government grants are recognized at fair value where there is reasonable assurance that the grant will be received and all grant conditions will be met. Grants relating to expense items are recognized as income over the periods necessary to match the grant to the costs it is compensating. Grants relating to assets are credited to deferred income at fair value and are credited to income over the expected useful life of the asset on a straight-line basis. (s) Income taxes The Company accounts for income taxes in accordance with the asset and liability method. Deferred taxes are recognized for the future tax consequences attributable to temporary differences between the carrying amounts of assets and liabilities for financial statement purposes and income tax purposes using enacted rates expected to be in effect when such amounts are realized or settled. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established, as needed, to reduce the amount of deferred tax assets if it is considered more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The Company recognizes the effect of uncertain income tax positions only if those positions are more-likely-than-not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% On December 22, 2017 the Tax Cut and Jobs Act of 2017 (“the Tax Act”) was signed into law, which among other effects, reduces the U.S. federal corporate income tax rate to 21% from 34% (or 35% in certain cases) beginning in 2018 (t) Value added tax (“VAT”) Sales revenue represents the invoiced value of goods, net of VAT. The VAT is based on gross sales price. Since April 1, 2019, VAT rate was lowered from 16 13 For export sales, VAT is not imposed on gross sales price, but the VAT related to purchasing raw materials is refunded after the export is completed. (u) Earnings per Share The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted presents the dilutive effect on a per share basis of potential common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. As of December 31, 2022 and 2021, warrants were included for the dilutive EPS calculation, respectively. (v) Comprehensive income (loss) Comprehensive income (loss) consists of two components, net income and other comprehensive income (loss). The foreign currency translation gain or loss resulting from translation of the financial statements expressed in RMB to US$ is reported in other comprehensive income (loss) in the consolidated statements of income and comprehensive income. (w) Recent Accounting Pronouncements The Company considers the applicability and impact of all accounting standards updates (“ASUs”). Management periodically reviews new accounting standards that are issued. In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” including interim periods within those fiscal years. Early application of the guidance will be permitted for all entities for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years . The Company adopted ASU 2020-06 effective January 1, 2021. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326), which introduces new guidance for the accounting for credit losses on instruments within its scope. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale (AFS) debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The pronouncement will be effective for public business entities that are SEC filers in fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early application of the guidance will be permitted for all entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company adopted ASU 2016-13 utilizing the modified retrospective transition method. The adoption of ASU 2016-13 did not have a material impact on the Company’s condensed consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”. In October 2021, the FASB issued ASU No. 2021-08, which will require companies to apply the definition of a performance obligation under ASC Topic 606 to recognize and measure contract assets and contract liabilities (i.e., deferred revenue) relating to contracts with customers that are acquired in a business combination. Under current U.S. GAAP, an acquirer generally recognizes assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers, at fair value on the acquisition date. ASU No. 2021-08 will result in the acquirer recording acquired contract assets and liabilities on the same basis that would have been recorded by the acquiree before the acquisition under ASC Topic 606. ASU No. 2021-08 is effective for fiscal years beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the impact of this ASU on its financial statements and the effects will be based upon the contract assets and liabilities acquired in the future. From time to time, the FASB or other standards setting bodies issue new accounting pronouncements. Updates to the FASB ASCs are communicated through issuance of ASUs. Unless otherwise discussed, the Company believes that the recently issued guidance, whether adopted or to be adopted in the future, is not expected to have a material impact on its consolidated financial statements upon adoption. |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Receivables [Abstract] | ||
ACCOUNTS RECEIVABLE | NOTE-3- ACCOUNTS RECEIVABLE Accounts receivable consists of the following: SCHEDULE OF ACCOUNTS RECEIVABLE September 30, December 31, Accounts receivable $ 13,931,782 $ 9,057,741 Allowance for doubtful accounts - - Accounts receivable, net $ 13,931,782 $ 9,057,741 The Company’s accounts receivable primarily includes balance due from customers when the Company’s products are sold and delivered to customers. | NOTE-3- ACCOUNTS RECEIVABLE Accounts receivable consists of the following: SCHEDULE OF ACCOUNTS RECEIVABLE December 31, 2022 December 31 2021 Accounts receivable $ 9,057,741 $ 7,991,037 Allowance for doubtful accounts - - Accounts receivable, net $ 9,057,741 $ 7,991,037 The Company’s accounts receivable primarily includes balance due from customers when the Company’s products are sold and delivered to customers. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Prepaid Expenses And Other Current Assets | ||
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE-4 — PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS September 30, December 31, Advance to suppliers $ 325,852 $ 333,920 VAT input credits - 355,482 Issue cost related to convertible promissory notes 69,566 81,614 Prepayment for land use right (i) 537,998 569,105 Security deposit (ii) 53,865 56,979 Others receivable (iii) 55,989 53,520 Prepaid expenses and other current assets $ 1,043,270 $ 1,450,620 (i) On July 23, 2021, Sichuan Vtouch entered into a contract with Chengdu Wenjiang District Planning and Natural Resources Bureau for purchasing a land use right of 131,010 3,925,233 537,998 (ii) On July 28, 2021, Sichuan Vtouch made a security deposit of RMB 393,000 53,865 (iii) Other receivables are mainly employee advances, and prepaid expenses. | NOTE-4 — PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consists of the following: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS December 31, 2022 December 31, 2021 Advance to suppliers $ 333,920 $ 244,758 VAT input credits 355,482 307,575 Issue cost related to convertible promissory notes 81,614 159,000 Deferred marketing expenses - 1,000,000 Prepayment for land use right/ (i) (i) 569,105 615,955 Security deposit (ii) (ii) 56,979 61,670 Others receivable (iii) (iii) 53,520 56,936 Prepaid expenses and other current assets $ 1,450,620 $ 2,445,894 (i) On July 23, 2021, Sichuan Vtouch entered into a contract with Chengdu Wenjiang District Planning and Natural Resources Bureau for purchasing a land use right of 131,010 3,925,233 569,105 (ii) On July 28, 2021, Sichuan Vtouch made a security deposit of RMB 393,000 56,979 (i) Other receivables are mainly employee advances, and prepaid expenses. |
PROPERTY, PLANT AND EQUIPMENT,
PROPERTY, PLANT AND EQUIPMENT, NET | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | ||
PROPERTY, PLANT AND EQUIPMENT, NET | NOTE 5— PROPERTY, PLANT AND EQUIPMENT, NET SCHEDULE OF PROPERTY , PLANT AND EQUIPMENT September 30, 2023 December 31, 2022 Buildings $ 11,804 $ 12,487 Vehicles 40,132 42,453 Construction in progress 10,288,183 10,883,051 Subtotal 10,340,119 10,937,991 Less: accumulated depreciation (20,439 ) (14,381 ) Property, plant and equipment, net $ 10,319,680 $ 10,923,610 Depreciation expense was $ 2,294 2,340 9,465 12,494 Pursuant to local PRC government guidelines on local environment issues and the national overall plan, Sichuan Wetouch is under the government directed relocation order to relocate no later than December 31, 2021 and received compensation accordingly. On March 18, 2021, pursuant to the agreement with the local government and an appraisal report issued by a mutual agreed appraiser, Sichuan Wetouch received a compensation of RMB 115.2 15.8 On March 16, 2021, in order to minimize interruption of our business, Sichuan Vtouch entered into a leasing agreement with Sichuan Renshou Shigao Tianfu Investment Co., Ltd. (later renamed as Meishan Huantian Industrial Co., Ltd.), a limited company owned by the local government, to lease the property, and all buildings, facilities and equipment thereon (“Demised Properties) of Sichuan Wetouch, commencing from April 1, 2021 until December 31, 2021 at a monthly rent of RMB 300,000 41,372 renewed on December 31, 2021 at a monthly rent of RMB 400,000 52,825 | NOTE 5— PROPERTY, PLANT AND EQUIPMENT, NET SCHEDULE OF PROPERTY , PLANT AND EQUIPMENT December 31, 2022 December 31, 2021 Buildings $ 12,487 $ 13,514 Vehicles 42,453 45,948 Construction in progress 10,883,051 11,778,957 Subtotal 10,937,991 11,838,419 Less: accumulated depreciation (14,381 ) (5,117 ) Property, plant and equipment, net $ 10,923,610 $ 11,833,302 Depreciation expense was $ 9,891 5,117 Pursuant to local PRC government guidelines on local environment issues and the national overall plan, Sichuan Wetouch is under the government directed relocation order to relocate no later than December 31, 2021 and received compensation accordingly. On March 18, 2021, pursuant to the agreement with the local government and an appraisal report issued by a mutual agreed appraiser, Sichuan Wetouch received a compensation of RMB 115.2 16.7 7,648,423 872,045 On March 16, 2021, in order to minimize interruption of our business, Sichuan Vtouch entered into a leasing agreement with Sichuan Renshou Shigao Tianfu Investment Co., Ltd. (later renamed as Meishan Huantian Industrial Co., Ltd.), a limited company owned by the local government, to lease the property, and all buildings, facilities and equipment thereon (“Demised Properties) of Sichuan Wetouch, commencing from April 1, 2021 until December 31, 2021 at a monthly rent of RMB 300,000 43,496 renewed on December 31, 2021 at a monthly rent of RMB 400,000 ($57,994) from January 1, 2022 till October 31, 2023 for the use of the Demised Properties. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Related Party Transactions [Abstract] | ||
RELATED PARTY TRANSACTIONS | NOTE 6 – RELATED PARTY TRANSACTIONS Amounts due to a related party are as follows: SCHEDULE OF RELATED PARTY TRANSACTIONS Relationship September 30, December 31, Note Mr. Zongyi Lian President and CEO of the Company - 1,665 Payable to employee Total - $ - $ 1,665 - owns 94 % and 95 % of | NOTE 6 – RELATED PARTY TRANSACTIONS The related party transactions are summarized as follows: SCHEDULE OF REVENUES FROM RELATED PARTY TRANSACTIONS 2022 2021 Years Ended December 31, 2022 2021 US$ US$ Revenues resulting from related parties: Sales to Chengdu Wetouch Technology Co., Ltd (“Chengdu Wetouch”) - 10,483 Sales to Meishan Wetouch Electronics Technology Co., Ltd. (“Meishan Wetouch”) - 87,367 Total revenue $ - $ 97,850 The Company sells capacitive touchscreens to Chengdu Wetouch and Meishan Wetouch from time to time. There are no written agreements between the Company and Meishan Wetouch. Mr. Guangde Cai, Chairman and director of the Company and our indirect majority shareholder, owns 94 95 Amounts due to related parties are as follows : SCHEDULE OF RELATED PARTY TRANSACTIONS Relationship December 31, 2022 December 31, 2021 Note Mr. Zongyi Lian President and CEO of the Company $ 1,665 $ 1,802 Payable to employee Mr. Guangde Cai Former Chairman of the Company - 32,867 Payable to employee Total $ 1,665 $ 34,669 - |
INCOME TAXES
INCOME TAXES | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
INCOME TAXES | NOTE 7 — INCOME TAXES Wetouch Wetouch Technology Inc. files a U.S. federal income tax return. BVI Wetouch Under the current laws of the British Virgin Islands, BVI Wetouch, subsidiaries of Wetouch, is not subject to tax on its income or capital gains. In addition, no British Virgin Islands withholding tax will be imposed upon the payment of dividends by the Company to its shareholders. Hong Kong HK Wetouch is incorporated in Hong Kong and is subject to profit taxes in Hong Kong at a rate of 16.5 SCHEDULE OF COMPONENTS OF THE INCOME TAX PROVISION PRC Sichuan Wetouch and Sichuan Vtouch files income tax returns in the PRC. Effective from January 1, 2008, the PRC statutory income tax rate is 25 Under PRC CIT Law, domestic enterprises and Foreign Investment Enterprises (“FIEs”) are usually subject to a unified 25 15 15 On October 21, 2020, Sichuan Wetouch was granted on a case-by-case basis by Sichuan Provincial government as preferential tax treatment High and New Technology Enterprises (“HNTEs”), entitled to a reduced income tax rate of 15% beginning October 21, 2020 until October 20, 2023 On March 30, 2023 an independent third party acquired all shares of Sichuan Wetouch. . Sichuan Vtouch is entitled to 25 The effective income tax rates for the nine-month periods ended September 30, 2023 and 2022 were 28.5 27.9 The estimated effective income tax rate for the year ended December 31, 2023 would be similar to actual effective tax rate of the nine-month periods ended September 30, 2023. | NOTE 7 — INCOME TAXES Wetouch Wetouch Technology Inc. is subject to a tax rate of 21 BVI Wetouch Under the current laws of the British Virgin Islands, BVI Wetouch, subsidiaries of Wetouch, is not subject to tax on its income or capital gains. In addition, no British Virgin Islands withholding tax will be imposed upon the payment of dividends by the Company to its shareholders. Hong Kong HK Wetouch is incorporated in Hong Kong and is subject to profit taxes in Hong Kong at a progressive rate of 16.5 PRC Sichuan Wetouch and Sichuan Vtouch files income tax returns in the PRC. Effective from January 1, 2008, the PRC statutory income tax rate is 25 Under PRC CIT Law, domestic enterprises and Foreign Investment Enterprises (“FIEs”) are usually subject to a unified 25% enterprise income tax rate while preferential tax rates, tax holidays and even tax exemption may be granted on a case-by-case basis by local government as preferential tax treatment to High and New Technology Enterprises (“HNTEs”). Under this preferential tax treatment, HNTEs are entitled to an income tax rate of 15 15 On October 21, 2020, Sichuan Wetouch was granted on a case-by-case basis by Sichuan Provincial government as preferential tax treatment High and New Technology Enterprises (“HNTEs”), entitled to a reduced income tax rate of 15% beginning October 21, 2020 until October 20, 2023. Sichuan Vtouch is entitled to 25 The CIT Law and its implementation rules impose a withholding income tax at 10%, unless reduced by a tax treaty or arrangement, on the amount of dividends distributed by a PRC-resident enterprise to its immediate holding company outside the PRC that are related to earnings accumulated beginning on January 1, 2008. Dividends relating to undistributed earnings generated prior to January 1, 2008 are exempt from such withholding income tax. The components of the income tax provision are as follows: SCHEDULE OF COMPONENTS OF THE INCOME TAX PROVISION 2022 2021 For the Years Ended December 31, 2022 2021 Current tax provision PRC $ 3,352,802 $ 4,409,589 Total current tax provision $ 3,352,802 $ 4,409,589 Deferred tax provision BVI - - Hong Kong - - China - - Total deferred tax provision - - Income tax provision $ 3,352,802 $ 4,409,589 The following table reconciles the China statutory rates to the Company’s effective tax rate for the years ended December 31, 2022 and 2021: SCHEDULE OF INCOME TAX RATE 2022 2021 For the Years Ended December 31, 2022 2021 PRC statutory income tax rate 25.0 % 25.0 % Effect of income tax holiday 0.0 % (1.0 )% Tax rate differential on entities not subject to PRC income (0.5 )% (0.6 )% R&D additional deduction (1.0 )% (0.5 )% Non-deductible expenses in the PRC 4.2 % (2.7 )% Effective tax rate 27.7 % 20.2 % Deferred tax assets The Company’s has no The Company follows ASC 740, “Income Taxes”, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates, applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The Company continually evaluates expiring statutes of limitations, audits, proposed settlements, changes in tax law and new authoritative rulings. As of December 31, 2022 and 2021, Sichuan Wetouch and Sichuan Vtouch remains open for statutory examination by PRC tax authorities. |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Payables and Accruals [Abstract] | ||
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | NOTE 8— ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consist of the following: SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES September 30, December 31, Advance from customers $ 532,069 $ 397,886 Accrued payroll and employee benefits 82,015 89,359 Accrued interest expenses 209,397 122,135 Accrued underwriter fees (i) 1,200,000 - Other tax payables (ii) 595,183 261 Other payable to a former shareholder (iii) - 191,180 Accrued professional fees 332,313 - Others (iv) 111,074 153,803 Accrued expenses and other current liabilities $ 3,062,051 $ 944,624 (i) On March 18, 2023, the Company entered into a private placement consent agreement with Representatives of the private placement taken place on January 19, 2023 (see Note 10) on the underwriting fees of US$ 1.2 (ii) Other tax payables are mainly value added tax payable. (iii) Other payable to a former shareholder was paid in March 2023. (iv) Others mainly represent accrued employee reimbursement payable and other accrued miscellaneous operating expenses. | NOTE 8— ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consist of the following: SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES December 31, 2022 December 31, 2021 Advance from customers $ 397,886 $ 59,111 Accrued payroll and employee benefits 89,359 99,342 Accrued interest expenses 122,135 20,795 Other tax payables (i) (i) 261 - Other payable to a former shareholder (ii) (ii) 191,180 - Others (iii) (iii) 153,803 131,159 Accrued expenses and other current liabilities $ 944,624 $ 310,407 (i) Other tax payables are mainly value added tax payable. (ii) Other payable to a former shareholder was paid in March, 2023. (iii) Others mainly represent accrued employee reimbursement payable and other accrued miscellaneous operating expenses. |
CONVERTIBLE PROMISSORY NOTES PA
CONVERTIBLE PROMISSORY NOTES PAYABLE | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Debt Disclosure [Abstract] | ||
