Cover
Cover | 9 Months Ended |
Sep. 30, 2023 | |
Entity Addresses [Line Items] | |
Document Type | S-1/A |
Amendment Flag | true |
Amendment Description | AMENDMENT NO. 1 |
Entity Registrant Name | HEALTHY CHOICE WELLNESS CORP. |
Entity Central Index Key | 0001948864 |
Entity Primary SIC Number | 5411 |
Entity Tax Identification Number | 88-4128927 |
Entity Incorporation, State or Country Code | DE |
Entity Address, Address Line One | 3800 North 28th Way |
Entity Address, City or Town | Hollywood |
Entity Address, State or Province | FL |
Entity Address, Postal Zip Code | 33020 |
City Area Code | (305) |
Local Phone Number | 600-5004 |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | true |
Elected Not To Use the Extended Transition Period | true |
Business Contact [Member] | |
Entity Addresses [Line Items] | |
Entity Address, Address Line One | 3800 North 28th Way |
Entity Address, City or Town | Hollywood |
Entity Address, State or Province | FL |
Entity Address, Postal Zip Code | 33020 |
City Area Code | (305) |
Local Phone Number | 600-5004 |
Contact Personnel Name | Jeffrey Holman |
Condensed Combined Carve-out Ba
Condensed Combined Carve-out Balance Sheets - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
CURRENT ASSETS | |||||
Cash and cash equivalents | $ 941,803 | $ 2,020,571 | $ 356,373 | ||
Accounts receivable | 130,907 | 55,230 | 28,347 | ||
Inventory | 3,487,137 | 3,750,364 | 1,332,406 | ||
Prepaid expenses and vendor deposits | 123,988 | 82,954 | 52,122 | ||
Other current assets | 240,598 | 288,934 | |||
Total current assets | 4,924,433 | 6,198,053 | 1,769,248 | ||
PROPERTY, PLANT, AND EQUIPMENT, NET | 2,801,556 | 3,035,847 | 172,502 | ||
Intangible assets, net | 4,117,585 | 4,780,504 | 697,662 | ||
Goodwill | 5,747,000 | 5,747,000 | 916,000 | $ 916,000 | |
Right-of-use asset | 10,055,199 | 10,604,935 | 3,423,123 | ||
Due from related party | 2,879,083 | 2,336,365 | |||
Other assets | 454,026 | 450,966 | |||
Other assets (See Note 15) | 2,787,331 | 1,446,136 | |||
OTHER ASSETS | |||||
Total assets | 30,978,882 | 33,153,670 | 8,424,671 | ||
CURRENT LIABILITIES | |||||
Accounts payable and accrued expenses | 3,370,160 | 3,489,544 | 377,064 | ||
Contingent consideration | 774,900 | ||||
Contract liabilities | 144,861 | 198,606 | 18,514 | 16,014 | |
Current portion of loan payable | 560,322 | 536,542 | 2,604 | ||
Operating lease liability, current | 2,321,018 | 2,228,852 | 323,056 | ||
Total current liabilities | 6,396,361 | 7,228,444 | 721,238 | ||
LONG-TERM LIABILITIES | |||||
Loan payable, net of current portion | 1,954,691 | 2,378,061 | 815 | ||
Operating lease liability, net of current | 7,494,395 | 8,041,504 | 2,675,495 | ||
TOTAL LIABILITIES | 15,845,447 | 17,648,009 | 3,397,548 | ||
COMMITMENTS AND CONTINGENCIES (SEE NOTE 15) | |||||
SHAREHOLDERS’/MEMBER’s (LOSS) EQUITY | |||||
Total shareholders’ equity | 15,133,435 | 15,505,661 | $ 10,257,884 | 5,027,123 | 4,781,527 |
Total liabilities and shareholders’ equity | $ 30,978,882 | 33,153,670 | 8,424,671 | ||
Mother Earth's Storehouse, Inc. [Member] | |||||
CURRENT ASSETS | |||||
Cash and cash equivalents | 2,556,171 | 2,189,674 | |||
Inventory | 718,727 | 732,782 | |||
Rebate receivable | 10,727 | ||||
Note receivable, current portion | 130,305 | 39,523 | |||
Prepaid expenses | 10,838 | 7,427 | |||
Total current assets | 3,426,768 | 2,969,406 | |||
PROPERTY, PLANT, AND EQUIPMENT, NET | 885,417 | 994,180 | |||
OTHER ASSETS | |||||
Deposits | 29,541 | 29,541 | |||
Note receivable, net of current portion | 130,305 | ||||
Total other assets | 29,541 | 159,846 | |||
Total assets | 4,341,726 | 4,123,432 | |||
CURRENT LIABILITIES | |||||
Accounts payable and accrued expenses | 474,974 | 405,129 | |||
Accrued expenses | 31,378 | 113,049 | |||
Deposits | 700 | 700 | |||
Paycheck protection program (PPP) loan | 669,500 | ||||
Total current liabilities | 507,052 | 1,188,378 | |||
LONG-TERM LIABILITIES | |||||
TOTAL LIABILITIES | 507,052 | 1,188,378 | |||
SHAREHOLDERS’/MEMBER’s (LOSS) EQUITY | |||||
Capital stock | 60,260 | 60,260 | |||
Accumulated Loss | 3,774,414 | 2,874,794 | |||
Total shareholders’ equity | 3,834,674 | 2,935,054 | |||
Total liabilities and shareholders’ equity | 4,341,726 | 4,123,432 | |||
Greens Natural Foods, Inc. [Member] | |||||
CURRENT ASSETS | |||||
Cash and cash equivalents | 215,764 | 500,762 | |||
Accounts receivable | 131,905 | 76,932 | |||
Inventory | 1,589,447 | 1,821,895 | |||
Prepaid expenses | 92,492 | 140,287 | |||
Other current assets | 12,797 | 13,772 | |||
Total current assets | 2,042,405 | 2,553,648 | |||
PROPERTY, PLANT, AND EQUIPMENT, NET | 2,012,142 | 1,746,976 | |||
Right-of-use asset | 6,036,104 | ||||
OTHER ASSETS | |||||
Deposits | 221,033 | 233,089 | |||
Other | 14,565 | 14,565 | |||
Total other assets | 6,271,702 | 247,654 | |||
Total assets | 10,326,249 | 4,548,278 | |||
CURRENT LIABILITIES | |||||
Accounts payable and accrued expenses | 1,749,399 | 1,614,245 | |||
Accrued expenses | 29,308 | ||||
Payroll liabilities | 470,923 | 510,624 | |||
Lease Incentive | 128,794 | 128,794 | |||
Sales tax payable | 18,519 | ||||
Contract liabilities | 309,358 | $ 215,528 | |||
Current portion of note payable | 27,517 | ||||
Other current liabilities | 27,376 | 4,160 | |||
Operating lease liability, current | 1,661,788 | ||||
Total current liabilities | 4,377,128 | 2,642,525 | |||
LONG-TERM LIABILITIES | |||||
Operating lease liability, net of current | 4,374,315 | ||||
Note payable, net of current portion | 81,591 | ||||
Total long-term liabilities | 81,591 | ||||
TOTAL LIABILITIES | 2,724,116 | ||||
SHAREHOLDERS’/MEMBER’s (LOSS) EQUITY | |||||
Capital stock | 30,002 | 30,002 | |||
Additional paid in capital | 5,212,491 | 5,212,491 | |||
Accumulated Loss | (3,136,818) | (2,922,234) | |||
Members’ loss | (588,062) | (496,097) | |||
Total shareholders’ equity | 1,517,613 | 1,824,162 | |||
Total liabilities and shareholders’ equity | $ 10,326,249 | 4,548,278 | |||
Related Party [Member] | |||||
CURRENT ASSETS | |||||
Due from related party | $ 2,336,365 |
Condensed Combined Carve-out _2
Condensed Combined Carve-out Balance Sheets (Parenthetical) - Mother Earth's Storehouse, Inc. [Member] - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
Capital stock, par value | $ 0 | $ 0 |
Capital stock, shares authorized | 100 | 100 |
Capital stock, shares issued | 100 | 100 |
Capital stock, shares outstanding | 100 | 100 |
Condensed Combined Carve-out St
Condensed Combined Carve-out Statements of Operations - 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 | Dec. 31, 2020 | |
Sales | $ 12,704,600 | $ 5,775,543 | $ 39,839,202 | $ 16,700,596 | $ 29,009,640 | $ 11,235,041 | |
Cost of sales | 8,061,966 | 3,909,190 | 25,199,879 | 10,670,440 | 18,926,175 | 7,187,701 | |
Gross profit | 4,642,634 | 1,866,353 | 14,639,323 | 6,030,156 | 10,083,465 | 4,047,340 | |
Operating costs: | |||||||
Total operating costs | 5,897,769 | 2,706,123 | 17,743,763 | 7,566,602 | 14,251,075 | 5,812,754 | |
Loss from operations | (1,255,135) | (839,770) | (3,104,440) | (1,536,446) | (4,167,610) | (1,765,414) | |
Other income (expenses), net | |||||||
Other income (expenses), net | 2,535 | 4,327 | 11,785 | 12,309 | 874,907 | (25) | |
Interest | (39,073) | (21) | (123,197) | (93) | (29,992) | (47,165) | |
Change in contingent consideration | 372,000 | 774,900 | |||||
Total other income (expenses) | 335,462 | 4,306 | 663,488 | 12,216 | 844,915 | (47,190) | |
Loss before taxes | (919,673) | (835,464) | (2,440,952) | (1,524,230) | (3,322,695) | (1,812,604) | |
Income tax benefit (expense) | |||||||
Net loss | $ (919,673) | (835,464) | $ (2,440,952) | (1,524,230) | $ (3,322,695) | (1,812,604) | |
Mother Earth's Storehouse, Inc. [Member] | |||||||
Sales | 14,292,166 | $ 17,034,222 | |||||
Cost of sales | 9,389,790 | 11,098,441 | |||||
Gross profit | 4,902,376 | 5,935,781 | |||||
Operating costs: | |||||||
General and administrative | 306,274 | 471,199 | |||||
Employee costs | 2,760,397 | 3,414,863 | |||||
Store operations | 829,412 | 1,089,580 | |||||
Depreciation | 146,437 | 199,896 | |||||
Total operating costs | 4,042,520 | 5,175,538 | |||||
Loss from operations | 859,856 | 760,243 | |||||
Other income (expenses), net | |||||||
Rental income | 18,600 | 16,865 | |||||
Interest income | 4,346 | 5,781 | |||||
Loss from sale of property | (52,530) | ||||||
Forgiveness of paycheck protection program (PPP) loan | 669,500 | ||||||
Other income (expenses), net | (13,932) | ||||||
Total other income (expenses) | 678,514 | (29,884) | |||||
Net loss | 1,538,370 | $ 730,359 | |||||
Greens Natural Foods, Inc. [Member] | |||||||
Sales | 7,673,837 | 23,979,762 | 25,177,058 | ||||
Cost of Sales | (4,538,358) | (14,014,132) | (15,067,426) | ||||
Returns and Allowances | (242,098) | (779,136) | (442,291) | ||||
Gross profit | 2,893,381 | 9,186,494 | 9,667,341 | ||||
Operating costs: | |||||||
General and administrative | 1,319,764 | 4,207,019 | 4,914,388 | ||||
Salaries and wages | 1,629,352 | 4,955,330 | 4,914,031 | ||||
Depreciation | 85,611 | 256,660 | 366,085 | ||||
Total operating costs | 3,034,727 | 9,419,009 | 10,194,504 | ||||
Loss from operations | (141,346) | (232,515) | (527,163) | ||||
Other income (expenses), net | |||||||
Forgiveness of paycheck protection program (PPP) loan | 817,927 | ||||||
Commission - market data services | 323,404 | ||||||
Other income (expenses), net | (53,090) | (66,240) | 198,910 | ||||
Bad debt | |||||||
Taxes and fees | |||||||
Interest | (1,232) | (7,793) | (14,427) | ||||
Contributions and donations | (11,715) | ||||||
Total other income (expenses) | (54,322) | (74,033) | 1,314,099 | ||||
Net loss | $ (195,668) | $ (306,548) | $ 786,936 |
Condensed Combined Carve-out _3
Condensed Combined Carve-out Statements of Changes in Net Parent's Investment - 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 | Dec. 31, 2020 | |
Balance, January 1, 2022 | $ 15,486,920 | $ 10,543,229 | $ 15,505,661 | $ 5,027,123 | $ 5,027,123 | $ 4,781,527 | |
Net transfer from parent | 566,188 | 550,119 | 2,068,726 | 6,754,991 | 13,801,233 | 2,058,200 | |
Net loss | (919,673) | (835,464) | (2,440,952) | (1,524,230) | (3,322,695) | (1,812,604) | |
Balance, September 30, 2022 | $ 15,133,435 | 10,257,884 | $ 15,133,435 | 10,257,884 | 15,505,661 | 5,027,123 | $ 4,781,527 |
Mother Earth's Storehouse, Inc. [Member] | |||||||
Balance, January 1, 2022 | 3,834,674 | 3,834,674 | 2,935,054 | ||||
Net loss | 1,538,370 | 730,359 | |||||
Balance, September 30, 2022 | 3,834,674 | 2,935,054 | |||||
Greens Natural Foods, Inc. [Member] | |||||||
Balance, January 1, 2022 | 1,824,162 | 1,824,162 | |||||
Net loss | (195,668) | (306,548) | 786,936 | ||||
Balance, September 30, 2022 | 1,517,613 | 1,517,613 | 1,824,162 | ||||
Capital Units [Member] | Mother Earth's Storehouse, Inc. [Member] | |||||||
Balance, January 1, 2022 | $ 60,260 | $ 60,260 | $ 60,260 | $ 60,260 | |||
Balance, shares | 100 | 100 | 100 | 100 | |||
Distributions / dividends | |||||||
Pass-through entity tax | |||||||
Net loss | |||||||
Balance, September 30, 2022 | $ 60,260 | $ 60,260 | |||||
Balance, shares | 100 | 100 | |||||
Capital Units [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Balance, January 1, 2022 | $ 30,002 | $ 30,002 | $ 2 | ||||
Distributions / dividends | |||||||
Net loss | |||||||
Balance, September 30, 2022 | 30,002 | 30,002 | 30,002 | $ 2 | |||
Acquisition of New Jersey locations | 30,000 | 30,000 | |||||
Retained Earnings [Member] | Mother Earth's Storehouse, Inc. [Member] | |||||||
Balance, January 1, 2022 | 3,774,414 | 3,774,414 | 2,874,794 | 3,473,435 | |||
Distributions / dividends | (536,000) | (1,329,000) | |||||
Pass-through entity tax | (102,750) | ||||||
Net loss | 1,538,370 | 730,359 | |||||
Balance, September 30, 2022 | 3,774,414 | 2,874,794 | |||||
Retained Earnings [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Balance, January 1, 2022 | (2,922,234) | (2,922,234) | (4,574,690) | ||||
Distributions / dividends | |||||||
Net loss | (214,584) | 1,742,836 | |||||
Balance, September 30, 2022 | (3,136,818) | (3,136,818) | (2,922,234) | (4,574,690) | |||
Acquisition of New Jersey locations | (90,380) | (90,380) | |||||
Total Shareholders' Equity [Member] | Mother Earth's Storehouse, Inc. [Member] | |||||||
Balance, January 1, 2022 | 3,834,674 | 3,834,674 | 2,935,054 | 3,533,695 | |||
Distributions / dividends | (536,000) | (1,329,000) | |||||
Pass-through entity tax | (102,750) | ||||||
Net loss | 1,538,370 | 730,359 | |||||
Balance, September 30, 2022 | 3,834,674 | 2,935,054 | |||||
Total Shareholders' Equity [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Balance, January 1, 2022 | 1,824,162 | 1,824,162 | 765,435 | ||||
Distributions / dividends | (127,632) | ||||||
Net loss | (306,548) | 786,936 | |||||
Balance, September 30, 2022 | 1,517,613 | 1,517,613 | 1,824,162 | 765,435 | |||
Acquisition of New Jersey locations | 399,423 | 399,423 | |||||
Member Units [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Balance, January 1, 2022 | (496,097) | (496,097) | |||||
Distributions / dividends | |||||||
Net loss | (91,965) | (955,900) | |||||
Balance, September 30, 2022 | (588,062) | (588,062) | (496,097) | ||||
Acquisition of New Jersey locations | 459,803 | 459,803 | |||||
Additional Paid-in Capital [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Balance, January 1, 2022 | 5,212,491 | $ 5,212,491 | 5,340,123 | ||||
Distributions / dividends | (127,632) | ||||||
Net loss | |||||||
Balance, September 30, 2022 | $ 5,212,491 | 5,212,491 | 5,212,491 | $ 5,340,123 | |||
Acquisition of New Jersey locations |
Condensed Combined Carve-out _4
Condensed Combined Carve-out Statements of Cash Flows - USD ($) | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||||
Net loss | $ (2,440,952) | $ (1,524,230) | $ (3,322,695) | $ (1,812,604) | |
Adjustments to reconcile net loss to net cash provided by Operating activities: | |||||
Depreciation and amortization | 1,070,686 | 608,585 | 1,003,325 | 458,208 | |
Amortization of right-of-use asset | 1,687,522 | 434,919 | 1,043,220 | 372,454 | |
Write-down of obsolete and slow moving inventory | 1,581,043 | 526,068 | 1,499,938 | 644,101 | |
Change in contingent consideration | (774,900) | (333,100) | |||
Write-off of intangible assets | 53,958 | ||||
Changes in assets and liabilities: | |||||
Accounts receivable | (75,677) | (24,397) | (26,883) | (14,776) | |
Inventory | (1,317,816) | (723,894) | (1,471,859) | (530,874) | |
Prepaid expenses and vendor deposits | (41,034) | 28,571 | (30,832) | 227 | |
Other current assets | 48,336 | (288,934) | |||
Due to/from related parties | (542,718) | (608,654) | |||
Other assets | (3,060) | (39,116) | (1,341,195) | 624,272 | |
Accounts payable and accrued expenses | (119,384) | 850,621 | 3,112,481 | (293,385) | |
Contract liabilities | (53,745) | (243,857) | (313,257) | 2,500 | |
Lease liability | (1,592,729) | (376,183) | (953,227) | (302,119) | |
Net cash provided by operating activities | (2,574,428) | (1,091,567) | (1,369,060) | (851,996) | |
CASH FLOWS FROM INVESTING ACTIVITIES | |||||
Payment for acquisition | (5,150,000) | (10,291,674) | (75,000) | ||
Purchase of property, plant, and equipment | (173,475) | (158,399) | (387,485) | (53,438) | |
Net cash used for investing activities | (173,475) | (5,308,399) | (10,679,159) | (128,438) | |
CASH FLOWS FROM FINANCING ACTIVITIES | |||||
Principal payments on loan payable | (399,590) | (1,940) | (88,816) | (803,396) | |
Investment from parent company | 2,068,725 | 6,754,991 | 13,801,233 | 2,058,200 | |
Net cash used for financing activities | 1,669,135 | 6,753,051 | 13,712,417 | 1,254,804 | |
NET DECREASE IN CASH AND CASH EQUIVALENTS | (1,078,768) | 353,085 | 1,664,198 | 274,370 | |
CASH AND CASH EQUIVALENTS, Beginning of year | 2,020,571 | 356,373 | 356,373 | 82,003 | |
CASH AND CASH EQUIVALENTS, End of year | 941,803 | 709,458 | 2,020,571 | 356,373 | $ 82,003 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||
Cash paid for income taxes | |||||
Cash paid for interest | 123,221 | 101 | 30,017 | 47,171 | |
Non-cash activity: | |||||
Leases acquired | 8,225,033 | ||||
Contingent consideration relating to acquisition | 1,108,000 | ||||
Issuance of promissory note in connection with acquisition | 3,000,000 | ||||
Right-of-use assets obtained in exchange for operating lease liabilities | $ 1,137,786 | 1,797,667 | |||
Mother Earth's Storehouse, Inc. [Member] | |||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||
Net loss | 1,538,370 | 730,359 | |||
Adjustments to reconcile net loss to net cash provided by Operating activities: | |||||
Depreciation | 146,437 | 199,896 | |||
Forgiveness of PPP loan | (669,500) | ||||
Loss on property sale | 52,530 | ||||
Changes in assets and liabilities: | |||||
Inventory | 14,055 | (16,456) | |||
Rebate receivable | (10,727) | ||||
Prepaid expenses | (3,411) | ||||
Accounts payable | 69,845 | (113,225) | |||
Accrued expenses | (81,671) | 96,179 | |||
Deposits | (700) | ||||
Miscellaneous receivables | 4,594 | ||||
Net cash provided by operating activities | 1,003,398 | 953,177 | |||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||
Purchase of property, plant, and equipment | (37,674) | (19,143) | |||
Receipts from notes receivable related to property sale | 39,523 | 5,172 | |||
Proceeds from property sale | 50,000 | ||||
Net cash used for investing activities | 1,849 | 36,029 | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||
Pass-through entity tax payment | (102,750) | ||||
Distributions | (536,000) | (1,329,000) | |||
Proceeds from PPP loan | 669,500 | ||||
Net cash used for financing activities | (638,750) | (659,500) | |||
NET DECREASE IN CASH AND CASH EQUIVALENTS | 366,497 | 329,706 | |||
CASH AND CASH EQUIVALENTS, Beginning of year | 2,556,171 | 2,556,171 | 2,189,674 | 1,859,968 | |
CASH AND CASH EQUIVALENTS, End of year | 2,556,171 | 2,189,674 | |||
Non-cash activity: | |||||
Inventory included in property sale | 175,000 | ||||
Fixed assets included in property sale | 102,530 | ||||
Note received as consideration for property sale | 175,000 | ||||
Greens Natural Foods, Inc. [Member] | |||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||
Net loss | (306,548) | 786,936 | |||
Adjustments to reconcile net loss to net cash provided by Operating activities: | |||||
Depreciation | 256,660 | 366,085 | |||
Forgiveness of PPP loan | (817,927) | ||||
Changes in assets and liabilities: | |||||
Accounts receivable | (54,973) | (10,267) | |||
Inventory | 232,448 | (179,481) | |||
Prepaid expenses | 47,795 | 72,678 | |||
Other current assets | 975 | (11,907) | |||
Due to/from related parties | 19,089 | ||||
Other assets | 26,980 | ||||
Accounts payable | 135,154 | (189,561) | |||
Accrued expenses | (29,308) | (5,541) | |||
Deposits | 12,056 | (2,214) | |||
Payroll liabilities | (39,701) | (202,310) | |||
Lease incentive | (13,557) | ||||
Contract liabilities | (1,891) | (2,051) | |||
Other current liabilities | 23,215 | (160,301) | |||
Sales tax payable | (18,519) | 18,519 | |||
Net cash provided by operating activities | 257,362 | (304,830) | |||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||
Purchase of property, plant, and equipment | (521,826) | (20,117) | |||
Net cash used for investing activities | (521,826) | (20,117) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||
Distributions | (127,632) | ||||
Proceeds from PPP loan | 817,927 | ||||
Payments on notes payable | (20,534) | (26,440) | |||
Payments on notes payable to related parties | (600,000) | ||||
Payments on lines of credit | |||||
Net cash used for financing activities | (20,534) | 63,855 | |||
NET DECREASE IN CASH AND CASH EQUIVALENTS | (284,998) | (261,092) | |||
CASH AND CASH EQUIVALENTS, Beginning of year | 500,762 | $ 500,762 | 761,854 | ||
CASH AND CASH EQUIVALENTS, End of year | 215,764 | 500,762 | $ 761,854 | ||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||
Cash paid for interest | $ 7,793 | $ 14,427 |
ORGANIZATION
ORGANIZATION | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
ORGANIZATION | NOTE 1. ORGANIZATION Organization Healthy Choice Wellness Corp. (the “Company”) is a Delaware corporation organized in September 2022. It is a wholly owned operating segment of Healthier Choices Management Corp (“HCMC”), a U.S. based holding company, which trades on the OTC Pink Sheets, specializing in providing consumers with healthier alternatives to everyday lifestyle choices. Through its wholly owned subsidiaries, Healthy Choice Markets, Inc., Healthy Choice Markets 2, LLC, Healthy Choice Markets 3, LLC, and Healthy Choice Markets IV, LLC respectively, the Company operates: ● Ada’s Natural Market, a natural and organic grocery store offering fresh produce, bulk foods, vitamins and supplements, packaged groceries, meat and seafood, deli, baked goods, dairy products, frozen foods, health & beauty products, and natural household items. ● Paradise Health & Nutrition’s three stores that likewise offer fresh produce, bulk foods, vitamins and supplements, packaged groceries, meat and seafood, deli, baked goods, dairy products, frozen foods, health & beauty products, and natural household items. ● Mother Earth’s Storehouse, a two-store organic and health food and vitamin chain in New York’s Hudson Valley, has been in existence for over 40 years. ● Greens Natural Foods’ eight stores in New York and New Jersey, offering a selection of 100% organic produce and all-natural, non-GMO groceries & bulk foods; a wide selection of local products; an organic juice and smoothie bar; a fresh foods department, which offers fresh and healthy “grab & go” foods; a full selection of vitamins & supplements; as well as health and beauty products. ● Ellwood Thompson’s, an organic and natural health food and vitamin store located in Richmond, Virginia. Through its wholly owned subsidiary, Healthy Choice Wellness, LLC, the Company (1) operates Healthy Choice Wellness Center in Kingston, NY and (2) has a licensing agreement for a Healthy Choice Wellness Center located at the Casbah Spa and Salon in Fort Lauderdale, FL. These centers offer multiple vitamin drip mixes and intramuscular shots for clients to choose from that are designed to help boost immunity, fight fatigue and stress, reduce inflammation, enhance weight loss, and efficiently deliver antioxidants and anti-aging mixes. Additionally, there are IV vitamin mixes and shots for health, beauty, and re-hydration. Through its wholly owned subsidiary, Healthy U Wholesale, Inc., the Company sells vitamins and supplements, as well as health, beauty and personal care products through its on-line retail subsidiary, The Vitamin Store, LLC. Sourcing and Vendors We source from multiple suppliers. These suppliers range from small independent businesses to multinational conglomerates. For the three months ended September 30, 2023 and 2022, approximately 40 34 42 32 Spin-Off HCMC has commenced steps to spin off (“Spin-Off”) its grocery segment and wellness business into a new publicly traded company (hereinafter referred to as “HCWC” or “The Company”). HCWC will continue the path of growth in the wellness verticals started by HCMC and explore other growth opportunities that comport with HCMC’s healthier lifestyle mission. Following the Spin-Off, HCMC will retain its entire patent suite, the Q-Cup® brand, and continue to develop its patent suite through R&D as well as continuing its path of enforcing its patent rights against infringers and attempting to monetize said patents through licensing deals. At the time of the Spin-Off, HCMC will distribute all the outstanding shares of Common Stock held by it on a pro rata basis to holders of HCMC’s common stock. Shares of HCMC’s common stock outstanding as of the record date for the Spin-Off (the “Record Date”), will entitle the holder thereof to receive a certain number of shares of Common Stock in HCWC. The distribution will be made in book-entry form by a distribution agent. Fractional shares of Common Stock will not be distributed in the Spin-Off and any fractional amounts will be rounded down. | Note 1. ORGANIZATION Organization Healthy Choice Wellness Corp. (the “Company”) is a Delaware corporation organized in September 2022. It is a wholly owned operating segment of Healthier Choices Management Corp (HCMC), a U.S. based holding company, which trades on the OTC Pink Sheets, specializing in providing consumers with healthier alternatives to everyday lifestyle choices. Through its wholly owned subsidiaries, Healthy Choice Markets, Inc., Healthy Choice Markets 2, LLC, Healthy Choice Markets 3, LLC, and Healthy Choice Markets IV, LLC respectively, Healthy Choice Wellness Corp. operates: ● Ada’s Natural Market, a natural and organic grocery store offering fresh produce, bulk foods, vitamins and supplements, packaged groceries, meat and seafood, deli, baked goods, dairy products, frozen foods, health & beauty products and natural household items. ● Paradise Health & Nutrition’s three stores likewise offer fresh produce, bulk foods, vitamins and supplements, packaged groceries, meat and seafood, deli, baked goods, dairy products, frozen foods, health & beauty products and natural household items. ● Mother Earth’s Storehouse, a two-store organic and health food and vitamin chain in New York’s Hudson Valley, which has been in existence for over 40 years. ● Greens Natural Foods’ eight stores in New York and New Jersey, offering a selection of 100% organic produce and all-natural, non-GMO groceries & bulk foods; a wide selection of local products; an organic juice and smoothie bar; a fresh foods department, which offers fresh and healthy “grab & go” foods; a full selection of vitamins & supplements; as well as health and beauty products. Through its wholly owned subsidiary, Healthy Choice Wellness, LLC, the Company operates: ● Licensing agreements for Healthy Choice Wellness Centers located at the Casbah Spa and Salon in Fort Lauderdale, FL, Boston Direct Health in Boston, MA and Green Care Medical Services in Chicago, IL. Through its wholly owned subsidiary, Healthy U Wholesale, Inc., the Company sells vitamins and supplements, as well as health, beauty and personal care products through The Vitamin Store, LLC. Spin-Off Parent company Healthier Choice Management Corp. (“HCMC’) is planning to spin off its grocery segment and wellness business into a new publicly traded company (hereinafter referred to as “NewCo”). NewCo will continue the path of growth in the health verticals started by HCMC and explore other growth opportunities that comport with HCMC’s healthier lifestyle mission. HCMC will retain its entire patent suite, the Q-Cup® brand, and continue to develop its patent suite through R&D as well as continuing its path of enforcing its patent rights against infringers and attempting to monetize said patents through licensing deals. At the time of the Spin-Off, HCMC will distribute all the outstanding shares of Common Stock held by it on a pro rata basis to holders of HCMC’s common stock. Each share of HCMC’s common stock outstanding as the record date for the Spin-Off (the “Record Date”), will entitle the holder thereof to receive shares of Common Stock in NewCo. The distribution will be made in book-entry form by a distribution agent. Fractional shares of Common Stock will not be distributed in the Spin-Off and any fractional amounts will be rounded down. Sourcing and Vendors We source from multiple suppliers. These suppliers range from small independent businesses to multinational conglomerates. For the years ended December 31, 2022 and 2021, approximately 37 31 | |
Mother Earth's Storehouse, Inc. [Member] | |||
ORGANIZATION | NOTE 1 – ORGANIZATION Organization Mother Earth’s Storehouse, Inc. (the “Company”) was founded in 1978 in Kingston, New York. Mother Earths Storehouse, Inc. is a grocery store for organic and all-natural foods. The Company has two locations in Kingston and Saugerties, New York. A third location, in Poughkeepsie, New York, operated until September 30, 2020, when it was sold (see Note 9). On February 8, 2022, the Company’s operations were purchased in the form of an asset sale by Healthy Choice Markets 3, LLC. Sale of Company Business On February 8, 2022, the shareholders of the Company agreed to sell their business including the Kingston and Saugerties, New York store locations to a third-party for $ 5,300,000 The shareholders of the Company are prohibited from operating a similar competitive business as defined in the sale agreement for a period of five years. | ||
Greens Natural Foods, Inc. [Member] | |||
ORGANIZATION | NOTE 2 – ORGANIZATION Green’s Natural Foods, Inc., Dean’s Natural Food Market, Inc., Dean’s Natural Food Market of Shrewsbury, Inc., Dean’s Natural Food Market of Basking Ridge, LLC, Dean’s Natural Food Market of Chester, LLC, and Dean’s Natural Holdings, LLC (collectively the “Company”) operate organic and all-natural food grocery stores. The Company has eight grocery store locations in Mount Kisco, Eastchester, Briarcliff, and Somers, New York as well as Basking Ridge, Chester, Shrewsbury, and Ocean, New Jersey. | NOTE 1 – ORGANIZATION Organization Green’s Natural Foods, Inc., Dean’s Natural Food Market, Inc., Dean’s Natural Food Market of Shrewsbury, Inc., Dean’s Natural Food Market of Basking Ridge, LLC, Dean’s Natural Food Market of Chester, LLC, and Dean’s Natural Holdings, LLC (collectively the “Company”) operate organic and all-natural food grocery stores. The Company has eight grocery store locations in Mount Kisco, Eastchester, Briarcliff, and Somers, New York as well as Basking Ridge, Chester, Shrewsbury, and Ocean, New Jersey. Green’s Natural Foods, Inc, (the “New York Locations”) was acquired in the form of a stock sale by Hudson Equity Partners, LLC on December 30, 2020. Dean’s Natural Food Market, Inc., Dean’s Natural Food Market of Shrewsbury, Inc., Dean’s Natural Food Market of Basking Ridge, LLC, Dean’s Natural Food Market of Chester, LLC, and Dean’s Natural Holdings, LLC (the “New Jersey Locations”) were owned by Dean Nelson until acquired in the form of a stock sale by Red Oak Equity Partners, LLC on August 16, 2021. The same two individuals own 100 On October 14, 2022, the Company’s assets were acquired by Healthy Choice Market IV, LLC, a wholly owned subsidiary of Healthier Choices Management Corp. |
GOING CONCERN AND LIQUIDITY
GOING CONCERN AND LIQUIDITY | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
GOING CONCERN AND LIQUIDITY | NOTE 2. GOING CONCERN AND LIQUIDITY The accompanying condensed combined carve-out financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”), which contemplate continuation of the Company as a going concern and realization of assets and satisfaction of liabilities in the normal course of business and do not include any adjustments that might result from the outcome of any uncertainties related to our going concern assessment. The carrying amounts of assets and liabilities presented in the financial statements do not necessarily purport to represent realizable or settlement values. As of September 30, 2023, the Company had approximately $ 0.9 1.5 For the nine-month period ended September 30, 2023, the Company incurred net losses of approximately $ 2.4 2.6 The Company believes that it has sufficient cash on hand to meet its obligations and capital requirements for at least the twelve months from the date these financial statements are issued. Accordingly, no adjustment has been made to the financial statements to account for this uncertainty. | Note 2. GOING CONCERN AND LIQUIDITY The accompanying combined carve-out financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”), which contemplate continuation of the Company as a going concern and realization of assets and satisfaction of liabilities in the normal course of business and do not include any adjustments that might result from the outcome of any uncertainties related to our going concern assessment. The carrying amounts of assets and liabilities presented in the financial statements do not necessarily purport to represent realizable or settlement values. The Company currently and historically has reported net losses and cash outflows from operations. As of December 31, 2022, cash totaled approximately $ 2.0 3.3 The Company is actively seeking additional funds either through equity or debt financing, collaborative agreements or from other sources. Should we require additional funds, HCMC has committed to providing such funding to the Company. As a result, as of the date of the issuance of these combined carve-out financial statements, we believe our plans have alleviated substantial doubt about the Company’s ability to sustain operations for at least the next twelve months from the issuance of these combined carve-out financial statements. |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 3. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying condensed combined carve-out financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The Company has historically operated as part of Healthier Choices Management Corp. and not as a standalone company. Financial statements representing the historical operations of HCMC’s grocery segment have been derived from HCMC’s historical accounting records and are presented on a carve-out basis. All revenues and costs as well as assets and liabilities directly associated with the business activity of the Company are included in the financial statements. The financial statements also include allocations of certain general, administrative, sales and marketing expenses from HCMC. However, amounts recognized by the Company are not necessarily representative of the amounts that would have been reflected in the financial statements had the Company operated independently of HCMC. Related-party allocations are discussed further in Note 14. The condensed combined carve-out financial statements do not include all information and notes required by accounting principles generally accepted in the United States of America for complete financial statements. Unaudited Interim Condensed Combined Carve-Out Financial Statements The interim condensed combined carve-out balance sheet as of September 30, 2023, the interim condensed combined carve-out statements of operations and the interim condensed combined carve-out statements of changes in net parent’s investment for the three and nine months ended September 30, 2023 and 2022 and cash flows for the nine months ended September 30, 2023 and 2022 are unaudited. The financial data and the other financial information disclosed in the notes to these condensed combined carve-out financial statements relating to the three and nine-month periods are also unaudited. In the opinion of management, the accompanying interim financial statements include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of our condensed consolidated cash flows, operating results, and balance sheets for the periods presented. Principles of Combination The condensed combined carve-out financial statements include the accounts of the Company and its wholly-owned subsidiaries, Healthy Choice Markets, Inc. (“Ada’s Natural Market”), Healthy Choice Markets 2, LLC (“Paradise Health and Nutrition”), Healthy Choice Markets 3, LLC (“Mother Earth’s Storehouse”), Healthy Choices Markets 3 Real Estate LLC, Healthy Choice Markets IV, LLC (Green’s Natural Foods), Healthy Choice Wellness, LLC, and Healthy U Wholesale, Inc (“The Vitamin Store, LLC”). All intercompany accounts and transactions have been eliminated in combination. Net Parent Investment The condensed combined carve-out financial statements were derived from the consolidated financial statements of HCMC on a carve-out basis. The financial statements also include allocations of certain general, administrative, legal, and marketing expenses from HCMC. The primary components of the net parent’s investment are intercompany balances other than related party payables, the allocation of shared costs, and funding received to cover any shortfall in operating cash requirements. Balances between HCMC and the Company that were not historically cash settled are included in net parent investment. Net parent’s investment represents the cumulative investment by HCMC in the Company through the dates presented. Use of Estimates in the Preparation of the Financial Statements The preparation of condensed combined carve-out financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed combined carve-out financial statements, and the reported amounts of net revenue and expenses during the reporting periods. Actual results could differ from those estimates. These estimates and assumptions include allowances, deferred taxes and related valuation allowances, and the valuation of the assets and liabilities acquired in business combinations. Certain of management’s estimates could be affected by external conditions, including those unique to our industry, and general economic conditions. It is possible that these external factors could have an effect on our estimates that could cause actual results to differ from our estimates. The Company re-evaluates all its accounting estimates at least quarterly based on these conditions and records adjustments when necessary. Revenue Recognition Revenues from product sales and services rendered, net of promotional discounts, manufacturer coupons and rebates, return allowances, and sales and consumption taxes, are recorded when products are delivered, title passes to customers and collection is likely to occur. Title passes to customers at the point of sale for retail and upon delivery of products for wholesale. Return allowances, which reduce revenue, are estimated using historical experience. The Company recognizes revenue in accordance with the following five-step model: ● identify arrangements with customers; ● identify performance obligations; ● determine transaction price; ● allocate transaction price to the separate performance obligations in the arrangement, if more than one exists; and ● recognize revenue as performance obligations are satisfied. Shipping and Handling Shipping charges billed to customers are included in net sales and the related shipping and handling costs are included in cost of sales. The Company incurred shipping and handling costs of approximately $ 25,000 23,000 90,000 51,000 Cash and Cash Equivalents The Company considers all highly liquid instruments with an original maturity of three months or less, when purchased, to be cash and cash equivalents. The majority of the Company’s cash is concentrated in one financial institution, which is in excess of Federal Deposit Insurance Corporation (FDIC) coverage. The Company has not experienced any losses in such accounts. The Company did not have any cash equivalents as of September 30, 2023 and December 31, 2022. A summary of the financial institution that had cash in excess of FDIC limits of $ 250,000 SCHEDULE OF CASH AND CASH EQUIVALENTS September 30, 2023 December 31, 2022 Total cash in excess of FDIC limits of $ 250,000 $ - $ 949,677 Accounts Receivable, Contract Assets and Contract Liabilities Accounts receivables are claims to consideration which are unconditional; meaning no performance obligations remain for the Company and only the passage of time is necessary before collection. Contract assets are distinguished from accounts receivable as performance obligations remain before claims to consideration become unconditional. By nature of the Company’s operations, contract assets are typically not recognized. Contract liabilities are recorded when customers transfer consideration in advance of delivery of products or services, which the Company records for gift cards and loyalty reward programs. When one party to an arrangement performs before the other(s), the Company records an account receivable, contract asset or contract liability. The majority of arrangements with customers contain one performance obligation: to provide a distinct set of products or services. Most performance obligations are satisfied simultaneously as the Company exchanges products or services for customer payment. Exceptions include gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products or services at a future date. As gift cards are purchased and loyalty points earned, contract liabilities are recorded until the performance obligations are satisfied through delivery of products or services or breakage based on gift card and loyalty reward program term limits. The Company’s breakage policy is twenty-four months for gift cards and twelve months for loyalty rewards. Loyalty rewards are earned at five percent on qualifying purchases and the reward functions as an allocation of transaction price from the period earned by the customer to the period the performance obligation is satisfied by the Company. As such, all contract liabilities are expected to be recognized within a twenty-four-month period. Other Current Assets Other current assets are the non-trade related assets that the Company owns, benefits from, or uses to generate income that can be converted into cash within one business cycle. Included in “Other current assets” on our condensed consolidated balance sheets are amounts primarily related to other receivables or non-trade receivable from government and other companies. Inventories Inventories are measured at the lower of cost and net realizable value using the average cost method. If the cost of the inventories exceeds their net realizable value, adjustments are recorded to write down excess inventory to their net realizable value. The Company’s inventories consist primarily of merchandise available for resale, such as fresh produce, perishable grocery items and non-perishable consumable goods. Property, Plant, and Equipment Property, plant, and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the expected useful life of the respective asset, after the asset is placed in service. Revenue earning property, plant, and equipment includes signage, furniture and fixtures, building, computer hardware, appliance, cooler, and displays have useful lives ranging from two to seven years . Leasehold improvements are amortized over the shorter of the life of the improvement or the term of the lease. Identifiable Intangible Assets and Goodwill Identifiable intangible assets are recorded at cost, or when acquired as part of a business acquisition, at estimated fair value. Certain identifiable intangible assets are amortized over 4 10 Impairment of Long-Lived Assets The Company reviews all long-lived assets such as property and equipment and amortized intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated future cash flows expected to be generated by the asset or asset group. Impairment is measured by the amount by which the carrying value of the asset(s) exceeds their fair value. There were no triggering events that would indicate impairment of long-lived assets during the three month or nine month periods ended September 30, 2023 and 2022. Goodwill The Company assesses the carrying amounts of goodwill for recoverability on at least an annual basis or when events or changes in circumstances indicate evidence of potential impairment exists, using a fair value-based test. Application of the goodwill impairment test requires significant judgments including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for the businesses, and the useful life over which cash flows will occur. Changes in these estimates and assumptions could materially affect the determination of fair value and/or conclusions on goodwill impairment for the Company. Our annual impairment test is conducted on September 30 of each year or more often if deemed necessary. As part of management’s qualitative analysis on September 30, 2023, management determines whether any triggering events have occurred since the annual test date of September 30, 2022, which would indicate an impairment. Management determined no triggering events had occurred through September 30, 2023. Advertising Advertising expense is classified as an operating expense on condensed combined carve-out statement of operation. The Company expenses advertising costs as incurred. The Company incurred advertising expenses of approximately $ 215,000 47,000 366,000 91,000 401(k) retirement savings plan The Company’s employees are offered a 401(k) retirement savings plan that is administered under HCMC with discretionary contribution matching opportunities. 401K employer expense amounted to $ 21,000 6,000 59,000 14,000 Income Taxes The Company’s income taxes are included in HCMC’s consolidated return. For the purposes of the condensed combined carve-out financial statements, the income taxes for the Company have been presented on a separate return basis, under which a new stand-alone set of deferred tax assets and liabilities is created based on the financial statement accounts of the carveout. The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740, “Income Taxes” (“ASC 740”). Under this method, income tax expense is recognized as the amount of: (i) taxes payable or refundable for the current year and (ii) future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of available evidence it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of September 30, 2023 and December 31, 2022. The Company had no uncertain tax positions as of September 30, 2023 and December 31, 2022. Leases Operating lease liabilities are recognized at the lease commencement date based on the present value of the fixed lease payments using the Company’s incremental borrowing rates. Related operating ROU assets are recognized based on the initial present value of the fixed lease payments, reduced by contributions from landlords, plus any prepaid rent and direct costs from executing the leases. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the lease term. Variable lease payments are recognized as lease expense as they are incurred. The Company did not have finance leases as of September 30, 2023 and December 31, 2022. If the Company enters into a finance lease in the future, it will be accounted for in accordance with ASC Topic 842. Fair Value Measurements The fair value of the Company’s financial assets and liabilities reflects management’s estimated amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company uses the fair value framework under FASB’s guidance, and it requires the categorization of assets and liabilities into three levels based upon the assumptions used to measure the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3, if applicable, would generally require significant management judgment. The three levels for categorizing assets and liabilities under the fair value measurement requirements are as follows: ● Level 1: Fair value measurement of the asset or liability using observable inputs such as quoted prices in active markets for identical assets or liabilities; ● Level 2: Fair value measurement of the asset or liability using inputs other than quoted prices that are observable for the applicable asset or liability, either directly or indirectly, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and ● Level 3: Fair value measurement of the asset or liability using unobservable inputs that reflect the Company’s own assumptions regarding the applicable asset or liability. Business Combination The Company applies the provisions of ASC Topic 805, Business Combinations Acquisition-related expenses were expensed as incurred and recorded in selling, general and administrative expenses in the condensed combined carve-out statements of operations. Recent Accounting Pronouncements Public companies in the United States are subject to the accounting and reporting requirements of various authorities, including the Financial Accounting Standards Board (“FASB”) and the Securities and Exchange Commission (“SEC”). There were no accounting pronouncements issued in the quarter or with future effective dates that are either applicable nor are expected to have a material impact on the Company’s Combined Financial Statements. Reclassification Certain amounts in the condensed combined carve-out financial statements and related notes have been reclassified to conform to the current year presentation. Such reclassifications do not impact the Company’s previously reported financial position or net loss. Due from related party of $ 2.3 609,000 1.6 | Note 3. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying combined carve-out financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The Company has historically operated as part of Healthier Choices Management Corp. and not as a standalone company. Financial statements representing the historical operations of HCMC’s grocery segment have been derived from HCMC’s historical accounting records and are presented on a carve-out basis. All revenues and costs as well as assets and liabilities directly associated with the business activity of the Company are included in the financial statements. The financial statements also include allocations of certain general, administrative, sales and marketing expenses from HCMC. However, amounts recognized by the Company are not necessarily representative of the amounts that would have been reflected in the financial statements had the Company operated independently of HCMC. Related-party allocations are discussed further in Note 15. Principles of Combination The combined carve-out financial statements include the accounts of the Company and its wholly-owned subsidiaries, Healthy Choice Markets, Inc. (“Ada’s Natural Market”), Healthy Choice Markets 2, LLC (“Paradise Health and Nutrition”), Healthy Choice Markets 3, LLC (“Mother Earth’s Storehouse”), Healthy Choices Markets 3 Real Estate LLC, Healthy Choice Markets IV, LLC (Green’s Natural Foods), Healthy Choice Wellness, LLC, and Healthy U Wholesale, Inc (“The Vitamin Store, LLC”). All intercompany accounts and transactions have been eliminated in combination. Net Parent’s Investment The combined carve-out financial statements were derived from the consolidated financial statements of HCMC on a carve-out basis. The financial statements also include allocations of certain general, administrative, legal, and marketing expenses from HCMC. The primary components of the net parent’s investment are intercompany balances other than related party payables, the allocation of shared costs, and funding received to cover any shortfall on operating cash requirements. Balances between HCMC and the Company that were not historically cash settled are included in net parent investment. Net parent’s investment represents the cumulative investment by HCMC in the Company through the dates presented. Use of Estimates in the Preparation of the Financial Statements The preparation of combined carve-out financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the combined carve-out financial statements, and the reported amounts of net revenue and expenses during the reporting periods. Actual results could differ from those estimates. These estimates and assumptions include allocation of corporate general expenses, allowances, deferred taxes and related valuation allowances, and the valuation of the assets and liabilities acquired in business combinations. Certain of management’s estimates could be affected by external conditions, including those unique to our industry, and general economic conditions. It is possible that these external factors could have an effect on our estimates that could cause actual results to differ from our estimates. The Company re-evaluates all of its accounting estimates at least quarterly based on these conditions and records adjustments when necessary. Revenue Recognition Revenues from product sales and services rendered, net of promotional discounts, manufacturer coupons and rebates, return allowances, and sales and consumption taxes, are recorded when products are delivered, title passes to customers and collection is likely to occur. Title passes to customers at the point of sale for retail and upon delivery of products for wholesale. Return allowances, which reduce revenue, are estimated using historical experience. The Company recognizes revenue in accordance with the following five-step model: ● identify arrangements with customers; ● identify performance obligations; ● determine transaction price; ● allocate transaction price to the separate performance obligations in the arrangement, if more than one exists; and ● recognize revenue as performance obligations are satisfied. Shipping and Handling Shipping charges billed to customers are included in net sales and the related shipping and handling costs are included in cost of sales. For the years ended December 31, 2022 and 2021, shipping and handling costs of approximately $ 91,000 39,000 Cash and Cash Equivalents The Company considers all highly liquid instruments with an original maturity of three months or less, when purchased, to be cash and cash equivalents. The majority of the Company’s cash are concentrated in several large financial institutions, which is in excess of Federal Deposit Insurance Corporation (FDIC) coverage. The Company has not experienced any losses in such accounts. The Company did not have any cash equivalents as of December 31, 2022 and 2021. A summary of the financial institutions that had a cash and cash equivalents in excess of FDIC limits of $ 250,000 SCHEDULE OF CASH AND CASH EQUIVALENTS December 31, 2022 December 31, 2021 Total cash in excess of FDIC limits $ 949,677 $ - Accounts Receivable, Contract Assets and Contract Liabilities Accounts receivables are claims to consideration which are unconditional; meaning no performance obligations remain for the Company and only the passage of time is necessary before collection. Contract assets are distinguished from accounts receivable as performance obligations remain before claims to consideration become unconditional. By nature of the Company’s operations, contract assets are typically not recognized. Contract liabilities are recorded when customers transfer consideration in advance of delivery of products or services, which the Company records for gift cards and loyalty reward programs. When one party to an arrangement performs before the other(s), the Company records an account receivable, contract asset or contract liability. The majority of arrangements with customers contain one performance obligation: to provide a distinct set of products or services. Most performance obligations are satisfied simultaneously as the Company exchanges products or services for customer payment. Exceptions include gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products or services at a future date. As gift cards are purchased and loyalty points earned, contract liabilities are recorded until the performance obligations are satisfied through delivery of products or services or breakage based on gift card and loyalty reward program term limits. The Company’s breakage policy is twenty-four months for gift cards and twelve months for loyalty rewards. Loyalty rewards are earned at five percent on qualifying purchases and the reward functions as an allocation of transaction price from the period earned by the customer to the period the performance obligation is satisfied by the Company. As such, all contract liabilities are expected to be recognized within a twenty-four month period. Accounts receivable balance represents credit sales, sales on account and billing to vendors for advertising vendors’ products in our stores. Concentration of accounts receivable consist of the following: SCHEDULE OF CONCENTRATION OF ACCOUNTS RECEIVABLE December 31, 2022 December 31, 2021 Customer A 17 % 0 % Customer B - 12 % Customer C 6 % 30 % Other Current Assets Other current assets are the non-trade related assets that the Company owns, benefits from, or uses to generate income that can be converted into cash within one business cycle. Included in “Other current assets” on our combined carve-out balance sheets are amounts primarily related to other receivables or non-trade receivable from other companies. Inventories Inventories are measured at the lower of cost and net realizable value using the average cost method. If the cost of the inventories exceeds their net realizable value, adjustments are recorded to write down excess inventory to their net realizable value. The Company’s inventories consist primarily of merchandise available for resale, such as vitamins, fresh produce, perishable grocery items and non-perishable consumable goods. Property, Plant, and Equipment Property, plant, and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the expected useful life of the respective asset, after the asset is placed in service. Revenue earning property, plant, and equipment includes signage, furniture and fixtures, building, computer hardware, appliance, cooler, displays with useful lives range from two seven years Identifiable Intangible Assets and Goodwill Identifiable intangible assets are recorded at cost, or when acquired as part of a business acquisition, at estimated fair value. Certain identifiable intangible assets are amortized over 4 10 Impairment of Long-Lived Assets The Company reviews all long-lived assets such as property and equipment and amortized intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated future cash flows expected to be generated by the asset or asset group. Impairment is measured by the amount by which the carrying value of the asset(s) exceeds their fair value. There were no triggering events that would indicate impairment of long-lived assets at December 31, 2022. Goodwill The Company assesses the carrying amounts of goodwill for recoverability on at least an annual basis or when events or changes in circumstances indicate evidence of potential impairment exists, using a fair value based test. Application of the goodwill impairment test requires significant judgments including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for the businesses, and the useful life over which cash flows will occur. Changes in these estimates and assumptions could materially affect the determination of fair value and/or conclusions on goodwill impairment for the Company. Our annual impairment test is conducted on September 30 of each year or more often if deemed necessary. As part of management’s qualitative analysis at December 31, 2022 management determines whether any triggering events have occurred since the annual test date of September 30, 2022, which would indicate an impairment. Management determined no triggering events had occurred through December 31, 2022. Advertising The Company expenses advertising costs as incurred. For the years ended December 31, 2022 and 2021, the company incurred advertising expenses of approximately $ 145,000 39,000 401(k) retirement savings plan The Company’s employees are offered a 401(k) retirement savings plan that is administered under HCMC with discretionary contribution matching opportunities. 401K employer expense amounted to $ 25,000 7,000 Income Taxes Historically, the Company’s income taxes were included in HCMC’s consolidated return. For the purposes of the combined carve-out financial statements, the income taxes for the Company have been presented on a separate return basis, under which a new stand-alone set of deferred tax assets and liabilities is created based on the financial statement accounts of the carveout. The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740, “Income Taxes” (“ASC 740”). Under this method, income tax expense is recognized as the amount of: (i) taxes payable or refundable for the current year and (ii) future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of available evidence it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2022 or December 31, 2021. The Company had no uncertain tax positions as of December 31, 2022, and 2021. Leases Operating lease liabilities are recognized at the lease commencement date based on the present value of the fixed lease payments using the Company’s incremental borrowing rates. Related operating ROU assets are recognized based on the initial present value of the fixed lease payments, reduced by contributions from landlords, plus any prepaid rent and direct costs from executing the leases. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the lease term. Variable lease payments are recognized as lease expense as they are incurred. The Company did not have finance leases for the years ended December 31, 2022 and 2021. If the Company enters into a finance lease in the future, it will be accounted for in accordance with ASC Topic 842. Fair Value Measurements The fair value framework under FASB’s guidance requires the categorization of assets and liabilities into three levels based upon the assumptions used to measure the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3, if applicable, would generally require significant management judgment. The three levels for categorizing assets and liabilities under the fair value measurement requirements are as follows: ● Level 1: Fair value measurement of the asset or liability using observable inputs such as quoted prices in active markets for identical assets or liabilities; ● Level 2: Fair value measurement of the asset or liability using inputs other than quoted prices that are observable for the applicable asset or liability, either directly or indirectly, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and ● Level 3: Fair value measurement of the asset or liability using unobservable inputs that reflect the Company’s own assumptions regarding the applicable asset or liability. Nonfinancial assets such as goodwill, other intangible assets, and long-lived assets held and used are measured at fair value when there is an indicator of impairment and recorded at fair value when impairment is recognized or for a business combination. Business Combination The Company applies the provisions of ASC Topic 805, Business Combinations Reclassifications Certain prior year amounts have been reclassified for consistency with the current year presentation. The increase in net parent investment for corporate overhead in the amount of $ 1,021,413 Recent Accounting Pronouncements Public companies in the United States are subject to the accounting and reporting requirements of various authorities, including the Financial Accounting Standards Board (“FASB”) and the Securities and Exchange Commission (“SEC”). These authorities issue numerous pronouncements, most of which are not applicable to the Company’s current or reasonably foreseeable operating structure. There were no accounting pronouncements issued in the year or with future effective dates that are either applicable nor are expected to have a material impact on the Company’s Combined Carve-Out Financial Statements. | |