CONVERTIBLE PROMISSORY NOTES PAYABLE | NOTE 9 – CONVERTIBLE PROMISSORY NOTES PAYABLE a) Convertible promissory notes In October, November, and December 2021, the Company, issued seven (7) convertible promissory notes of US$ 2,250,000 90.0 8.0 1,793,000 162,000 The details of convertible notes are as follows: Unless the Notes are converted, the principal amounts of the Notes, and accrued interest at the rate of 8 16 The Lenders have the right to convert any or all of the principal and accrued interest on the Notes into shares of common stock of the Company on the earlier of (i) 180 calendar days after the issuance date of the Notes or (ii) the closing of a listing for trading of the common stock of the Company on a national securities exchange offering resulting in gross proceeds to the Company of $ 15,000,000 or more (an “Uplist Offering”). If the Company closes an Uplist Offering on or before the 180 th 70 % of the per share offering price in the Uplist Offering; otherwise, the conversion price is $ 15.0 per share. Subject to customary exceptions, if the Company issues shares or any securities convertible into shares of common stock at an effective price per share lower than the conversion price of the Notes, the conversion rate of the Notes shall be reduced to such lower price. Until the Notes are either paid or converted in their entirety, the Company agreed with the Lenders not to sell any securities convertible into shares of common stock of the Company (i) at a conversion price that is based on the trading price of the stock or (ii) with a conversion price that is subject to being reset at a future date or upon an event directly or indirectly related to the business of the Company or the market for the common stock. The Company also agreed to not issue securities at a future determined price. The Lenders have the right to require the Company to repay the Notes if the Company receives cash proceeds, including proceeds from customers and the issuance of equity (including in the Uplist Offering). If the Company prepays the Notes prior to the Maturity Date, the Company shall pay a 10 The following table summarizes the outstanding promissory notes as of September 30, 2023 and December 31, 2022 (dollars in thousands): SUMMARY OF OUTSTANDING PROMISSORY NOTES September 30, 2023 December 31, 2022 Interest rate Principal Amount Carrying Amount Principal Amount Carrying Amount Convertible Note - Talos Victory (Note 9 (b)) 8 % $ - $ - $ - - Convertible Note - Mast Hill (Note 9 (b)) 8 % 725,000 679,402 740,000 635,535 Convertible Note - First Fire (Note 9 (b)) 8 % 156,250 146,654 181,250 156,594 Convertible Note - LGH Note 9 (b)) 8 % 202,500 199,438 207,500 188,987 Convertible Note - Fourth Man (Note 9 (b)) 8 % 152,000 137,882 157,000 128,703 Convertible Note - Jeffery Street Note 9 (b)) 8 % 165,000 145,865 170,000 142,554 Convertible Note - Blue Lake Note 9 (b))Total 8 % - - - - Total $ 1,400,750 $ 1,309,241 $ 1,455,750 $ 1,252,373 Amortization of discounts for the nine months ended September 30, 2023 (74,886 ) Convertible promissory notes payable as of September 30, 2023 $ 1,234,355 From December 28, 2022 to April 6, 2023, the remaining five (5) lenders and the Company entered into an amendment to the Note (“Amendment to Promissory Note”) extending maturity date for an additional 6 months. From August 29 to September 9, 2023, the remaining lenders and the Company entered into an amendment to the Note (“Amendment to Promissory Note”) that the Company’s ordinary shares on the Nasdaq Capital Market (the “Uplist”), the Company shall within three (3) business days after the Uplist, pay to the Holders amounts equal to 105% of the total outstanding balance of the Convertible Debenture During the nine-month period ended September 30, 2023, principal and default charges totaling $ 1,200,000 25,000 For the nine-month period ended September 30, 2023 and 2022, the Company recognized interest expenses of the Notes in the amount of US$ 211,383 172,255 * The Company prepaid $ 10,000 b) Warrants Accounting for Warrants In connection with the issuance of a convertible promissory notes (see Note 11 (a) in October, November and December, 2021, the Company also issued seven (7) three-year warrant (the “Warrant”) to purchase an aggregate of 90,000 The Warrants issued to the Lenders granted each of the Lenders the right to purchase up to 10,000 25 th 125 25 The Lenders have the right to exercise the Warrants on a cashless basis if the highest traded price of a share of common stock of the Company during the 150 trading days prior to exercise of the Warrants exceeds the exercise price, unless there is an effective registration statement of the Company which covers the resale of the Lenders. If the Company issues shares or any securities convertible into shares at an effective price per share lower than the exercise price of the Warrants, the exercise price of the Warrants shall be reduced to such lower price, subject to customary exceptions. The Lenders may not convert the Notes or exercise the Warrants if such conversion or exercise will result in each of the Lenders, together with any affiliates, beneficially owning in excess of 4.9 On January 17, 2022, we closed a private offering of ordinary shares and warrants to purchase ordinary shares. A total of 137,500 16.0 2,200,000 17.6 During the year ended December 31, 2022, three lenders exercised cashless for 14,233 During the nine-month period ended September 30, 2023, two lenders exercised cashless for 22,338 The fair values of these warrants as of September 30, 2023 were calculated using the Black-Scholes option-pricing model with the following assumptions: SCHEDULE OF FAIR VALUE OF WARRANTS September 30, 2023 Volatility (%) Expected dividends yield (%) Weighted average expected life (year) Risk-free interest rate (%) (per annum) Common stock purchase warrants liability as of December 31, 2022(US$) Changes of fair value of common stock purchase warrants liability Common stock purchase warrants liability as of September 30, 2023 (US$) Convertible Note - Talos Victory (Note 9 (a)) 522.6 % $ 0.0 % $ 1.1 5.46 % 14,803 28,758 43,561 Convertible Note - Mast Hill (Note 9 (a)) 522.6 % 0.0 % - 5.46 % 101,293 (101,293 ) - Convertible Note - First Fire (Note 9 (a)) 522.6 % 0.0 % 1.1 5.46 % 33,919 65,246 99,165 Convertible Note - LGH Note 9 (a)) 522.6 % 0.0 % 1.2 5.46 % 34,028 65,204 99,232 Convertible Note - Fourth Man (Note 9 (ab)) 522.6 % 0.0 % 1.2 5.46 % 14,398 27,524 41,922 Convertible Note - Jeffery Street Note 9 (a)) 522.6 % 0.0 % 1.2 5.46 % 34,134 (7,697 ) 26,437 Convertible Note - Blue Lake Note 9 (a)) 522.6 % 0.0 % 1.2 5.46 % 24,382 46,542 70,924 Total Total 256,957 124,284 381,241 (c) Registration Rights Agreements Pursuant to the terms of the Registration Rights Agreement dated as of contract date of each convertible promissory note, 2021, executed between the Company and Lender, the Registration Rights Agreement dated as of each contract date, executed between the Company and Lenders, the Company agreed to file a registration statement with the Securities and Exchange Commission to register the shares of common stock underlying the Notes and the shares issuable upon exercise of the Warrants within sixty days from the date of each Registration Rights Agreement. The Company also granted the Lenders piggyback registration rights on such shares pursuant to the Purchase Agreements. | NOTE 9 – CONVERTIBLE PROMISSORY NOTES PAYABLE a) Convertible promissory notes In October, November, and December 2021, the Company, issued seven (7) convertible promissory notes 2,250,000 90.0 8.0 1,793,000 162,000 The details of convertible notes are as follows: Unless the Notes are converted, the principal amounts of the Notes, and accrued interest at the rate of 8 16 The Lenders have the right to convert any or all of the principal and accrued interest on the Notes into shares of common stock of the Company on the earlier of (i) 180 calendar days after the issuance date of the Notes or (ii) the closing of a listing for trading of the common stock of the Company on a national securities exchange offering resulting in gross proceeds to the Company of $ 15,000,000 or more (an “Uplist Offering”). If the Company closes an Uplist Offering on or before the 180 th 70 % of the per share offering price in the Uplist Offering; otherwise, the conversion price is $ 0.75 per share ($15.0 per share after post-Reverse Stock Split). Subject to customary exceptions, if the Company issues shares or any securities convertible into shares of common stock at an effective price per share lower than the conversion price of the Notes, the conversion rate of the Notes shall be reduced to such lower price. Until the Notes are either paid or converted in their entirety, the Company agreed with the Lenders not to sell any securities convertible into shares of common stock of the Company (i) at a conversion price that is based on the trading price of the stock or (ii) with a conversion price that is subject to being reset at a future date or upon an event directly or indirectly related to the business of the Company or the market for the common stock. The Company also agreed to not issue securities at a future determined price. The Lenders have the right to require the Company to repay the Notes if the Company receives cash proceeds, including proceeds from customers and the issuance of equity (including in the Uplist Offering). If the Company prepays the Notes prior to the Maturity Date, the Company shall pay a 10 On April 27, 2022, the Company entered into an amendment to the Note (“Amendment to Promissory Note”) issued to the Lender and, on May 3, 2022, an amendment to the Registration Rights Agreement by and between the Company and the Lender (“Amendment to Registration Rights Agreement”), extending the number of days the Company shall have in order to cause the registration statement covering the resale of the Common Stock to become effective. The following table summarizes the outstanding promissory notes as of December 31, 2022 and 2021 (dollars in thousands): SUMMARY OF OUTSTANDING PROMISSORY NOTES 2022 2021 Interest rate Principal Amount Carrying Amount Principal Amount Carrying Amount Convertible Note- Talos Victory (Note 9 (b)) 8 % $ - $ - $ 250,000 201,536 Convertible Note-Mast Hill (Note 9 (b)) 8 % 740,000 635,535 750,000 612,265 Convertible Note-First Fire (Note 9 (b)) 8 % 181,250 156,594 250,000 200,129 Convertible Note-LGH Note 9 (b)) 8 % 207,500 188,987 250,000 209,274 Convertible Note -Fourth Man (Note 9 (b)) 8 % 157,000 128,703 250,000 199,220 Convertible Note-Jefferson Street Note 9 (b)) 8 % 170,000 142,554 250,000 199,011 Convertible Note -Blue Lake Note 9 (b))Total 8 % - - 250,000 199,011 Total $ 1,455,750 $ 1,252,373 $ 2,250,000 $ 1,846,583 Amortization of discounts for year ended December 31, 2022 24,909 Convertible promissory notes payable as of December 31,2022 $ 1,277,282 From December 28, 2022 to January 18, 2023, the remaining five (5) lenders and the Company entered into an amendment to the Note (“Amendment to Promissory Note”) extending maturity date for additional 6 months. During the year ended December 31, 2022, principal, accrued and unpaid interest and default charges totalling $ 1,038,426 1,384,564 For the year ended December 31, 2022 and 2021, the Company recognized interest expenses of the Notes in the amount of US$ 224,885 27,447 *The Company prepaid $ 10,000 b) Warrants Accounting for Warrants In connection with the issuance of a convertible promissory notes (see Note 11 (a) seven (7) three-year warrant (the “Warrant”) to purchase an aggregate of 1,800,000 90,000 The Warrants issued to the Lenders granted each of the Lenders the right to purchase up to 200,000 shares (except Mast Hill Fund, L.P., which was granted Warrants to purchase up to 600,000 30,000 10,000 shares post-Reverse Stock Split) of the Company at an exercise price of $ 1.25 per share ($ 25 per share post-Reverse Stock Split). However, if the Company closes an Uplist Offering on or before the 180 th 125 % of the offering price of a share in the Uplist Offering. If the adjusted exercise price as a result of the Uplist Offering is less than $ 1.25 per share ($ 25 per share post-Reverse Stock Split), then the number of shares for which the Warrants are exercisable shall be increased such that the total exercise price, after taking into account the decrease in the per share exercise price, shall be equal to the total exercise price prior to such adjustment. The Lenders have the right to exercise the Warrants on a cashless basis if the highest traded price of a share of common stock of the Company during the 150 trading days prior to exercise of the Warrants exceeds the exercise price, unless there is an effective registration statement of the Company which covers the resale of the Lenders. If the Company issues shares or any securities convertible into shares at an effective price per share lower than the exercise price of the Warrants, the exercise price of the Warrants shall be reduced to such lower price, subject to customary exceptions. The Lenders may not convert the Notes or exercise the Warrants if such conversion or exercise will result in each of the Lenders, together with any affiliates, beneficially owning in excess of 4.9 On April 14, April 27, and September 1, 2022, three lenders exercised cashless for 115,540 5,777 111,972 5,599 57,142 2,858 The fair values of these warrants as of December 31, 2022 were calculated using the Black-Scholes option-pricing model with the following assumptions: SCHEDULE OF FAIR VALUE OF WARRANTS December 31, 2022 Volatility (%) Expected dividends yield (%) Weighted average expected life (year) Risk-free interest rate (%) (per annum) Common stock purchase warrants liability as of December 31, 2021(US$) Changes of fair value of common stock purchase warrants liability Common stock purchase warrants liability as of December 31, 2022 (US$) Convertible Note- Talos Victory (Note 9 (a)) 289.9 % $ 0.0 % $ 1.8 4.41 % 124,756 (109,953 ) 14,803 Convertible Note-Mast Hill (Note 9 (a)) 289.9 % 0.0 % 1.8 4.41 % 375,156 (273,863 ) 101,293 Convertible Note-First Fire (Note 9 (a)) 289.9 % 0.0 % 1.9 4.41 % 125,408 (91,489 ) 33,919 Convertible Note-LGH Note 9 (a)) 289.9 % 0.0 % 1.9 4.41 % 125,664 (91,636 ) 34,028 Convertible Note -Fourth Man (Note 9 (ab)) 289.9 % 0.0 % 1.9 4.41 % 125,821 (111,423 ) 14,398 Convertible Note-Jefferson Street Note 9 (a))3,054 289.9 % 0.0 % 1.9 4.41 % 125,915 (91,781 ) 34,134 Convertible Note -Blue Lake Note 9 (a)) 289.9 % 0.0 % 1.9 4.41 % 125,915 (101,533 ) 24,382 Total Total 1,128,635 (868,678 ) 256,957 (c) Registration Rights Agreements Pursuant to the terms of the Registration Rights Agreement dated as of contract date of each convertible promissory note, 2021, executed between the Company and Lender, the Registration Rights Agreement dated as of each contract date, executed between the Company and Lenders, the Company agreed to file a registration statement with the Securities and Exchange Commission to register the shares of common stock underlying the Notes and the shares issuable upon exercise of the Warrants within sixty days from the date of each Registration Rights Agreement. The Company also granted the Lenders piggyback registration rights on such shares pursuant to the Purchase Agreements. |
SHAREHOLDERS_ EQUITY
SHAREHOLDERS’ EQUITY | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Equity [Abstract] | ||
SHAREHOLDERS’ EQUITY | NOTE 10— SHAREHOLDERS’ EQUITY 1) Ordinary Shares The Company’s authorized number of ordinary shares was 15,000,000 0.001 On December 22, 2020, the Company issued 5,181 On January 1, 2021, the Company issued an aggregate of 15,541 On April 14, April 27, 2022 and September 1, 2022, the Company issued cashless warrant shares of 5,777 5,599 2,857 During the year ended December 31, 2022, the Company issued 6,211 During the year ended December 31, 2022, the Company issued 69,228 On January 19, 2023, the Company sold an aggregate of 8,000,000 40,000,000 5.00 40 During nine-month ended September 30, 2023, the Company issued 25,000 During the nine-month ended September 30, 2023, the Company issued 22,338 As of September 30, 2023, the Company had 9,732,948 2) Reverse Stock Split On February 17, 2023, the Company’s board of directors authorized a reverse stock split with a ratio of not less than one to five (1:5) and not more than one to eighty (1:80), with the exact amount and the timing of the reverse stock split to be as determined by the Chairman of the Board. Upon such reverse stock split becoming effective, the number of authorized shares of the common stock of the Company will also be decreased in the same ratio. Pursuant to Nevada Revised Statutes Section 78.209, the reverse stock split does not have to be approved by the shareholders of the Company On July 16, 2023, the Company’s board of directors approved a reverse stock split of the Company’s common stock at a ratio of 1-for-20. On July 16, 2023, the Company filed a certificate of change (with an effective date of July 16, 2023) with the Nevada Secretary of State pursuant to Nevada Revised Statutes 78.209 to effectuate a 1-for-20 reverse stock split of its outstanding common stock. On September 11, 2023, the Company received notice from FINRA/OTC Corporate Actions the reverse split would take effect at the open of business on September 12, 2023, and the reverse stock that split took effect on that date. All share information included in this Form 10-Q has been reflected as if the reverse stock split occurred as of the earliest period presented | NOTE 10— SHAREHOLDERS’ EQUITY Ordinary Shares The Company’s authorized number of ordinary shares was 300,000,000 0.001 On December 22,2020, the Company issued 103,610 5,181 On January 1, 2021, the Company issued an aggregate of 310,830 15,541 On April 14, April 27, 2022 and September 1, 2022, the Company issued cashless warrant shares of 115,540 5,777 111,972 57,142 During the year ended December 31, 2022, the Company issued 124,223 6,211 During the year ended December 31, 2022, the Company issued 1,384,564 69,228 As of December 31, 2022, the Company had 33,604,965 1,680,248 Statutory reserve and restricted net assets Under PRC rules and regulations, all subsidiaries of Wetouch in the PRC Appropriations to the discretionary surplus reserve are made at the discretion of the board of directors. The statutory reserve may be applied against prior year losses, if any, and may be used for general business expansion and production or increase in registered capital, but are not distributable as cash dividends. For the years ended December 31, 2022 and 2021, the Company made appropriations to the reserve fund of RMB 6,554,271 973,718 12,933,795 2,005,084 |
SHARE BASED COMPENSATION
SHARE BASED COMPENSATION | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||