Mother Earth's Storehouse, Inc. [Member] | |||
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures. Cash and Cash Equivalents For the purposes of the statement of cash flows, the Company considers all short-term investment securities purchased with a maturity of three months or less to be cash equivalents. Revenue Recognition The Company recognizes revenue at the point of sale. Unredeemed Gift Cards The Company sells gift cards with no expiration dates to customers. The Company records revenue at the point of sale and does not expect future gift card obligations to be material. Sales returns and allowances The Company does not expect future returns to be material, and consequently does not maintain an allowance for merchandise returns. MOTHER EARTH’S STOREHOUSE, INC. NOTES TO FINANCIAL STATEMENTS December 31, 2021 and 2020 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Income Taxes Mother Earth’s Storehouse, Inc. has elected to be treated as an S Corporation for federal income tax purposes. No provision has been made for federal income taxes since S Corporations are not taxable entities. Individual partners/shareholders report their share of taxable income or loss in their personal tax returns. The Company has evaluated any uncertain tax positions and related income tax contingencies and determined uncertain positions, if any, are not material to the financial statements, according to FASB ASC 740. Penalties and interest assessed by income taxing authorities are included in operating expenses, if incurred. None of the Company’s current returns are under examination. Under New York State S Corporation tax law, the Corporation is subject to an annual franchise tax. Beginning in the year ended December 31, 2021, the Company elected to be subject to the New York State Pass-Through Entity Tax (the “PTET”). The Company must elect each year by March 15 th 102,750 0 Inventories Inventories are valued at the lower of cost (average cost method) or net realizable value. Inventories are comprised of perishable and non-perishable food items available for sale. Property, Plant and Equipment Property, plant and equipment is stated at cost. Depreciation is recorded using the straight-line method over the estimated useful lives of the related assets. Expenditures for maintenance and repairs and minor renewals are charged to expense; betterments and major renewals are capitalized. Leasehold improvements are amortized over the lesser of the lease terms or the assets’ useful lives. Upon retirement or sale of assets, the cost of the assets disposed of and the related accumulated depreciation are removed from the accounts, and any resulting gain or loss is credited or charged to income. Advertising Costs The Company expenses advertising costs as they are incurred. They are presented as a component of store operating expenses. Advertising costs were $ 76,379 86,071 Retirement Plan The Company maintains a 401(k) plan. Under the terms of the 401(k) Plan, the employer makes up to 4 4 140,859 144,110 MOTHER EARTH’S STOREHOUSE, INC. NOTES TO FINANCIAL STATEMENTS December 31, 2021 and 2020 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Presentation of Sales Tax The State of New York imposes sales taxes on all of the Company’s sales to nonexempt customers. The Company collects sales taxes from customers and remits the amounts to the state. The Company’s accounting policy is to exclude the tax collected and remitted to the State from revenues and expenses with the exception of excise taxes paid on purchases. Subsequent Events Subsequent events have been evaluated through April 8, 2022, which is the date the financial statements were available to be issued. | ||
Greens Natural Foods, Inc. [Member] | |||
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Combination The accompanying unaudited condensed combined financial statement is prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying combined financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the period presented. The accompanying unaudited condensed combined financial statements should be read in conjunction with the Company’s prospectus for its Initial Public Offering, as filed with the SEC on October 27, 2023. The interim results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022, or for any future periods. Use of Estimates The preparation of condensed combined financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. Adopted Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU 2016-02 is effective for annual periods beginning after December 15, 2021 for private companies, and annual and interim periods thereafter, with early adoption permitted. The Company adopted ASU No. 2016-02 on January 1, 2022 using the cumulative-effect adjustment transition method, which applies the provisions of the standard at the effective date without adjusting the comparative periods presented. Adoption of this standard resulted in the recognition of operating lease right-of-use assets of $7.1 million and corresponding lease liabilities of $7.1 million on the condensed combined balance sheet as of January 1, 2022. The standard did not materially impact operating results or liquidity. Cash and Cash Equivalents For the purposes of the statement of cash flows, the Company considers all short-term investment securities purchased with a maturity of three months or less to be cash equivalents. Cash and cash equivalents include monies held by the Company’s credit card processors. The funds are held by the merchant credit card processors pending satisfaction of their hold requirements and expiration of charge backs/refunds circumstances. Revenue Recognition Revenues from product sales, net of promotional discounts, manufacturer coupons and rebates, return allowances, and sales and consumption taxes, are recorded when products are delivered, title passes to customers, and collection is likely to occur. Title is passed to customers at the point of sale for all retail purchases. Return allowances, which reduce revenue, are estimated using historical experience. Accounts Receivable, Contract Assets and Contract Liabilities Accounts receivables are claims to consideration which are unconditional, meaning no performance obligations remain for the Company and only the passage of time is necessary before collection. Contract assets are distinguished from accounts receivable as performance obligations remain before claims to consideration become unconditional. Contract liabilities are recorded when customers transfer consideration in advance of delivery of products, which the Company records for all gift cards and loyalty reward programs. When one party to an arrangement performs before the other(s), the Company records an account receivable, contract asset, or contract liability. The majority of arrangements with customers contain one performance obligation to provide a distinct set of products. Most performance obligations are satisfied simultaneously as the Company exchanges products for customer payment. Exceptions include gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products at a future date. As gift cards are purchased and loyalty points earned, contract liabilities are recorded until the performance obligations are satisfied through delivery of products or breakage based on gift card and loyalty reward program term limits. Inventories Inventories are stated at average cost. If the cost of inventories exceeds their net realizable value, adjustments are recorded to write down excess inventory value to net realizable value. The Company’s inventories consist primarily of merchandise available for resale, such as fresh produce, perishable grocery items, and non-perishable consumable goods. Property, Plant and Equipment Property, plant and equipment is stated at cost. Depreciation is recorded using the straight-line method over the estimated useful lives of the related assets. Expenditures for maintenance and repairs and minor renewals are charged to expense; betterments and major renewals are capitalized. Leasehold improvements are amortized over the lesser of the lease terms or the assets’ useful lives. Upon retirement or sale of assets, the cost of the assets disposed of, and the related accumulated depreciation are removed from the accounts, and any resulting gain or loss is credited or charged to income. Property, plant and equipment is comprised of the following at September 30, 2022, and estimated useful lives of the related assets are as follows: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT Years Vehicles $ 46,256 5 7 Leasehold improvements 1,988,570 15 Furniture and fixtures 1,732,154 7 Office equipment 50,708 5 7 Machinery and equipment 2,227,571 5 7 Total 6,045,259 Accumulated depreciation (4,033,117 ) Property, plant and equipment, net $ 2,012,142 Depreciation expense amounted to $ 85,611 256,660 Advertising Costs The Company expenses advertising costs as they are incurred. They are presented as a component of store operating expenses. Advertising costs were approximately $ 36,000 133,000 Retirement Plan The Company maintains two 401(k) plans. Under the terms of these plans, the employer may make up to 4 4 Presentation of Sales Tax The states of New York and New Jersey impose sales taxes on all of the Company’s sales to nonexempt customers. The Company collects sales taxes from customers and remits the amounts to the states. The Company’s accounting policy is to exclude the tax collected and remitted to the State from revenues and expenses with the exception of excise taxes paid on purchases. | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Combination The Company’s combined financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). The combined financial statements include the accounts of all the entities under common control. All intercompany accounts have been eliminated in combination. These combined financial statements include the New Jersey entities as of the date of acquisition by Red Oak Equity Partners, LLC on August 16, 2021, and reflect the results of operations and cash flows for the period August 16, 2021, through December 31, 2021. Push Down Accounting The Company has elected to not apply “push down” accounting in accordance with ASC 805-50-25- 4 for the business combinations by Hudson Equity Partners, LLC and Red Oak Equity Partners, LLC of the New York and New Jersey entities. Use of Estimates The preparation of combined financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Cash and Cash Equivalents For the purposes of the statement of cash flows, the Company considers all short-term investment securities purchased with a maturity of three months or less to be cash equivalents. Cash and cash equivalents include monies held by the Company’s credit card processors. The funds are held by the merchant credit card processors pending satisfaction of their hold requirements and expiration of charge backs/refunds circumstances. Revenue Recognition Revenues from product sales, net of promotional discounts, manufacturer coupons and rebates, return allowances, and sales and consumption taxes, are recorded when products are delivered, title passes to customers, and collection is likely to occur. Title passes to customers at the point of sale for all retail purchases. Return allowances, which reduce revenue, are estimated using historical experience. Accounts Receivable, Contract Assets and Contract Liabilities Accounts receivable are claims to consideration which are unconditional, meaning no performance obligations remain for the Company and only the passage of time is necessary before collection. Contract assets are distinguished from accounts receivable as performance obligations remain before claims to consideration become unconditional. Contract liabilities are recorded when customers transfer consideration in advance of delivery of products, which the Company records for all gift cards and loyalty reward programs. When one party to an arrangement performs before the other(s), the Company records an account receivable, contract asset, or contract liability. The majority of arrangements with customers contain one performance obligation to provide a distinct set of products. Most performance obligations are satisfied simultaneously as the Company exchanges products for customer payment. Exceptions include gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products at a future date. As gift cards are purchased and loyalty points earned, contract liabilities are recorded until the performance obligations are satisfied through delivery of products or breakage based on gift card and loyalty reward program term limits. The Company’s breakage policy is twelve months for gift cards and twelve months for loyalty rewards. Loyalty rewards are earned at 1% on qualifying purchases and the reward functions as an allocation of transaction price from the period earned by the customer to the period the performance obligation is satisfied by the Company. As such, all contract liabilities are expected to be recognized within a twenty-four-month period. A summary of the contract liabilities activity for the year ended December 31, 2021, is presented below: SCHEDULE OF CONTRACT LIABILITIES ACTIVITY Beginning Balance as of January 1, 2021 $ 215,528 New Jersey balance as of August 16, 2021 95,881 Issued 40,741 Redeemed (42,792 ) Ending balance as of December 31, 2021 $ 309,358 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Income Taxes S-Corporation Dean’s Natural Food Market of Shrewsbury, Inc. has elected to be treated as an S Corporation for federal and state income tax purposes. Green’s Natural Foods, Inc. was treated as an S Corporation until December 30, 2020, when it was purchased and became a Qualified Subsidiary under Hudson Equity Partners, LLC. No provision has been made for federal income taxes since S Corporations are not taxable entities. Individual partners/shareholders report their share of taxable income or loss in their personal tax returns. C-Corporation Dean’s Natural Food Market, Inc. is a C Corporation for federal income tax purposes. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities, their respective tax bases, and tax operating loss and credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are subject to valuation allowances if, based on all available evidence, management determines that it is more likely than not that some position or all of the deferred tax assets and liabilities will not be realized. The financial impact of Dean’s Natural Food Market, Inc. deferred and current income taxes is not considered material as of and for the year ended December 31, 2021. Limited Liability Companies Dean’s Natural Food Market of Basking Ridge, LLC, Dean’s Natural Food Market of Chester, LLC, and Dean’s Natural Holdings, LLC have elected to be treated as single-member limited liability companies for federal and state income tax purposes with all income tax liabilities and/or benefits of the entities being passed through to its members. As such, there is no recognition of federal or state income taxes for each of these entities. Any uncertain tax position taken by the member is not an uncertain position of the entities. In accordance with the LLC agreements, the term of the Company is indefinite with termination determined by the Member. The LLC agreements indicate that the Member shall not have any liability for obligations of the Company, except to the extent expressly mandated by law. The Company has evaluated any uncertain tax positions and related income tax contingencies and determined uncertain positions, if any, are not material to the financial statements. Penalties and interest assessed by income taxing authorities are included in operating expenses, if incurred. None of the Company’s current returns are under examination. Inventories Inventories are stated at average cost. If the cost of inventories exceeds their net realizable value, adjustments are recorded to write down excess inventory value to net realizable value. The Company’s inventories consist primarily of merchandise available for resale, such as fresh produce, perishable grocery items, and non-perishable consumable goods. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Property, Plant and Equipment Property, plant and equipment is stated at cost. Depreciation is recorded using the straight-line method over the estimated useful lives of the related assets. Expenditures for maintenance and repairs and minor renewals are charged to expense; betterments and major renewals are capitalized. Leasehold improvements are amortized over the lesser of the lease terms or the assets’ useful lives. Upon retirement or sale of assets, the cost of the assets disposed of and the related accumulated depreciation are removed from the accounts, and any resulting gain or loss is credited or charged to income. Advertising Costs The Company expenses advertising costs as they are incurred. They are presented as a component of store operating expenses. Advertising costs were $ 54,921 Retirement Plan The Company maintains two 401(k) plans. Under the terms of these plans, the employer may make up to 4 4 15,731 Presentation of Sales Tax The States of New York and New Jersey impose sales taxes on all of the Company’s sales to nonexempt customers. The Company collects sales taxes from customers and remits the amounts to the states. The Company’s accounting policy is to exclude the tax collected and remitted to the State from revenues and expenses with the exception of excise taxes paid on purchases. Subsequent Events Subsequent events have been evaluated through December 19, 2023, which is the date the financial statements were available to be issued. |
DISAGGREGATION OF REVENUES
DISAGGREGATION OF REVENUES | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Disaggregation Of Revenues | ||
DISAGGREGATION OF REVENUES | NOTE 4. DISAGGREGATION OF REVENUES The Company’s disaggregated revenues consist of the following for the three and nine months ended September 30, 2023 and 2022: SCHEDULE OF REVENUE 2023 2022 2023 2022 Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Retail Grocery $ 11,307,056 $ 5,187,540 $ 35,374,652 $ 14,944,075 Food service/restaurant 1,396,194 584,382 4,459,142 1,743,228 Online/eCommerce 1,350 3,621 5,408 13,293 Total revenue $ 12,704,600 $ 5,775,543 $ 39,839,202 $ 16,700,596 | Note 4. DISAGGREGATION OF REVENUES When the Company prepares its internal management reporting to evaluate business performance, we disaggregate revenue into the following categories that depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. SCHEDULE OF REVENUE December 31, 2022 December 31, 2021 Retail Grocery $ 25,867,061 $ 9,923,138 Food service/restaurant 3,126,709 1,202,121 Online/eCommerce 15,870 93,600 Wholesale Grocery - 16,182 Total revenue $ 29,009,640 $ 11,235,041 |
ACCOUNTS RECEIVABLE
ACCOUNTS RECEIVABLE | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Credit Loss [Abstract] | ||
ACCOUNTS RECEIVABLE | NOTE 5. ACCOUNTS RECEIVABLE Accounts receivable is mainly related to COOP billing from each of the Healthy Choice Wellness Corp. entities. Healthy Choice Wellness Corp. bills its vendors for advertising vendors’ products in our sales channels. Advertising revenue is included in sales revenue on condensed combined carve-out statement of operations. The Company recorded advertising revenue of approximately $ 68,000 22,000 206,000 70,000 131,000 55,000 | Note 5. ACCOUNTS RECEIVABLE Accounts receivable is mainly related to COOP billing from each Healthy Choice Wellness Corp entity. Healthy Choice Wellness Corp bills its vendors for advertising vendors’ products in our sales channels. The Company’s accounts receivable totaled approximately $ 55,000 28,000 |
INVENTORIES
INVENTORIES | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | ||
INVENTORIES | NOTE 6. INVENTORIES Inventories are measured at the lower of cost and net realizable value using the average cost method. If the cost of the inventories exceeds their market value, adjustments are recorded to write down excess inventory to its net realizable value. The Company recorded the write down of inventories amounting to approximately $ 630,000 310,000 1,581,000 526,000 | Note 6. INVENTORIES Inventories are measured at the lower of cost and net realizable value using the average cost method. If the cost of the inventories exceeds their market value, adjustments are recorded to write down excess inventory to its net realizable value. The Company, as a result of its physical inventory observations recorded the write down of inventories amounting to approximately $ 1.5 0.6 |
PROPERTY, PLANT, AND EQUIPMENT
PROPERTY, PLANT, AND EQUIPMENT | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
PROPERTY, PLANT, AND EQUIPMENT | NOTE 8. PROPERTY, PLANT, AND EQUIPMENT Property, plant, and equipment consist of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT September 30, 2023 December 31, 2022 Displays $ 312,146 $ 312,146 Building 575,000 575,000 Furniture and fixtures 501,342 469,338 Leasehold improvements 1,925,385 1,910,719 Computer hardware & equipment 139,629 114,525 Other 680,718 579,547 Property, plant and equipment gross 4,134,220 3,961,275 Less: accumulated depreciation and amortization (1,332,664 ) (925,428 ) Total property, plant, and equipment $ 2,801,556 $ 3,035,847 The Company incurred approximately $ 132,000 60,000 408,000 163,000 | Note 7. PROPERTY, PLANT, AND EQUIPMENT Property, plant, and equipment consist of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT December 31, 2022 December 31, 2021 Displays $ 312,146 $ 305,558 Furniture and fixtures 469,338 71,600 Leasehold improvements 1,910,719 112,503 Computer hardware & equipment 114,525 84,887 Building 575,000 - Other 579,547 243,257 Property, plant and equipment gross 3,961,275 817,805 Less: accumulated depreciation and amortization (925,428 ) (645,303 ) Total property and equipment $ 3,035,847 $ 172,502 The Company incurred approximately $ 280,000 108,000 | |
Mother Earth's Storehouse, Inc. [Member] | |||
PROPERTY, PLANT, AND EQUIPMENT | NOTE 5 – PROPERTY, PLANT, AND EQUIPMENT The Company provides for depreciation on a straight-line basis. Property, plant and equipment is comprised of the following at December 31, and estimated useful lives of the related assets are as follows: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT AND ESTIMATED USEFUL LIVES OF THE RELATED ASSETS 2021 2020 Years Building and improvements $ 386,362 $ 386,362 10 40 Leasehold improvements 1,587,125 1,587,125 15 Furniture and fixtures 121,273 92,714 7 Office equipment 11,685 31,724 5 7 Machinery and equipment 421,925 443,152 5 7 Total 2,528,370 2,541,077 Accumulated depreciation (1,642,953 ) (1,546,897 ) Property, plant and equipment, net $ 885,417 $ 994,180 Depreciation expense amounted to $ 146,437 199,896 | ||
Greens Natural Foods, Inc. [Member] | |||
PROPERTY, PLANT, AND EQUIPMENT | NOTE 4 – PROPERTY, PLANT, AND EQUIPMENT Property, plant and equipment is comprised of the following at December 31, 2021, and estimated useful lives of the related assets are as follows: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT Years Vehicles $ 42,263 5 7 Leasehold improvements 1,816,917 15 Furniture and fixtures 1,582,635 7 Office equipment 46,331 5 7 Machinery and equipment 2,035,287 5 7 Total 5,523,433 Accumulated depreciation (3,776,457 ) Property, plant and equipment, net $ 1,746,976 Depreciation expense amounted to $ 366,085 |
GOODWILL
GOODWILL | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | Note 8. GOODWILL The Company’s goodwill relates to the acquisition of Paradise Health and Nutrition, The Vitamin Store, Mother Earth’s Storehouse and Green’s Natural Foods. The following table summarizes the changes in goodwill for the years ended December 31, 2022 and 2021: SCHEDULE OF GOODWILL Healthy Choice Markets 2, LLC The Vitamin Store, Healthy Choice Markets 3, LLC Healthy Choice Markets Total January 1, 2021 $ 477,000 $ 439,000 $ - $ - $ 916,000 Addition - - - - - Impairment - - - - - December 31, 2021 477,000 439,000 - - 916,000 Goodwill, Beginning Balance 477,000 439,000 - - 916,000 Addition - - 1,741,000 3,090,000 4,831,000 Impairment - - - - - December 31, 2022 $ 477,000 $ 439,000 $ 1,741,000 $ 3,090,000 $ 5,747,000 Goodwill, Ending Balance $ 477,000 $ 439,000 $ 1,741,000 $ 3,090,000 $ 5,747,000 |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
INTANGIBLE ASSETS, NET | NOTE 9. INTANGIBLE ASSETS, NET At September 30, 2023 and December 31, 2022, intangible assets consist of the following: SCHEDULE OF INTANGIBLE ASSETS, NET September 30, 2023 Useful Lives (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trade names 8 10 years $ 2,569,000 (951,193 ) $ 1,617,807 Customer relationships 4 6 years 2,669,000 (1,256,556 ) 1,412,444 Non-compete 4 5 years 1,602,000 (514,666 ) 1,087,334 Intangible assets, net $ 6,840,000 $ (2,722,415 ) $ 4,117,585 December 31, 2022 Useful Lives (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trade names 8- 10 years $ 2,569,000 (725,724 ) $ 1,843,276 Customer relationships 4- 6 years 2,669,000 (1,033,306 ) 1,635,694 Non-compete 4- 5 years 1,602,000 (300,466 ) 1,301,533 Intangible assets, net $ 6,840,000 $ (2,059,496 ) $ 4,780,504 Intangible assets are amortized on a straight-line basis over their estimated useful lives. Amortization expense was approximately $ 221,000 156,000 663,000 446,000 Future annual estimated amortization expense is as follows: SCHEDULE OF FUTURE ANNUAL ESTIMATED AMORTIZATION EXPENSE For the nine months ending September 30, 2023 (remaining three months) $ 220,973 2024 883,891 2025 878,391 2026 801,355 2027 662,550 Thereafter 670,425 Total $ 4,117,585 | Note 9. INTANGIBLE ASSETS, NET At December 31, 2022 and 2021, intangible assets consist of the following: SCHEDULE OF INTANGIBLE ASSETS, NET December 31, 2022 Useful Lives Gross Carrying Amount Accumulated Amortization Net Carrying Trade names 8 10 years $ 2,569,000 (725,724 ) $ 1,843,276 Customer relationships 4 6 years 2,669,000 (1,033,306 ) 1,635,694 Non-compete 4 5 years 1,602,000 (300,466 ) 1,301,533 Intangible assets, net $ 6,840,000 $ (2,059,496 ) $ 4,780,504 December 31, 2021 Useful Lives Gross Accumulated Net Trade names 8 10 years $ 923,000 (536,661 ) $ 386,339 Customer relationships 4 5 years 883,000 (685,823 ) 197,177 Non-compete 4 5 years 238,000 (133,646 ) 104,354 Website 4 years 10,000 (208 ) 9,792 Intangible assets, net $ 2,054,000 $ (1,356,338 ) $ 697,662 Future annual estimated amortization expense is as follows: SCHEDULE OF FUTURE ANNUAL ESTIMATED AMORTIZATION EXPENSE For the years ending December 31, 2023 $ 883,891 2024 883,891 2025 878,391 2026 801,355 2027 662,550 Thereafter 670,426 Total $ 4,780,504 Intangible assets are amortized on a straight-line basis over their estimated useful lives. Amortization expense was approximately $ 723,000 351,000 |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | ||
ACQUISITIONS | NOTE 7. ACQUISITION ACQUISITIONS On October 14, 2022, the Company through its wholly owned subsidiary, Healthy Choice Markets IV, LLC, entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Dean’s Natural Food Market of Shrewsbury, Inc., a New Jersey corporation, Green’s Natural Foods, Inc., a Delaware corporation, Dean’s Natural Food Market of Chester, LLC, a New Jersey limited liability company, Dean’s Natural Food Market of Basking Ridge, LLC, a New Jersey limited liability company, and Dean’s Natural Food Market, Inc., a New Jersey corporation (collectively, the “Sellers”), and shareholders of the Sellers. Pursuant to the Purchase Agreement, the Company acquired certain assets and assumed certain liabilities of an organic and natural health food and vitamin chain with eight store locations in New York and northern and central New Jersey (the “Stores”). The cash purchase price under the Asset Purchase Agreement was $ 5,142,000 3,000,000 The Company recorded $ 1,108,000 3.8 The following table summarizes the change in fair value of contingent consideration from acquisition date to September 30, 2023: SCHEDULE OF ASSET ACQUISITION CONTINGENT CONSIDERATION Fair Market Balance as of October 14, 2022 $ 1,108,000 Remeasurement (333,100 Balance as of December 31, 2022 $ 774,900 Remeasurement (774,900 ) Balance as of September 30, 2023 $ - The following table summarizes the change in fair value of contingent consideration for the three months ended September 30, 2023: Fair Market Balance as of June 30, 2023 $ 372,000 Balance beginning $ 372,000 Remeasurement (372,000 ) Balance as of September 30, 2023 $ - Balance ending $ - The following table summarizes the purchase price allocation based on fair values of the net assets acquired at the acquisition date: SCHEDULE OF PURCHASE PRICE ALLOCATION Purchase Consideration Cash consideration paid $ 5,142,000 Promissory note 3,000,000 Contingent consideration issued to Green’s Natural seller 1,108,000 Total Purchase Consideration $ 9,250,000 Purchase price allocation Inventory $ 1,642,000 Property and equipment 1,478,000 Intangible assets 3,251,000 Right of use asset - Operating lease 6,427,000 Other liabilities (211,000 ) Operating lease liability (6,427,000 ) Goodwill 3,090,000 Net assets acquired $ 9,250,000 Finite-lived intangible assets Trade Names ( 8 years $ 1,133,000 Customer Relationships ( 6 years 1,103,000 Non-Compete Agreement ( 5 years 1,015,000 Total intangible assets $ 3,251,000 The acquisition is structured as asset purchase in a business combination, and goodwill is tax-deductible, and amortizable over 15 Revenue and Earnings The following table represents the condensed combined pro forma revenue and earnings for the three and nine months ended September 30, 2022: SCHEDULE OF UNAUDITED PROFORMA INFORMATION For Three Months Ended For Nine Months Ended September 30, 2022 September 30, 2022 Sales $ 13,207,282 $ 39,984,097 Net loss $ (1,294,861 ) $ (2,678,379 ) The condensed combined proforma revenue and earnings for the three-month period and nine-month period ended September 30, 2022 were prepared as though acquisition occurred as of January 1, 2022. | Note 10. ACQUISITIONS The purchase method of accounting in accordance with ASC 805, Business Combinations Mother Earth’s Storehouse On February 9, 2022, the Company through its wholly owned subsidiary, Healthy Choice Markets 3, LLC, entered into an Asset Purchase Agreement with Mother Earth’s Storehouse Inc. (“HCM3”) and its shareholders. Pursuant to the Purchase Agreement, HCM3 acquired certain assets and assumed certain liabilities related to Mother Earth’s grocery stores in Kingston and Saugerties, New York. The Company intends to continue to operate the grocery stores under their existing name. The cash purchase price under the Asset Purchase Agreement was $ 4,472,500 677,500 The following table summarizes the purchase price allocation based on fair values of the net assets acquired at the acquisition date: SCHEDULE OF PURCHASE PRICE ALLOCATION Purchase Consideration Cash consideration paid $ 5,150,000 Purchase price allocation Inventory 805,000 Property, plant, and equipment 1,278,000 Intangible assets 1,609,000 Right of use asset - operating lease 1,797,000 Other liabilities (283,000 ) Operating lease liability (1,797,000 ) Goodwill 1,741,000 Net assets acquired $ 5,150,000 Finite-lived intangible assets Trade Names ( 8 years $ 513,000 Customer Relationships ( 6 years 683,000 Non-Compete Agreement ( 5 years 413,000 Total intangible assets $ 1,609,000 The acquisition is structured as asset purchase in a business combination, and goodwill is tax-deductible, and amortizable over 15 The results of operations of Mother’s Earth have been included in the combined carve-out statements of operations as of the effective date of operations. Revenue and net income for Year ended December 31, 2022 were $ 11.9 0.30 157,000 Green’s Natural Foods On October 14, 2022, the Company through its wholly owned subsidiary, Healthy Choice Markets IV, LLC, entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Dean’s Natural Food Market of Shrewsbury, Inc., a New Jersey corporation, Green’s Natural Foods, Inc., a Delaware corporation, Dean’s Natural Food Market of Chester, LLC, a New Jersey limited liability company, Dean’s Natural Food Market of Basking Ridge, LLC, a New Jersey limited liability company, and Dean’s Natural Food Market, Inc., a New Jersey corporation (collectively, the “Sellers”), and shareholders of the Sellers. Pursuant to the Purchase Agreement, the Company acquired certain assets and assumed certain liabilities of an organic and natural health food and vitamin chain with eight store locations in New York and northern and central New Jersey (the “Stores”). The cash purchase price under the Asset Purchase Agreement was $ 5,142,000 3,000,000 The Company recorded $ 1,108,000 3.8 The following table summarizes the change in fair value of contingent consideration from acquisition date to December 31, 2022: SCHEDULE OF ASSET ACQUISITION CONTINGENT CONSIDERATION Fair Market Balance as of October 14, 2022 $ 1,108,000 Remeasurement (333,100 ) Balance as of December 31, 2022 $ 774,900 The following table summarizes the purchase price allocation based on fair values of the net assets acquired at the acquisition date: SCHEDULE OF PURCHASE PRICE ALLOCATION Purchase Consideration Cash consideration paid $ 5,142,000 Promissory note 3,000,000 Contingent consideration issued to Green’s Natural seller 1,108,000 Total Purchase Consideration $ 9,250,000 Purchase price allocation Inventory $ 1,642,000 Property and equipment 1,478,000 Intangible assets 3,251,000 Right of use asset - Operating lease 6,427,000 Other liabilities (211,000 ) Operating lease liability (6,427,000 ) Goodwill 3,090,000 Net assets acquired $ 9,250,000 Finite-lived intangible assets Trade Names ( 8 years $ 1,133,000 Customer Relationships ( 6 years 1,103,000 Non-Compete Agreement ( 5 years 1,015,000 Total intangible assets $ 3,251,000 The acquisition is structured as asset purchase in a business combination, and goodwill is tax-deductible, and amortizable over 15 Revenue and net loss for year ended December 31, 2022 were $ 6.3 0.05 906,000 Revenue and Earnings The following unaudited pro forma summary presents combined information of the Company, including Mother Earth’s Storehouse and Green’s Natural Foods, as if the business combinations had occurred on January 1, 2021, the earliest period presented herein: SCHEDULE OF UNAUDITED PROFORMA INFORMATION - - December 31, 2022 2021 Sales $ 54,846,023 $ 60,773,310 Net loss (790,119 ) 1,803,584 The pro forma financial information includes adjustments that are directly attributable to the business combinations and are factually supportable. The pro forma adjustments include incremental amortization of intangible and remove non-recurring transaction costs directly associated with the acquisitions, such as legal and other professional service fees. The pro forma data gives effects to actual operating results prior to the acquisition. These pro forma amounts do not purport to be indicative of the results that would have actually been obtained if the acquisitions occurred as of the beginning of each period presented or that may be obtained in future periods. For the year ended December 31, 2022, the pro forma financial information excludes $ 1,063,000 Acquisition of EIR Hydration On November 30, 2021, the Company, through its wholly owned subsidiary, Healthy Choice Wellness, LLC, acquired EIR Hydration, an IV therapy center located in Roslyn Heights, NY. The cost of the transaction was $ 75,000 54,000 |
CONTRACT LIABILITIES
CONTRACT LIABILITIES | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
CONTRACT LIABILITIES | NOTE 11. CONTRACT LIABILITIES A summary of the contract liabilities activity at September 30, 2023 and December 31, 2022 is presented below: SCHEDULE OF CONTRACT LIABILITIES ACTIVITY September 30, 2023 December 31, 2022 Beginning balance as January 1, $ 198,606 $ 18,514 Issued 664,003 859,383 Redeemed (664,294 ) (623,348 ) Breakage recognized (53,454 ) (55,943 ) Ending balance $ 144,861 $ 198,606 | Note 11. CONTRACT LIABILITIES The Company’s contract liabilities consist of customer deposits, gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products when customers redeem balances or terms expire through breakage. A summary of the contract liabilities activity for the years ended December 31, 2022 and 2021 is presented below: SCHEDULE OF CONTRACT LIABILITIES ACTIVITY 2022 2021 Year ended December 31, 2022 2021 Beginning balance as of January1, $ 18,514 $ 16,014 Issued 859,383 24,733 Redeemed (623,348 ) (21,764 ) Breakage recognized (55,943 ) (469 ) Ending balance as of December 31, $ 198,606 $ 18,514 | |
Mother Earth's Storehouse, Inc. [Member] | |||
CONTRACT LIABILITIES | NOTE 4 – NET SALES CONTRACT LIABILITIES Sales are net of returns and allowances and discounts. For the years ended December 31, sales were as follows: SCHEDULE OF NET OF RETURNS AND ALLOWANCES AND DISCOUNTS 2021 2020 Sales $ 15,438,995 $ 18,535,034 Less: Allowances 80,225 98,836 Discounts 1,066,604 1,401,976 Total net sales $ 14,292,166 $ 17,034,222 MOTHER EARTH’S STOREHOUSE, INC. NOTES TO FINANCIAL STATEMENTS December 31, 2021 and 2020 |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Payables and Accruals [Abstract] | ||
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 10. ACCOUNTS PAYABLE AND ACCRUED EXPENSES At September 30, 2023 and December 31, 2022, accounts payable and accrued expenses consisted of: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES September 30, 2023 December 31, 2022 Trade creditors $ 3,160,017 $ 3,118,757 Accrued expenses 210,143 370,787 Total $ 3,370,160 $ 3,489,544 | Note 12. ACCOUNTS PAYABLE AND ACCRUED EXPENSES At December 31, 2022 and 2021, accounts payable and accrued expenses consisted of: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES December 31, 2022 December 31, 2021 Trade creditors $ 3,118,757 $ 324,890 Accrued expenses 370,787 52,174 Total $ 3,489,544 $ 377,064 |
DEBT
DEBT | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
DEBT | NOTE 12. DEBT The following table provides a breakdown of the Company’s debt as of September 30, 2023 and December 31, 2022: SCHEDULE OF DEBT September 30, 2023 December 31, 2022 Promissory note $ 2,515,013 $ 2,913,788 Other debt - 815 Total debt $ 2,515,013 $ 2,914,603 Current portion of long-term debt (560,322 ) (536,542 ) Long-term debt $ 1,954,691 $ 2,378,061 Promissory Note In connection with the Green’s Natural Foods acquisition, on October 14, 2022, the Company issued a secured promissory note (the “Greens Note”) in the principal amount of $ 3,000,000 five-year 6.0 The Company may, at its option, at any time or from time to time prepay the outstanding principal amount or any accrued but unpaid interest, in each case in whole or in part, without penalty or premium, provided that any such prepayment of any outstanding amount of principal shall be accompanied by the payment of all accrued but unpaid interest on the amount of principal being prepaid, plus any costs and fees incurred. | Note 13. DEBT The following table provides a breakdown of the Company’s debt as of December 31, 2022 and 2021: SCHEDULE OF DEBT 2022 2021 December 31, 2022 2021 Promissory note $ 2,913,788 $ - Other debt 815 3,419 Total debt $ 2,914,603 $ 3,419 Current portion of long-term debt (536,542 ) (2,604 ) Long-term debt $ 2,378,061 $ - Promissory Note In connection with the Green’s Natural Foods acquisition, on October 14, 2022, the Company issued a secured promissory note (the “Greens Note”) in the principal amount of $ 3,000,000 five-year 6.0 The Company may, at its option, at any time or from time to time prepay the outstanding principal amount or any accrued but unpaid interest, in each case in whole or in part, without penalty or premium, provided that any such prepayment of any outstanding amount of principal shall be accompanied by the payment of all accrued but unpaid interest on the amount of principal being prepaid, plus any costs and fees incurred. | |
Mother Earth's Storehouse, Inc. [Member] | |||
DEBT | NOTE 7 – DEBT In April 2020, the Company applied for and received a loan from its bank in the amount of $ 669,500 According to the rules of the SBA, the Company is required to retain PPP loan documentation for six years after the date the loan is forgiven or repaid in full, and permit authorized representatives of the SBA, including representatives of its Office of Inspector General, to access such files upon request. Should the SBA conduct such a review and reject all or some of the Company’s judgements pertaining to satisfying PPP loan eligibility or forgiveness conditions, the Company may be required to adjust previously reported amounts and disclosures in the financial statements. | ||
Greens Natural Foods, Inc. [Member] | |||
DEBT | NOTE 9 – DEBT During 2021, the Company applied for and received a loan from its bank in the amount of $ 817,927 According to the rules of the SBA, the Company is required to retain PPP loan documentation for six years after the date the loan is forgiven or repaid in full, and permit authorized representatives of the SBA, including representatives of its Office of Inspector General, to access such files upon request. Should the SBA conduct such a review and reject all or some of the Company’s judgements pertaining to satisfying PPP loan eligibility or forgiveness conditions, the Company may be required to adjust previously reported amounts and disclosures in the financial statements. The $ 88,574 SCHEDULE OF DEBT MATURITIES 2022 (3 remaining months) $ 6,983 2023 28,638 2024 29,805 2025 23,148 Total debt $ 88,574 | NOTE 5 – DEBT During 2021, the Company applied for and received a loan from its bank in the amount of $ 817,927 According to the rules of the SBA, the Company is required to retain PPP loan documentation for six years after the date the loan is forgiven or repaid in full, and permit authorized representatives of the SBA, including representatives of its Office of Inspector General, to access such files upon request. Should the SBA conduct such a review and reject all or some of the Company’s judgements pertaining to satisfying PPP loan eligibility or forgiveness conditions, the Company may be required to adjust previously reported amounts and disclosures in the financial statements. The $ 109,108 SCHEDULE OF DEBT MATURITIES December 31, 2022 $ 27,517 2023 28,638 2024 29,805 2025 23,148 Total debt $ 109,108 |
LEASES
LEASES | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
LEASES | NOTE 13. LEASES The Company has various lease agreements with terms up to 20 years Maturity of lease liabilities under our non-cancellable operating leases as of September 30, 2023 were as follows: SCHEDULE OF MATURITY OF LEASE LIABILITIES Payments due by period September 30, 2023 2023 (remaining three months) $ 675,033 2024 2,593,309 2025 2,331,433 2026 1,995,684 2027 1,092,715 Thereafter 2,041,925 Total undiscounted operating lease payments $ 10,730,099 Less: Imputed interest (914,686 ) Present value of operating lease liabilities $ 9,815,413 The following table summarizes the Company’s operating leases: SCHEDULE OF COMPANY’S OPERATING LEASE Balance Sheet Classification September 30, 2023 December 31, 2022 Right of use asset $ 10,055,199 $ 10,604,935 Operating lease liability, current $ 2,321,018 $ 2,228,852 Operating lease liability, net of current $ 7,494,395 $ 8,041,504 The amortization of the right-of-use asset of $ 625,000 152,000 1,688,000 435,000 The following table provides a summary of other information related to the leases at September 30, 2023 and December 31, 2022: SCHEDULE OF OPERATING LEASE TERM Other Information September 30, 2023 December 31, 2022 Weighted-average remaining lease term for operating leases 5 years 6 years Weighted-average discount rate for operating leases 3.87 % 3.83 % Rent expense for three months ended September 30, 2023 and 2022 was approximately $ 830,000 235,000 2,508,000 653,000 The components of lease expenses for the three and nine months ended September 30, 2023 and 2022 were as follows: SCHEDULE OF COMPONENTS OF LEASE EXPENSE 20 23 2022 Three Months Ended September 30, 2023 2022 Operating lease cost $ 586,247 $ 143,280 Variable lease cost 205,355 82,603 Short-term lease cost 38,637 9,041 Total rent expense $ 830,239 $ 234,924 20 23 2022 Nine Months Ended September 30, 2023 2022 Operating lease cost $ 1,742,748 $ 408,273 Variable lease cost 650,211 217,738 Short-term lease cost 114,802 26,647 Total rent expense $ 2,507,761 $ 652,658 The aggregate cash payments under the leasing arrangement were approximately $ 1,593,000 376,000 | Note 14. LEASES The Company has various lease agreements with terms up to 20 years Maturity of lease liabilities under our non-cancellable operating leases as of December 31, 2022 were as follows: SCHEDULE OF MATURITY OF LEASE LIABILITIES Payments due by period 2023 $ 2,572,637 2024 1,995,148 2025 1,688,859 2026 1,504,408 2027 1,177,509 Thereafter 2,934,186 Total undiscounted operating lease payments $ 11,872,747 Less: Imputed interest (1,602,391 ) Present value of operating lease liabilities $ 10,270,356 The following table summarizes the Company’s operating leases: SCHEDULE OF COMPANY’S OPERATING LEASE Balance Sheet Classification December 31, 2022 December 31, 2021 Right of use asset $ 10,604,935 $ 3,423,123 Operating lease liability, current $ 2,228,852 $ 323,056 Operating lease liability, net of current 8,041,504 2,675,495 Total operating lease liabilities $ 10,270,356 $ 2,998,551 The amortization of the right-of-use asset of $ 1,043,220 372,454 SCHEDULE OF OPERATING LEASE TERM Other information December 31, 2022 December 31, 2021 Weighted-average remaining lease term for operating leases 6 years 10 years Weighted-average discount rate for operating leases 3.83 % 4.75 % Rent expense for the years ended December 31, 2022 and 2021 was approximately $ 1.4 0.6 The components of lease expenses for the year ended December 31, 2022 and 2021 were as follows: SCHEDULE OF COMPONENTS OF LEASE EXPENSE December 31, 2022 December 31, 2021 Operating lease cost $ 759,207 $ 372,454 Variable lease cost 355,924 216,073 Short-term lease cost 284,013 - Total rent expense $ 1,399,144 $ 588,527 The aggregate cash payments under the leasing arrangement were approximately $ 953,000 302,000 | |
Mother Earth's Storehouse, Inc. [Member] | |||
LEASES | NOTE 8 – LEASES The Company leased store space under an operating lease at 1955 South Road in Poughkeepsie, NY. The lease was on a month-to-month basis at $ 14,709 2 MOTHER EARTH’S STOREHOUSE, INC. NOTES TO FINANCIAL STATEMENTS December 31, 2021 and 2020 NOTE 8 – LEASES Beginning September 1, 2021, monthly lease payments were $ 15,923 August 31, 2029 ten years Lease expense was $ 188,582 251,074 | ||
Greens Natural Foods, Inc. [Member] | |||
LEASES | NOTE 5 – LEASES The Company leased four retail locations in the State of New Jersey (NJ) and four in the State of New York (NY). All the leases are classified as operating leases. Maturity of lease liabilities under our non-cancellable operating leases as of September 30, 2022 were as follows: SCHEDULE OF MATURITY OF LEASE LIABILITIES Payments due by period September 30, 2022 2022 (remaining three months) $ 432,127 2023 1,774,056 2024 1,232,391 2025 982,606 2026 859,607 Thereafter 1,296,758 Total undiscounted operating lease payments $ 6,577,545 Less: Imputed interest (541,441 ) Present value of operating lease liabilities $ 6,036,104 The following table summarizes the Company’s operating leases: SCHEDULE OF COMPANY’S OPERATING LEASE Balance Sheet Classification September 30, 2022 Right of use asset $ 6,036,104 Operating lease liability, current $ 1,661,788 Operating lease liability, net of current $ 4,374,315 The following table provides a summary of other information related to the leases at September 30, 2022: SCHEDULE OF OPERATING LEASE TERM Other Information September 30, 2022 Weighted-average remaining lease term for operating leases 5 Weighted-average discount rate for operating leases 1.30 % Rent expenses for three and nine months ended September 30, 2022 were approximately $ 0.5 1.5 The components of lease expenses for the three and nine months ended September 30, 2022: SCHEDULE OF COMPONENTS OF LEASE EXPENSE Three Month Ended September 30, 2022 Nine Month Ended September 30, 2022 Operating lease cost $ 322,629 $ 964,753 Variable lease cost 77,633 267,301 Short-term lease cost 89,455 267,496 Total rent expense $ 489,717 $ 1,499,550 The aggregate cash payments under the leasing arrangement were approximately $ 1.1 | NOTE 6 – LEASES The Company leased four retail locations in the State of New Jersey (NJ) and four in the State of New York (NY). The leases were as follows: ● Dean’s Natural Food Market, Inc. leased retail space in Ocean, NJ which runs from August 16, 2021 through August 2031. The minimum monthly payments are $ 17,460 18,333 ● Dean’s Natural Food Market of Shrewsbury, Inc. leased retail space in Shrewsbury, NJ originally dated May 28, 2003 through April 2018. The lease was renewed for five years on March 30, 2018 ● Dean’s Natural Food Market of Basking Ridge, LLC leased retail space in Basking Ridge, NJ from May 2012 through April 2018. The lease was renewed for another five-year term through April 2023 and an option to renew for two additional five-year terms ● Dean’s Natural Food Market of Chester, LLC leased retail space in Chester, NJ from February 2016 through January 2026, with the option for 2 five-year renewal terms 203,359 128,794 ● The lease for the Eastchester, NY location, originally dated February 1994 through November 2003 was renewed through November 2009 and again through November 2014. In August 2014, the lease was renewed for an additional ten-year term through November 2024 ● The lease for the Briarcliff Manor, NY location, originally dated August 20, 2003, expired September 30, 2018. The lease was renewed through September 30, 2023 ● The lease for the Mount Kisco, NY location, originally dated January 30, 1997, expired October 2007 and was renewed through July 31, 2022 and again through July 31, 2027 ● The lease for the Somers, NY location, dated September 20, 2018 expires five years after the Term Commencement Date, with the option to renew for an additional five years. Monthly rent payments are $ 10,300 3 ● The Ocean Store was owned by Dean Nelson prior to its acquisition by Red Oak Equity Partners, LLC in August 2021. There was no formal lease agreement because of the related party relationship. Future minimum payments under these leases are as follows: SCHEDULE OF MATURITY OF LEASE LIABILITIES 2022 $ 1,706,695 2023 1,557,868 2024 1,227,570 2025 1,005,515 2026 908,237 Thereafter 2,000,317 $ 8,406,202 Lease expense was $ 1,317,182 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS | NOTE 14. RELATED PARTY TRANSACTIONS The Company has not historically operated as a separate company and has various relationships with HCMC whereby HCMC provided services to the Company as noted below. Related party transactions include allocation of general corporate expenses and advances from parent. Allocation of General Corporate Expenses HCMC provides human resources, accounting, payroll processing, legal and other managerial services to the Company. The accompanying condensed combined carve-out financial statements include allocations of these expenses. Management adopted a proportional cost allocation method to allocate HCMC expenses to the Company. The allocation method calculates the appropriate share of overhead costs to the Company based on management’s estimate that the sum of management time and resources spent managing the Company is approximately equal to the amount of time and resources spent managing HCMC and its subsidiaries. As a result, 50% of HCMC overhead on a weighted average basis was allocated to the Company based on the fact that management spent equal amount of time to manage HCMC and the Company. The Company believes the allocation methodology used is reasonable and has been consistently applied, and results in an appropriate allocation of costs incurred. However, these allocations may not be indicative of the cost had the Company been a stand-alone entity or of future services. HCMC allocated $ 0.6 0.6 2.0 1.6 Investment by Parent The Company received approximately $ 2.1 6.8 2.0 0.1 1.6 5.2 Intercompany Receivable and Payable There is no intercompany agreement between the Company and HCMC. Management has determined those intercompany receivables and payables will be settled within twelve months after the balance sheet date. As a result, the Company’s intercompany balances are reflected as “due to” or “due from” accounts in the condensed combined carve-out balance sheets. The Company had a net receivable balance of $ 2.9 2.3 | Note 15. RELATED PARTY TRANSACTIONS The Company has not historically operated as a separate company and has various relationships with HCMC whereby HCMC provides services to the Company as noted below. Related party transactions include allocation of general corporate expenses and advances from parent. Allocation of General Corporate Expenses HCMC provides human resources, accounting, payroll processing, legal and other managerial services to the Company. The accompanying combined carve-out financial statements include allocations of these expenses. Management adopted a proportional cost allocation method to allocate HCMC expenses to the Company. The allocation method calculates the appropriate share of overhead costs to the Company based on management’s estimate that the sum of management time and resources spent managing the Company is approximately equal to the amount of time and resources spent managing HCMC and its subsidiaries. As a result, 50% of HCMC overhead on a weighted average basis, was allocated to the Company based on the fact that management spent equal amount of time to manage HCMC and the Company. The Company believes the allocation methodology used is reasonable and has been consistently applied, and results in an appropriate allocation of costs incurred. However, these allocations may not be indicative of the cost had the Company been a stand-alone entity or of future services. HCMC allocated $ 3.4 1.5 Investment by Parent The Company received approximately $ 13.8 2.1 2.8 11.0 1.5 0.08 0.5 Intercompany Receivable and Payable There is no intercompany agreement between Healthy Choice Wellness Corp and HCMC. Management has determined those intercompany receivables and payables will be settled within twelve months after the balance sheet date. As a result, Healthy Choice Wellness Corp’s intercompany balances are reflected as “due to” or “due from” accounts, and presented in other assets in the financial statements. The Company had a net receivable balance of $ 2.3 1.4 | |
Greens Natural Foods, Inc. [Member] | |||
RELATED PARTY TRANSACTIONS | NOTE 6 – RELATED PARTY TRANSACTIONS During the three- and nine-months periods ended September 30, 2022, the Company paid approximately $ 45,000 179,000 | NOTE 8 – RELATED PARTY TRANSACTIONS As of December 31, 2020, the Company had two notes payable to its officers for $ 543,750 and 56,250 During the year ended December 31, 2021, the Company paid $ 216,792 |