SHARE BASED COMPENSATION | NOTE 11- SHARE BASED COMPENSATION The Company applied ASC 718 and related interpretations in accounting for measuring the cost of share-based compensation over the period during which the consultants are required to provide services in exchange for the issued shares. The fair value of above award was estimated at the grant date using Black-Scholes model for pricing the share compensation expenses. On December 22, 2020, the Board of Directors of the Company authorized the issuance of an aggregate of 5,181 10,518 The shares of 5,181 6,211 4,307 2.5 0 43.5 0.11 On January 1, 2021, the Board of Directors of the Company authorized the issuance of an aggregate of 15,541 31,554 The 15,541 31,554 The fair value of above award was estimated at the grant date using Black-Scholes model for pricing the share compensation expenses. The fair value of the Black-Scholes model includes the following assumptions: expected life of 2.5 0 51.3 0.12 As of September 30, 2023, the Company had 35,861 0.2 0.2 0.4 | NOTE 11- SHARE BASED COMPENSATION The Company applied ASC 718 and related interpretations in accounting for measuring the cost of share-based compensation over the period during which the consultants are required to provide services in exchange for the issued shares. The fair value of above award was estimated at the grant date using Black-Scholes model for pricing the share compensation expenses. On December 22, 2020, the Board of Directors of the Company authorized the issuance of an aggregate of 103,610 5,181 210,360 The shares of 103,610 5,181 no 2.5 0 43.5 0.11 On January 1, 2021, the Board of Directors of the Company authorized the issuance of an aggregate of 310,830 15,541 631,080 31,554 The 310,830 15,541 631,080 31,554 124,223 6,211 The fair value of above award was estimated at the grant date using Black-Scholes model for pricing the share compensation expenses. The fair value of the Black-Scholes model includes the following assumptions: expected life of 1.5 0 215.4 2.96 As of December 31, 2022, the Company had 841,440 42,072 0.01 0.2 1.00 0.2 For the year ended December 31, 2022 and 2021, the Company recognized relevant share-based compensation expense of nil 1,041,281 nil 2,107,825 |
RISKS AND UNCERTAINTIES
RISKS AND UNCERTAINTIES | 9 Months Ended |
Sep. 30, 2023 | |
Risks and Uncertainties [Abstract] | |
RISKS AND UNCERTAINTIES | NOTE 12- RISKS AND UNCERTAINTIES Credit Risk The Company has its cash in bank deposits primarily at state owned banks located in the PRC. Historically, deposits in PRC banks have been secured due to the state policy of protecting depositors’ interests. The PRC promulgated a Bankruptcy Law in August 2006, effective June 1, 2007, which contains provisions for the implementation of measures for the bankruptcy of PRC banks. The bank deposits with financial institutions in the PRC are insured by the government authority for up to RMB 500,000 Interest Rate Risk Currency Risk - Concentrations - For the three-month periods ended September 30, 2023 and 2022, five customers accounted for 20.5 17.4 15.7 15.6 12.3 21.9 16.3 15.0 13.4 12.9 For the nine-month periods ended September 30, 2023 and 2022, five customers accounted for 22.0 16.1 15.9 14.4 11.6 20.5 15.9 15.6 14.5 12.3 10.2 And the Company’s top ten customers aggregately accounted for 99.8 99.1 99.6 99.2 As of September 30, 2023, two customers accounted for 26.7 14.1 The Company purchases its raw materials through various suppliers. Raw material purchases from these suppliers which individually exceeded 10% of the Company’s total raw material purchases, accounted for approximately 23.0 47.7 11.9 47.2 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | ||
COMMITMENTS AND CONTINGENCIES | NOTE 13 — COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time, the Company and its affiliates are parties to various legal actions arising in the ordinary course of business. Although Sichuan Wetouch and Hong Kong Wetouch, the previous subsidiaries of the Company, and our former Chairman and director Mr. Guangde Cai were named as defendants in several litigation matters, as of the date of this report, all such matters have been settled and Sichuan Wetouch, Hong Kong Wetouch and Mr. Guangde Cai were unconditionally and fully discharged and released therefrom. Accordingly, there are no pending material legal proceedings against the Company. Please also refer to NOTE 13 - commitments and of our 2023 10K-Annual report for year ending December 31, 2022 filed on April 17, 2023. Capital Expenditure Commitment On December 20, 2021, the Company entered into a contract with Shenzhen Municipal Haoyutuo Decoration & Cleaning Engineering Company Limited to purchase a facility decoration contract of RMB 20.0 3.1 15.0 2.1 5.0 0.7 | NOTE 13 — COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time, the Company and its affiliates are parties to various legal actions arising in the ordinary course of business. Although Sichuan Wetouch and Hong Kong Wetouch, the previous subsidiaries of the Company, and our former Chairman and director Mr. Guangde Cai were named as defendants in several litigation matters, as of the date of this report, all such matters have been settled and Sichuan Wetouch, Hong Kong Wetouch and Mr. Guangde Cai were unconditionally and fully discharged and released therefrom (See Item 13- Legal Proceedings). Accordingly, there are no pending material legal proceedings against the Company. i) An equity dispute case with Yunqing Su with a disputed amount of RMB 1,318,604 191,180 On June 22, 2017, Yunqing Su, a former shareholder, entered an Equity Investment Agreement with Sichuan Wetouch and Guangde Cai, agreed that Yunqing Su would invest RMB 1 149,853 370,370.37 220,000 32,968 128,000 19,181 On May 9, 2022, pursuant to a civil mediation statement issued by the Renshou County People’s Court of Sichuan Province, Sichuan Wetouch and Guangde Cai agreed to repay Yunqing Su the principal and interest in the total amount of RMB 1,318,604 191,180 ii) Legal case with Chengdu SME Credit Guarantee Co., Ltd. on a court acceptance fee of RMB 338,418 49,066 On July 5, 2013, Sichuan Wetouch obtained a one-year loan of RMB 60.0 9.8 8.61 Chengdu SME Credit Guarantee Co., Ltd (“Chengdu SME”), a third party, provided a 70% guarantee and Bank of Chengdu retained 30% of the risk, while Chengdu Wetouch and Mr. Guangde Cai provided joint and several liability guarantee for 100% of the loan On July 31, 2014, Sichuan Wetouch repaid RMB 5.0 0.8 55.0 8.9 55 8.9 55 8.0 5.8 0.8 6.0 0.9 1.7 Chengdu SME applied to the Chengdu High-tech Court for enforcement for the above-mentioned loan default penalties of RMB 5.8 0.8 6.0 0.9 5.8 0.8 6.0 0.9 On September 16, 2020, Sichuan Wetouch made a full repayment of RMB 11.8 1.7 On March 16, 2023, pursuant to an Enforcement Settlement Agreement entered among Chengdu SME, Sichuan Wetouch and Chengdu Wetouch, Chengdu Wetouch agreed to pay the court acceptance fee of RMB 338,418 49,066 iii) Legal case with Zhuhai Hongguang Technology Co., Ltd on the total amount of RMB 131,859 19,118 In September 2016, Sichuan Wetouch started purchasing components from Hongguang Technology Co., Ltd (“Hongguang Technology”) by sending a Purchase Order to Hongguang Technology and agreed to bear 20% of the breach of contract as liquidated damages. On November 30, 2021, Hongguang Technology filed a complaint with Renshou County People’s Court of Sichuan Province, requesting Sichuan Wetouch to pay RMB 109,883.2 (equivalent to $ 16,466 ) in arrears and liquidated damages of RMB 21,976.64 (equivalent to $ 3,293 ). Thereafter, the parties entered into a settlement agreement, pursuant to which Sichuan Wetouch agreed to pay the principal of outstanding payment and liquidated damages in the total amount of RMB 131,859 (equivalent to $ 19,118 ) on a lump-sum basis. Sichuan Wetouch paid the entire aforesaid amount to Hongguang Technology on February 16, 2022. iv) Legal case with Lifan Financial Leasing (Shanghai) Co., Ltd. and Sichuan Wetouch, Chengdu Wetouch, Meishan Wetouch and Xinjiang Wetouch Electronic Technology Co., Ltd. on a court acceptance fee of RMB RMB 250,470 (equivalent to $ 36,315 ) On November 20, 2014, Lifan Financial Lease (Shanghai) Co., Ltd. (“Lifan Financial”) and Chengdu Wetouch entered into a Financial Lease Contract (Sale and Leaseback), which stipulated that Lifan Financial shall lease the equipment to Chengdu Wetouch after the purchase of the production equipment owned by Chengdu Wetouch at a purchase price, the purchase price/lease principal shall be RMB 20 8% On August 9, 2021, Lifan Financial filed a lawsuit against Chengdu Wetouch, Guangde Cai, Sichuan Wetouch, Meishan Wetouch and Xinjiang Wetouch to the Chengdu Intermediate People’s Court. The court ruled that: 1) the Financial Lease Contract (Sale and Leaseback) was terminated; 2) the leased property was owned by Lifan Financial; 3) Chengdu Wetouch shall pay Lifan Financial all outstanding rent and interest thereon in the total amount of RMB 22,905,807.12 The parties executed a settlement agreement on March 7, 2023, in which the parties confirmed that the outstanding payment of RMB 22,905,807.12 has been fully paid up on December 23, 2021 and the above cases have been settled. As for the court acceptance fees that were not previously agreed upon by the parties, Chengdu Wetouch agreed to pay the court acceptance fee of RMB 250,470 (equivalent to $ 36,315 ). Chengdu Wetouch paid the aforesaid fees to Lifan Financial on March 10, 2023. v) Legal case with Sichuan Renshou Shigao Tianfu Investment Co., Ltd and Renshou Tengyi Landscaping Co., Ltd. on a court acceptance fee of RMB 103,232 14,967 On March 19, 2014, Chengdu Wetouch, a related party, obtained a two and half-year loan of RMB 15.0 2.2 Upon the loan due in January 2017, Chengdu Wetouch defaulted the loan, thus, CDHT Investment filed a lawsuit against Chengdu Wetouch, Sichuan Wetouch, and Hong Kong Wetouch demanding a full repayment of such debts. To support the local economic development as well as Chengdu Wetouch, two government-backed companies, Sichuan Renshou Shigao Tianfu Investment Co., Ltd. (“Sichuan Renshou”) and Renshou Tengyi Landscaping Co., Ltd. (“Renshou Tengyi”) provided their bank deposits of RMB 12.0 1.7 Upon the expiration of the guarantee, Chengdu Wetouch still defaulted on repayment of the above pledge. As a result, CDHT Investment levied this collateral of RMB 12.0 12.0 1.7 On December 2, 2019, pursuant to the reconciling agreement issued by Chengdu Intermediate People’s Court, the parties agreed to cancel the demand to seize property of Sichuan Wetouch rather than the property of Chengdu Wetouch, and to waive freezing Guangde Cai’s 60% shareholding equity in Xinjiang Wetouch Electronic Technology Co., Ltd. On October 9, 2020, pursuant to a settlement and release agreement, Sichuan Wetouch, Hong Kong Wetouch and Guangde Cai are fully discharged and released from any and all obligations under the outstanding debts, and from all liabilities under guarantee with Chengdu Wetouch being responsible for the outstanding debts by December 31, 2020. On October 27, 2020, Chengdu Wetouch made a full payment of the above debts. The settlement and release agreement did not specify which party shall pay the court acceptane fee. On March 10, 2023, pursuant to an enforcement settlement agreement entered among Sichuan Renshou, Renshou Tengyi, Sichuan Wetouch, Chengdu Wetouch, and other relevant parties, Sichuan Wetouch agreed to pay the court acceptance fee of RMB 103,232 14,967 vi) Legal case with Chengdu High Investment Financing Guarantee Co. on a court acceptance fee of RMB 250,000 36,246 On March 22, 2019, Chengdu High Investment Financing Guarantee Co., Ltd, (“Chengdu High Investment”) filed a lawsuit against Hong Kong Wetouch to the Chengdu Intermediate People’s Court, claiming that Hong Kong Wetouch should assume the guarantee liability for the debt payable by Chengdu Wetouch. On May 21, 2020, the court rendered a judgment ordering Hong Kong Wetouch to pay compensation of RMB 17,467,042 (equivalent to $ 2,617,491 ), interest, liquidated damages, liquidated damages for late performance, etc. On March 16, 2023, Chengdu Wetouch, Sichuan Wetouch and Chengdu High Investment entered into a settlement enforcement agreement, confirming that Chengdu High Investment had received RMB 17,547,197.5 (equivalent to $ 2,629,503 ) on October 27, 2020, and the above case has been settled. As for the court acceptance fees that were not previously agreed upon by the parties, Chengdu Wetouch agreed to pay the court acceptance fee of RMB 250,000 (equivalent to $ 36,246 ). Chengdu Wetouch paid the aforesaid fees to Chengdu High Investment on March 20, 2023. vii) Legal case with Hubei Lai’en Optoelectronics Technology Co., Ltd. on a product payment of RMB 157,714 22,866 Sichuan Wetouch purchased products from Hubei Lai’en Optoelectronics Technology Co., Ltd. (“Hubei Lai’en) multiple times from March to June 2019, but failed to pay the corresponding amount of RMB 137,142.7 for the purchased products. On April 6, 2022, Hubei Lai’en filed a lawsuit against Sichuan Wetouch to the Renshou County People’s Court of Sichuan Province, requesting payment of overdue payment for the products and liquidated damages. On May 31, 2022, the Renshou County People’s Court rendered a judgment that Sichuan Wetouch shall pay Hubei Lai’en the price of goods of RMB 137,143 and liquidated damages of RMB 20,571 . Sichuan Wetouch paid the above amount to Hubei Lai’en on March 15, 2023. viii) Legal case with Shenzhen Helitong Technology Co., Ltd. on a product payment of RMB 229,513 34,393 Sichuan Wetouch purchased products from Shenzhen Helitong Technology Co., Ltd. (“Shenzhen Helitong”) multiple times from January to June 2020, but failed to pay some of the purchase fee for the products. On October 21, 2021, Shenzhen Helitong filed a lawsuit against Sichuan Wetouch to the Renshou County People’s Court of Sichuan Province, requesting payment of overdue payment for the products and interests. On October 10, 2021, pursuant to a civil mediation letter issued by the Renshou County People’s Court, both parties agree that Sichuan Wetouch shall pay a total of RMB 229,513 (equivalent to $ 34,393 ) to Shenzhen Helitong, and the other claims waived by Shenzhen Helitong. As of February 16, 2022, Sichuan Wetouch made a full payment of RMB 229,513 (equivalent to $ 33,276 ) to Shenzhen Helitong. ix) Legal case with Xinjiang Weiyida Real Estate Development Co., Ltd on a loan payment of RMB 17,318,625 2,510,964 Xinjiang Weiyida Real Estate Development Co., Ltd (“Weiyida Real Estate”) filed a lawsuit against Meishan Wetouch, Guangde Cai, Sichuan Wetouch, Xinjiang Wetouch, Sichuan Yitong Financing Guarantee Co., Ltd to the Renshou County People’s Court of Sichuan Province and applied for property preservation on February 14, 2022 with respect to the dispute over recovery right in connection with the loan agreement. The parties entered into a settlement agreement and agreed that Meishan Wetouch shall repay the principal of RMB$ 17,318,625 2,595,250 17,318,625 2,510,964 Capital expenditure commitment On December 20, 2021, the Company entered into a contract with Shenzhen Municipal Haoyutuo Decoration & Cleaning Engineering Company Limited to purchase a facility decoration contract of RMB 20.0 3.1 15.0 2.2 5.0 0.7 |
WEIGHTED AVERAGE NUMBER OF SHAR
WEIGHTED AVERAGE NUMBER OF SHARES | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
EARNINGS PER COMMON SHARE* | ||
WEIGHTED AVERAGE NUMBER OF SHARES | NOTE 12. WEIGHTED AVERAGE NUMBER OF SHARES 21.2 | NOTE 12. WEIGHTED AVERAGE NUMBER OF SHARES In October 2020, the Company entered into a reverse merger transaction. The Company computes the weighted-average number of common shares outstanding in accordance with ASC 260 states that in calculating the weighted average shares when a reverse merger takes place in the middle of the year, the number of common shares outstanding from the beginning of that period to the acquisition date shall be computed on the basis of the weighted-average number of common shares of the legal acquiree (accounting acquirer) outstanding during the period multiplied by the exchange ratio established in the merger agreement. The number of common shares outstanding from the acquisition date to the end of that period shall be the actual number of common shares of the legal acquirer (the accounting acquiree) outstanding during that period. Credit Risk The Company has its cash in bank deposits primarily at state owned banks located in the PRC. Historically, deposits in PRC banks have been secured due to the state policy of protecting depositors’ interests. The PRC promulgated a Bankruptcy Law in August 2006, effective June 1, 2007, which contains provisions for the implementation of measures for the bankruptcy of PRC banks. The bank deposits with financial institutions in the PRC are insured by the government authority for up to RMB 500,000 Interest Rate Risk Currency Risk - Concentrations - 21.2 16.1 14.8 13.7 11.9 10.1 19.5 17.3 14.5 14.2 11.1 And the Company’s top 10 customers aggregately accounted for 98.7 97.5 As of December 31, 2022 three customers accounted for 32.2 22.8 14.0 As of December 31, 2021, six customers accounted for 25.7 18.6 12.5 11.5 11.3 10.2 The Company purchases its raw materials through various suppliers. Raw material purchases from these suppliers which individually exceeded 10% of the Company’s total raw material purchases, accounted for approximately 47.2 11.2 |
REVENUES
REVENUES | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
REVENUES | NOTE 14 — REVENUES The Company’s geographical revenue information is set forth below: SCHEDULE OF GEOGRAPHICAL REVENUE INFORMATION Three-Month Period Ended September 30, Nine-Month Period Ended September 30, 2023 2022 2023 2022 US$ US$ US$ US$ Sales in PRC $ 7,423,695 $ 8,159,260 $ 25,819,405 $ 24,421,569 Sales in Overseas -Republic of China (ROC, or Taiwan) 1,943,123 1,851,599 5,962,410 5,708,133 -South Korea 1,742,589 1,578,002 5,387,021 5,144,829 -Others 14,199 34,157 162,662 95,968 Sub-total 3,699,910 3,463,758 11,512,093 10,948,930 Total Revenue $ 11,123,605 $ 11,623,018 $ 37,331,498 $ 35,370,499 | NOTE 14 — REVENUES The Company’s geographical revenue information is set forth below: SCHEDULE OF GEOGRAPHICAL REVENUE INFORMATION 2022 2021 For the Years Ended December 31, 2022 2021 Sales in PRC $ 26,438,509 $ 27,213,684 Sales in Overseas -Republic of China (ROC, or Taiwan) 6,146,043 7,246,592 -South Korea 5,221,209 5,962,067 -Others 126,351 363,131 Sub-total 11,484,603 13,571,790 Total revenues $ 37,923,112 $ 40,785,474 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Subsequent Events [Abstract] | ||