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 15. COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time the Company may be involved in various claims and legal actions arising in the ordinary course of our business. With respect to legal costs, we record such costs as incurred. | Note 16. COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time the Company may be involved in various claims and legal actions arising in the ordinary course of our business. In the opinion of management, such litigation will not have a material effects in the Company’s combined carve-out financial statements. COVID-19 Management Update The global outbreak of COVID-19 was declared a pandemic by the World Health Organization and a national emergency by the U.S. government in March 2020 and has negatively impacted the U.S. and global economies, disrupted global supply chains and, mandated closures and stay-at-home orders and created significant disruptions of the global financial markets. The Company adjusted certain aspects of the operations to protect their employees and customers while still meeting customers’ needs. While we have experienced many challenges, including but not limited to, product shortages, staffing difficulties, and evolving customer shopping behaviors, our focus remains on both offering our customers a high quality service experience and supporting our essential front-line team members. Though we have successfully managed these challenges to date, our operations and financial condition could still be negatively affected by the COVID-19 pandemic and future developments, which are highly uncertain and cannot be predicted. |
INCOME TAX
INCOME TAX | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
INCOME TAX | Note 17. INCOME TAX The Company did not have a provision for income taxes (current or deferred tax expense) for tax years ended December 31, 2022 and 2021. The following is a reconciliation of the expected tax expense (benefit) at the U.S. statutory rate 21 SCHEDULE OF PROVISION FOR INCOME TAX 2022 2021 Year Ended December 31, 2022 2021 Provision/(benefit) at statutory rate $ (697,766 ) (380,647 ) State tax provision/(benefit) net of federal benefit (165,565 ) (50,719 ) Change in valuation allowance 929,300 400,532 Change in tax rate (19,027 ) 7,150 Other (46,942 ) 23,684 Income tax provision/(benefit) $ - $ - As of December 31, 2022 and 2021, the Company’s deferred tax assets and liabilities consisted of the effects of temporary differences attributable to the following: SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES 2022 2021 Year Ended December 31, 2022 2021 Deferred tax assets (liabilities): NOL & AMT credit carryforward $ 1,586,187 $ 913,063 Accrued expenses and deferred Income - 2,541 Charitable contribution - 69 Fixed assets (15,414 ) 20,550 Intangible assets 434,547 196,209 ASC 842 - Lease Accounting 44,485 (11,927 ) Total net deferred tax assets 2,049,805 1,120,505 Valuation allowance (2,049,805 ) (1,120,505 ) Net deferred tax assets $ - $ - In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the positive and negative evidence available, management has determined that a valuation allowance is required at December 31, 2022 and 2021 to reduce the deferred tax assets to amounts that are more likely than not to be realized. The Company’s valuation increased by approximately $ 1.2 930,000 At December 31, 2022 the Company had U.S. federal and state net operating loss carryforwards (“NOLS”) of $ 6,206,000 6,177,000 80 On August 16, 2022, the Inflation Reduction Act of 2022 (“IRA”) was signed into law. Among other provisions, the IRA includes a 15% 1 The Company had no uncertain tax positions as of December 31, 2022, and 2021. The Company files a federal income tax return and income tax returns in various state tax jurisdictions and the Company is generally no longer subject examinations by federal and state tax authorities for years before 2019. | |
Greens Natural Foods, Inc. [Member] | ||
INCOME TAX | NOTE 10 – INCOME TAXES INCOME TAX S-Corporation Dean’s Natural Food Market of Shrewsbury, Inc. has elected to be treated as an S Corporation for federal and state income tax purposes. Green’s Natural Foods, Inc. was treated as an S Corporation until December 30, 2020, when it was purchased and became a Qualified Subsidiary under Hudson Equity Partners, LLC. No provision has been made for federal income taxes since S Corporations are not taxable entities. Individual partners/shareholders report their share of taxable income or loss in their personal tax returns. C-Corporation Dean’s Natural Food Market, Inc. is a C Corporation for federal income tax purposes. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities, their respective tax bases, and tax operating loss and credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are subject to valuation allowances if, based on all available evidence, management determines that it is more likely than not that some position or all of the deferred tax assets and liabilities will not be realized. The financial impact of Dean’s Natural Food Market, Inc. deferred, and current income taxes is not considered material as of the period ended September 30, 2022. Limited Liability Companies Dean’s Natural Food Market of Basking Ridge, LLC, Dean’s Natural Food Market of Chester, LLC, and Dean’s Natural Holdings, LLC have elected to be treated as single-member limited liability companies for federal and state income tax purposes with all income tax liabilities and/or benefits of the entities being passed through to its members. As such, there is no recognition of federal or state income taxes for each of these entities. Any uncertain tax position taken by the member is not an uncertain position of the entities. In accordance with the LLC agreements, the term of the Company is indefinite with termination determined by the Member. The LLC agreements indicate that the Member shall not have any liability for the obligations of the Company, except to the extent expressly mandated by law. The Company has evaluated any uncertain tax positions and related income tax contingencies and determined uncertain positions, if any, are not material to the financial statements. Penalties and interest assessed by income taxing authorities are included in operating expenses, if incurred. None of the Company’s current returns are under examination. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
SUBSEQUENT EVENTS | NOTE 16. SUBSEQUENT EVENTS On September 28, 2023, the Company through its wholly owned subsidiary, Healthy Choice Markets V, LLC, entered into an Asset Purchase Agreement (the “Purchase Agreement”) with ET Holding, Inc., d/b/a Ellwood Thompson’s Local Market, a Virginia corporation, Ellwood Thompson’s Natural Market, L.C., a Virginia limited liability company, and Richard T. Hood, an individual resident of the Commonwealth of Virginia. The Company acquired certain assets and assumed certain liabilities of an organic and natural health food and vitamin store located in Richmond, Virginia (the “Store”). The purchase price under the Purchase Agreement is approximately $ 1,500,000 750,000 On October 27, 2023, the Company filed a new registration statement on Form S-1 in connection with the spin-off of all of the existing HCWC common stock by HCMC (the “Spin Off S-1”) with the Securities and Exchange Commission (the “Commission”). On October 30, 2023, the Company filed Amendment No. 1 to its registration statement on Form S-1 (“IPO S-1”) with the Commission. | Note 18. SUBSEQUENT EVENTS In accordance with FASB ASC 855-10, the Company has analyzed its operations subsequent to December 31, 2022, and through April 7, 2023, the date of this report being issued and has determined that it does not have any material subsequent event. |
Greens Natural Foods, Inc. [Member] | ||
SUBSEQUENT EVENTS | NOTE 11 – SUBSEQUENT EVENTS In accordance with FASB ASC 855-10, the Company has analyzed its operations subsequent to September 30, 2022, and through December 19, 2023, the date of this report being issued and has determined that the only material subsequent event is the company sales. On October 14, 2022, the Company entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Healthy Choice Markets IV, LLC (“HCM V”), wholly owned subsidiary of Healthier Choices Management Corp. Pursuant to the Purchase Agreement, the Company sold certain assets and certain liabilities of an organic and natural health food and vitamin chain with eight store locations in New York and northern and central New Jersey (the “Stores”). The cash purchase price under the Asset Purchase Agreement was $ 5,142,000 3,000,000 |
CONCENTRATION OF CREDIT AND MAR
CONCENTRATION OF CREDIT AND MARKET RISK | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2021 | |
Mother Earth's Storehouse, Inc. [Member] | ||
CONCENTRATION OF CREDIT AND MARKET RISK | NOTE 3 – CONCENTRATION OF CREDIT AND MARKET RISK Financial instruments that potentially expose the Company to concentration of credit and market risk consist primarily of cash equivalents and a note receivable. Cash is maintained at Federal Deposit Insurance Corporation insured financial institutions and credit exposure is limited to any one institution. As of December 31, 2021, cash and cash equivalents were in excess of FDIC insurance coverage by approximately $ 2,210,000 The Company has a concentration with two of its vendors related to the purchase of inventory. Approximately 29 21 31 21 Accounts payable consists of balances due to vendors for inventory the Company sells in its stores as well as services rendered to the Company on or before the year-end which have not been paid as of the year-end. At December 31, 2021 and 2020, one vendor represented 58 50 As mentioned in Note 1, the Company has 2 store locations in Kingston and Saugerties, New York. Because of this, there is a concentration of market risk as the Company is reliant upon the continued support of customers in the Kingston and Saugerties, New York communities and surrounding areas. The Company’s note receivable is due from one entity and is uncollateralized. The Company expects to collect this note in full during 2022. | |
Greens Natural Foods, Inc. [Member] | ||
CONCENTRATION OF CREDIT AND MARKET RISK | NOTE 4 – CONCENTRATION OF CREDIT AND MARKET RISK The Company considers all highly liquid instruments with an original maturity of three months or less, when purchased, to be cash and cash equivalents. As of the nine-month period ended September 30, 2022, the Company did not have cash concentrated in any one financial institution which was in excess of Federal Deposit Insurance Corporation (FDIC) coverage of $ 250,000 The Company carries its accounts receivable at cost less an allowance for doubtful accounts. On a periodic basis, the Company evaluates its receivables and establishes an allowance for doubtful accounts, based on a history of past write-offs, collections, and current credit conditions. Accounts are written off as uncollectible at the time management determines that collections are unlikely. Accounts receivables are uncollateralized. The Company has a concentration with two of its vendors, UNFI and Albert’s Organics, related to the purchase of inventory. Approximately 41 54 Accounts payable consist of balances due to vendors for inventory the Company sells in its stores as well as services rendered to the Company on or before the year-end which have not been paid as of September 30, 2022. At September 30, 2022, vendor Albert’s Organics represented 9 25 | NOTE 3 – CONCENTRATION OF CREDIT AND MARKET RISK Financial instruments that potentially expose the Company to concentration of credit and market risk consist primarily of cash equivalents and receivables. Cash is maintained at Federal Deposit Insurance Corporation insured financial institutions and credit exposure is limited to any one institution. As of December 31, 2021, cash and cash equivalents were in excess of FDIC insurance coverage by approximately $ 219,600 NOTE 3 – CONCENTRATION OF CREDIT AND MARKET RISK The Company carries its accounts receivable at cost less an allowance for doubtful accounts. On a periodic basis, the Company evaluates its receivables and establishes an allowance for doubtful accounts, based on a history of past write-offs, collections, and current credit conditions. Accounts are written off as uncollectible at the time management determines that collections are unlikely. Accounts receivable are un-collateralized. The Company has a concentration with two of its vendors, UNFI and Albert’s Organics, related to the purchase of inventory. Approximately 42 56 Accounts payable consists of balances due to vendors for inventory the Company sells in its stores as well as services rendered to the Company on or before the year-end which have not been paid as of the year-end. At December 31, 2021, vendor Albert’s Organics represented 10.5 24.2 |
NOTE RECEIVABLE
NOTE RECEIVABLE | 12 Months Ended |
Dec. 31, 2021 | |
Mother Earth's Storehouse, Inc. [Member] | |
NOTE RECEIVABLE | NOTE 6 – NOTE RECEIVABLE As part of the sale of the Poughkeepsie store location in 2020 (see Note 9), the purchaser entered into a note for the remaining $ 175,000 3,294 5.00% November 1, 2022 130,305 169,828 |
SALE OF STORE LOCATION
SALE OF STORE LOCATION | 12 Months Ended |
Dec. 31, 2021 | |
Mother Earth's Storehouse, Inc. [Member] | |
SALE OF STORE LOCATION | NOTE 9 – SALE OF STORE LOCATION On September 30, 2020, the Company sold its Poughkeepsie store location for $ 225,000 175,000 SCHEDULE OF POUGHKEEPSIE STORE ASSETS SOLD AND GAIN FROM THE SALE Cash $ 50,000 Issuance of promissory note 175,000 Consideration received 225,000 Inventory 175,000 Fixed assets, net book value 102,530 Net Assets 277,530 Net loss $ (52,530 ) |
SETTLEMENT
SETTLEMENT | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SETTLEMENT | NOTE 15. COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time the Company may be involved in various claims and legal actions arising in the ordinary course of our business. With respect to legal costs, we record such costs as incurred. | Note 16. COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time the Company may be involved in various claims and legal actions arising in the ordinary course of our business. In the opinion of management, such litigation will not have a material effects in the Company’s combined carve-out financial statements. COVID-19 Management Update The global outbreak of COVID-19 was declared a pandemic by the World Health Organization and a national emergency by the U.S. government in March 2020 and has negatively impacted the U.S. and global economies, disrupted global supply chains and, mandated closures and stay-at-home orders and created significant disruptions of the global financial markets. The Company adjusted certain aspects of the operations to protect their employees and customers while still meeting customers’ needs. While we have experienced many challenges, including but not limited to, product shortages, staffing difficulties, and evolving customer shopping behaviors, our focus remains on both offering our customers a high quality service experience and supporting our essential front-line team members. Though we have successfully managed these challenges to date, our operations and financial condition could still be negatively affected by the COVID-19 pandemic and future developments, which are highly uncertain and cannot be predicted. | |
Mother Earth's Storehouse, Inc. [Member] | |||
SETTLEMENT | NOTE 10 – SETTLEMENT During the year ended December 31, 2020, the Company settled a litigation claim brought against it for $ 83,839 |
SUPPLEMENTAL INFORMATION
SUPPLEMENTAL INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
Mother Earth's Storehouse, Inc. [Member] | |
SUPPLEMENTAL INFORMATION | SUPPLEMENTAL INFORMATION SCHEDULE OF SUPPLEMENTAL INFORMATION OF OPERATION STATEMENTS 2021 2020 STORE OPERATING EXPENSES Advertising $ 76,379 $ 86,071 Automobile - 10 Trade shows and other events - 953 Laundry and uniforms 17,004 31,288 Licenses and permits 19,019 37,656 Materials and supplies 191,461 220,639 Outside services 22,840 30,480 Rent 188,582 251,074 Real estate taxes 67,008 92,869 Repairs and maintenance 121,467 181,828 Telephone 10,235 17,135 Travel 998 2,681 Utilities 114,419 136,896 Total store operating expenses $ 829,412 $ 1,089,580 EMPLOYEE COSTS Salaries $ 2,351,112 $ 2,952,896 Payroll taxes 211,372 252,875 Employee benefits 143,193 142,135 Insurance - WC 41,164 55,588 Insurance - DBL 13,556 11,369 Total employee costs $ 2,760,397 $ 3,414,863 GENERAL AND ADMINISTRATIVE EXPENSES Bank and credit card fees $ 214,477 $ 278,418 Corporation tax 750 3,750 Computer 9,226 7,459 Donations 479 444 Dues and subscriptions 9,899 13,121 Insurance 29,293 30,286 Miscellaneous 403 12,058 Settlement - 83,839 Office 17,709 19,365 Professional fees 24,038 22,171 Training - 288 Total general and administrative expenses $ 306,274 $ 471,199 |
NEW JERSEY ACQUISITION
NEW JERSEY ACQUISITION | 12 Months Ended |
Dec. 31, 2021 | |
Greens Natural Foods, Inc. [Member] | |
NEW JERSEY ACQUISITION | NOTE 7 – NEW JERSEY ACQUISITION On August 16, 2021, Red Oak Equity Partners, LLC purchased all issued and outstanding capital stock and membership interest, as applicable, of Dean’s Natural Food Market, Inc., Dean’s Natural Food Market of Shrewsbury, Inc., Dean’s Natural Food Market of Basking Ridge, LLC, Dean’s Natural Food Market of Chester, LLC, and Dean’s Natural Holdings, LLC for a total of $ 2,500,000 2,250,000 250,000 5 |
STOCK_UNITS
STOCK/UNITS | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2021 | |
Greens Natural Foods, Inc. [Member] | ||
STOCK/UNITS | NOTE 7 – STOCK/UNITS The Company has authorized and issued 2,200 2,000 .001 no | NOTE 9 – STOCK/UNITS The Company has authorized and issued 2,200 2,000 .001 no |
COMMITMENTS
COMMITMENTS | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2021 | |
Greens Natural Foods, Inc. [Member] | ||
COMMITMENTS | NOTE 8 – COMMITMENTS The Company has an agreement with a food distributor that runs from November 24, 2021, to March 11, 2025, where 90% of the products sold at the New York Stores must be purchased from that distributor. | NOTE 10 – COMMITMENTS The Company has an agreement with a food distributor that runs from November 24, 2021, to March 11, 2025, where 90% of the products sold at the New York Stores must be purchased from that distributor. |
RESTATEMENT
RESTATEMENT | 12 Months Ended |
Dec. 31, 2021 | |
Greens Natural Foods, Inc. [Member] | |
RESTATEMENT | NOTE 11 – RESTATEMENT These combined financial statements have been restated to exclude the financial results of the New Jersey Locations for the period January 1, 2021, through August 16, 2021. During this period, the New Jersey Locations were not controlled by the Company’s owners or management and therefore, should not have been combined for the twelve months ended December 31, 2021. The following amounts have been restated: SCHEDULE OF RESTATEMENT OF COMBAINED FINANCIAL STATEMENTS Combined Statement of Income As Previously As Stated Adjustments Re-Stated Sales $ 35,731,191 $ (10,554,133 ) $ 25,177,058 Cost of sales (21,163,894 ) 6,096,468 (15,067,426 ) Returns and allowances (485,088 ) 42,797 (442,291 ) Gross profit 14,082,209 (4,414,868 ) 9,667,341 Operating costs: Salaries and wages 7,126,346 (2,212,315 ) 4,914,031 General and administrative 6,383,033 (1,468,645 ) 4,914,388 Depreciation 430,083 (63,998 ) 366,085 Total operating costs 13,939,462 (3,744,958 ) 10,194,504 Income (loss) from operations 142,747 (669,910 ) (527,163 ) Other income (expenses): Forgiveness of paycheck protection program (PPP) loan 817,927 - 817,927 Commission - market data services 323,404 - 323,404 Other Income 138,567 60,343 198,910 Bad debt (8,336 ) 8,336 - Taxes and fees (13,925 ) 13,925 - Contributions and donations (21,563 ) 9,848 (11,715 ) Interest (19,425 ) 4,998 (14,427 ) Total other income (expenses) 1,216,649 97,450 1,314,099 Net income $ 1,359,396 $ (572,460 ) $ 786,936 NOTE 11 – RESTATEMENT Combined Statement of Cash Flows As Previously As Stated Adjustments Re-Stated CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 1,359,396 $ (572,460 ) $ 786,936 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation 430,083 (63,998 ) 366,085 Forgiveness of PPP loan (817,927 ) - (817,927 ) Changes in assets and liabilities: Accounts receivable (23,827 ) 13,560 (10,267 ) Inventory (124,156 ) (55,325 ) (179,481 ) Prepaid expenses 49,610 23,068 72,678 Other current assets (7,819 ) (4,088 ) (11,907 ) Due to/from related parties 14,485 4,604 19,089 Other assets 20,984 5,996 26,980 Deposits (2,214 ) - (2,214 ) Accounts payable (300,649 ) 111,088 (189,561 ) Accrued expenses (13,142 ) 7,601 (5,541 ) Payroll liabilities (178,013 ) (24,297 ) (202,310 ) Lease incentive (13,557 ) - (13,557 ) Contract liabilities (37,647 ) 35,596 (2,051 ) Other current liabilities (171,453 ) 11,152 (160,301 ) Sales tax payable 18,519 - 18,519 Net cash provided by (used in) operating activities 202,673 (507,503 ) (304,830 ) NOTE 11 – RESTATEMENT Combined Statement of Cash Flows, Continued: As Previously As Stated Adjustments Re-Stated CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant, and equipment $ (34,303 ) $ 14,186 $ (20,117 ) Net cash used for investing activities (34,303 ) 14,186 (20,117 ) CASH FLOWS FROM FINANCING ACTIVITIES Payments on notes payable (113,806 ) 87,366 (26,440 ) Payments on notes payable to related parties (600,000 ) - (600,000 ) Payments on lines of credit (200,000 ) 200,000 - Distributions (1,337,124 ) 1,209,492 (127,632 ) Proceeds from PPP loan 817,927 - 817,927 Net cash used for financing activities (1,433,003 ) 1,496,858 63,855 NET DECREASE IN CASH AND CASH EQUIVALENTS (1,264,633 ) 1,003,541 (261,092 ) NET DECREASE IN CASH AND CASH EQUIVALENTS (1,264,633 ) 1,003,541 (261,092 ) CASH AND CASH EQUIVALENTS, Beginning of year 1,765,395 (1,003,541 ) 761,854 CASH AND CASH EQUIVALENTS, Beginning of year 1,765,395 (1,003,541 ) 761,854 CASH AND CASH EQUIVALENTS, End of year $ 500,762 $ - $ 500,762 CASH AND CASH EQUIVALENTS, End of year $ 500,762 $ - $ 500,762 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash paid for interest $ 19,425 $ (4,998 ) $ 14,427 In addition, the balance sheet as of December 31, 2021, was adjusted to reclassify certain contract liabilities from other current liabilities to accounts payable and additional expenses were accrued related to payroll liabilities, contract liabilities and inventory. Distributions/dividends in excess of earnings was reclassified and applied to additional paid in capital. Balance Sheet As Previously As Stated Adjustments Re-Stated Inventory $ 1,856,495 $ (34,600 ) $ 1,821,895 Accounts payable 1,519,667 94,578 1,614,245 Payroll liabilities 500,913 9,711 510,624 Contract liabilities 289,359 19,999 309,358 Other current liabilities 98,738 (94,578 ) 4,160 Accumulated loss (2,985,556 ) 63,322 (2,922,234 ) Additional paid in capital 5,340,123 (127,632 ) 5,212,491 |
AUDIT REPORT MODIFICATION
AUDIT REPORT MODIFICATION | 12 Months Ended |
Dec. 31, 2021 | |
Greens Natural Foods, Inc. [Member] | |
AUDIT REPORT MODIFICATION | NOTE 12 – AUDIT REPORT MODIFICATION The initial audit report dated December 28, 2022, was qualified because during 2020, Green’s Natural Foods, Inc. wrote off its remaining intangible assets balance of $298,482. The Company was unable to obtain to provide its Auditors with sufficient appropriate audit evidence to substantiate the carrying amount of these intangible assets immediately prior to their write off. In addition, the combined financial statements originally included the operations of the New Jersey stores for the entire year ended December 31, 2021, even though they were not acquired by the owners of Red Oak Equity Partners, LLC until August 16, 2021. Because the New Jersey stores were not under common control for the entire year ended December 31, 2021, the activity related to the New Jersey stores should not be reported in those combined financial statements for the period from January 1, 2021 through August 15, 2021. These combined financial statements have been restated to now include the financial results of the New Jersey stores from August 16, 2021, to December 31, 2021, which is the period they were under common control. In addition, the Auditors were able to obtain appropriate audit evidence for the intangible assets written off. As a result, the Auditor’s Report has been updated and is now unqualified. |
MANAGEMENT_S RESPONSIBILITY
MANAGEMENT’S RESPONSIBILITY | 9 Months Ended |
Sep. 30, 2023 | |
Greens Natural Foods, Inc. [Member] | |
MANAGEMENT’S RESPONSIBILITY | MANAGEMENT’S RESPONSIBILITY The accompanying condensed combined financial statements for the nine-months ended September 30, 2022, have been prepared by the Company’s management without an audit or review by an independent registered public accounting firm. The Company has made estimates and judgments affecting the amounts reported in the Company’s unaudited condensed combined financial statements and the accompanying notes. The actual results experienced by the Company may differ materially from the Company’s estimates. The financial information is unaudited but reflects all normal adjustments that are, in the opinion of management, necessary to provide a fair statement of results for the interim periods presented. |
BASIS OF PRESENTATION AND SIG_2
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Basis of Accounting | Basis of Presentation The accompanying condensed combined carve-out financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The Company has historically operated as part of Healthier Choices Management Corp. and not as a standalone company. Financial statements representing the historical operations of HCMC’s grocery segment have been derived from HCMC’s historical accounting records and are presented on a carve-out basis. All revenues and costs as well as assets and liabilities directly associated with the business activity of the Company are included in the financial statements. The financial statements also include allocations of certain general, administrative, sales and marketing expenses from HCMC. However, amounts recognized by the Company are not necessarily representative of the amounts that would have been reflected in the financial statements had the Company operated independently of HCMC. Related-party allocations are discussed further in Note 14. The condensed combined carve-out financial statements do not include all information and notes required by accounting principles generally accepted in the United States of America for complete financial statements. | Basis of Presentation The accompanying combined carve-out financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The Company has historically operated as part of Healthier Choices Management Corp. and not as a standalone company. Financial statements representing the historical operations of HCMC’s grocery segment have been derived from HCMC’s historical accounting records and are presented on a carve-out basis. All revenues and costs as well as assets and liabilities directly associated with the business activity of the Company are included in the financial statements. The financial statements also include allocations of certain general, administrative, sales and marketing expenses from HCMC. However, amounts recognized by the Company are not necessarily representative of the amounts that would have been reflected in the financial statements had the Company operated independently of HCMC. Related-party allocations are discussed further in Note 15. | |
Principles of Combination | Principles of Combination The condensed combined carve-out financial statements include the accounts of the Company and its wholly-owned subsidiaries, Healthy Choice Markets, Inc. (“Ada’s Natural Market”), Healthy Choice Markets 2, LLC (“Paradise Health and Nutrition”), Healthy Choice Markets 3, LLC (“Mother Earth’s Storehouse”), Healthy Choices Markets 3 Real Estate LLC, Healthy Choice Markets IV, LLC (Green’s Natural Foods), Healthy Choice Wellness, LLC, and Healthy U Wholesale, Inc (“The Vitamin Store, LLC”). All intercompany accounts and transactions have been eliminated in combination. | Principles of Combination The combined carve-out financial statements include the accounts of the Company and its wholly-owned subsidiaries, Healthy Choice Markets, Inc. (“Ada’s Natural Market”), Healthy Choice Markets 2, LLC (“Paradise Health and Nutrition”), Healthy Choice Markets 3, LLC (“Mother Earth’s Storehouse”), Healthy Choices Markets 3 Real Estate LLC, Healthy Choice Markets IV, LLC (Green’s Natural Foods), Healthy Choice Wellness, LLC, and Healthy U Wholesale, Inc (“The Vitamin Store, LLC”). All intercompany accounts and transactions have been eliminated in combination. | |
Net Parent Investment | Net Parent Investment The condensed combined carve-out financial statements were derived from the consolidated financial statements of HCMC on a carve-out basis. The financial statements also include allocations of certain general, administrative, legal, and marketing expenses from HCMC. The primary components of the net parent’s investment are intercompany balances other than related party payables, the allocation of shared costs, and funding received to cover any shortfall in operating cash requirements. Balances between HCMC and the Company that were not historically cash settled are included in net parent investment. Net parent’s investment represents the cumulative investment by HCMC in the Company through the dates presented. | Net Parent’s Investment The combined carve-out financial statements were derived from the consolidated financial statements of HCMC on a carve-out basis. The financial statements also include allocations of certain general, administrative, legal, and marketing expenses from HCMC. The primary components of the net parent’s investment are intercompany balances other than related party payables, the allocation of shared costs, and funding received to cover any shortfall on operating cash requirements. Balances between HCMC and the Company that were not historically cash settled are included in net parent investment. Net parent’s investment represents the cumulative investment by HCMC in the Company through the dates presented. | |
Use of Estimates | Use of Estimates in the Preparation of the Financial Statements The preparation of condensed combined carve-out financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed combined carve-out financial statements, and the reported amounts of net revenue and expenses during the reporting periods. Actual results could differ from those estimates. These estimates and assumptions include allowances, deferred taxes and related valuation allowances, and the valuation of the assets and liabilities acquired in business combinations. Certain of management’s estimates could be affected by external conditions, including those unique to our industry, and general economic conditions. It is possible that these external factors could have an effect on our estimates that could cause actual results to differ from our estimates. The Company re-evaluates all its accounting estimates at least quarterly based on these conditions and records adjustments when necessary. | Use of Estimates in the Preparation of the Financial Statements The preparation of combined carve-out financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the combined carve-out financial statements, and the reported amounts of net revenue and expenses during the reporting periods. Actual results could differ from those estimates. These estimates and assumptions include allocation of corporate general expenses, allowances, deferred taxes and related valuation allowances, and the valuation of the assets and liabilities acquired in business combinations. Certain of management’s estimates could be affected by external conditions, including those unique to our industry, and general economic conditions. It is possible that these external factors could have an effect on our estimates that could cause actual results to differ from our estimates. The Company re-evaluates all of its accounting estimates at least quarterly based on these conditions and records adjustments when necessary. | |
Revenue Recognition | Revenue Recognition Revenues from product sales and services rendered, net of promotional discounts, manufacturer coupons and rebates, return allowances, and sales and consumption taxes, are recorded when products are delivered, title passes to customers and collection is likely to occur. Title passes to customers at the point of sale for retail and upon delivery of products for wholesale. Return allowances, which reduce revenue, are estimated using historical experience. The Company recognizes revenue in accordance with the following five-step model: ● identify arrangements with customers; ● identify performance obligations; ● determine transaction price; ● allocate transaction price to the separate performance obligations in the arrangement, if more than one exists; and ● recognize revenue as performance obligations are satisfied. | Revenue Recognition Revenues from product sales and services rendered, net of promotional discounts, manufacturer coupons and rebates, return allowances, and sales and consumption taxes, are recorded when products are delivered, title passes to customers and collection is likely to occur. Title passes to customers at the point of sale for retail and upon delivery of products for wholesale. Return allowances, which reduce revenue, are estimated using historical experience. The Company recognizes revenue in accordance with the following five-step model: ● identify arrangements with customers; ● identify performance obligations; ● determine transaction price; ● allocate transaction price to the separate performance obligations in the arrangement, if more than one exists; and ● recognize revenue as performance obligations are satisfied. | |
Shipping and Handling | Shipping and Handling Shipping charges billed to customers are included in net sales and the related shipping and handling costs are included in cost of sales. The Company incurred shipping and handling costs of approximately $ 25,000 23,000 90,000 51,000 | Shipping and Handling Shipping charges billed to customers are included in net sales and the related shipping and handling costs are included in cost of sales. For the years ended December 31, 2022 and 2021, shipping and handling costs of approximately $ 91,000 39,000 | |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid instruments with an original maturity of three months or less, when purchased, to be cash and cash equivalents. The majority of the Company’s cash is concentrated in one financial institution, which is in excess of Federal Deposit Insurance Corporation (FDIC) coverage. The Company has not experienced any losses in such accounts. The Company did not have any cash equivalents as of September 30, 2023 and December 31, 2022. A summary of the financial institution that had cash in excess of FDIC limits of $ 250,000 SCHEDULE OF CASH AND CASH EQUIVALENTS September 30, 2023 December 31, 2022 Total cash in excess of FDIC limits of $ 250,000 $ - $ 949,677 | Cash and Cash Equivalents The Company considers all highly liquid instruments with an original maturity of three months or less, when purchased, to be cash and cash equivalents. The majority of the Company’s cash are concentrated in several large financial institutions, which is in excess of Federal Deposit Insurance Corporation (FDIC) coverage. The Company has not experienced any losses in such accounts. The Company did not have any cash equivalents as of December 31, 2022 and 2021. A summary of the financial institutions that had a cash and cash equivalents in excess of FDIC limits of $ 250,000 SCHEDULE OF CASH AND CASH EQUIVALENTS December 31, 2022 December 31, 2021 Total cash in excess of FDIC limits $ 949,677 $ - | |
Accounts Receivable, Contract Assets and Contract Liabilities | Accounts Receivable, Contract Assets and Contract Liabilities Accounts receivables are claims to consideration which are unconditional; meaning no performance obligations remain for the Company and only the passage of time is necessary before collection. Contract assets are distinguished from accounts receivable as performance obligations remain before claims to consideration become unconditional. By nature of the Company’s operations, contract assets are typically not recognized. Contract liabilities are recorded when customers transfer consideration in advance of delivery of products or services, which the Company records for gift cards and loyalty reward programs. When one party to an arrangement performs before the other(s), the Company records an account receivable, contract asset or contract liability. The majority of arrangements with customers contain one performance obligation: to provide a distinct set of products or services. Most performance obligations are satisfied simultaneously as the Company exchanges products or services for customer payment. Exceptions include gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products or services at a future date. As gift cards are purchased and loyalty points earned, contract liabilities are recorded until the performance obligations are satisfied through delivery of products or services or breakage based on gift card and loyalty reward program term limits. The Company’s breakage policy is twenty-four months for gift cards and twelve months for loyalty rewards. Loyalty rewards are earned at five percent on qualifying purchases and the reward functions as an allocation of transaction price from the period earned by the customer to the period the performance obligation is satisfied by the Company. As such, all contract liabilities are expected to be recognized within a twenty-four-month period. | Accounts Receivable, Contract Assets and Contract Liabilities Accounts receivables are claims to consideration which are unconditional; meaning no performance obligations remain for the Company and only the passage of time is necessary before collection. Contract assets are distinguished from accounts receivable as performance obligations remain before claims to consideration become unconditional. By nature of the Company’s operations, contract assets are typically not recognized. Contract liabilities are recorded when customers transfer consideration in advance of delivery of products or services, which the Company records for gift cards and loyalty reward programs. When one party to an arrangement performs before the other(s), the Company records an account receivable, contract asset or contract liability. The majority of arrangements with customers contain one performance obligation: to provide a distinct set of products or services. Most performance obligations are satisfied simultaneously as the Company exchanges products or services for customer payment. Exceptions include gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products or services at a future date. As gift cards are purchased and loyalty points earned, contract liabilities are recorded until the performance obligations are satisfied through delivery of products or services or breakage based on gift card and loyalty reward program term limits. The Company’s breakage policy is twenty-four months for gift cards and twelve months for loyalty rewards. Loyalty rewards are earned at five percent on qualifying purchases and the reward functions as an allocation of transaction price from the period earned by the customer to the period the performance obligation is satisfied by the Company. As such, all contract liabilities are expected to be recognized within a twenty-four month period. Accounts receivable balance represents credit sales, sales on account and billing to vendors for advertising vendors’ products in our stores. Concentration of accounts receivable consist of the following: SCHEDULE OF CONCENTRATION OF ACCOUNTS RECEIVABLE December 31, 2022 December 31, 2021 Customer A 17 % 0 % Customer B - 12 % Customer C 6 % 30 % | |
Other Current Assets | Other Current Assets Other current assets are the non-trade related assets that the Company owns, benefits from, or uses to generate income that can be converted into cash within one business cycle. Included in “Other current assets” on our condensed consolidated balance sheets are amounts primarily related to other receivables or non-trade receivable from government and other companies. | Other Current Assets Other current assets are the non-trade related assets that the Company owns, benefits from, or uses to generate income that can be converted into cash within one business cycle. Included in “Other current assets” on our combined carve-out balance sheets are amounts primarily related to other receivables or non-trade receivable from other companies. | |
Inventories | Inventories Inventories are measured at the lower of cost and net realizable value using the average cost method. If the cost of the inventories exceeds their net realizable value, adjustments are recorded to write down excess inventory to their net realizable value. The Company’s inventories consist primarily of merchandise available for resale, such as fresh produce, perishable grocery items and non-perishable consumable goods. | Inventories Inventories are measured at the lower of cost and net realizable value using the average cost method. If the cost of the inventories exceeds their net realizable value, adjustments are recorded to write down excess inventory to their net realizable value. The Company’s inventories consist primarily of merchandise available for resale, such as vitamins, fresh produce, perishable grocery items and non-perishable consumable goods. | |
Property, Plant and Equipment | Property, Plant, and Equipment Property, plant, and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the expected useful life of the respective asset, after the asset is placed in service. Revenue earning property, plant, and equipment includes signage, furniture and fixtures, building, computer hardware, appliance, cooler, and displays have useful lives ranging from two to seven years . Leasehold improvements are amortized over the shorter of the life of the improvement or the term of the lease. | Property, Plant, and Equipment Property, plant, and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the expected useful life of the respective asset, after the asset is placed in service. Revenue earning property, plant, and equipment includes signage, furniture and fixtures, building, computer hardware, appliance, cooler, displays with useful lives range from two seven years | |
Identifiable Intangible Assets and Goodwill | Identifiable Intangible Assets and Goodwill Identifiable intangible assets are recorded at cost, or when acquired as part of a business acquisition, at estimated fair value. Certain identifiable intangible assets are amortized over 4 10 | Identifiable Intangible Assets and Goodwill Identifiable intangible assets are recorded at cost, or when acquired as part of a business acquisition, at estimated fair value. Certain identifiable intangible assets are amortized over 4 10 | |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews all long-lived assets such as property and equipment and amortized intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated future cash flows expected to be generated by the asset or asset group. Impairment is measured by the amount by which the carrying value of the asset(s) exceeds their fair value. There were no triggering events that would indicate impairment of long-lived assets during the three month or nine month periods ended September 30, 2023 and 2022. | Impairment of Long-Lived Assets The Company reviews all long-lived assets such as property and equipment and amortized intangible assets for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the estimated future cash flows expected to be generated by the asset or asset group. Impairment is measured by the amount by which the carrying value of the asset(s) exceeds their fair value. There were no triggering events that would indicate impairment of long-lived assets at December 31, 2022. | |
Goodwill | Goodwill The Company assesses the carrying amounts of goodwill for recoverability on at least an annual basis or when events or changes in circumstances indicate evidence of potential impairment exists, using a fair value-based test. Application of the goodwill impairment test requires significant judgments including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for the businesses, and the useful life over which cash flows will occur. Changes in these estimates and assumptions could materially affect the determination of fair value and/or conclusions on goodwill impairment for the Company. Our annual impairment test is conducted on September 30 of each year or more often if deemed necessary. As part of management’s qualitative analysis on September 30, 2023, management determines whether any triggering events have occurred since the annual test date of September 30, 2022, which would indicate an impairment. Management determined no triggering events had occurred through September 30, 2023. | Goodwill The Company assesses the carrying amounts of goodwill for recoverability on at least an annual basis or when events or changes in circumstances indicate evidence of potential impairment exists, using a fair value based test. Application of the goodwill impairment test requires significant judgments including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for the businesses, and the useful life over which cash flows will occur. Changes in these estimates and assumptions could materially affect the determination of fair value and/or conclusions on goodwill impairment for the Company. Our annual impairment test is conducted on September 30 of each year or more often if deemed necessary. As part of management’s qualitative analysis at December 31, 2022 management determines whether any triggering events have occurred since the annual test date of September 30, 2022, which would indicate an impairment. Management determined no triggering events had occurred through December 31, 2022. | |
Advertising Costs | Advertising Advertising expense is classified as an operating expense on condensed combined carve-out statement of operation. The Company expenses advertising costs as incurred. The Company incurred advertising expenses of approximately $ 215,000 47,000 366,000 91,000 | Advertising The Company expenses advertising costs as incurred. For the years ended December 31, 2022 and 2021, the company incurred advertising expenses of approximately $ 145,000 39,000 | |
401(k) retirement savings plan | 401(k) retirement savings plan The Company’s employees are offered a 401(k) retirement savings plan that is administered under HCMC with discretionary contribution matching opportunities. 401K employer expense amounted to $ 21,000 6,000 59,000 14,000 | 401(k) retirement savings plan The Company’s employees are offered a 401(k) retirement savings plan that is administered under HCMC with discretionary contribution matching opportunities. 401K employer expense amounted to $ 25,000 7,000 | |
Income Taxes | Income Taxes The Company’s income taxes are included in HCMC’s consolidated return. For the purposes of the condensed combined carve-out financial statements, the income taxes for the Company have been presented on a separate return basis, under which a new stand-alone set of deferred tax assets and liabilities is created based on the financial statement accounts of the carveout. The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740, “Income Taxes” (“ASC 740”). Under this method, income tax expense is recognized as the amount of: (i) taxes payable or refundable for the current year and (ii) future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of available evidence it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of September 30, 2023 and December 31, 2022. The Company had no uncertain tax positions as of September 30, 2023 and December 31, 2022. | Income Taxes Historically, the Company’s income taxes were included in HCMC’s consolidated return. For the purposes of the combined carve-out financial statements, the income taxes for the Company have been presented on a separate return basis, under which a new stand-alone set of deferred tax assets and liabilities is created based on the financial statement accounts of the carveout. The Company uses the asset and liability method of accounting for income taxes in accordance with ASC 740, “Income Taxes” (“ASC 740”). Under this method, income tax expense is recognized as the amount of: (i) taxes payable or refundable for the current year and (ii) future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of available evidence it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2022 or December 31, 2021. The Company had no uncertain tax positions as of December 31, 2022, and 2021. | |
Leases | Leases Operating lease liabilities are recognized at the lease commencement date based on the present value of the fixed lease payments using the Company’s incremental borrowing rates. Related operating ROU assets are recognized based on the initial present value of the fixed lease payments, reduced by contributions from landlords, plus any prepaid rent and direct costs from executing the leases. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the lease term. Variable lease payments are recognized as lease expense as they are incurred. The Company did not have finance leases as of September 30, 2023 and December 31, 2022. If the Company enters into a finance lease in the future, it will be accounted for in accordance with ASC Topic 842. | Leases Operating lease liabilities are recognized at the lease commencement date based on the present value of the fixed lease payments using the Company’s incremental borrowing rates. Related operating ROU assets are recognized based on the initial present value of the fixed lease payments, reduced by contributions from landlords, plus any prepaid rent and direct costs from executing the leases. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the lease term. Variable lease payments are recognized as lease expense as they are incurred. The Company did not have finance leases for the years ended December 31, 2022 and 2021. If the Company enters into a finance lease in the future, it will be accounted for in accordance with ASC Topic 842. | |
Fair Value Measurements | Fair Value Measurements The fair value of the Company’s financial assets and liabilities reflects management’s estimated amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company uses the fair value framework under FASB’s guidance, and it requires the categorization of assets and liabilities into three levels based upon the assumptions used to measure the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3, if applicable, would generally require significant management judgment. The three levels for categorizing assets and liabilities under the fair value measurement requirements are as follows: ● Level 1: Fair value measurement of the asset or liability using observable inputs such as quoted prices in active markets for identical assets or liabilities; ● Level 2: Fair value measurement of the asset or liability using inputs other than quoted prices that are observable for the applicable asset or liability, either directly or indirectly, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and ● Level 3: Fair value measurement of the asset or liability using unobservable inputs that reflect the Company’s own assumptions regarding the applicable asset or liability. | Fair Value Measurements The fair value framework under FASB’s guidance requires the categorization of assets and liabilities into three levels based upon the assumptions used to measure the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3, if applicable, would generally require significant management judgment. The three levels for categorizing assets and liabilities under the fair value measurement requirements are as follows: ● Level 1: Fair value measurement of the asset or liability using observable inputs such as quoted prices in active markets for identical assets or liabilities; ● Level 2: Fair value measurement of the asset or liability using inputs other than quoted prices that are observable for the applicable asset or liability, either directly or indirectly, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and ● Level 3: Fair value measurement of the asset or liability using unobservable inputs that reflect the Company’s own assumptions regarding the applicable asset or liability. Nonfinancial assets such as goodwill, other intangible assets, and long-lived assets held and used are measured at fair value when there is an indicator of impairment and recorded at fair value when impairment is recognized or for a business combination. | |
Business Combination | Business Combination The Company applies the provisions of ASC Topic 805, Business Combinations Acquisition-related expenses were expensed as incurred and recorded in selling, general and administrative expenses in the condensed combined carve-out statements of operations. | Business Combination The Company applies the provisions of ASC Topic 805, Business Combinations | |
Reclassification | Reclassification Certain amounts in the condensed combined carve-out financial statements and related notes have been reclassified to conform to the current year presentation. Such reclassifications do not impact the Company’s previously reported financial position or net loss. Due from related party of $ 2.3 609,000 1.6 | Reclassifications Certain prior year amounts have been reclassified for consistency with the current year presentation. The increase in net parent investment for corporate overhead in the amount of $ 1,021,413 | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Public companies in the United States are subject to the accounting and reporting requirements of various authorities, including the Financial Accounting Standards Board (“FASB”) and the Securities and Exchange Commission (“SEC”). There were no accounting pronouncements issued in the quarter or with future effective dates that are either applicable nor are expected to have a material impact on the Company’s Combined Financial Statements. | Recent Accounting Pronouncements Public companies in the United States are subject to the accounting and reporting requirements of various authorities, including the Financial Accounting Standards Board (“FASB”) and the Securities and Exchange Commission (“SEC”). These authorities issue numerous pronouncements, most of which are not applicable to the Company’s current or reasonably foreseeable operating structure. There were no accounting pronouncements issued in the year or with future effective dates that are either applicable nor are expected to have a material impact on the Company’s Combined Carve-Out Financial Statements. | |
Unaudited Interim Condensed Combined Carve-Out Financial Statements | Unaudited Interim Condensed Combined Carve-Out Financial Statements The interim condensed combined carve-out balance sheet as of September 30, 2023, the interim condensed combined carve-out statements of operations and the interim condensed combined carve-out statements of changes in net parent’s investment for the three and nine months ended September 30, 2023 and 2022 and cash flows for the nine months ended September 30, 2023 and 2022 are unaudited. The financial data and the other financial information disclosed in the notes to these condensed combined carve-out financial statements relating to the three and nine-month periods are also unaudited. In the opinion of management, the accompanying interim financial statements include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of our condensed consolidated cash flows, operating results, and balance sheets for the periods presented. | ||
Mother Earth's Storehouse, Inc. [Member] | |||
Basis of Accounting | Basis of Accounting The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). | ||
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures. | ||
Revenue Recognition | Revenue Recognition The Company recognizes revenue at the point of sale. Unredeemed Gift Cards The Company sells gift cards with no expiration dates to customers. The Company records revenue at the point of sale and does not expect future gift card obligations to be material. Sales returns and allowances The Company does not expect future returns to be material, and consequently does not maintain an allowance for merchandise returns. MOTHER EARTH’S STOREHOUSE, INC. NOTES TO FINANCIAL STATEMENTS December 31, 2021 and 2020 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Cash and Cash Equivalents | Cash and Cash Equivalents For the purposes of the statement of cash flows, the Company considers all short-term investment securities purchased with a maturity of three months or less to be cash equivalents. | ||
Inventories | Inventories Inventories are valued at the lower of cost (average cost method) or net realizable value. Inventories are comprised of perishable and non-perishable food items available for sale. | ||
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment is stated at cost. Depreciation is recorded using the straight-line method over the estimated useful lives of the related assets. Expenditures for maintenance and repairs and minor renewals are charged to expense; betterments and major renewals are capitalized. Leasehold improvements are amortized over the lesser of the lease terms or the assets’ useful lives. Upon retirement or sale of assets, the cost of the assets disposed of and the related accumulated depreciation are removed from the accounts, and any resulting gain or loss is credited or charged to income. | ||
Advertising Costs | Advertising Costs The Company expenses advertising costs as they are incurred. They are presented as a component of store operating expenses. Advertising costs were $ 76,379 86,071 | ||
Income Taxes | Income Taxes Mother Earth’s Storehouse, Inc. has elected to be treated as an S Corporation for federal income tax purposes. No provision has been made for federal income taxes since S Corporations are not taxable entities. Individual partners/shareholders report their share of taxable income or loss in their personal tax returns. The Company has evaluated any uncertain tax positions and related income tax contingencies and determined uncertain positions, if any, are not material to the financial statements, according to FASB ASC 740. Penalties and interest assessed by income taxing authorities are included in operating expenses, if incurred. None of the Company’s current returns are under examination. Under New York State S Corporation tax law, the Corporation is subject to an annual franchise tax. Beginning in the year ended December 31, 2021, the Company elected to be subject to the New York State Pass-Through Entity Tax (the “PTET”). The Company must elect each year by March 15 th 102,750 0 | ||