SUBSEQUENT EVENTS | NOTE 15 — SUBSEQUENT EVENTS On September 7, 2023, Wetouch Technology Inc. (the “Company”) filed a Certificate of Change Pursuant to Nevada Revised Statutes Section 78.209 with the Secretary of State of the State of Nevada to affect a 1-for-20 reverse stock split (the “Reverse Stock Split”). On September 11, 2023, the Financial Industry Regulatory Authority (“FINRA”) notified us that the Reverse Stock Split will become effective on the OTCQB marketplace of OTC Markets on September 12, 2023 (the “Effective Date”). At the opening of business on the Effective Date, the Company’s common stock began trading on a split-adjusted basis. In connection with the Reverse Stock Split, the CUSIP number for the common stock will change to 961881208. The Company’s shares of common stock will continue to trade on the OTCQB marketplace under the symbol “WETHD” for a period of 20 business days, and thereafter, the symbol will return to “WETH”. Pursuant to Nevada Revised Statutes Section 78.209, the reverse stock split does not have to be approved by the shareholders of the Company. Fractional shares resulting from the Reverse Stock Split will be rounded up to the nearest whole number Prior to the effective date of the Certificate of Change, the Company was authorized to issue 300,000,000 15,000,000 194,551,716 9,727,586 Each shareholder’s percentage ownership interest in the Company and proportional voting power remains virtually unchanged as a result of the Reverse Stock Split, except for minor changes and adjustments that will result from rounding fractional shares into whole shares. The rights and privileges of the holders of shares of common stock will be substantially unaffected by the Reverse Stock Split. All options, warrants and convertible securities of the Company outstanding immediately prior to the Reverse Stock Split (to the extent they don’t provide otherwise) will be appropriately adjusted by dividing the number of shares of common stock into which the options, warrants and convertible securities are exercisable or convertible by 20 and multiplying the exercise or conversion price thereof by 20, as a result of the Reverse Stock Split. | NOTE 15 — SUBSEQUENT EVENTS 1) Private Placement On January 19, 2023, Wetouch Technology Inc., a Nevada corporation (the “Company”), entered into a Securities Purchase Agreement (the “Agreement”) with the buyers indicated therein (collectively, the “Buyers”), pursuant to which the Company sold to the Buyers an aggregate of 160,000,000 8,000,000 40,000,000 0.25 5.00 On January 20, 2023, the Company received net proceeds of $ 40 2) Reverse Stock Split On February 17, 2023, the Board authorized a reverse stock split with a ratio of not less than one to five (1:5) and not more than one to eighty (1:80) |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | ||
Common stock purchase warrants | (g) Common stock purchase warrants 871,677 256,957 | (g) Common stock purchase warrants The Company also analyzed the Warrants in accordance with ASC 815, to determine whether the Warrants meet the definition of a derivative and, if so, whether the Warrants meet the scope exception of ASC 815-40, which is that contracts issued or held by the reporting entity that are both (1) indexed to its own stock and (2) classified in stockholders’ equity shall not be considered to be derivative instruments for purposes of ASC 815-40. The Company concluded that the Warrants issued in November and December 2021 financing should be treated as a derivative liability because the Warrants are entitled to a price adjustment provision to allow the exercise price to be increased or reduced in the event the Company issues or sells any additional shares of common stock at a price per share more or less than the then-applicable exercise price or without consideration, which is typically referred to as a “Down-round protection” or “anti-dilution” provision. According to ASC 815-40, the “Down-round protection” provision is not considered to be an input to the fair value of a fixed-for-fixed option on equity shares which leads the Warrants to fail to be qualified as indexed to the Company’s own stock and then to fail to meet the scope exceptions of ASC 815. Therefore, the Company accounted for the Warrants as derivative liabilities under ASC 815. Pursuant to ASC 815, derivatives are measured at fair value and re-measured at fair value with changes in fair value recorded in earnings at each reporting period. The Company used a black-scholes-pricing model to estimate the fair values of common stock purchase warrants at the balance sheet dates. As of December 31, 2022 and 2021, the Company recorded $ 256,957 1,128,635 871,677 759,471 |
Uses of estimates | Use of Estimates The preparation of condensed financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosure of contingent assets and liabilities. Actual results could differ from those estimates. On an ongoing basis, management evaluates the Company’s estimates, including those related to the bad debt allowance, fair values of financial instruments, intangible assets and property and equipment, income taxes, and contingent liabilities, among others. The Company bases its estimates on assumptions, both historical and forward looking, that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. SCHEDULE OF ESTIMATED USEFUL LIFE OF PROPERTY PLANT AND EQUIPMENT Significant Accounting Policies For a detailed discussion about Wetouch’s significant accounting policies, refer to Note 2 — “Summary of Significant Accounting Policies,” in Wetouch’s consolidated financial statements included in Company’s 2022 audited consolidated financial statements. During the nine-month periods ended September 30, 2023, there were no significant changes made to Wetouch significant accounting policies. | (b) Uses of estimates In preparing the consolidated financial statements in conformity with US GAAP, management makes 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. These estimates are based on information as of the date of the consolidated financial statements. Significant estimates required to be made by management include, but are not limited to, the allowance for estimated uncollectible receivables, fair values of financial instruments, |
Significant Accounting Policies | Significant Accounting Policies For a detailed discussion about Wetouch’s significant accounting policies, refer to Note 2 — “Summary of Significant Accounting Policies,” in Wetouch’s consolidated financial statements included in Company’s 2022 audited consolidated financial statements. During the nine-month periods ended September 30, 2023, there were no significant changes made to Wetouch significant accounting policies. | |
Basis of Presentation and Principles of Consolidation | (a) Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The accompanying consolidated financial statements include the financial statements of Wetouch and its wholly owned subsidiaries. All significant intercompany transactions and balances have been eliminated upon consolidation. | |
Cash and cash equivalents | (c) Cash and cash equivalents Cash includes currency on hand and deposits held by banks that can be added or withdrawn without limitation. | |
Accounts receivables, net | (d) Accounts receivables, net Accounts receivables are presented net of allowance for doubtful accounts. The Company determines the adequacy of reserves for doubtful accounts based on individual account analysis and historical collection trend. The Company establishes a provision for doubtful receivables when there is objective evidence that the Company may not be able to collect amounts due. The allowance is based on management’s best estimate of specific losses on individual exposures, as well as a provision on historical trends of collections. Actual amounts received may differ from management’s estimate of credit worthiness and the economic environment. Delinquent account balances are written-off against the allowance for doubtful accounts after management has determined that the collection is not probable. | |
Inventory | (e) Inventory Inventory consists of raw materials, work-in-process and finished goods and is stated at the lower of cost or net realizable value. Cost is determined using a weighted average. For work-in-process and manufactured inventories, cost consists of raw materials, direct labor and an allocated portion of the Company’s production overhead. The Company writes down excess and obsolete inventory to its estimated net realizable value based upon assumptions about future demand and market conditions. For finished goods and work-in-process, if the estimated net realizable value for an inventory item, which is the estimated selling price in the ordinary course of business, less reasonably predicable costs to completion and disposal, is lower than its cost, the specific inventory item is written down to its estimated net realizable value. Net realizable value for raw materials is based on replacement cost. Provisions for inventory write-downs are included in the cost of revenues in the consolidated statements of operations. Inventories are carried at this lower cost basis until sold or scrapped. $ 74,100 nil | |
Convertible Promissory Notes | (f) Convertible Promissory Notes The Company accounts for its convertible promissory notes according to guidance of ASU 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”, which simplifies the accounting for convertible instruments by eliminating the requirement to separate embedded conversion features from the host contract when the conversion features are not required to be accounted for as derivatives under Topic 815. We analyze the convertible notes for the existence of a beneficial conversion feature. the Company considered the three characteristics of a derivative instrument listed in ASC 815-10-15-83: (i) having one or more underlyings and one or more notional amounts or payment provisions or both; (ii) requiring no initial net investment; (iii) permitting net settlement; Since the Company’s notes have fixed interest rate, specified notional principal and settlement date, which no other events would affect specified settlement, and the Company received net proceeds after issuance costs and discount, which the Company recorded as the net proceeds or net settled investment, the management assessed that the Notes did not do not meet the definition of a derivative instruments and an embedded feature would not be bifurcated. The discounts on the convertible notes, are amortized to interest expense, using the effective interest method, over the terms of the related convertible notes. | |
Fair value of financial instruments | (h) Fair value of financial instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: ● Level 1 — inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 — inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted market prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable and inputs derived from or corroborated by observable market data. ● Level 3 — inputs to the valuation methodology are unobservable. Unless otherwise disclosed, the fair value of the Company’s financial instruments, including cash, accounts receivable, prepaid expenses and other current assets, accounts payable, short-term bank loans, accrued expenses and other current liabilities, taxes payable and due to related parties, common stock purchase warrants liability, approximate the fair value of the respective assets and liabilities as of December 31, 2022 and 2021 based upon the nature of the assets and liabilities. | |
Property, plant and equipment, net | (i) Property, plant and equipment, net Property, plant and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization of property and equipment is provided using the straight-line method over their expected useful lives, as follows: SCHEDULE OF ESTIMATED USEFUL LIFE OF PROPERTY PLANT AND EQUIPMENT Useful life Buildings 20 Machinery and equipment 10 Office and electric equipment 3 Expenditures for maintenance and repairs, which do not materially extend the useful lives of the assets, are charged to expense as incurred. Expenditures for major renewals and betterments which substantially extend the useful life of assets are capitalized. The cost and related accumulated depreciation of assets retired or sold are removed from the respective accounts, and any gain or loss is recognized in the consolidated statements of income and other comprehensive income in other income or expenses. | |
Impairment of long-lived Assets | (l) Impairment of long-lived Assets Long-lived assets, such as property, plant and equipment, land use rights, are reviewed for impairment when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Recoverability of a long-lived asset or asset group to be held and used is measured by a comparison of the carrying amount of an asset or asset group to the estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying value of an asset or asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount that the carrying value exceeds the estimated fair value of the asset or asset group. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third party independent appraisals, as considered necessary. Assets to be disposed are reported at the lower of carrying amount or fair value less costs to sell, and are no longer depreciated. There were nil impairment of intangible assets recognized for the years ended December 31, 2022 and 2021. | |
Foreign Currency Translation | (m) Foreign Currency Translation The Company uses US dollars as the reporting currency. The Company’s subsidiary HK Wetouch’s functional currency for HK Wetouch is Hong Kong dollar. The functional currency of Sichuan Wetouch is the Chinese Yuan (“RMB”). The Company’s consolidated financial statements have been translated into US$. Assets and liabilities accounts are translated using the exchange rate at each reporting period end date. Equity accounts are translated at historical rates. Income and expense accounts are translated at the average rate of exchange during the reporting period. The resulting translation adjustments are reported under other comprehensive income (loss). Gains and losses resulting from the translations of foreign currency transactions and balances are reflected in the results of operations. The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into US$ at the rates used in translation. The following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report: SCHEDULE OF CURRENT EXCHANGE RATES December 31, December 31, Year-end spot rate US$1=RMB 6.8972 US$1=RMB 6.3726 Average rate US$1=RMB 6.7312 US$1=RMB 6.4505 | |
Revenue recognition | (n) Revenue recognition The Company adopted Accounting Standards Codification (“ASC”) 606 using the modified retrospective approach. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements. Therefore, no adjustments to opening retained earnings were necessary. ASC 606, Revenue from Contracts with customers, establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. ASC 606 requires the use of a five-step model to recognize revenue from customer contracts. The five-step model requires that the Company (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies the performance obligation. The application of the five-step model to the revenue streams compared to the prior guidance did not result in significant changes in the way the Company records its revenue. The Company has assessed the impact of the guidance by reviewing its existing customer contracts and current accounting policies and practices to identify differences that would result from applying the new requirements, including the evaluation of its performance obligations, transaction price, customer payments, transfer of control and principal versus agent considerations. Based on the assessment, the Company concluded that there was no change to the timing and pattern of revenue recognition for its current revenue streams. In accordance with ASC 606, the Company recognizes revenue when it transfers its goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. The Company accounts for the revenue generated from sales of its products primarily to its customers in PRC and overseas, as the Company is acting as a principal in these transactions, is subject to inventory risk, has latitude in establishing prices, and is responsible for fulfilling the promise to provide customers the specified goods, which the Company has control of the goods and has the ability to direct the use of goods to obtain substantially all the benefits. All of the Company’s contracts have one single performance obligation as the promise is to transfer the individual goods to customers, and there is no separately identifiable other promises in the contracts. The Company’s revenue streams are recognized at a point in time when title and risk of loss passes and the customer accepts the goods, which generally occurs at delivery. The Company’s products are sold with no right of return and the Company does not provide other credits or sales incentive to customers. The Company’s sales are net of value added tax (“VAT”) and business tax and surcharges collected on behalf of tax authorities in respect of product sales. Contract Assets and Liabilities Payment terms are established on the Company’s pre-established credit requirements based upon an evaluation of customers’ credit quality. Contract assets are recognized for in related accounts receivable. Contract liabilities are recognized for contracts where payment has been received in advance of delivery. The contract liability balance can vary significantly depending on the timing when an order is placed and when shipment or delivery occurs. As of December 31, 2022 and 2021, other than accounts receivable and advances from customers, the Company had no other material contract assets, contract liabilities or deferred contract costs recorded on its consolidated balance sheet. Costs of fulfilling customers’ purchase orders, such as shipping, handling and delivery, which occur prior to the transfer of control, are recognized in selling, general and administrative expense when incurred. Disaggregation of Revenues The Company disaggregates its revenue from contracts by geography, as the Company believes it best depicts how the nature, amount, timing and uncertainty of the revenue and cash flows are affected by economic factors. The Company’s disaggregation of revenues for the years ended December 31, 2022 and 2021 are disclosed in Note 14 to the financial statements. | |
Selling, General and Administrative Expenses | (o) Selling, General and Administrative Expenses Selling expenses represents primarily costs of payroll, benefits, commissions for sales representatives and advertising expenses. General and administrative expenses represents primarily payroll and benefits costs for administrative employees, rent and operating costs of office premises, depreciation and amortization of office facilities, professional fees and other administrative expenses. | |
Research and Development Expense | (p) Research and Development Expense Research and development costs are expensed as incurred. | |
Share-Based Compensation | (q) Share-Based Compensation The Company awards share options and other equity-based instruments to its employees, directors and third party service providers (collectively “share-based payments”). Compensation cost related to such awards is measured based on the fair value of the instrument on the grant date. The Company recognizes the compensation cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The amount of cost recognized is adjusted to reflect the expected forfeiture prior to vesting. When no future services are required to be performed by the employee in exchange for an award of equity instruments, and if such award does not contain a performance or market condition, the cost of the award is expensed on the grant date. The Company recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant-date value of such award that is vested at that date. | |
Government grant | (r) Government grant The Company follows other authoritative accounting guidance since there is no clear guidance with regard to government grants. Government grants are recognized at fair value where there is reasonable assurance that the grant will be received and all grant conditions will be met. Grants relating to expense items are recognized as income over the periods necessary to match the grant to the costs it is compensating. Grants relating to assets are credited to deferred income at fair value and are credited to income over the expected useful life of the asset on a straight-line basis. | |