Retirement Plan | Retirement Plan The Company maintains a 401(k) plan. Under the terms of the 401(k) Plan, the employer makes up to 4 4 140,859 144,110 MOTHER EARTH’S STOREHOUSE, INC. NOTES TO FINANCIAL STATEMENTS December 31, 2021 and 2020 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Presentation of Sales Tax | Presentation of Sales Tax The State of New York imposes sales taxes on all of the Company’s sales to nonexempt customers. The Company collects sales taxes from customers and remits the amounts to the state. The Company’s accounting policy is to exclude the tax collected and remitted to the State from revenues and expenses with the exception of excise taxes paid on purchases. | ||
Subsequent Events | Subsequent Events Subsequent events have been evaluated through April 8, 2022, which is the date the financial statements were available to be issued. | ||
Greens Natural Foods, Inc. [Member] | |||
Use of Estimates | Use of Estimates The preparation of condensed combined financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. Adopted Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU 2016-02 is effective for annual periods beginning after December 15, 2021 for private companies, and annual and interim periods thereafter, with early adoption permitted. The Company adopted ASU No. 2016-02 on January 1, 2022 using the cumulative-effect adjustment transition method, which applies the provisions of the standard at the effective date without adjusting the comparative periods presented. Adoption of this standard resulted in the recognition of operating lease right-of-use assets of $7.1 million and corresponding lease liabilities of $7.1 million on the condensed combined balance sheet as of January 1, 2022. The standard did not materially impact operating results or liquidity. | Use of Estimates The preparation of combined financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Revenue Recognition | Revenue Recognition Revenues from product sales, net of promotional discounts, manufacturer coupons and rebates, return allowances, and sales and consumption taxes, are recorded when products are delivered, title passes to customers, and collection is likely to occur. Title is passed to customers at the point of sale for all retail purchases. Return allowances, which reduce revenue, are estimated using historical experience. | Revenue Recognition Revenues from product sales, net of promotional discounts, manufacturer coupons and rebates, return allowances, and sales and consumption taxes, are recorded when products are delivered, title passes to customers, and collection is likely to occur. Title passes to customers at the point of sale for all retail purchases. Return allowances, which reduce revenue, are estimated using historical experience. | |
Cash and Cash Equivalents | Cash and Cash Equivalents For the purposes of the statement of cash flows, the Company considers all short-term investment securities purchased with a maturity of three months or less to be cash equivalents. Cash and cash equivalents include monies held by the Company’s credit card processors. The funds are held by the merchant credit card processors pending satisfaction of their hold requirements and expiration of charge backs/refunds circumstances. | Cash and Cash Equivalents For the purposes of the statement of cash flows, the Company considers all short-term investment securities purchased with a maturity of three months or less to be cash equivalents. Cash and cash equivalents include monies held by the Company’s credit card processors. The funds are held by the merchant credit card processors pending satisfaction of their hold requirements and expiration of charge backs/refunds circumstances. | |
Accounts Receivable, Contract Assets and Contract Liabilities | Accounts Receivable, Contract Assets and Contract Liabilities Accounts receivables are claims to consideration which are unconditional, meaning no performance obligations remain for the Company and only the passage of time is necessary before collection. Contract assets are distinguished from accounts receivable as performance obligations remain before claims to consideration become unconditional. Contract liabilities are recorded when customers transfer consideration in advance of delivery of products, which the Company records for all gift cards and loyalty reward programs. When one party to an arrangement performs before the other(s), the Company records an account receivable, contract asset, or contract liability. The majority of arrangements with customers contain one performance obligation to provide a distinct set of products. Most performance obligations are satisfied simultaneously as the Company exchanges products for customer payment. Exceptions include gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products at a future date. As gift cards are purchased and loyalty points earned, contract liabilities are recorded until the performance obligations are satisfied through delivery of products or breakage based on gift card and loyalty reward program term limits. | Accounts Receivable, Contract Assets and Contract Liabilities Accounts receivable are claims to consideration which are unconditional, meaning no performance obligations remain for the Company and only the passage of time is necessary before collection. Contract assets are distinguished from accounts receivable as performance obligations remain before claims to consideration become unconditional. Contract liabilities are recorded when customers transfer consideration in advance of delivery of products, which the Company records for all gift cards and loyalty reward programs. When one party to an arrangement performs before the other(s), the Company records an account receivable, contract asset, or contract liability. The majority of arrangements with customers contain one performance obligation to provide a distinct set of products. Most performance obligations are satisfied simultaneously as the Company exchanges products for customer payment. Exceptions include gift cards and loyalty rewards, for which the Company has a performance obligation to deliver products at a future date. As gift cards are purchased and loyalty points earned, contract liabilities are recorded until the performance obligations are satisfied through delivery of products or breakage based on gift card and loyalty reward program term limits. The Company’s breakage policy is twelve months for gift cards and twelve months for loyalty rewards. Loyalty rewards are earned at 1% on qualifying purchases and the reward functions as an allocation of transaction price from the period earned by the customer to the period the performance obligation is satisfied by the Company. As such, all contract liabilities are expected to be recognized within a twenty-four-month period. A summary of the contract liabilities activity for the year ended December 31, 2021, is presented below: SCHEDULE OF CONTRACT LIABILITIES ACTIVITY Beginning Balance as of January 1, 2021 $ 215,528 New Jersey balance as of August 16, 2021 95,881 Issued 40,741 Redeemed (42,792 ) Ending balance as of December 31, 2021 $ 309,358 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Inventories | Inventories Inventories are stated at average cost. If the cost of inventories exceeds their net realizable value, adjustments are recorded to write down excess inventory value to net realizable value. The Company’s inventories consist primarily of merchandise available for resale, such as fresh produce, perishable grocery items, and non-perishable consumable goods. | Inventories Inventories are stated at average cost. If the cost of inventories exceeds their net realizable value, adjustments are recorded to write down excess inventory value to net realizable value. The Company’s inventories consist primarily of merchandise available for resale, such as fresh produce, perishable grocery items, and non-perishable consumable goods. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment is stated at cost. Depreciation is recorded using the straight-line method over the estimated useful lives of the related assets. Expenditures for maintenance and repairs and minor renewals are charged to expense; betterments and major renewals are capitalized. Leasehold improvements are amortized over the lesser of the lease terms or the assets’ useful lives. Upon retirement or sale of assets, the cost of the assets disposed of, and the related accumulated depreciation are removed from the accounts, and any resulting gain or loss is credited or charged to income. Property, plant and equipment is comprised of the following at September 30, 2022, and estimated useful lives of the related assets are as follows: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT Years Vehicles $ 46,256 5 7 Leasehold improvements 1,988,570 15 Furniture and fixtures 1,732,154 7 Office equipment 50,708 5 7 Machinery and equipment 2,227,571 5 7 Total 6,045,259 Accumulated depreciation (4,033,117 ) Property, plant and equipment, net $ 2,012,142 Depreciation expense amounted to $ 85,611 256,660 | Property, Plant and Equipment Property, plant and equipment is stated at cost. Depreciation is recorded using the straight-line method over the estimated useful lives of the related assets. Expenditures for maintenance and repairs and minor renewals are charged to expense; betterments and major renewals are capitalized. Leasehold improvements are amortized over the lesser of the lease terms or the assets’ useful lives. Upon retirement or sale of assets, the cost of the assets disposed of and the related accumulated depreciation are removed from the accounts, and any resulting gain or loss is credited or charged to income. | |
Advertising Costs | Advertising Costs The Company expenses advertising costs as they are incurred. They are presented as a component of store operating expenses. Advertising costs were approximately $ 36,000 133,000 | Advertising Costs The Company expenses advertising costs as they are incurred. They are presented as a component of store operating expenses. Advertising costs were $ 54,921 | |
Income Taxes | Income Taxes S-Corporation Dean’s Natural Food Market of Shrewsbury, Inc. has elected to be treated as an S Corporation for federal and state income tax purposes. Green’s Natural Foods, Inc. was treated as an S Corporation until December 30, 2020, when it was purchased and became a Qualified Subsidiary under Hudson Equity Partners, LLC. No provision has been made for federal income taxes since S Corporations are not taxable entities. Individual partners/shareholders report their share of taxable income or loss in their personal tax returns. C-Corporation Dean’s Natural Food Market, Inc. is a C Corporation for federal income tax purposes. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities, their respective tax bases, and tax operating loss and credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred tax assets are subject to valuation allowances if, based on all available evidence, management determines that it is more likely than not that some position or all of the deferred tax assets and liabilities will not be realized. The financial impact of Dean’s Natural Food Market, Inc. deferred and current income taxes is not considered material as of and for the year ended December 31, 2021. Limited Liability Companies Dean’s Natural Food Market of Basking Ridge, LLC, Dean’s Natural Food Market of Chester, LLC, and Dean’s Natural Holdings, LLC have elected to be treated as single-member limited liability companies for federal and state income tax purposes with all income tax liabilities and/or benefits of the entities being passed through to its members. As such, there is no recognition of federal or state income taxes for each of these entities. Any uncertain tax position taken by the member is not an uncertain position of the entities. In accordance with the LLC agreements, the term of the Company is indefinite with termination determined by the Member. The LLC agreements indicate that the Member shall not have any liability for obligations of the Company, except to the extent expressly mandated by law. The Company has evaluated any uncertain tax positions and related income tax contingencies and determined uncertain positions, if any, are not material to the financial statements. Penalties and interest assessed by income taxing authorities are included in operating expenses, if incurred. None of the Company’s current returns are under examination. | ||
Retirement Plan | Retirement Plan The Company maintains two 401(k) plans. Under the terms of these plans, the employer may make up to 4 4 | Retirement Plan The Company maintains two 401(k) plans. Under the terms of these plans, the employer may make up to 4 4 15,731 | |
Presentation of Sales Tax | Presentation of Sales Tax The states of New York and New Jersey impose sales taxes on all of the Company’s sales to nonexempt customers. The Company collects sales taxes from customers and remits the amounts to the states. The Company’s accounting policy is to exclude the tax collected and remitted to the State from revenues and expenses with the exception of excise taxes paid on purchases. | Presentation of Sales Tax The States of New York and New Jersey impose sales taxes on all of the Company’s sales to nonexempt customers. The Company collects sales taxes from customers and remits the amounts to the states. The Company’s accounting policy is to exclude the tax collected and remitted to the State from revenues and expenses with the exception of excise taxes paid on purchases. | |
Subsequent Events | Subsequent Events Subsequent events have been evaluated through December 19, 2023, which is the date the financial statements were available to be issued. | ||
Basis of Presentation and Principles of Combination | Basis of Presentation and Principles of Combination The accompanying unaudited condensed combined financial statement is prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying combined financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the period presented. The accompanying unaudited condensed combined financial statements should be read in conjunction with the Company’s prospectus for its Initial Public Offering, as filed with the SEC on October 27, 2023. The interim results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022, or for any future periods. | Basis of Presentation and Principles of Combination The Company’s combined financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). The combined financial statements include the accounts of all the entities under common control. All intercompany accounts have been eliminated in combination. These combined financial statements include the New Jersey entities as of the date of acquisition by Red Oak Equity Partners, LLC on August 16, 2021, and reflect the results of operations and cash flows for the period August 16, 2021, through December 31, 2021. | |
Push Down Accounting | Push Down Accounting The Company has elected to not apply “push down” accounting in accordance with ASC 805-50-25- 4 for the business combinations by Hudson Equity Partners, LLC and Red Oak Equity Partners, LLC of the New York and New Jersey entities. |
BASIS OF PRESENTATION AND SIG_3
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SCHEDULE OF CASH AND CASH EQUIVALENTS | SCHEDULE OF CASH AND CASH EQUIVALENTS September 30, 2023 December 31, 2022 Total cash in excess of FDIC limits of $ 250,000 $ - $ 949,677 | SCHEDULE OF CASH AND CASH EQUIVALENTS December 31, 2022 December 31, 2021 Total cash in excess of FDIC limits $ 949,677 $ - | |
SCHEDULE OF CONCENTRATION OF ACCOUNTS RECEIVABLE | Accounts receivable balance represents credit sales, sales on account and billing to vendors for advertising vendors’ products in our stores. Concentration of accounts receivable consist of the following: SCHEDULE OF CONCENTRATION OF ACCOUNTS RECEIVABLE December 31, 2022 December 31, 2021 Customer A 17 % 0 % Customer B - 12 % Customer C 6 % 30 % | ||
SCHEDULE OF CONTRACT LIABILITIES ACTIVITY | A summary of the contract liabilities activity at September 30, 2023 and December 31, 2022 is presented below: SCHEDULE OF CONTRACT LIABILITIES ACTIVITY September 30, 2023 December 31, 2022 Beginning balance as January 1, $ 198,606 $ 18,514 Issued 664,003 859,383 Redeemed (664,294 ) (623,348 ) Breakage recognized (53,454 ) (55,943 ) Ending balance $ 144,861 $ 198,606 | A summary of the contract liabilities activity for the years ended December 31, 2022 and 2021 is presented below: SCHEDULE OF CONTRACT LIABILITIES ACTIVITY 2022 2021 Year ended December 31, 2022 2021 Beginning balance as of January1, $ 18,514 $ 16,014 Issued 859,383 24,733 Redeemed (623,348 ) (21,764 ) Breakage recognized (55,943 ) (469 ) Ending balance as of December 31, $ 198,606 $ 18,514 | |
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT | Property, plant, and equipment consist of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT September 30, 2023 December 31, 2022 Displays $ 312,146 $ 312,146 Building 575,000 575,000 Furniture and fixtures 501,342 469,338 Leasehold improvements 1,925,385 1,910,719 Computer hardware & equipment 139,629 114,525 Other 680,718 579,547 Property, plant and equipment gross 4,134,220 3,961,275 Less: accumulated depreciation and amortization (1,332,664 ) (925,428 ) Total property, plant, and equipment $ 2,801,556 $ 3,035,847 | Property, plant, and equipment consist of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT December 31, 2022 December 31, 2021 Displays $ 312,146 $ 305,558 Furniture and fixtures 469,338 71,600 Leasehold improvements 1,910,719 112,503 Computer hardware & equipment 114,525 84,887 Building 575,000 - Other 579,547 243,257 Property, plant and equipment gross 3,961,275 817,805 Less: accumulated depreciation and amortization (925,428 ) (645,303 ) Total property and equipment $ 3,035,847 $ 172,502 | |
Greens Natural Foods, Inc. [Member] | |||
SCHEDULE OF CONTRACT LIABILITIES ACTIVITY | A summary of the contract liabilities activity for the year ended December 31, 2021, is presented below: SCHEDULE OF CONTRACT LIABILITIES ACTIVITY Beginning Balance as of January 1, 2021 $ 215,528 New Jersey balance as of August 16, 2021 95,881 Issued 40,741 Redeemed (42,792 ) Ending balance as of December 31, 2021 $ 309,358 | ||
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT | Property, plant and equipment is comprised of the following at September 30, 2022, and estimated useful lives of the related assets are as follows: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT Years Vehicles $ 46,256 5 7 Leasehold improvements 1,988,570 15 Furniture and fixtures 1,732,154 7 Office equipment 50,708 5 7 Machinery and equipment 2,227,571 5 7 Total 6,045,259 Accumulated depreciation (4,033,117 ) Property, plant and equipment, net $ 2,012,142 | Property, plant and equipment is comprised of the following at December 31, 2021, and estimated useful lives of the related assets are as follows: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT Years Vehicles $ 42,263 5 7 Leasehold improvements 1,816,917 15 Furniture and fixtures 1,582,635 7 Office equipment 46,331 5 7 Machinery and equipment 2,035,287 5 7 Total 5,523,433 Accumulated depreciation (3,776,457 ) Property, plant and equipment, net $ 1,746,976 |
DISAGGREGATION OF REVENUES (Tab
DISAGGREGATION OF REVENUES (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Disaggregation Of Revenues | ||
SCHEDULE OF REVENUE | The Company’s disaggregated revenues consist of the following for the three and nine months ended September 30, 2023 and 2022: SCHEDULE OF REVENUE 2023 2022 2023 2022 Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Retail Grocery $ 11,307,056 $ 5,187,540 $ 35,374,652 $ 14,944,075 Food service/restaurant 1,396,194 584,382 4,459,142 1,743,228 Online/eCommerce 1,350 3,621 5,408 13,293 Total revenue $ 12,704,600 $ 5,775,543 $ 39,839,202 $ 16,700,596 | When the Company prepares its internal management reporting to evaluate business performance, we disaggregate revenue into the following categories that depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. SCHEDULE OF REVENUE December 31, 2022 December 31, 2021 Retail Grocery $ 25,867,061 $ 9,923,138 Food service/restaurant 3,126,709 1,202,121 Online/eCommerce 15,870 93,600 Wholesale Grocery - 16,182 Total revenue $ 29,009,640 $ 11,235,041 |
PROPERTY, PLANT, AND EQUIPMENT
PROPERTY, PLANT, AND EQUIPMENT (Tables) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT | Property, plant, and equipment consist of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT September 30, 2023 December 31, 2022 Displays $ 312,146 $ 312,146 Building 575,000 575,000 Furniture and fixtures 501,342 469,338 Leasehold improvements 1,925,385 1,910,719 Computer hardware & equipment 139,629 114,525 Other 680,718 579,547 Property, plant and equipment gross 4,134,220 3,961,275 Less: accumulated depreciation and amortization (1,332,664 ) (925,428 ) Total property, plant, and equipment $ 2,801,556 $ 3,035,847 | Property, plant, and equipment consist of the following: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT December 31, 2022 December 31, 2021 Displays $ 312,146 $ 305,558 Furniture and fixtures 469,338 71,600 Leasehold improvements 1,910,719 112,503 Computer hardware & equipment 114,525 84,887 Building 575,000 - Other 579,547 243,257 Property, plant and equipment gross 3,961,275 817,805 Less: accumulated depreciation and amortization (925,428 ) (645,303 ) Total property and equipment $ 3,035,847 $ 172,502 | |
Mother Earth's Storehouse, Inc. [Member] | |||
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT | The Company provides for depreciation on a straight-line basis. Property, plant and equipment is comprised of the following at December 31, and estimated useful lives of the related assets are as follows: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT AND ESTIMATED USEFUL LIVES OF THE RELATED ASSETS 2021 2020 Years Building and improvements $ 386,362 $ 386,362 10 40 Leasehold improvements 1,587,125 1,587,125 15 Furniture and fixtures 121,273 92,714 7 Office equipment 11,685 31,724 5 7 Machinery and equipment 421,925 443,152 5 7 Total 2,528,370 2,541,077 Accumulated depreciation (1,642,953 ) (1,546,897 ) Property, plant and equipment, net $ 885,417 $ 994,180 | ||
Greens Natural Foods, Inc. [Member] | |||
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT | Property, plant and equipment is comprised of the following at September 30, 2022, and estimated useful lives of the related assets are as follows: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT Years Vehicles $ 46,256 5 7 Leasehold improvements 1,988,570 15 Furniture and fixtures 1,732,154 7 Office equipment 50,708 5 7 Machinery and equipment 2,227,571 5 7 Total 6,045,259 Accumulated depreciation (4,033,117 ) Property, plant and equipment, net $ 2,012,142 | Property, plant and equipment is comprised of the following at December 31, 2021, and estimated useful lives of the related assets are as follows: SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT Years Vehicles $ 42,263 5 7 Leasehold improvements 1,816,917 15 Furniture and fixtures 1,582,635 7 Office equipment 46,331 5 7 Machinery and equipment 2,035,287 5 7 Total 5,523,433 Accumulated depreciation (3,776,457 ) Property, plant and equipment, net $ 1,746,976 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF GOODWILL | The Company’s goodwill relates to the acquisition of Paradise Health and Nutrition, The Vitamin Store, Mother Earth’s Storehouse and Green’s Natural Foods. The following table summarizes the changes in goodwill for the years ended December 31, 2022 and 2021: SCHEDULE OF GOODWILL Healthy Choice Markets 2, LLC The Vitamin Store, Healthy Choice Markets 3, LLC Healthy Choice Markets Total January 1, 2021 $ 477,000 $ 439,000 $ - $ - $ 916,000 Addition - - - - - Impairment - - - - - December 31, 2021 477,000 439,000 - - 916,000 Goodwill, Beginning Balance 477,000 439,000 - - 916,000 Addition - - 1,741,000 3,090,000 4,831,000 Impairment - - - - - December 31, 2022 $ 477,000 $ 439,000 $ 1,741,000 $ 3,090,000 $ 5,747,000 Goodwill, Ending Balance $ 477,000 $ 439,000 $ 1,741,000 $ 3,090,000 $ 5,747,000 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
SCHEDULE OF INTANGIBLE ASSETS, NET | At September 30, 2023 and December 31, 2022, intangible assets consist of the following: SCHEDULE OF INTANGIBLE ASSETS, NET September 30, 2023 Useful Lives (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trade names 8 10 years $ 2,569,000 (951,193 ) $ 1,617,807 Customer relationships 4 6 years 2,669,000 (1,256,556 ) 1,412,444 Non-compete 4 5 years 1,602,000 (514,666 ) 1,087,334 Intangible assets, net $ 6,840,000 $ (2,722,415 ) $ 4,117,585 December 31, 2022 Useful Lives (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trade names 8- 10 years $ 2,569,000 (725,724 ) $ 1,843,276 Customer relationships 4- 6 years 2,669,000 (1,033,306 ) 1,635,694 Non-compete 4- 5 years 1,602,000 (300,466 ) 1,301,533 Intangible assets, net $ 6,840,000 $ (2,059,496 ) $ 4,780,504 | At December 31, 2022 and 2021, intangible assets consist of the following: SCHEDULE OF INTANGIBLE ASSETS, NET December 31, 2022 Useful Lives Gross Carrying Amount Accumulated Amortization Net Carrying Trade names 8 10 years $ 2,569,000 (725,724 ) $ 1,843,276 Customer relationships 4 6 years 2,669,000 (1,033,306 ) 1,635,694 Non-compete 4 5 years 1,602,000 (300,466 ) 1,301,533 Intangible assets, net $ 6,840,000 $ (2,059,496 ) $ 4,780,504 December 31, 2021 Useful Lives Gross Accumulated Net Trade names 8 10 years $ 923,000 (536,661 ) $ 386,339 Customer relationships 4 5 years 883,000 (685,823 ) 197,177 Non-compete 4 5 years 238,000 (133,646 ) 104,354 Website 4 years 10,000 (208 ) 9,792 Intangible assets, net $ 2,054,000 $ (1,356,338 ) $ 697,662 |
SCHEDULE OF FUTURE ANNUAL ESTIMATED AMORTIZATION EXPENSE | Future annual estimated amortization expense is as follows: SCHEDULE OF FUTURE ANNUAL ESTIMATED AMORTIZATION EXPENSE For the nine months ending September 30, 2023 (remaining three months) $ 220,973 2024 883,891 2025 878,391 2026 801,355 2027 662,550 Thereafter 670,425 Total $ 4,117,585 | Future annual estimated amortization expense is as follows: SCHEDULE OF FUTURE ANNUAL ESTIMATED AMORTIZATION EXPENSE For the years ending December 31, 2023 $ 883,891 2024 883,891 2025 878,391 2026 801,355 2027 662,550 Thereafter 670,426 Total $ 4,780,504 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | ||
SCHEDULE OF PURCHASE PRICE ALLOCATION | The following table summarizes the purchase price allocation based on fair values of the net assets acquired at the acquisition date: SCHEDULE OF PURCHASE PRICE ALLOCATION Purchase Consideration Cash consideration paid $ 5,142,000 Promissory note 3,000,000 Contingent consideration issued to Green’s Natural seller 1,108,000 Total Purchase Consideration $ 9,250,000 Purchase price allocation Inventory $ 1,642,000 Property and equipment 1,478,000 Intangible assets 3,251,000 Right of use asset - Operating lease 6,427,000 Other liabilities (211,000 ) Operating lease liability (6,427,000 ) Goodwill 3,090,000 Net assets acquired $ 9,250,000 Finite-lived intangible assets Trade Names ( 8 years $ 1,133,000 Customer Relationships ( 6 years 1,103,000 Non-Compete Agreement ( 5 years 1,015,000 Total intangible assets $ 3,251,000 | |
SCHEDULE OF ASSET ACQUISITION CONTINGENT CONSIDERATION | The following table summarizes the change in fair value of contingent consideration from acquisition date to September 30, 2023: SCHEDULE OF ASSET ACQUISITION CONTINGENT CONSIDERATION Fair Market Balance as of October 14, 2022 $ 1,108,000 Remeasurement (333,100 Balance as of December 31, 2022 $ 774,900 Remeasurement (774,900 ) Balance as of September 30, 2023 $ - The following table summarizes the change in fair value of contingent consideration for the three months ended September 30, 2023: Fair Market Balance as of June 30, 2023 $ 372,000 Balance beginning $ 372,000 Remeasurement (372,000 ) Balance as of September 30, 2023 $ - Balance ending $ - | |
SCHEDULE OF UNAUDITED PROFORMA INFORMATION | The following table represents the condensed combined pro forma revenue and earnings for the three and nine months ended September 30, 2022: SCHEDULE OF UNAUDITED PROFORMA INFORMATION For Three Months Ended For Nine Months Ended September 30, 2022 September 30, 2022 Sales $ 13,207,282 $ 39,984,097 Net loss $ (1,294,861 ) $ (2,678,379 ) | The following unaudited pro forma summary presents combined information of the Company, including Mother Earth’s Storehouse and Green’s Natural Foods, as if the business combinations had occurred on January 1, 2021, the earliest period presented herein: SCHEDULE OF UNAUDITED PROFORMA INFORMATION - - December 31, 2022 2021 Sales $ 54,846,023 $ 60,773,310 Net loss (790,119 ) 1,803,584 |
Mother Earth's Storehouse, Inc. [Member] | ||
Business Acquisition [Line Items] | ||
SCHEDULE OF PURCHASE PRICE ALLOCATION | The following table summarizes the purchase price allocation based on fair values of the net assets acquired at the acquisition date: SCHEDULE OF PURCHASE PRICE ALLOCATION Purchase Consideration Cash consideration paid $ 5,150,000 Purchase price allocation Inventory 805,000 Property, plant, and equipment 1,278,000 Intangible assets 1,609,000 Right of use asset - operating lease 1,797,000 Other liabilities (283,000 ) Operating lease liability (1,797,000 ) Goodwill 1,741,000 Net assets acquired $ 5,150,000 Finite-lived intangible assets Trade Names ( 8 years $ 513,000 Customer Relationships ( 6 years 683,000 Non-Compete Agreement ( 5 years 413,000 Total intangible assets $ 1,609,000 | |
Greens Natural Foods, Inc. [Member] | ||