Income taxes | (s) Income taxes The Company accounts for income taxes in accordance with the asset and liability method. Deferred taxes are recognized for the future tax consequences attributable to temporary differences between the carrying amounts of assets and liabilities for financial statement purposes and income tax purposes using enacted rates expected to be in effect when such amounts are realized or settled. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established, as needed, to reduce the amount of deferred tax assets if it is considered more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The Company recognizes the effect of uncertain income tax positions only if those positions are more-likely-than-not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% On December 22, 2017 the Tax Cut and Jobs Act of 2017 (“the Tax Act”) was signed into law, which among other effects, reduces the U.S. federal corporate income tax rate to 21% from 34% (or 35% in certain cases) beginning in 2018 | |
Value added tax (“VAT”) | (t) Value added tax (“VAT”) Sales revenue represents the invoiced value of goods, net of VAT. The VAT is based on gross sales price. Since April 1, 2019, VAT rate was lowered from 16 13 For export sales, VAT is not imposed on gross sales price, but the VAT related to purchasing raw materials is refunded after the export is completed. | |
Earnings per Share | (u) Earnings per Share The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted presents the dilutive effect on a per share basis of potential common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. As of December 31, 2022 and 2021, warrants were included for the dilutive EPS calculation, respectively. | |
Comprehensive income (loss) | (v) Comprehensive income (loss) Comprehensive income (loss) consists of two components, net income and other comprehensive income (loss). The foreign currency translation gain or loss resulting from translation of the financial statements expressed in RMB to US$ is reported in other comprehensive income (loss) in the consolidated statements of income and comprehensive income. | |
Recent Accounting Pronouncements | (w) Recent Accounting Pronouncements The Company considers the applicability and impact of all accounting standards updates (“ASUs”). Management periodically reviews new accounting standards that are issued. In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” including interim periods within those fiscal years. Early application of the guidance will be permitted for all entities for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years . The Company adopted ASU 2020-06 effective January 1, 2021. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326), which introduces new guidance for the accounting for credit losses on instruments within its scope. The new guidance introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modifies the impairment model for available-for-sale (AFS) debt securities and provides for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The pronouncement will be effective for public business entities that are SEC filers in fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early application of the guidance will be permitted for all entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company adopted ASU 2016-13 utilizing the modified retrospective transition method. The adoption of ASU 2016-13 did not have a material impact on the Company’s condensed consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”. In October 2021, the FASB issued ASU No. 2021-08, which will require companies to apply the definition of a performance obligation under ASC Topic 606 to recognize and measure contract assets and contract liabilities (i.e., deferred revenue) relating to contracts with customers that are acquired in a business combination. Under current U.S. GAAP, an acquirer generally recognizes assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers, at fair value on the acquisition date. ASU No. 2021-08 will result in the acquirer recording acquired contract assets and liabilities on the same basis that would have been recorded by the acquiree before the acquisition under ASC Topic 606. ASU No. 2021-08 is effective for fiscal years beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the impact of this ASU on its financial statements and the effects will be based upon the contract assets and liabilities acquired in the future. From time to time, the FASB or other standards setting bodies issue new accounting pronouncements. Updates to the FASB ASCs are communicated through issuance of ASUs. Unless otherwise discussed, the Company believes that the recently issued guidance, whether adopted or to be adopted in the future, is not expected to have a material impact on its consolidated financial statements upon adoption. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | ||
SCHEDULE OF ESTIMATED USEFUL LIFE OF PROPERTY PLANT AND EQUIPMENT | SCHEDULE OF ESTIMATED USEFUL LIFE OF PROPERTY PLANT AND EQUIPMENT | SCHEDULE OF ESTIMATED USEFUL LIFE OF PROPERTY PLANT AND EQUIPMENT Useful life Buildings 20 Machinery and equipment 10 Office and electric equipment 3 |
SCHEDULE OF CURRENT EXCHANGE RATES | The following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report: SCHEDULE OF CURRENT EXCHANGE RATES December 31, December 31, Year-end spot rate US$1=RMB 6.8972 US$1=RMB 6.3726 Average rate US$1=RMB 6.7312 US$1=RMB 6.4505 |
ACCOUNTS RECEIVABLE (Tables)
ACCOUNTS RECEIVABLE (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Receivables [Abstract] | ||
SCHEDULE OF ACCOUNTS RECEIVABLE | Accounts receivable consists of the following: SCHEDULE OF ACCOUNTS RECEIVABLE September 30, December 31, Accounts receivable $ 13,931,782 $ 9,057,741 Allowance for doubtful accounts - - Accounts receivable, net $ 13,931,782 $ 9,057,741 | Accounts receivable consists of the following: SCHEDULE OF ACCOUNTS RECEIVABLE December 31, 2022 December 31 2021 Accounts receivable $ 9,057,741 $ 7,991,037 Allowance for doubtful accounts - - Accounts receivable, net $ 9,057,741 $ 7,991,037 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Prepaid Expenses And Other Current Assets | ||
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS | Prepaid expenses and other current assets consist of the following: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS September 30, December 31, Advance to suppliers $ 325,852 $ 333,920 VAT input credits - 355,482 Issue cost related to convertible promissory notes 69,566 81,614 Prepayment for land use right (i) 537,998 569,105 Security deposit (ii) 53,865 56,979 Others receivable (iii) 55,989 53,520 Prepaid expenses and other current assets $ 1,043,270 $ 1,450,620 (i) On July 23, 2021, Sichuan Vtouch entered into a contract with Chengdu Wenjiang District Planning and Natural Resources Bureau for purchasing a land use right of 131,010 3,925,233 537,998 (ii) On July 28, 2021, Sichuan Vtouch made a security deposit of RMB 393,000 53,865 (iii) Other receivables are mainly employee advances, and prepaid expenses. | Prepaid expenses and other current assets consists of the following: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS December 31, 2022 December 31, 2021 Advance to suppliers $ 333,920 $ 244,758 VAT input credits 355,482 307,575 Issue cost related to convertible promissory notes 81,614 159,000 Deferred marketing expenses - 1,000,000 Prepayment for land use right/ (i) (i) 569,105 615,955 Security deposit (ii) (ii) 56,979 61,670 Others receivable (iii) (iii) 53,520 56,936 Prepaid expenses and other current assets $ 1,450,620 $ 2,445,894 (i) On July 23, 2021, Sichuan Vtouch entered into a contract with Chengdu Wenjiang District Planning and Natural Resources Bureau for purchasing a land use right of 131,010 3,925,233 569,105 (ii) On July 28, 2021, Sichuan Vtouch made a security deposit of RMB 393,000 56,979 (i) Other receivables are mainly employee advances, and prepaid expenses. |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | ||
SCHEDULE OF PROPERTY , PLANT AND EQUIPMENT | SCHEDULE OF PROPERTY , PLANT AND EQUIPMENT September 30, 2023 December 31, 2022 Buildings $ 11,804 $ 12,487 Vehicles 40,132 42,453 Construction in progress 10,288,183 10,883,051 Subtotal 10,340,119 10,937,991 Less: accumulated depreciation (20,439 ) (14,381 ) Property, plant and equipment, net $ 10,319,680 $ 10,923,610 | SCHEDULE OF PROPERTY , PLANT AND EQUIPMENT December 31, 2022 December 31, 2021 Buildings $ 12,487 $ 13,514 Vehicles 42,453 45,948 Construction in progress 10,883,051 11,778,957 Subtotal 10,937,991 11,838,419 Less: accumulated depreciation (14,381 ) (5,117 ) Property, plant and equipment, net $ 10,923,610 $ 11,833,302 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Related Party Transactions [Abstract] | ||
SCHEDULE OF RELATED PARTY TRANSACTIONS | Amounts due to a related party are as follows: SCHEDULE OF RELATED PARTY TRANSACTIONS Relationship September 30, December 31, Note Mr. Zongyi Lian President and CEO of the Company - 1,665 Payable to employee Total - $ - $ 1,665 - | Amounts due to related parties are as follows : SCHEDULE OF RELATED PARTY TRANSACTIONS Relationship December 31, 2022 December 31, 2021 Note Mr. Zongyi Lian President and CEO of the Company $ 1,665 $ 1,802 Payable to employee Mr. Guangde Cai Former Chairman of the Company - 32,867 Payable to employee Total $ 1,665 $ 34,669 - |
SCHEDULE OF REVENUES FROM RELATED PARTY TRANSACTIONS | The related party transactions are summarized as follows: SCHEDULE OF REVENUES FROM RELATED PARTY TRANSACTIONS 2022 2021 Years Ended December 31, 2022 2021 US$ US$ Revenues resulting from related parties: Sales to Chengdu Wetouch Technology Co., Ltd (“Chengdu Wetouch”) - 10,483 Sales to Meishan Wetouch Electronics Technology Co., Ltd. (“Meishan Wetouch”) - 87,367 Total revenue $ - $ 97,850 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
SCHEDULE OF COMPONENTS OF THE INCOME TAX PROVISION | SCHEDULE OF COMPONENTS OF THE INCOME TAX PROVISION PRC Sichuan Wetouch and Sichuan Vtouch files income tax returns in the PRC. Effective from January 1, 2008, the PRC statutory income tax rate is 25 Under PRC CIT Law, domestic enterprises and Foreign Investment Enterprises (“FIEs”) are usually subject to a unified 25 15 15 On October 21, 2020, Sichuan Wetouch was granted on a case-by-case basis by Sichuan Provincial government as preferential tax treatment High and New Technology Enterprises (“HNTEs”), entitled to a reduced income tax rate of 15% beginning October 21, 2020 until October 20, 2023 On March 30, 2023 an independent third party acquired all shares of Sichuan Wetouch. . Sichuan Vtouch is entitled to 25 The effective income tax rates for the nine-month periods ended September 30, 2023 and 2022 were 28.5 27.9 The estimated effective income tax rate for the year ended December 31, 2023 would be similar to actual effective tax rate of the nine-month periods ended September 30, 2023. | The components of the income tax provision are as follows: SCHEDULE OF COMPONENTS OF THE INCOME TAX PROVISION 2022 2021 For the Years Ended December 31, 2022 2021 Current tax provision PRC $ 3,352,802 $ 4,409,589 Total current tax provision $ 3,352,802 $ 4,409,589 Deferred tax provision BVI - - Hong Kong - - China - - Total deferred tax provision - - Income tax provision $ 3,352,802 $ 4,409,589 |
SCHEDULE OF INCOME TAX RATE | The following table reconciles the China statutory rates to the Company’s effective tax rate for the years ended December 31, 2022 and 2021: SCHEDULE OF INCOME TAX RATE 2022 2021 For the Years Ended December 31, 2022 2021 PRC statutory income tax rate 25.0 % 25.0 % Effect of income tax holiday 0.0 % (1.0 )% Tax rate differential on entities not subject to PRC income (0.5 )% (0.6 )% R&D additional deduction (1.0 )% (0.5 )% Non-deductible expenses in the PRC 4.2 % (2.7 )% Effective tax rate 27.7 % 20.2 % |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Payables and Accruals [Abstract] | ||
SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | Accrued expenses and other current liabilities consist of the following: SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES September 30, December 31, Advance from customers $ 532,069 $ 397,886 Accrued payroll and employee benefits 82,015 89,359 Accrued interest expenses 209,397 122,135 Accrued underwriter fees (i) 1,200,000 - Other tax payables (ii) 595,183 261 Other payable to a former shareholder (iii) - 191,180 Accrued professional fees 332,313 - Others (iv) 111,074 153,803 Accrued expenses and other current liabilities $ 3,062,051 $ 944,624 (i) On March 18, 2023, the Company entered into a private placement consent agreement with Representatives of the private placement taken place on January 19, 2023 (see Note 10) on the underwriting fees of US$ 1.2 (ii) Other tax payables are mainly value added tax payable. (iii) Other payable to a former shareholder was paid in March 2023. (iv) Others mainly represent accrued employee reimbursement payable and other accrued miscellaneous operating expenses. | Accrued expenses and other current liabilities consist of the following: SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES December 31, 2022 December 31, 2021 Advance from customers $ 397,886 $ 59,111 Accrued payroll and employee benefits 89,359 99,342 Accrued interest expenses 122,135 20,795 Other tax payables (i) (i) 261 - Other payable to a former shareholder (ii) (ii) 191,180 - Others (iii) (iii) 153,803 131,159 Accrued expenses and other current liabilities $ 944,624 $ 310,407 (i) Other tax payables are mainly value added tax payable. (ii) Other payable to a former shareholder was paid in March, 2023. (iii) Others mainly represent accrued employee reimbursement payable and other accrued miscellaneous operating expenses. |
CONVERTIBLE PROMISSORY NOTES _2
CONVERTIBLE PROMISSORY NOTES PAYABLE (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Debt Disclosure [Abstract] | ||
SUMMARY OF OUTSTANDING PROMISSORY NOTES | The following table summarizes the outstanding promissory notes as of September 30, 2023 and December 31, 2022 (dollars in thousands): SUMMARY OF OUTSTANDING PROMISSORY NOTES September 30, 2023 December 31, 2022 Interest rate Principal Amount Carrying Amount Principal Amount Carrying Amount Convertible Note - Talos Victory (Note 9 (b)) 8 % $ - $ - $ - - Convertible Note - Mast Hill (Note 9 (b)) 8 % 725,000 679,402 740,000 635,535 Convertible Note - First Fire (Note 9 (b)) 8 % 156,250 146,654 181,250 156,594 Convertible Note - LGH Note 9 (b)) 8 % 202,500 199,438 207,500 188,987 Convertible Note - Fourth Man (Note 9 (b)) 8 % 152,000 137,882 157,000 128,703 Convertible Note - Jeffery Street Note 9 (b)) 8 % 165,000 145,865 170,000 142,554 Convertible Note - Blue Lake Note 9 (b))Total 8 % - - - - Total $ 1,400,750 $ 1,309,241 $ 1,455,750 $ 1,252,373 Amortization of discounts for the nine months ended September 30, 2023 (74,886 ) Convertible promissory notes payable as of September 30, 2023 $ 1,234,355 | The following table summarizes the outstanding promissory notes as of December 31, 2022 and 2021 (dollars in thousands): SUMMARY OF OUTSTANDING PROMISSORY NOTES 2022 2021 Interest rate Principal Amount Carrying Amount Principal Amount Carrying Amount Convertible Note- Talos Victory (Note 9 (b)) 8 % $ - $ - $ 250,000 201,536 Convertible Note-Mast Hill (Note 9 (b)) 8 % 740,000 635,535 750,000 612,265 Convertible Note-First Fire (Note 9 (b)) 8 % 181,250 156,594 250,000 200,129 Convertible Note-LGH Note 9 (b)) 8 % 207,500 188,987 250,000 209,274 Convertible Note -Fourth Man (Note 9 (b)) 8 % 157,000 128,703 250,000 199,220 Convertible Note-Jefferson Street Note 9 (b)) 8 % 170,000 142,554 250,000 199,011 Convertible Note -Blue Lake Note 9 (b))Total 8 % - - 250,000 199,011 Total $ 1,455,750 $ 1,252,373 $ 2,250,000 $ 1,846,583 Amortization of discounts for year ended December 31, 2022 24,909 Convertible promissory notes payable as of December 31,2022 $ 1,277,282 |
SCHEDULE OF FAIR VALUE OF WARRANTS | The fair values of these warrants as of September 30, 2023 were calculated using the Black-Scholes option-pricing model with the following assumptions: SCHEDULE OF FAIR VALUE OF WARRANTS September 30, 2023 Volatility (%) Expected dividends yield (%) Weighted average expected life (year) Risk-free interest rate (%) (per annum) Common stock purchase warrants liability as of December 31, 2022(US$) Changes of fair value of common stock purchase warrants liability Common stock purchase warrants liability as of September 30, 2023 (US$) Convertible Note - Talos Victory (Note 9 (a)) 522.6 % $ 0.0 % $ 1.1 5.46 % 14,803 28,758 43,561 Convertible Note - Mast Hill (Note 9 (a)) 522.6 % 0.0 % - 5.46 % 101,293 (101,293 ) - Convertible Note - First Fire (Note 9 (a)) 522.6 % 0.0 % 1.1 5.46 % 33,919 65,246 99,165 Convertible Note - LGH Note 9 (a)) 522.6 % 0.0 % 1.2 5.46 % 34,028 65,204 99,232 Convertible Note - Fourth Man (Note 9 (ab)) 522.6 % 0.0 % 1.2 5.46 % 14,398 27,524 41,922 Convertible Note - Jeffery Street Note 9 (a)) 522.6 % 0.0 % 1.2 5.46 % 34,134 (7,697 ) 26,437 Convertible Note - Blue Lake Note 9 (a)) 522.6 % 0.0 % 1.2 5.46 % 24,382 46,542 70,924 Total Total 256,957 124,284 381,241 | The fair values of these warrants as of December 31, 2022 were calculated using the Black-Scholes option-pricing model with the following assumptions: SCHEDULE OF FAIR VALUE OF WARRANTS December 31, 2022 Volatility (%) Expected dividends yield (%) Weighted average expected life (year) Risk-free interest rate (%) (per annum) Common stock purchase warrants liability as of December 31, 2021(US$) Changes of fair value of common stock purchase warrants liability Common stock purchase warrants liability as of December 31, 2022 (US$) Convertible Note- Talos Victory (Note 9 (a)) 289.9 % $ 0.0 % $ 1.8 4.41 % 124,756 (109,953 ) 14,803 Convertible Note-Mast Hill (Note 9 (a)) 289.9 % 0.0 % 1.8 4.41 % 375,156 (273,863 ) 101,293 Convertible Note-First Fire (Note 9 (a)) 289.9 % 0.0 % 1.9 4.41 % 125,408 (91,489 ) 33,919 Convertible Note-LGH Note 9 (a)) 289.9 % 0.0 % 1.9 4.41 % 125,664 (91,636 ) 34,028 Convertible Note -Fourth Man (Note 9 (ab)) 289.9 % 0.0 % 1.9 4.41 % 125,821 (111,423 ) 14,398 Convertible Note-Jefferson Street Note 9 (a))3,054 289.9 % 0.0 % 1.9 4.41 % 125,915 (91,781 ) 34,134 Convertible Note -Blue Lake Note 9 (a)) 289.9 % 0.0 % 1.9 4.41 % 125,915 (101,533 ) 24,382 Total Total 1,128,635 (868,678 ) 256,957 |
REVENUES (Tables)
REVENUES (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
SCHEDULE OF GEOGRAPHICAL REVENUE INFORMATION | The Company’s geographical revenue information is set forth below: SCHEDULE OF GEOGRAPHICAL REVENUE INFORMATION Three-Month Period Ended September 30, Nine-Month Period Ended September 30, 2023 2022 2023 2022 US$ US$ US$ US$ Sales in PRC $ 7,423,695 $ 8,159,260 $ 25,819,405 $ 24,421,569 Sales in Overseas -Republic of China (ROC, or Taiwan) 1,943,123 1,851,599 5,962,410 5,708,133 -South Korea 1,742,589 1,578,002 5,387,021 5,144,829 -Others 14,199 34,157 162,662 95,968 Sub-total 3,699,910 3,463,758 11,512,093 10,948,930 Total Revenue $ 11,123,605 $ 11,623,018 $ 37,331,498 $ 35,370,499 | The Company’s geographical revenue information is set forth below: SCHEDULE OF GEOGRAPHICAL REVENUE INFORMATION 2022 2021 For the Years Ended December 31, 2022 2021 Sales in PRC $ 26,438,509 $ 27,213,684 Sales in Overseas -Republic of China (ROC, or Taiwan) 6,146,043 7,246,592 -South Korea 5,221,209 5,962,067 -Others 126,351 363,131 Sub-total 11,484,603 13,571,790 Total revenues $ 37,923,112 $ 40,785,474 |
BUSINESS DESCRIPTION (Details N
BUSINESS DESCRIPTION (Details Narrative) - shares | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Oct. 09, 2020 | Sep. 30, 2023 | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 08, 2023 | Dec. 31, 2021 | Jul. 19, 2016 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||
Number of reverse merger stock | 1,680,248 | ||||||
Common stock, shares issued | 9,732,948 | 9,732,948 | 1,680,248 | ||||
Common stock, shares outstanding | 9,732,948 | 9,732,948 | 1,680,248 | 1,590,576 | |||
Sichuan Wetouch Technology Co. Ltd. [Member] | |||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||
Ownership percentage | 100% | 100% | |||||
Sichuan Wetouch Technology Co. Ltd. [Member] | |||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||
Ownership percentage | 100% | ||||||
Common Stock [Member] | |||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||
Number of reverse merger stock | 5,362 | 5,362 | |||||
Common stock, shares outstanding | 9,727,586 | ||||||
BVI shareholders [Member] | |||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||
Stock issued during period, shares, acquisitions | 28,000,000 | ||||||
Number of reverse merger stock | 2,800 | ||||||
Common stock, shares outstanding | 31,396,394 | ||||||
BVI shareholders [Member] | Post Reverse Stock Split [Member] | |||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||
Stock issued during period, shares, acquisitions | 1,400,000 | ||||||
Common stock, shares outstanding | 1,569,820 | ||||||
Share Exchange Agreement [Member] | |||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||
Number of reverse merger stock | 1,569,820 | ||||||
Share Exchange Agreement [Member] | BVI shareholders [Member] | |||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||
Stock issued during period, shares, acquisitions | 28,000,000 | ||||||
Number of reverse merger stock | 1,400,000 | ||||||
Number of reverse merger stock | 2,800 | ||||||
Common stock, shares issued | 31,396,394 | ||||||
Common stock, shares outstanding | 31,396,394 | ||||||
Share Exchange Agreement [Member] | BVI shareholders [Member] | Common Stock [Member] | |||||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||||||
Number of reverse merger stock | 140 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | ||||
Apr. 01, 2019 | Mar. 31, 2019 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Loss Carryforwards [Line Items] | ||||||
Gain on changes of fair value of common stock purchase liability | $ (124,284) | $ 35,542 | $ 871,677 | $ 759,471 | ||
Common stock purchase warrants liability | 256,957 | |||||
Inventory write-off | $ 74,100 | |||||
Common stock purchase warrants liability | $ 1,128,635 | |||||
Income tax percentage description | greater than 50% | |||||
Income tax, description | The CIT Law and its implementation rules impose a withholding income tax at 10%, unless reduced by a tax treaty or arrangement, on the amount of dividends distributed by a PRC-resident enterprise to its immediate holding company outside the PRC that are related to earnings accumulated beginning on January 1, 2008. Dividends relating to undistributed earnings generated prior to January 1, 2008 are exempt from such withholding income tax. | |||||
Value added tax rate | 13% | 16% | ||||
Tax Cut and Jobs Act [Member] | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Income tax, description | On December 22, 2017 the Tax Cut and Jobs Act of 2017 (“the Tax Act”) was signed into law, which among other effects, reduces the U.S. federal corporate income tax rate to 21% from 34% (or 35% in certain cases) beginning in 2018 |
SCHEDULE OF ACCOUNTS RECEIVABLE
SCHEDULE OF ACCOUNTS RECEIVABLE (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Receivables [Abstract] | |||
Accounts receivable | $ 13,931,782 | $ 9,057,741 | $ 7,991,037 |
Allowance for doubtful accounts | |||
Accounts receivable, net | $ 13,931,782 | $ 9,057,741 | $ 7,991,037 |
SCHEDULE OF PREPAID EXPENSES AN
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |||
Prepaid Expenses And Other Current Assets | ||||||
Advance to suppliers | $ 325,852 | $ 333,920 | $ 244,758 | |||
VAT input credits | 355,482 | 307,575 | ||||
Issue cost related to convertible promissory notes | 69,566 | 81,614 | 159,000 | |||
Prepayment for land use right/ (i) | 537,998 | [1] | 569,105 | [1],[2],[3] | 615,955 | [2],[3] |
Security deposit (ii) | 53,865 | [4] | 56,979 | [4],[5] | 61,670 | [5] |
Others receivable (iii) | 55,989 | [6] | 53,520 | [6] | 56,936 | |
Prepaid expenses and other current assets | $ 1,043,270 | 1,450,620 | 2,445,894 | |||
Deferred marketing expenses | $ 1,000,000 | |||||
[1]On July 23, 2021, Sichuan Vtouch entered into a contract with Chengdu Wenjiang District Planning and Natural Resources Bureau for purchasing a land use right of 131,010 3,925,233 537,998 131,010 3,925,233 569,105 393,000 53,865 393,000 56,979 |
SCHEDULE OF PREPAID EXPENSES _2
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) (Parenthetical) | Sep. 30, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jul. 28, 2021 USD ($) | Jul. 28, 2021 CNY (¥) | Jul. 23, 2021 USD ($) ft² | Jul. 23, 2021 CNY (¥) ft² | |||
Prepayment for land use right | $ | $ 537,998 | [1] | $ 569,105 | [1],[2],[3] | $ 615,955 | [2],[3] | ||||
Security deposit | $ | $ 53,865 | [4] | $ 56,979 | [4],[5] | $ 61,670 | [5] | ||||
Sichuan Vtouch [Member] | ||||||||||
Area of land | ft² | 131,010 | 131,010 | ||||||||
Prepayment for land use right | $ 569,105 | ¥ 3,925,233 | ||||||||
Security deposit | $ 56,979 | ¥ 393,000 | ||||||||
Sichuan Vtouch Technology Co Ltd [Member] | ||||||||||
Area of land | ft² | 131,010 | 131,010 | ||||||||
Prepayment for land use right | $ 537,998 | ¥ 3,925,233 | ||||||||
Security deposit | $ 53,865 | ¥ 393,000 | ||||||||
[1]On July 23, 2021, Sichuan Vtouch entered into a contract with Chengdu Wenjiang District Planning and Natural Resources Bureau for purchasing a land use right of 131,010 3,925,233 537,998 131,010 3,925,233 569,105 393,000 53,865 393,000 56,979 |
SCHEDULE OF PROPERTY , PLANT AN
SCHEDULE OF PROPERTY , PLANT AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | |||
Subtotal | $ 10,340,119 | $ 10,937,991 | $ 11,838,419 |
Less: accumulated depreciation | (20,439) | (14,381) | (5,117) |
Property, plant and equipment, net | 10,319,680 | 10,923,610 | 11,833,302 |
Building [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 11,804 | 12,487 | 13,514 |
Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 40,132 | 42,453 | 45,948 |
Construction in Progress [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | $ 10,288,183 | $ 10,883,051 | $ 11,778,957 |
PROPERTY, PLANT AND EQUIPMENT_3
PROPERTY, PLANT AND EQUIPMENT, NET (Details Narrative) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 34 Months Ended | ||||||||
Mar. 18, 2021 USD ($) | Mar. 18, 2021 CNY (¥) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Oct. 31, 2024 USD ($) | Oct. 31, 2024 CNY (¥) | |
Depreciation expense | $ 2,294 | $ 2,340 | $ 9,465 | $ 12,494 | $ 9,891 | $ 5,117 | ||||||
Compensation expenses | $ 15,800,000 | ¥ 115,200,000 | ||||||||||
Gain (loss) on disposition of intangible assets | 7,648,423 | |||||||||||
Gain (loss) on disposition of intangible assets | $ 872,045 | |||||||||||
Sichuan Vtouch Technology Co Ltd [Member] | ||||||||||||
Compensation expenses | $ 16,700,000 | ¥ 115,200,000 | ||||||||||
Rent expenses | $ 41,372 | ¥ 300,000 | $ 52,825 | ¥ 400,000 | ||||||||
Lease renewal description | renewed on December 31, 2021 at a monthly rent of RMB 400,000 ($52,825) from January 1, 2022 till October 31, 2024 for the use of the Demised Properties | renewed on December 31, 2021 at a monthly rent of RMB 400,000 ($52,825) from January 1, 2022 till October 31, 2024 for the use of the Demised Properties | ||||||||||
Sichuan Vtouch [Member] | ||||||||||||
Rent expenses | $ 43,496 | ¥ 300,000 | ||||||||||
Lease renewal description | renewed on December 31, 2021 at a monthly rent of RMB 400,000 ($57,994) from January 1, 2022 till October 31, 2023 for the use of the Demised Properties. | renewed on December 31, 2021 at a monthly rent of RMB 400,000 ($57,994) from January 1, 2022 till October 31, 2023 for the use of the Demised Properties. |
SCHEDULE OF RELATED PARTY TRANS
SCHEDULE OF RELATED PARTY TRANSACTIONS (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party [Member] | |||
Related Party Transaction [Line Items] | |||
Amounts due from related party | $ 1,665 | ||
Amounts due to related parties | $ 1,665 | $ 34,669 | |
Mr Zongyi Lian [Member] | |||
Related Party Transaction [Line Items] | |||
Related party transaction relationship | President and CEO of the Company | President and CEO of the Company | President and CEO of the Company |
Mr Zongyi Lian [Member] | Related Party [Member] | |||
Related Party Transaction [Line Items] | |||
Amounts due to related parties | $ 1,665 | $ 1,802 | |
Mr. Guangde Cai [Member] | |||
Related Party Transaction [Line Items] | |||
Related party transaction relationship | Former Chairman of the Company | Former Chairman of the Company | |
Mr. Guangde Cai [Member] | Related Party [Member] | |||
Related Party Transaction [Line Items] | |||
Amounts due to related parties | $ 32,867 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) | Dec. 31, 2022 |
Chengdu Wetouch [Member] | |
Equity ownership percentage | 94% |
Meishan Wetouch [Member] | |
Equity ownership percentage | 95% |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | 36 Months Ended | |||||
Mar. 30, 2023 | Oct. 21, 2020 | Jan. 01, 2008 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Oct. 11, 2020 | |
Operating Loss Carryforwards [Line Items] | ||||||||
Income tax rate | 27.70% | 20.20% | ||||||
Income tax description | The CIT Law and its implementation rules impose a withholding income tax at 10%, unless reduced by a tax treaty or arrangement, on the amount of dividends distributed by a PRC-resident enterprise to its immediate holding company outside the PRC that are related to earnings accumulated beginning on January 1, 2008. Dividends relating to undistributed earnings generated prior to January 1, 2008 are exempt from such withholding income tax. | |||||||
Statutory income tax rate | 21% | |||||||
Deferred tax assets | $ 0 | $ 0 | ||||||
Sichuan Wetouch Technology Co. Ltd. [Member] | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Income tax description | On October 21, 2020, Sichuan Wetouch was granted on a case-by-case basis by Sichuan Provincial government as preferential tax treatment High and New Technology Enterprises (“HNTEs”), entitled to a reduced income tax rate of 15% beginning October 21, 2020 until October 20, 2023 | On October 21, 2020, Sichuan Wetouch was granted on a case-by-case basis by Sichuan Provincial government as preferential tax treatment High and New Technology Enterprises (“HNTEs”), entitled to a reduced income tax rate of 15% beginning October 21, 2020 until October 20, 2023. | ||||||
Sichuan Vtouch Technology Co Ltd [Member] | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Income tax rate | 28.50% | 27.90% | ||||||
PRC [Member] | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Income tax rate | 15% | |||||||
Statutory income tax rate | 25% | 25% | 25% | |||||
HONG KONG | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Income tax rate | 16.50% | |||||||
Inland Revenue, Hong Kong [Member] | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Income tax rate | 16.50% | |||||||
State Administration of Taxation, China [Member] | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Income tax rate | 25% | 15% |
SCHEDULE OF ACCRUED EXPENSES AN
SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||||
Payables and Accruals [Abstract] | |||||||
Advance from customers | $ 532,069 | $ 397,886 | $ 59,111 | ||||
Accrued payroll and employee benefits | 82,015 | 89,359 | 99,342 | ||||
Accrued interest expenses | 209,397 | 122,135 | 20,795 | ||||
Accrued underwriter fees | [1] | 1,200,000 | |||||
Other tax payables (i) | 595,183 | [2] | 261 | [2] | [3] | ||
Other payable to a former shareholder (ii) | [4] | 191,180 | [4],[5] | [5] | |||
Accrued professional fees | 332,313 | ||||||
Others | [6] | 111,074 | 153,803 | ||||
Accrued expenses and other current liabilities | $ 3,062,051 | 944,624 | 310,407 | ||||
Others (iii) | [7] | $ 153,803 | $ 131,159 | ||||
[1]On March 18, 2023, the Company entered into a private placement consent agreement with Representatives of the private placement taken place on January 19, 2023 (see Note 10) on the underwriting fees of US$ 1.2 |
SCHEDULE OF ACCRUED EXPENSES _2
SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) (Parenthetical) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |||
Accrued underwriter fees | [1] | $ 1,200,000 | |
[1]On March 18, 2023, the Company entered into a private placement consent agreement with Representatives of the private placement taken place on January 19, 2023 (see Note 10) on the underwriting fees of US$ 1.2 |
SUMMARY OF OUTSTANDING PROMISSO
SUMMARY OF OUTSTANDING PROMISSORY NOTES (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Short-Term Debt [Line Items] | |||
Principal amount | $ 1,400,750 | $ 1,455,750 | $ 2,250,000 |
Carrying amount | 1,309,241 | 1,252,373 | 1,846,583 |
Amortization of discounts | (74,886) | (24,909) | |
Convertible promissory notes payable | 1,234,355 | 1,277,282 | 2,030,550 |
Amortization of discounts | $ 74,886 | $ 24,909 | |
Convertible Note - Talos Victory [Member] | |||
Short-Term Debt [Line Items] | |||
Interest rate | 8% | 8% | |
Principal amount | 250,000 | ||
Carrying amount | 201,536 | ||
Convertible Note-Mast Hill [Member] | |||
Short-Term Debt [Line Items] | |||
Interest rate | 8% | 8% | |
Principal amount | $ 725,000 | $ 740,000 | 750,000 |
Carrying amount | $ 679,402 | $ 635,535 | 612,265 |
Convertible Note-First Fire [Member] | |||
Short-Term Debt [Line Items] | |||
Interest rate | 8% | 8% | |
Principal amount | $ 156,250 | $ 181,250 | 250,000 |
Carrying amount | $ 146,654 | $ 156,594 | 200,129 |
Convertible Note-LGH [Member] | |||
Short-Term Debt [Line Items] | |||
Interest rate | 8% | 8% | |
Principal amount | $ 202,500 | $ 207,500 | 250,000 |
Carrying amount | $ 199,438 | $ 188,987 | 209,274 |
Convertible Note -Fourth Man [Member] | |||
Short-Term Debt [Line Items] | |||
Interest rate | 8% | 8% | |
Principal amount | $ 152,000 | $ 157,000 | 250,000 |
Carrying amount | $ 137,882 | 128,703 | 199,220 |
Convertible Note Jefferson Street [Member] | |||
Short-Term Debt [Line Items] | |||
Interest rate | 8% | ||
Principal amount | $ 165,000 | 170,000 | |
Carrying amount | 145,865 | $ 142,554 | |
Convertible Note -Blue Lake [Member] | |||
Short-Term Debt [Line Items] | |||
Interest rate | 8% | ||
Principal amount | 250,000 | ||
Carrying amount | 199,011 | ||
Convertible Note-Jeffery Street [Member] | |||
Short-Term Debt [Line Items] | |||
Interest rate | 8% | ||
Principal amount | $ 170,000 | 250,000 | |
Carrying amount | $ 142,554 | $ 199,011 |
SCHEDULE OF FAIR VALUE OF WARRA
SCHEDULE OF FAIR VALUE OF WARRANTS (Details) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Short-Term Debt [Line Items] | |||
Common stock purchase sarrants liability | $ 381,241 | $ 256,957 | $ 1,128,635 |
Changes of fair value of common stock purchase warrants liability | 124,284 | (868,678) | |
Convertible Note - Talos Victory [Member] | |||
Short-Term Debt [Line Items] | |||
Common stock purchase sarrants liability | 43,561 | 14,803 | 124,756 |
Changes of fair value of common stock purchase warrants liability | 28,758 | (109,953) | |
Convertible Note-Mast Hill [Member] | |||
Short-Term Debt [Line Items] | |||
Common stock purchase sarrants liability | 101,293 | 375,156 | |
Changes of fair value of common stock purchase warrants liability | (101,293) | (273,863) | |
Convertible Note-First Fire [Member] | |||
Short-Term Debt [Line Items] | |||
Common stock purchase sarrants liability | 99,165 | 33,919 | 125,408 |
Changes of fair value of common stock purchase warrants liability | 65,246 | (91,489) | |
Convertible Note-LGH [Member] | |||
Short-Term Debt [Line Items] | |||
Common stock purchase sarrants liability | 99,232 | 34,028 | 125,664 |
Changes of fair value of common stock purchase warrants liability | 65,204 | (91,636) | |
Convertible Note -Fourth Man [Member] | |||
Short-Term Debt [Line Items] | |||
Common stock purchase sarrants liability | 41,922 | 14,398 | 125,821 |
Changes of fair value of common stock purchase warrants liability | 27,524 | (111,423) | |
Convertible Note Jefferson Street [Member] | |||
Short-Term Debt [Line Items] | |||
Common stock purchase sarrants liability | 26,437 | 34,134 | |
Changes of fair value of common stock purchase warrants liability | (7,697) | ||
Convertible Note -Blue Lake [Member] | |||
Short-Term Debt [Line Items] | |||
Common stock purchase sarrants liability | 70,924 | 24,382 | 125,915 |
Changes of fair value of common stock purchase warrants liability | $ 46,542 | (101,533) | |
Convertible Note-Jeffery Street [Member] | |||
Short-Term Debt [Line Items] | |||
Common stock purchase sarrants liability | 34,134 | $ 125,915 | |
Changes of fair value of common stock purchase warrants liability | $ (91,781) | ||
Measurement Input, Price Volatility [Member] | Convertible Note - Talos Victory [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 522.6 | 289.9 | |
Measurement Input, Price Volatility [Member] | Convertible Note-Mast Hill [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 522.6 | 289.9 | |
Measurement Input, Price Volatility [Member] | Convertible Note-First Fire [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 522.6 | 289.9 | |
Measurement Input, Price Volatility [Member] | Convertible Note-LGH [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 522.6 | 289.9 | |
Measurement Input, Price Volatility [Member] | Convertible Note -Fourth Man [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 522.6 | 289.9 | |
Measurement Input, Price Volatility [Member] | Convertible Note Jefferson Street [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 522.6 | ||
Measurement Input, Price Volatility [Member] | Convertible Note -Blue Lake [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 522.6 | 289.9 | |
Measurement Input, Price Volatility [Member] | Convertible Note-Jeffery Street [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 289.9 | ||
Measurement Input, Expected Dividend Rate [Member] | Convertible Note - Talos Victory [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 0 | 0 | |
Measurement Input, Expected Dividend Rate [Member] | Convertible Note-Mast Hill [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 0 | 0 | |
Measurement Input, Expected Dividend Rate [Member] | Convertible Note-First Fire [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 0 | 0 | |
Measurement Input, Expected Dividend Rate [Member] | Convertible Note-LGH [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 0 | 0 | |
Measurement Input, Expected Dividend Rate [Member] | Convertible Note -Fourth Man [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 0 | 0 | |
Measurement Input, Expected Dividend Rate [Member] | Convertible Note Jefferson Street [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 0 | ||
Measurement Input, Expected Dividend Rate [Member] | Convertible Note -Blue Lake [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 0 | 0 | |
Measurement Input, Expected Dividend Rate [Member] | Convertible Note-Jeffery Street [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 0 | ||
Measurement Input, Expected Term [Member] | Convertible Note - Talos Victory [Member] | |||
Short-Term Debt [Line Items] | |||
Weighted average expected life | 1 year 1 month 6 days | 1 year 9 months 18 days | |
Measurement Input, Expected Term [Member] | Convertible Note-Mast Hill [Member] | |||
Short-Term Debt [Line Items] | |||
Weighted average expected life | 1 year 9 months 18 days | ||
Measurement Input, Expected Term [Member] | Convertible Note-First Fire [Member] | |||
Short-Term Debt [Line Items] | |||
Weighted average expected life | 1 year 1 month 6 days | 1 year 10 months 24 days | |
Measurement Input, Expected Term [Member] | Convertible Note-LGH [Member] | |||
Short-Term Debt [Line Items] | |||
Weighted average expected life | 1 year 2 months 12 days | 1 year 10 months 24 days | |
Measurement Input, Expected Term [Member] | Convertible Note -Fourth Man [Member] | |||
Short-Term Debt [Line Items] | |||
Weighted average expected life | 1 year 2 months 12 days | 1 year 10 months 24 days | |
Measurement Input, Expected Term [Member] | Convertible Note Jefferson Street [Member] | |||
Short-Term Debt [Line Items] | |||
Weighted average expected life | 1 year 2 months 12 days | ||
Measurement Input, Expected Term [Member] | Convertible Note -Blue Lake [Member] | |||
Short-Term Debt [Line Items] | |||
Weighted average expected life | 1 year 2 months 12 days | 1 year 10 months 24 days | |
Measurement Input, Expected Term [Member] | Convertible Note-Jeffery Street [Member] | |||
Short-Term Debt [Line Items] | |||
Weighted average expected life | 1 year 10 months 24 days | ||
Measurement Input, Risk Free Interest Rate [Member] | Convertible Note - Talos Victory [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 5.46 | 4.41 | |
Measurement Input, Risk Free Interest Rate [Member] | Convertible Note-Mast Hill [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 5.46 | 4.41 | |
Measurement Input, Risk Free Interest Rate [Member] | Convertible Note-First Fire [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 5.46 | 4.41 | |
Measurement Input, Risk Free Interest Rate [Member] | Convertible Note-LGH [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 5.46 | 4.41 | |
Measurement Input, Risk Free Interest Rate [Member] | Convertible Note -Fourth Man [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 5.46 | 4.41 | |
Measurement Input, Risk Free Interest Rate [Member] | Convertible Note Jefferson Street [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 5.46 | ||
Measurement Input, Risk Free Interest Rate [Member] | Convertible Note -Blue Lake [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 5.46 | 4.41 | |
Measurement Input, Risk Free Interest Rate [Member] | Convertible Note-Jeffery Street [Member] | |||
Short-Term Debt [Line Items] | |||
Warrants measurement input | 4.41 |
CONVERTIBLE PROMISSORY NOTES _3
CONVERTIBLE PROMISSORY NOTES PAYABLE (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||
Sep. 08, 2023 | Jan. 17, 2022 | Sep. 09, 2023 | Dec. 31, 2021 | Nov. 30, 2021 | Oct. 31, 2021 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 01, 2022 | Apr. 27, 2022 | Apr. 14, 2022 | |
Short-Term Debt [Line Items] | |||||||||||||||
Principal amount | $ 2,250,000 | $ 1,400,750 | $ 1,400,750 | $ 1,455,750 | $ 2,250,000 | ||||||||||
Debt Instrument, Convertible, Conversion Price | $ 25,000 | $ 25,000 | |||||||||||||
Debt instrument, convertible, associated derivative transactions, description | From August 29 to September 9, 2023, the remaining lenders and the Company entered into an amendment to the Note (“Amendment to Promissory Note”) that the Company’s ordinary shares on the Nasdaq Capital Market (the “Uplist”), the Company shall within three (3) business days after the Uplist, pay to the Holders amounts equal to 105% of the total outstanding balance of the Convertible Debenture | ||||||||||||||
Senior notes | $ 1,200,000 | $ 1,200,000 | |||||||||||||
Number of shares converted | 25,000 | ||||||||||||||
Interest expense | $ 139,876 | $ 58,692 | $ 211,383 | $ 172,255 | $ 224,885 | 27,450 | |||||||||
Proceeds from legal settlements | $ 10,000 | ||||||||||||||
Warrants to purchase | 124,223 | 57,142 | 111,972 | 115,540 | |||||||||||
Number of shares issued | 194,551,716 | ||||||||||||||
Cashless warrant shares exercised | 22,338 | 22,338 | 14,233 | ||||||||||||
Debt conversion amount | $ 1,038,426 | ||||||||||||||
Conversion of shares | 1,384,564 | ||||||||||||||
Interest expense | $ 224,885 | $ 27,447 | |||||||||||||
Warrant [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Warrants to purchase | 90,000 | 90,000 | 90,000 | 90,000 | |||||||||||
Warrants to purchase | 1,800,000 | 35,861 | 35,861 | 841,440 | 1,800,000 | ||||||||||
Warrant [Member] | Mast Hill Fund L P [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Warrants to purchase | 600,000 | ||||||||||||||
Warrant [Member] | Lenders [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Ownership percentage | 4.90% | 4.90% | 4.90% | ||||||||||||
Common Stock [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Number of shares issued | 8,000,000 | ||||||||||||||
Post Reverse Stock Split [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Warrants to purchase | 90,000 | 6,211 | 90,000 | 5,777 | |||||||||||
Warrants to purchase | 42,072 | ||||||||||||||
Reverse Stock Split [Member] | Mast Hill Fund L P [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Warrants to purchase | 30,000 | ||||||||||||||
Lenders [Member] | Warrant [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Warrants to purchase | 10,000 | 10,000 | 200,000 | ||||||||||||
Excise price | $ 25 | $ 25 | $ 1.25 | ||||||||||||
Excise price, percentage | 125% | 125% | |||||||||||||
Lenders [Member] | Post Reverse Stock Split [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Excise price | $ 25 | ||||||||||||||
Lenders [Member] | Reverse Stock Split [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Warrants to purchase | 10,000 | ||||||||||||||
Investor [Member] | Common Stock [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Number of shares issued | 137,500 | ||||||||||||||
Subscribtion price | $ 16 | ||||||||||||||
Gross proceeds | $ 2,200,000 | ||||||||||||||
Exercise price | $ 17.6 | ||||||||||||||
FourthMan[Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Cashless warrant shares exercised | 115,540 | ||||||||||||||
FourthMan[Member] | Post Reverse Stock Split [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Cashless warrant shares exercised | 5,777 | ||||||||||||||
Tarlos [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Cashless warrant shares exercised | 111,972 | ||||||||||||||
Tarlos [Member] | Post Reverse Stock Split [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Cashless warrant shares exercised | 5,599 | ||||||||||||||
BlueLake [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Cashless warrant shares exercised | 57,142 | ||||||||||||||
BlueLake [Member] | Post Reverse Stock Split [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Cashless warrant shares exercised | 2,858 | ||||||||||||||
Seven Convertible Promissory Note [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Principal amount | $ 2,250,000 | $ 2,250,000 | $ 2,250,000 | $ 2,250,000 | |||||||||||
Issuance price discounted percentage | 90% | 90% | 90% | 90% | |||||||||||
Interest rate | 8% | 8% | 8% | 8% | 8% | 8% | |||||||||
Proceeds from debt issuance costs | $ 1,793,000 | $ 1,793,000 | $ 1,793,000 | $ 1,793,000 | |||||||||||
Proceeds from debt issuance costs | 162,000 | ||||||||||||||
Proceeds from Issuance Initial Public Offering | $ 15,000,000 | ||||||||||||||
Debt Conversion, Converted Instrument, Rate | 70% | ||||||||||||||
Debt Instrument, Convertible, Conversion Price | $ 15 | $ 15 | |||||||||||||
Debt issuance cost | $ 162,000 | $ 162,000 | $ 162,000 | $ 162,000 | |||||||||||
Convertible Notes Payable [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Interest rate | 16% | 16% | 8% | ||||||||||||
Proceeds from Issuance Initial Public Offering | $ 15,000,000 | ||||||||||||||
Debt Conversion, Converted Instrument, Rate | 70% | ||||||||||||||
Debt Instrument, Convertible, Conversion Price | $ 0.75 | ||||||||||||||
Default interest rate | 16% | ||||||||||||||
Promissory Note [Member] | Lender [Member] | |||||||||||||||
Short-Term Debt [Line Items] | |||||||||||||||
Percentage of prepayment penalty | 10% | 10% |
SHAREHOLDERS_ EQUITY (Details N
SHAREHOLDERS’ EQUITY (Details Narrative) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||
Sep. 08, 2023 shares | Jul. 16, 2023 | Feb. 17, 2023 | Jan. 19, 2023 USD ($) $ / shares shares | Jan. 02, 2021 shares | Jan. 01, 2021 shares | Dec. 22, 2020 shares | Sep. 30, 2023 $ / shares shares | Sep. 30, 2023 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) $ / shares shares | Sep. 10, 2023 shares | Dec. 31, 2022 CNY (¥) shares | Sep. 01, 2022 shares | Apr. 27, 2022 shares | Apr. 14, 2022 shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2021 CNY (¥) shares | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Common stock, shares authorized | 15,000,000 | 15,000,000 | 15,000,000 | 15,000,000 | 300,000,000 | 15,000,000 | 15,000,000 | 15,000,000 | ||||||||||
Common stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||||||
Cashless warrant shares exercised | 124,223 | 124,223 | 57,142 | 111,972 | 115,540 | |||||||||||||
Net proceeds | $ | $ 40,000,000 | |||||||||||||||||
Debt instrument, convertible, conversion price | $ / shares | $ 25,000 | $ 25,000 | ||||||||||||||||
Cashless warrant shares exercised | 22,338 | 22,338 | 14,233 | 14,233 | ||||||||||||||
Common stcok shares issued | 9,732,948 | 9,732,948 | 1,680,248 | 1,680,248 | ||||||||||||||
Common stock shares outstanding | 9,732,948 | 9,732,948 | 1,680,248 | 1,680,248 | 1,590,576 | 1,590,576 | ||||||||||||
Stockholders' equity note, stock split | the Company’s board of directors approved a reverse stock split of the Company’s common stock at a ratio of 1-for-20. On July 16, 2023, the Company filed a certificate of change (with an effective date of July 16, 2023) with the Nevada Secretary of State pursuant to Nevada Revised Statutes 78.209 to effectuate a 1-for-20 reverse stock split of its outstanding common stock. On September 11, 2023, the Company received notice from FINRA/OTC Corporate Actions the reverse split would take effect at the open of business on September 12, 2023, and the reverse stock that split took effect on that date. All share information included in this Form 10-Q has been reflected as if the reverse stock split occurred as of the earliest period presented | the Company’s board of directors authorized a reverse stock split with a ratio of not less than one to five (1:5) and not more than one to eighty (1:80), with the exact amount and the timing of the reverse stock split to be as determined by the Chairman of the Board. Upon such reverse stock split becoming effective, the number of authorized shares of the common stock of the Company will also be decreased in the same ratio. Pursuant to Nevada Revised Statutes Section 78.209, the reverse stock split does not have to be approved by the shareholders of the Company | ||||||||||||||||
Number of shares issued | 194,551,716 | |||||||||||||||||
Stock Issued During Period, Shares, Stock Splits | 1,680,248 | |||||||||||||||||
Previously Reported [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Common stcok shares issued | 33,604,965 | 33,604,965 | ||||||||||||||||
Common stock shares outstanding | 33,604,965 | 33,604,965 | ||||||||||||||||
Private Placement [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Number of shares issued in transaction | 8,000,000 | |||||||||||||||||
Value of stock sold | $ | $ 40,000,000 | |||||||||||||||||
Share price | $ / shares | $ 5 | |||||||||||||||||
Net proceeds | $ | $ 40,000,000 | |||||||||||||||||
Common Stock [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Conversion of convertible debt | 69,228 | |||||||||||||||||
Common stock shares outstanding | 9,727,586 | |||||||||||||||||
Number of shares issued | 8,000,000 | |||||||||||||||||
Conversion of convertible debt | 25,000 | 25,000 | 1,384,564 | |||||||||||||||
Ordinary [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Common stock, shares authorized | 300,000,000 | 300,000,000 | ||||||||||||||||
Post Reverse Stock Split [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Cashless warrant shares exercised | 6,211 | 6,211 | 5,777 | 90,000 | 90,000 | |||||||||||||
Conversion of convertible debt | 69,228 | |||||||||||||||||
Third Party Service Provider [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Number of shares issued for services | 310,830 | |||||||||||||||||
Third Party Service Provider [Member] | Common Stock [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Number of shares issued for services | 15,541 | |||||||||||||||||
Third Party Service Provider [Member] | Post Reverse Stock Split [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Number of shares issued for services | 15,541 | |||||||||||||||||
Lender One [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Cashless warrant shares exercised | 5,777 | |||||||||||||||||
Lender Two [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Cashless warrant shares exercised | 5,599 | |||||||||||||||||
Lender Three [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Cashless warrant shares exercised | 2,857 | |||||||||||||||||
Third Party Warrant [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Cashless warrant shares exercised | 6,211 | 6,211 | ||||||||||||||||
The Crone Law Group, P.C. [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Number of shares issued for services | 5,181 | |||||||||||||||||
Number of shares issued | 103,610 | |||||||||||||||||
The Crone Law Group, P.C. [Member] | Post Reverse Stock Split [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Number of shares issued for services | 5,181 | |||||||||||||||||
Sichuan Wetouch Technology Co. Ltd. [Member] | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||||||||||||||
Reserve fund | $ 973,718 | ¥ 6,554,271 | $ 2,005,084 | ¥ 12,933,795 |
SHARE BASED COMPENSATION (Detai
SHARE BASED COMPENSATION (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | |||||
Sep. 21, 2022 | Jan. 02, 2021 | Jan. 01, 2021 | Dec. 22, 2020 | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Number of shares warrant | 22,338 | 14,233 | |||||
Share-based compensation expense | $ 1,041,281 | ||||||
Warrant [Member] | |||||||
Warrants outstanding | 35,861 | 841,440 | 1,800,000 | ||||
Weighted average exercise price | $ 0.2 | $ 0.01 | |||||
Weighted average remaining contractual term | 2 months 12 days | 1 year | |||||
Aggregate intrinsic value | $ 400,000 | $ 200,000 | |||||
Share-based compensation expense | $ 2,107,825 | ||||||
Post Reverse Stock Split [Member] | |||||||
Number of shares authorized | 31,554 | ||||||
Warrants outstanding | 42,072 | ||||||
Weighted average exercise price | $ 0.2 | ||||||
Board of Directors [Member] | |||||||
Number of shares authorized | 15,541 | ||||||
Number of shares vested | 15,541 | ||||||
Number of warrants exercised | 124,223 | ||||||
Share based compensation, expected term of fair value | 2 years 6 months | 1 year 6 months | |||||
Share-based compensation, expected dividend rate | 0% | 0% | |||||
Share-based compensation, average interest rate | 0.12% | 2.96% | |||||
Share-based compensation, volatility | 51.30% | 215.40% | |||||
Board of Directors [Member] | Warrant [Member] | |||||||
Number of shares authorized | 31,554 | ||||||
Number of shares vested | 31,554 | ||||||
Board of Directors [Member] | Post Reverse Stock Split [Member] | |||||||
Number of shares authorized | 631,080 | ||||||
Number of shares vested | 31,554 | 5,181 | |||||
Number of warrants exercised | 6,211 | ||||||
Number of shares issues | 15,541 | ||||||
Board of Directors [Member] | Common Stock [Member] | |||||||
Number of shares authorized | 310,830 | ||||||
Number of shares vested | 310,830 | ||||||
Number of shares warrant | 15,541 | ||||||
Board of Directors [Member] | The Crone Law Group, P.C. [Member] | |||||||
Number of shares authorized | 103,610 | ||||||
Warrants outstanding | 210,360 | ||||||
Number of shares vested | 103,610 | ||||||
Number of warrants exercised | 4,307 | 0 | |||||
Share based compensation, expected term of fair value | 2 years 6 months | ||||||
Share-based compensation, expected dividend rate | 0% | ||||||
Expected volatility | 43.50% | ||||||
Share-based compensation, average interest rate | 0.11% | ||||||
Share-based compensation, volatility | 43.50% | ||||||
Board of Directors [Member] | The Crone Law Group, P.C. [Member] | Warrant [Member] | |||||||
Number of shares authorized | 5,181 | ||||||
Warrants outstanding | 10,518 | ||||||
Number of shares vested | 5,181 | ||||||
Number of warrants exercised | 6,211 | ||||||
Board of Directors [Member] | The Crone Law Group, P.C. [Member] | Post Reverse Stock Split [Member] | |||||||
Number of shares authorized | 5,181 |
RISKS AND UNCERTAINTIES (Detail
RISKS AND UNCERTAINTIES (Details Narrative) - CNY (¥) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer One [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 20.50% | 21.90% | 22% | 20.50% | 21.20% | 19.50% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Two [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 17.40% | 16.30% | 16.10% | 15.90% | 16.10% | 17.30% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Three [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 15.70% | 15% | 15.90% | 15.60% | 14.80% | 14.50% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Four [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 15.60% | 13.40% | 14.40% | 14.50% | 13.70% | 14.20% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Five [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 12.30% | 12.90% | 11.60% | 12.30% | 11.90% | 11.10% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Six[ Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 10.20% | 10.10% | ||||
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Top 10 Customers [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 99.80% | 99.10% | 99.60% | 99.20% | 98.70% | 97.50% |
Revenue Benchmark [Member] | Product Concentration Risk [Member] | Two Suppliers [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 23% | 11.90% | ||||
Revenue Benchmark [Member] | Product Concentration Risk [Member] | Four Suppliers [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 47.70% | 47.20% | 47.20% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer One [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 26.70% | 32.20% | 25.70% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Two [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 14.10% | 22.80% | 18.60% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Three [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 14% | 12.50% | ||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Four [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 11.50% | |||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Five [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 11.30% | |||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Six[ Member] | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk, percentage | 10.20% | |||||
Maximum [Member] | ||||||
Concentration Risk [Line Items] | ||||||
Bank deposits | ¥ 500,000 | ¥ 500,000 | ¥ 500,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) | 1 Months Ended | 9 Months Ended | 12 Months Ended | 132 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Sep. 08, 2023 shares | May 31, 2022 CNY (¥) | May 09, 2022 USD ($) | May 09, 2022 CNY (¥) | Mar. 14, 2022 USD ($) | Mar. 14, 2022 CNY (¥) | Feb. 16, 2022 USD ($) | Feb. 16, 2022 CNY (¥) | Feb. 14, 2022 USD ($) | Feb. 14, 2022 CNY (¥) | Dec. 23, 2021 CNY (¥) | Dec. 20, 2021 USD ($) | Dec. 20, 2021 CNY (¥) | Nov. 30, 2021 USD ($) | Nov. 30, 2021 CNY (¥) | Oct. 10, 2021 USD ($) | Oct. 10, 2021 CNY (¥) | Oct. 27, 2020 USD ($) | Oct. 27, 2020 CNY (¥) | Sep. 16, 2020 USD ($) | Sep. 16, 2020 CNY (¥) | May 21, 2020 USD ($) | May 21, 2020 CNY (¥) | Nov. 21, 2019 USD ($) | Nov. 21, 2019 CNY (¥) | Aug. 23, 2018 USD ($) | Aug. 23, 2018 CNY (¥) | Aug. 22, 2018 USD ($) | Aug. 22, 2018 CNY (¥) | Jun. 22, 2017 USD ($) shares | Jul. 31, 2014 USD ($) | Jul. 31, 2014 CNY (¥) | Mar. 19, 2014 USD ($) | Mar. 19, 2014 CNY (¥) | Jul. 05, 2013 USD ($) | Nov. 30, 2018 USD ($) | Nov. 30, 2018 CNY (¥) | Nov. 20, 2014 CNY (¥) | Sep. 30, 2023 USD ($) | Sep. 30, 2023 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2022 CNY (¥) | Aug. 09, 2032 CNY (¥) | Mar. 16, 2023 USD ($) | Mar. 16, 2023 CNY (¥) | Mar. 10, 2023 USD ($) | Mar. 10, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 20, 2022 USD ($) | Dec. 20, 2022 CNY (¥) | Dec. 31, 2021 USD ($) | Nov. 30, 2021 CNY (¥) | Mar. 12, 2020 USD ($) | Mar. 12, 2020 CNY (¥) | Dec. 30, 2018 USD ($) | Dec. 30, 2018 CNY (¥) | Dec. 31, 2017 USD ($) | Jun. 22, 2017 CNY (¥) | Jul. 31, 2014 CNY (¥) | Mar. 19, 2014 CNY (¥) | Jul. 05, 2013 CNY (¥) | |
Purchase commitment | $ 3,100,000 | ¥ 20,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Remaining balance | $ 700,000 | ¥ 5,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Original listed shares | shares | 194,551,716 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan obtained during period | $ | $ 1,400,750 | $ 1,455,750 | $ 2,250,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from Legal Settlements | $ | 10,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Dispute Case With Yunqing Su [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amount paid | $ 191,180 | ¥ 1,318,604 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment | $ 149,853 | ¥ 1,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Original listed shares | shares | 370,370.37 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest paid | $ 32,968 | ¥ 220,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repayments of debt | $ 19,181 | ¥ 128,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case with Chengdu SME Credit Guarantee Co., Ltd. [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repayments of debt | $ 800,000 | ¥ 5,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan obtained during period | 8,900,000 | ¥ 55,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case with Chengdu SME Credit Guarantee Co., Ltd. [Member] | Related to 30% of Remaining Loan Repaid By Chengdu SME [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan, default penalty | 800,000 | $ 800,000 | ¥ 5,800,000 | $ 800,000 | ¥ 5,800,000 | 5,800,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case with Chengdu SME Credit Guarantee Co., Ltd. [Member] | Related to 70% of Remaining Loan Repaid By Chengdu SME [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan, default penalty | $ 900,000 | $ 900,000 | ¥ 6,000,000 | $ 900,000 | ¥ 6,000,000 | ¥ 6,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case with Chengdu SME Credit Guarantee Co., Ltd. [Member] | Chengdu SME Credit Guarantee Co., Ltd. [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repayments of debt | $ 1,700,000 | ¥ 11,800,000 | $ 8,000,000 | ¥ 55,000,000 | $ 8,900,000 | ¥ 55,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan, default penalty | $ | $ 1,700,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case with Chengdu SME Credit Guarantee Co., Ltd. [Member] | Chengdu SME Credit Guarantee Co., Ltd. [Member] | Bank of Chengdu [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan obtained during period | $ 9,800,000 | ¥ 60,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt instrument, interest rate | 8.61% | 8.61% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt instrument, description | Chengdu SME Credit Guarantee Co., Ltd (“Chengdu SME”), a third party, provided a 70% guarantee and Bank of Chengdu retained 30% of the risk, while Chengdu Wetouch and Mr. Guangde Cai provided joint and several liability guarantee for 100% of the loan | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case with Chengdu SME Credit Guarantee Co., Ltd. [Member] | Chengdu SME Credit Guarantee Co., Ltd. [Member] | Subsequent Event [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acceptance fee | $ 49,066 | ¥ 338,418 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case With Zhuhai Hongguang Technology Co Ltd [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acceptance fee | 36,315 | ¥ 250,470 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case With Zhuhai Hongguang Technology Co Ltd [Member] | Zhuhai HongguangTechnology Co Ltd [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amount paid | $ 19,118 | ¥ 131,859 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss Contingency, Damages Sought, Value | 16,466 | ¥ 109,883.2 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Liquidated Damages | $ 3,293 | ¥ 21,976.64 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case With Lifan Financial Leasing Co Ltd [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amount paid | ¥ 22,905,807.12 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease price | ¥ 20,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease rate | 8% | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding payment | ¥ 22,905,807.12 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal case with Sichuan Renshou Shigao Tianfu Investment Co., Ltd and Renshou Tengyi Landscaping Co., Ltd. [Member] | Chengdu Bank Co, Ltd [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repayments of debt | ¥ 12,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loan obtained during period | $ 2,200,000 | ¥ 15,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt instrument, description | To support the local economic development as well as Chengdu Wetouch, two government-backed companies, Sichuan Renshou Shigao Tianfu Investment Co., Ltd. (“Sichuan Renshou”) and Renshou Tengyi Landscaping Co., Ltd. (“Renshou Tengyi”) provided their bank deposits of RMB 12.0 million (equivalent to $1.7 million) as pledge, while Mr. Guangde Cai and Sichuan Wetouch also provided counter-guarantee | To support the local economic development as well as Chengdu Wetouch, two government-backed companies, Sichuan Renshou Shigao Tianfu Investment Co., Ltd. (“Sichuan Renshou”) and Renshou Tengyi Landscaping Co., Ltd. (“Renshou Tengyi”) provided their bank deposits of RMB 12.0 million (equivalent to $1.7 million) as pledge, while Mr. Guangde Cai and Sichuan Wetouch also provided counter-guarantee | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss Contingency, Damages Sought, Value | $ 1,700,000 | ¥ 12,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pledged bank deposits for debt, value | $ 1,700,000 | ¥ 12,000,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal case with Sichuan Renshou Shigao Tianfu Investment Co., Ltd and Renshou Tengyi Landscaping Co., Ltd. [Member] | Subsequent Event [Member] | Chengdu Bank Co, Ltd [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acceptance fee | $ 14,967 | ¥ 103,232 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case With Chengdu High Investment Financing Guarantee Co Ltd [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding payment | $ 2,617,491 | ¥ 17,467,042 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from Legal Settlements | $ 2,629,503 | ¥ 17,547,197.5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case With Chengdu High Investment Financing Guarantee Co Ltd [Member] | Subsequent Event [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acceptance fee | $ 36,246 | ¥ 250,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case With Hubei Laien Optoelectronics Technology Co Ltd [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amount paid | 22,866 | ¥ 157,714 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Liquidated Damages | ¥ 20,571 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding payment | ¥ 137,143 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Payable, Trade | ¥ 137,142.7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case With Shenzhen Helitong Technology Co Ltd [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amount paid | $ 33,276 | ¥ 229,513 | 34,393 | 229,513 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outstanding payment | $ 34,393 | ¥ 229,513 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Legal Case With Xinjiang Weiyida Real Estate Development Co Ltd [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amount paid | $ 2,510,964 | ¥ 17,318,625 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss Contingency, Damages Sought, Value | $ 2,595,250 | ¥ 17,318,625 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Construction in Progress [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Purchase commitment | $ 2,100,000 | ¥ 15,000,000 | $ 2,200,000 | ¥ 15,000,000 |
WEIGHTED AVERAGE NUMBER OF SH_2
WEIGHTED AVERAGE NUMBER OF SHARES (Details Narrative) - CNY (¥) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Maximum [Member] | ||||||
Product Information [Line Items] | ||||||
Bank deposits | ¥ 500,000 | ¥ 500,000 | ¥ 500,000 | |||
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer One [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 20.50% | 21.90% | 22% | 20.50% | 21.20% | 19.50% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Two [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 17.40% | 16.30% | 16.10% | 15.90% | 16.10% | 17.30% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Three [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 15.70% | 15% | 15.90% | 15.60% | 14.80% | 14.50% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Four [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 15.60% | 13.40% | 14.40% | 14.50% | 13.70% | 14.20% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Five [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 12.30% | 12.90% | 11.60% | 12.30% | 11.90% | 11.10% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Customer Six[ Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 10.20% | 10.10% | ||||
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Top 10 Customers [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 99.80% | 99.10% | 99.60% | 99.20% | 98.70% | 97.50% |
Revenue Benchmark [Member] | Product Concentration Risk [Member] | Four Suppliers [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 47.70% | 47.20% | 47.20% | |||
Revenue Benchmark [Member] | Product Concentration Risk [Member] | One Suppliers [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 11.20% | |||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer One [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 26.70% | 32.20% | 25.70% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Two [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 14.10% | 22.80% | 18.60% | |||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Three [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 14% | 12.50% | ||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Four [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 11.50% | |||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Five [Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 11.30% | |||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer Six[ Member] | ||||||
Product Information [Line Items] | ||||||
Concentration risk, percentage | 10.20% |
SCHEDULE OF GEOGRAPHICAL REVENU
SCHEDULE OF GEOGRAPHICAL REVENUE INFORMATION (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||||||
Sales in PRC | $ 7,423,695 | $ 8,159,260 | $ 25,819,405 | $ 24,421,569 | $ 26,438,509 | $ 27,213,684 |
Sub-total | 3,699,910 | 3,463,758 | 11,512,093 | 10,948,930 | ||
Total Revenue | 11,123,605 | 11,623,018 | 37,331,498 | 35,370,499 | ||
Sub-total | 11,484,603 | 13,571,790 | ||||
Total revenues | 11,123,605 | 11,623,018 | 37,331,498 | 35,370,499 | 37,923,112 | 40,785,474 |
Republic Of China [Member] | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Sub-total | 1,943,123 | 1,851,599 | 5,962,410 | 5,708,133 | ||
Sub-total | 6,146,043 | 7,246,592 | ||||
KOREA, REPUBLIC OF | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Sub-total | 1,742,589 | 1,578,002 | 5,387,021 | 5,144,829 | ||
Sub-total | 5,221,209 | 5,962,067 | ||||
Others [Member] | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Sub-total | $ 14,199 | $ 34,157 | $ 162,662 | $ 95,968 | ||
Sub-total | $ 126,351 | $ 363,131 |
SCHEDULE OF ESTIMATED USEFUL LI
SCHEDULE OF ESTIMATED USEFUL LIFE OF PROPERTY PLANT AND EQUIPMENT (Details) | Dec. 31, 2022 |
Building [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated useful lives | 20 years |
Machinery and Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated useful lives | 10 years |
Office and Electric Equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated useful lives | 3 years |
SCHEDULE OF CURRENT EXCHANGE RA
SCHEDULE OF CURRENT EXCHANGE RATES (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Year-End Spot Rate US$1=RMB [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Foreign exchange rate | 6.8972 | 6.3726 |
Average Rate US$1=RMB [Member] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Foreign exchange rate | 6.7312 | 6.4505 |
SCHEDULE OF REVENUES FROM RELAT
SCHEDULE OF REVENUES FROM RELATED PARTY TRANSACTIONS (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | ||||||
Total revenue | $ 11,123,605 | $ 11,623,018 | $ 37,331,498 | $ 35,370,499 | ||
Related Party [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Total revenue | $ 97,850 | |||||
Chengdu Wetouch Technology Co., Ltd [Member] | Related Party [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Total revenue | 10,483 | |||||
Meishan Wetouch Electronics Technology Co., Ltd [Member] | Related Party [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Total revenue | $ 87,367 |
SCHEDULE OF COMPONENTS OF THE I
SCHEDULE OF COMPONENTS OF THE INCOME TAX PROVISION (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Total current tax provision | $ 3,352,802 | $ 4,409,589 | ||||
Total deferred tax provision | ||||||
Income tax provision | $ 1,148,185 | $ 1,232,629 | $ 4,109,679 | $ 3,392,587 | 3,352,802 | 4,409,589 |
PRC [Member] | ||||||
Total current tax provision | 3,352,802 | 4,409,589 | ||||
BVI [Member] | ||||||
Total deferred tax provision | ||||||
HONG KONG | ||||||
Total deferred tax provision | ||||||
CHINA | ||||||
Total deferred tax provision |
SCHEDULE OF INCOME TAX RATE (De
SCHEDULE OF INCOME TAX RATE (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Subsequent Events [Abstract] | ||
PRC statutory income tax rate | 25% | 25% |
Effect of income tax holiday | 0% | (1.00%) |
Tax rate differential on entities not subject to PRC income | (0.50%) | (0.60%) |
R&D additional deduction | (1.00%) | (0.50%) |
Non-deductible expenses in the PRC | 4.20% | (2.70%) |
Effective tax rate | 27.70% | 20.20% |
SUMMARY OF OUTSTANDING PROMIS_2
SUMMARY OF OUTSTANDING PROMISSORY NOTES (Details) (Parenthetical) | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Subsequent Events [Abstract] | |
Repayment of notes | $ 10,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | 9 Months Ended | ||||||||||
Sep. 08, 2023 | Sep. 06, 2023 | Feb. 17, 2023 | Jan. 20, 2023 | Jan. 19, 2023 | Jan. 19, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 10, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Subsequent Event [Line Items] | |||||||||||
Reverse stock split | Wetouch Technology Inc. (the “Company”) filed a Certificate of Change Pursuant to Nevada Revised Statutes Section 78.209 with the Secretary of State of the State of Nevada to affect a 1-for-20 reverse stock split (the “Reverse Stock Split”). On September 11, 2023, the Financial Industry Regulatory Authority (“FINRA”) notified us that the Reverse Stock Split will become effective on the OTCQB marketplace of OTC Markets on September 12, 2023 (the “Effective Date”). At the opening of business on the Effective Date, the Company’s common stock began trading on a split-adjusted basis. In connection with the Reverse Stock Split, the CUSIP number for the common stock will change to 961881208. The Company’s shares of common stock will continue to trade on the OTCQB marketplace under the symbol “WETHD” for a period of 20 business days, and thereafter, the symbol will return to “WETH”. Pursuant to Nevada Revised Statutes Section 78.209, the reverse stock split does not have to be approved by the shareholders of the Company. Fractional shares resulting from the Reverse Stock Split will be rounded up to the nearest whole number | reverse stock split (1-for-20) | |||||||||
Number of shares authorized,reverse split | 15,000,000 | 15,000,000 | 300,000,000 | 15,000,000 | 15,000,000 | ||||||
Shares issued to private placement,shares | 194,551,716 | ||||||||||
Common stock, shares, outstanding | 9,732,948 | 1,680,248 | 1,590,576 | ||||||||
Net proceeds | $ 40,000,000 | ||||||||||
Private Placement [Member] | |||||||||||
Subsequent Event [Line Items] | |||||||||||
Number of stock sold | 8,000,000 | ||||||||||
Value of stock sold | $ 40,000,000 | ||||||||||
Share price | $ 5 | $ 5 | |||||||||
Net proceeds | $ 40,000,000 | ||||||||||
Subsequent Event [Member] | |||||||||||
Subsequent Event [Line Items] | |||||||||||
Reverse stock split | one to five (1:5) and not more than one to eighty (1:80) | ||||||||||
Subsequent Event [Member] | Private Placement [Member] | Securities Purchase Agreement [Member] | |||||||||||
Subsequent Event [Line Items] | |||||||||||
Number of stock sold | 160,000,000 | ||||||||||
Number of stock sold | 8,000,000 | ||||||||||
Value of stock sold | $ 40,000,000 | ||||||||||
Share price | $ 0.25 | $ 0.25 | |||||||||
Net proceeds | $ 40,000,000 | ||||||||||
Common Stock [Member] | |||||||||||
Subsequent Event [Line Items] | |||||||||||
Shares issued to private placement,shares | 8,000,000 | ||||||||||
Common stock, shares, outstanding | 9,727,586 | ||||||||||
Post Reverse Stock Split [Member] | Subsequent Event [Member] | Private Placement [Member] | Securities Purchase Agreement [Member] | |||||||||||
Subsequent Event [Line Items] | |||||||||||
Share price | $ 5 | $ 5 |