Business Acquisition [Line Items] | ||
SCHEDULE OF ASSET ACQUISITION CONTINGENT CONSIDERATION | The following table summarizes the change in fair value of contingent consideration from acquisition date to December 31, 2022: SCHEDULE OF ASSET ACQUISITION CONTINGENT CONSIDERATION Fair Market Balance as of October 14, 2022 $ 1,108,000 Remeasurement (333,100 ) Balance as of December 31, 2022 $ 774,900 | |
Greens Natural Foods [Member] | ||
Business Acquisition [Line Items] | ||
SCHEDULE OF PURCHASE PRICE ALLOCATION | The following table summarizes the purchase price allocation based on fair values of the net assets acquired at the acquisition date: SCHEDULE OF PURCHASE PRICE ALLOCATION Purchase Consideration Cash consideration paid $ 5,142,000 Promissory note 3,000,000 Contingent consideration issued to Green’s Natural seller 1,108,000 Total Purchase Consideration $ 9,250,000 Purchase price allocation Inventory $ 1,642,000 Property and equipment 1,478,000 Intangible assets 3,251,000 Right of use asset - Operating lease 6,427,000 Other liabilities (211,000 ) Operating lease liability (6,427,000 ) Goodwill 3,090,000 Net assets acquired $ 9,250,000 Finite-lived intangible assets Trade Names ( 8 years $ 1,133,000 Customer Relationships ( 6 years 1,103,000 Non-Compete Agreement ( 5 years 1,015,000 Total intangible assets $ 3,251,000 |
CONTRACT LIABILITIES (Tables)
CONTRACT LIABILITIES (Tables) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SCHEDULE OF CONTRACT LIABILITIES ACTIVITY | A summary of the contract liabilities activity at September 30, 2023 and December 31, 2022 is presented below: SCHEDULE OF CONTRACT LIABILITIES ACTIVITY September 30, 2023 December 31, 2022 Beginning balance as January 1, $ 198,606 $ 18,514 Issued 664,003 859,383 Redeemed (664,294 ) (623,348 ) Breakage recognized (53,454 ) (55,943 ) Ending balance $ 144,861 $ 198,606 | A summary of the contract liabilities activity for the years ended December 31, 2022 and 2021 is presented below: SCHEDULE OF CONTRACT LIABILITIES ACTIVITY 2022 2021 Year ended December 31, 2022 2021 Beginning balance as of January1, $ 18,514 $ 16,014 Issued 859,383 24,733 Redeemed (623,348 ) (21,764 ) Breakage recognized (55,943 ) (469 ) Ending balance as of December 31, $ 198,606 $ 18,514 | |
Mother Earth's Storehouse, Inc. [Member] | |||
SCHEDULE OF NET OF RETURNS AND ALLOWANCES AND DISCOUNTS | Sales are net of returns and allowances and discounts. For the years ended December 31, sales were as follows: SCHEDULE OF NET OF RETURNS AND ALLOWANCES AND DISCOUNTS 2021 2020 Sales $ 15,438,995 $ 18,535,034 Less: Allowances 80,225 98,836 Discounts 1,066,604 1,401,976 Total net sales $ 14,292,166 $ 17,034,222 |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Payables and Accruals [Abstract] | ||
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES | At September 30, 2023 and December 31, 2022, accounts payable and accrued expenses consisted of: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES September 30, 2023 December 31, 2022 Trade creditors $ 3,160,017 $ 3,118,757 Accrued expenses 210,143 370,787 Total $ 3,370,160 $ 3,489,544 | At December 31, 2022 and 2021, accounts payable and accrued expenses consisted of: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES December 31, 2022 December 31, 2021 Trade creditors $ 3,118,757 $ 324,890 Accrued expenses 370,787 52,174 Total $ 3,489,544 $ 377,064 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SCHEDULE OF DEBT | The following table provides a breakdown of the Company’s debt as of September 30, 2023 and December 31, 2022: SCHEDULE OF DEBT September 30, 2023 December 31, 2022 Promissory note $ 2,515,013 $ 2,913,788 Other debt - 815 Total debt $ 2,515,013 $ 2,914,603 Current portion of long-term debt (560,322 ) (536,542 ) Long-term debt $ 1,954,691 $ 2,378,061 | The following table provides a breakdown of the Company’s debt as of December 31, 2022 and 2021: SCHEDULE OF DEBT 2022 2021 December 31, 2022 2021 Promissory note $ 2,913,788 $ - Other debt 815 3,419 Total debt $ 2,914,603 $ 3,419 Current portion of long-term debt (536,542 ) (2,604 ) Long-term debt $ 2,378,061 $ - | |
Greens Natural Foods, Inc. [Member] | |||
SCHEDULE OF DEBT MATURITIES | SCHEDULE OF DEBT MATURITIES 2022 (3 remaining months) $ 6,983 2023 28,638 2024 29,805 2025 23,148 Total debt $ 88,574 | SCHEDULE OF DEBT MATURITIES December 31, 2022 $ 27,517 2023 28,638 2024 29,805 2025 23,148 Total debt $ 109,108 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SCHEDULE OF MATURITY OF LEASE LIABILITIES | Maturity of lease liabilities under our non-cancellable operating leases as of September 30, 2023 were as follows: SCHEDULE OF MATURITY OF LEASE LIABILITIES Payments due by period September 30, 2023 2023 (remaining three months) $ 675,033 2024 2,593,309 2025 2,331,433 2026 1,995,684 2027 1,092,715 Thereafter 2,041,925 Total undiscounted operating lease payments $ 10,730,099 Less: Imputed interest (914,686 ) Present value of operating lease liabilities $ 9,815,413 | Maturity of lease liabilities under our non-cancellable operating leases as of December 31, 2022 were as follows: SCHEDULE OF MATURITY OF LEASE LIABILITIES Payments due by period 2023 $ 2,572,637 2024 1,995,148 2025 1,688,859 2026 1,504,408 2027 1,177,509 Thereafter 2,934,186 Total undiscounted operating lease payments $ 11,872,747 Less: Imputed interest (1,602,391 ) Present value of operating lease liabilities $ 10,270,356 | |
SCHEDULE OF COMPANY’S OPERATING LEASE | The following table summarizes the Company’s operating leases: SCHEDULE OF COMPANY’S OPERATING LEASE Balance Sheet Classification September 30, 2023 December 31, 2022 Right of use asset $ 10,055,199 $ 10,604,935 Operating lease liability, current $ 2,321,018 $ 2,228,852 Operating lease liability, net of current $ 7,494,395 $ 8,041,504 | The following table summarizes the Company’s operating leases: SCHEDULE OF COMPANY’S OPERATING LEASE Balance Sheet Classification December 31, 2022 December 31, 2021 Right of use asset $ 10,604,935 $ 3,423,123 Operating lease liability, current $ 2,228,852 $ 323,056 Operating lease liability, net of current 8,041,504 2,675,495 Total operating lease liabilities $ 10,270,356 $ 2,998,551 | |
SCHEDULE OF OPERATING LEASE TERM | The following table provides a summary of other information related to the leases at September 30, 2023 and December 31, 2022: SCHEDULE OF OPERATING LEASE TERM Other Information September 30, 2023 December 31, 2022 Weighted-average remaining lease term for operating leases 5 years 6 years Weighted-average discount rate for operating leases 3.87 % 3.83 % Rent expense for three months ended September 30, 2023 and 2022 was approximately $ 830,000 235,000 2,508,000 653,000 The components of lease expenses for the three and nine months ended September 30, 2023 and 2022 were as follows: SCHEDULE OF COMPONENTS OF LEASE EXPENSE 20 23 2022 Three Months Ended September 30, 2023 2022 Operating lease cost $ 586,247 $ 143,280 Variable lease cost 205,355 82,603 Short-term lease cost 38,637 9,041 Total rent expense $ 830,239 $ 234,924 20 23 2022 Nine Months Ended September 30, 2023 2022 Operating lease cost $ 1,742,748 $ 408,273 Variable lease cost 650,211 217,738 Short-term lease cost 114,802 26,647 Total rent expense $ 2,507,761 $ 652,658 | SCHEDULE OF OPERATING LEASE TERM Other information December 31, 2022 December 31, 2021 Weighted-average remaining lease term for operating leases 6 years 10 years Weighted-average discount rate for operating leases 3.83 % 4.75 % | |
SCHEDULE OF COMPONENTS OF LEASE EXPENSE | The components of lease expenses for the three and nine months ended September 30, 2023 and 2022 were as follows: SCHEDULE OF COMPONENTS OF LEASE EXPENSE 20 23 2022 Three Months Ended September 30, 2023 2022 Operating lease cost $ 586,247 $ 143,280 Variable lease cost 205,355 82,603 Short-term lease cost 38,637 9,041 Total rent expense $ 830,239 $ 234,924 20 23 2022 Nine Months Ended September 30, 2023 2022 Operating lease cost $ 1,742,748 $ 408,273 Variable lease cost 650,211 217,738 Short-term lease cost 114,802 26,647 Total rent expense $ 2,507,761 $ 652,658 | The components of lease expenses for the year ended December 31, 2022 and 2021 were as follows: SCHEDULE OF COMPONENTS OF LEASE EXPENSE December 31, 2022 December 31, 2021 Operating lease cost $ 759,207 $ 372,454 Variable lease cost 355,924 216,073 Short-term lease cost 284,013 - Total rent expense $ 1,399,144 $ 588,527 | |
Greens Natural Foods, Inc. [Member] | |||
SCHEDULE OF MATURITY OF LEASE LIABILITIES | Maturity of lease liabilities under our non-cancellable operating leases as of September 30, 2022 were as follows: SCHEDULE OF MATURITY OF LEASE LIABILITIES Payments due by period September 30, 2022 2022 (remaining three months) $ 432,127 2023 1,774,056 2024 1,232,391 2025 982,606 2026 859,607 Thereafter 1,296,758 Total undiscounted operating lease payments $ 6,577,545 Less: Imputed interest (541,441 ) Present value of operating lease liabilities $ 6,036,104 | Future minimum payments under these leases are as follows: SCHEDULE OF MATURITY OF LEASE LIABILITIES 2022 $ 1,706,695 2023 1,557,868 2024 1,227,570 2025 1,005,515 2026 908,237 Thereafter 2,000,317 $ 8,406,202 | |
SCHEDULE OF COMPANY’S OPERATING LEASE | The following table summarizes the Company’s operating leases: SCHEDULE OF COMPANY’S OPERATING LEASE Balance Sheet Classification September 30, 2022 Right of use asset $ 6,036,104 Operating lease liability, current $ 1,661,788 Operating lease liability, net of current $ 4,374,315 | ||
SCHEDULE OF OPERATING LEASE TERM | The following table provides a summary of other information related to the leases at September 30, 2022: SCHEDULE OF OPERATING LEASE TERM Other Information September 30, 2022 Weighted-average remaining lease term for operating leases 5 Weighted-average discount rate for operating leases 1.30 % | ||
SCHEDULE OF COMPONENTS OF LEASE EXPENSE | The components of lease expenses for the three and nine months ended September 30, 2022: SCHEDULE OF COMPONENTS OF LEASE EXPENSE Three Month Ended September 30, 2022 Nine Month Ended September 30, 2022 Operating lease cost $ 322,629 $ 964,753 Variable lease cost 77,633 267,301 Short-term lease cost 89,455 267,496 Total rent expense $ 489,717 $ 1,499,550 |
INCOME TAX (Tables)
INCOME TAX (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
SCHEDULE OF PROVISION FOR INCOME TAX | SCHEDULE OF PROVISION FOR INCOME TAX 2022 2021 Year Ended December 31, 2022 2021 Provision/(benefit) at statutory rate $ (697,766 ) (380,647 ) State tax provision/(benefit) net of federal benefit (165,565 ) (50,719 ) Change in valuation allowance 929,300 400,532 Change in tax rate (19,027 ) 7,150 Other (46,942 ) 23,684 Income tax provision/(benefit) $ - $ - |
SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES | As of December 31, 2022 and 2021, the Company’s deferred tax assets and liabilities consisted of the effects of temporary differences attributable to the following: SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES 2022 2021 Year Ended December 31, 2022 2021 Deferred tax assets (liabilities): NOL & AMT credit carryforward $ 1,586,187 $ 913,063 Accrued expenses and deferred Income - 2,541 Charitable contribution - 69 Fixed assets (15,414 ) 20,550 Intangible assets 434,547 196,209 ASC 842 - Lease Accounting 44,485 (11,927 ) Total net deferred tax assets 2,049,805 1,120,505 Valuation allowance (2,049,805 ) (1,120,505 ) Net deferred tax assets $ - $ - |
SALE OF STORE LOCATION (Tables)
SALE OF STORE LOCATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Mother Earth's Storehouse, Inc. [Member] | |
SCHEDULE OF POUGHKEEPSIE STORE ASSETS SOLD AND GAIN FROM THE SALE | SCHEDULE OF POUGHKEEPSIE STORE ASSETS SOLD AND GAIN FROM THE SALE Cash $ 50,000 Issuance of promissory note 175,000 Consideration received 225,000 Inventory 175,000 Fixed assets, net book value 102,530 Net Assets 277,530 Net loss $ (52,530 ) |
SUPPLEMENTAL INFORMATION (Table
SUPPLEMENTAL INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Mother Earth's Storehouse, Inc. [Member] | |
SCHEDULE OF SUPPLEMENTAL INFORMATION OF OPERATION STATEMENTS | SCHEDULE OF SUPPLEMENTAL INFORMATION OF OPERATION STATEMENTS 2021 2020 STORE OPERATING EXPENSES Advertising $ 76,379 $ 86,071 Automobile - 10 Trade shows and other events - 953 Laundry and uniforms 17,004 31,288 Licenses and permits 19,019 37,656 Materials and supplies 191,461 220,639 Outside services 22,840 30,480 Rent 188,582 251,074 Real estate taxes 67,008 92,869 Repairs and maintenance 121,467 181,828 Telephone 10,235 17,135 Travel 998 2,681 Utilities 114,419 136,896 Total store operating expenses $ 829,412 $ 1,089,580 EMPLOYEE COSTS Salaries $ 2,351,112 $ 2,952,896 Payroll taxes 211,372 252,875 Employee benefits 143,193 142,135 Insurance - WC 41,164 55,588 Insurance - DBL 13,556 11,369 Total employee costs $ 2,760,397 $ 3,414,863 GENERAL AND ADMINISTRATIVE EXPENSES Bank and credit card fees $ 214,477 $ 278,418 Corporation tax 750 3,750 Computer 9,226 7,459 Donations 479 444 Dues and subscriptions 9,899 13,121 Insurance 29,293 30,286 Miscellaneous 403 12,058 Settlement - 83,839 Office 17,709 19,365 Professional fees 24,038 22,171 Training - 288 Total general and administrative expenses $ 306,274 $ 471,199 |
RESTATEMENT (Tables)
RESTATEMENT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Greens Natural Foods, Inc. [Member] | |
SCHEDULE OF RESTATEMENT OF COMBAINED FINANCIAL STATEMENTS | The following amounts have been restated: SCHEDULE OF RESTATEMENT OF COMBAINED FINANCIAL STATEMENTS Combined Statement of Income As Previously As Stated Adjustments Re-Stated Sales $ 35,731,191 $ (10,554,133 ) $ 25,177,058 Cost of sales (21,163,894 ) 6,096,468 (15,067,426 ) Returns and allowances (485,088 ) 42,797 (442,291 ) Gross profit 14,082,209 (4,414,868 ) 9,667,341 Operating costs: Salaries and wages 7,126,346 (2,212,315 ) 4,914,031 General and administrative 6,383,033 (1,468,645 ) 4,914,388 Depreciation 430,083 (63,998 ) 366,085 Total operating costs 13,939,462 (3,744,958 ) 10,194,504 Income (loss) from operations 142,747 (669,910 ) (527,163 ) Other income (expenses): Forgiveness of paycheck protection program (PPP) loan 817,927 - 817,927 Commission - market data services 323,404 - 323,404 Other Income 138,567 60,343 198,910 Bad debt (8,336 ) 8,336 - Taxes and fees (13,925 ) 13,925 - Contributions and donations (21,563 ) 9,848 (11,715 ) Interest (19,425 ) 4,998 (14,427 ) Total other income (expenses) 1,216,649 97,450 1,314,099 Net income $ 1,359,396 $ (572,460 ) $ 786,936 NOTE 11 – RESTATEMENT Combined Statement of Cash Flows As Previously As Stated Adjustments Re-Stated CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 1,359,396 $ (572,460 ) $ 786,936 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation 430,083 (63,998 ) 366,085 Forgiveness of PPP loan (817,927 ) - (817,927 ) Changes in assets and liabilities: Accounts receivable (23,827 ) 13,560 (10,267 ) Inventory (124,156 ) (55,325 ) (179,481 ) Prepaid expenses 49,610 23,068 72,678 Other current assets (7,819 ) (4,088 ) (11,907 ) Due to/from related parties 14,485 4,604 19,089 Other assets 20,984 5,996 26,980 Deposits (2,214 ) - (2,214 ) Accounts payable (300,649 ) 111,088 (189,561 ) Accrued expenses (13,142 ) 7,601 (5,541 ) Payroll liabilities (178,013 ) (24,297 ) (202,310 ) Lease incentive (13,557 ) - (13,557 ) Contract liabilities (37,647 ) 35,596 (2,051 ) Other current liabilities (171,453 ) 11,152 (160,301 ) Sales tax payable 18,519 - 18,519 Net cash provided by (used in) operating activities 202,673 (507,503 ) (304,830 ) NOTE 11 – RESTATEMENT Combined Statement of Cash Flows, Continued: As Previously As Stated Adjustments Re-Stated CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant, and equipment $ (34,303 ) $ 14,186 $ (20,117 ) Net cash used for investing activities (34,303 ) 14,186 (20,117 ) CASH FLOWS FROM FINANCING ACTIVITIES Payments on notes payable (113,806 ) 87,366 (26,440 ) Payments on notes payable to related parties (600,000 ) - (600,000 ) Payments on lines of credit (200,000 ) 200,000 - Distributions (1,337,124 ) 1,209,492 (127,632 ) Proceeds from PPP loan 817,927 - 817,927 Net cash used for financing activities (1,433,003 ) 1,496,858 63,855 NET DECREASE IN CASH AND CASH EQUIVALENTS (1,264,633 ) 1,003,541 (261,092 ) NET DECREASE IN CASH AND CASH EQUIVALENTS (1,264,633 ) 1,003,541 (261,092 ) CASH AND CASH EQUIVALENTS, Beginning of year 1,765,395 (1,003,541 ) 761,854 CASH AND CASH EQUIVALENTS, Beginning of year 1,765,395 (1,003,541 ) 761,854 CASH AND CASH EQUIVALENTS, End of year $ 500,762 $ - $ 500,762 CASH AND CASH EQUIVALENTS, End of year $ 500,762 $ - $ 500,762 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash paid for interest $ 19,425 $ (4,998 ) $ 14,427 In addition, the balance sheet as of December 31, 2021, was adjusted to reclassify certain contract liabilities from other current liabilities to accounts payable and additional expenses were accrued related to payroll liabilities, contract liabilities and inventory. Distributions/dividends in excess of earnings was reclassified and applied to additional paid in capital. Balance Sheet As Previously As Stated Adjustments Re-Stated Inventory $ 1,856,495 $ (34,600 ) $ 1,821,895 Accounts payable 1,519,667 94,578 1,614,245 Payroll liabilities 500,913 9,711 510,624 Contract liabilities 289,359 19,999 309,358 Other current liabilities 98,738 (94,578 ) 4,160 Accumulated loss (2,985,556 ) 63,322 (2,922,234 ) Additional paid in capital 5,340,123 (127,632 ) 5,212,491 |
ORGANIZATION (Details Narrative
ORGANIZATION (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Feb. 08, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Greens Natural Foods, Inc. [Member] | Hudson Equity Partners LLC [Member] | |||||||
Product Information [Line Items] | |||||||
Ownership interest percentage | 100% | ||||||
Greens Natural Foods, Inc. [Member] | Red Oak Equity Partners LLC [Member] | |||||||
Product Information [Line Items] | |||||||
Ownership interest percentage | 100% | ||||||
Kingston and Saugerties New York [Member] | Mother Earth's Storehouse, Inc. [Member] | |||||||
Product Information [Line Items] | |||||||
Gain on sale of business | $ 5,300,000 | ||||||
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | One Vendor [Member] | |||||||
Product Information [Line Items] | |||||||
Concentration risk percentage | 40% | 34% | 42% | 32% | 37% | 31% |
GOING CONCERN AND LIQUIDITY (De
GOING CONCERN AND LIQUIDITY (Details Narrative) - 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 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||
Cash | $ 900,000 | $ 900,000 | $ 2,000,000 | |||
Net loss | 919,673 | $ 835,464 | 2,440,952 | $ 1,524,230 | 3,322,695 | $ 1,812,604 |
Working capital | $ 1,500,000 | 1,500,000 | ||||
Net Cash Provided by (Used in) Operating Activities | $ 2,574,428 | $ 1,091,567 | $ 1,369,060 | $ 851,996 |
SCHEDULE OF CASH AND CASH EQUIV
SCHEDULE OF CASH AND CASH EQUIVALENTS (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | |||
Total cash in excess of FDIC limits of $250,000 | $ 949,677 | ||
Cash in FDIC amount | $ 250,000 | $ 250,000 | $ 250,000 |
SCHEDULE OF CONCENTRATION OF AC
SCHEDULE OF CONCENTRATION OF ACCOUNTS RECEIVABLE (Details) - Customer Concentration Risk [Member] - Accounts Receivable [Member] | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Customer A [Member] | ||
Product Information [Line Items] | ||
Concentration risk percentage | 17% | 0% |
Customer B [Member] | ||
Product Information [Line Items] | ||
Concentration risk percentage | 12% | |
Customer C [Member] | ||
Product Information [Line Items] | ||
Concentration risk percentage | 6% | 30% |
BASIS OF PRESENTATION AND SIG_4
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - 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 | Dec. 31, 2020 | |
Product Information [Line Items] | |||||||
Cash, FDIC amount | $ 250,000 | $ 250,000 | $ 250,000 | $ 250,000 | |||
Advertising costs | 215,000 | $ 47,000 | 366,000 | $ 91,000 | 145,000 | 39,000 | |
Plan contributions amount | 21,000 | 6,000 | 59,000 | 14,000 | 25,000 | 7,000 | |
Prior period reclassification adjustment | 1,600,000 | 1,021,413 | |||||
Due from related party | 2,879,083 | 2,879,083 | 2,336,365 | ||||
Cash usgae in due from related party | 542,718 | 608,654 | |||||
Property, Plant and Equipment [Member] | |||||||
Product Information [Line Items] | |||||||
Depreciation expense | $ 132,000 | 60,000 | $ 408,000 | 163,000 | 280,000 | 108,000 | |
Mother Earth's Storehouse, Inc. [Member] | |||||||
Product Information [Line Items] | |||||||
Advertising costs | 76,379 | $ 86,071 | |||||
Plan contributions amount | 140,859 | 144,110 | |||||
Payment pass-through entity tax paid on behalf of shareholders | $ 102,750 | 0 | |||||
Minimum contribution plan, percentage | 4% | ||||||
Depreciation expense | $ 146,437 | 199,896 | |||||
Mother Earth's Storehouse, Inc. [Member] | Property, Plant and Equipment [Member] | |||||||
Product Information [Line Items] | |||||||
Depreciation expense | 146,437 | $ 199,896 | |||||
Greens Natural Foods, Inc. [Member] | |||||||
Product Information [Line Items] | |||||||
Advertising costs | 36,000 | $ 133,000 | 54,921 | ||||
Plan contributions amount | 15,731 | ||||||
Cash usgae in due from related party | $ (19,089) | ||||||
Minimum contribution plan, percentage | 4% | 4% | |||||
Depreciation expense | 85,611 | $ 256,660 | $ 366,085 | ||||
Greens Natural Foods, Inc. [Member] | Property, Plant and Equipment [Member] | |||||||
Product Information [Line Items] | |||||||
Depreciation expense | 85,611 | $ 256,660 | 366,085 | ||||
Related Party [Member] | |||||||
Product Information [Line Items] | |||||||
Due from related party | $ 2,336,365 | ||||||
Minimum [Member] | |||||||
Product Information [Line Items] | |||||||
Property plant and equipment useful life | 2 years | 2 years | 2 years | ||||
Intangible asset useful life | 4 years | 4 years | 4 years | ||||
Minimum [Member] | Mother Earth's Storehouse, Inc. [Member] | |||||||
Product Information [Line Items] | |||||||
Minimum contribution plan, percentage | 4% | ||||||
Minimum [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Product Information [Line Items] | |||||||
Minimum contribution plan, percentage | 4% | 4% | |||||
Maximum [Member] | |||||||
Product Information [Line Items] | |||||||
Property plant and equipment useful life | 7 years | 7 years | 7 years | ||||
Intangible asset useful life | 10 years | 10 years | 10 years | ||||
Shipping and Handling [Member] | |||||||
Product Information [Line Items] | |||||||
Costs of sales | $ 25,000 | $ 23,000 | $ 90,000 | $ 51,000 | $ 91,000 | $ 39,000 |
SCHEDULE OF REVENUE (Details)
SCHEDULE OF REVENUE (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 revenue | $ 12,704,600 | $ 5,775,543 | $ 39,839,202 | $ 16,700,596 | $ 29,009,640 | $ 11,235,041 |
Retail Grocery [Member] | ||||||
Total revenue | 11,307,056 | 5,187,540 | 35,374,652 | 14,944,075 | 25,867,061 | 9,923,138 |
Food Service Restaurant [Member] | ||||||
Total revenue | 1,396,194 | 584,382 | 4,459,142 | 1,743,228 | 3,126,709 | 1,202,121 |
Online E Commerce [Member] | ||||||
Total revenue | $ 1,350 | $ 3,621 | $ 5,408 | $ 13,293 | 15,870 | 93,600 |
Wholesale Grocery [Member] | ||||||
Total revenue | $ 16,182 |
ACCOUNTS RECEIVABLE (Details Na
ACCOUNTS RECEIVABLE (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Credit Loss [Abstract] | ||||||
Accounts receivables | $ 131,000 | $ 131,000 | $ 55,000 | $ 28,000 | ||
Advertising revenue | $ 68,000 | $ 22,000 | $ 206,000 | $ 70,000 |
INVENTORIES (Details Narrative)
INVENTORIES (Details Narrative) - 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 | |
Inventory Disclosure [Abstract] | ||||||
Inventory write down | $ 630,000 | $ 310,000 | $ 1,581,043 | $ 526,068 | $ 1,499,938 | $ 644,101 |
SCHEDULE OF PROPERTY, PLANT AND
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||||
Total | $ 4,134,220 | $ 3,961,275 | $ 817,805 | |
Accumulated depreciation | (1,332,664) | (925,428) | (645,303) | |
Property, plant and equipment, net | $ 2,801,556 | $ 3,035,847 | 172,502 | |
Minimum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 2 years | 2 years | ||
Maximum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 7 years | 7 years | ||
Greens Natural Foods, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | $ 6,045,259 | 5,523,433 | ||
Accumulated depreciation | (4,033,117) | (3,776,457) | ||
Property, plant and equipment, net | 2,012,142 | $ 1,746,976 | ||
Greens Natural Foods, Inc. [Member] | Vehicles [Member] | Minimum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 5 years | |||
Greens Natural Foods, Inc. [Member] | Vehicles [Member] | Maximum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 7 years | |||
Greens Natural Foods, Inc. [Member] | Leasehold Improvements [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 15 years | |||
Greens Natural Foods, Inc. [Member] | Furniture and Fixtures [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 7 years | |||
Greens Natural Foods, Inc. [Member] | Office Equipment [Member] | Minimum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 5 years | |||
Greens Natural Foods, Inc. [Member] | Office Equipment [Member] | Maximum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 7 years | |||
Greens Natural Foods, Inc. [Member] | Machinery and Equipment [Member] | Minimum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 5 years | |||
Greens Natural Foods, Inc. [Member] | Machinery and Equipment [Member] | Maximum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 7 years | |||
Displays [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | $ 312,146 | $ 312,146 | $ 305,558 | |
Furniture and Fixtures [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | 501,342 | 469,338 | 71,600 | |
Furniture and Fixtures [Member] | Greens Natural Foods, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | $ 1,732,154 | 1,582,635 | ||
Property, plant and equipment, useful life | 7 years | |||
Leasehold Improvements [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | 1,925,385 | 1,910,719 | 112,503 | |
Leasehold Improvements [Member] | Greens Natural Foods, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | $ 1,988,570 | 1,816,917 | ||
Property, plant and equipment, useful life | 15 years | |||
Computer Equipment [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | 139,629 | 114,525 | 84,887 | |
Building [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | 575,000 | 575,000 | ||
Other Machinery and Equipment [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | $ 680,718 | $ 579,547 | 243,257 | |
Vehicles [Member] | Greens Natural Foods, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | $ 46,256 | 42,263 | ||
Vehicles [Member] | Greens Natural Foods, Inc. [Member] | Minimum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 5 years | |||
Vehicles [Member] | Greens Natural Foods, Inc. [Member] | Maximum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 7 years | |||
Office Equipment [Member] | Greens Natural Foods, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | $ 50,708 | 46,331 | ||
Office Equipment [Member] | Greens Natural Foods, Inc. [Member] | Maximum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 7 years | |||
Machinery and Equipment [Member] | Greens Natural Foods, Inc. [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Total | $ 2,227,571 | $ 2,035,287 | ||
Machinery and Equipment [Member] | Greens Natural Foods, Inc. [Member] | Minimum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 5 years | |||
Machinery and Equipment [Member] | Greens Natural Foods, Inc. [Member] | Maximum [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Property, plant and equipment, useful life | 7 years |
PROPERTY, PLANT, AND EQUIPMEN_2
PROPERTY, PLANT, AND EQUIPMENT (Details Narrative) - 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 | Dec. 31, 2020 | |
Mother Earth's Storehouse, Inc. [Member] | |||||||
Impairment Effects on Earnings Per Share [Line Items] | |||||||
Deppreciation expense | $ 146,437 | $ 199,896 | |||||
Greens Natural Foods, Inc. [Member] | |||||||
Impairment Effects on Earnings Per Share [Line Items] | |||||||
Deppreciation expense | $ 85,611 | $ 256,660 | 366,085 | ||||
Property, Plant and Equipment [Member] | |||||||
Impairment Effects on Earnings Per Share [Line Items] | |||||||
Deppreciation expense | $ 132,000 | 60,000 | $ 408,000 | 163,000 | $ 280,000 | 108,000 | |
Property, Plant and Equipment [Member] | Mother Earth's Storehouse, Inc. [Member] | |||||||
Impairment Effects on Earnings Per Share [Line Items] | |||||||
Deppreciation expense | 146,437 | $ 199,896 | |||||
Property, Plant and Equipment [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Impairment Effects on Earnings Per Share [Line Items] | |||||||
Deppreciation expense | $ 85,611 | $ 256,660 | $ 366,085 |
SCHEDULE OF GOODWILL (Details)
SCHEDULE OF GOODWILL (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Indefinite-Lived Intangible Assets [Line Items] | ||
Goodwill, Beginning Balance | $ 916,000 | $ 916,000 |
Addition | 4,831,000 | |
Impairment | ||
Goodwill, Ending Balance | 5,747,000 | 916,000 |
Healthy Choice Markets 2 LLC [Member] | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Goodwill, Beginning Balance | 477,000 | 477,000 |
Addition | ||
Impairment | ||
Goodwill, Ending Balance | 477,000 | 477,000 |
The Vitamin Store LLC [Member] | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Goodwill, Beginning Balance | 439,000 | 439,000 |
Addition | ||
Impairment | ||
Goodwill, Ending Balance | 439,000 | 439,000 |
Healthy Choice Markets 3 LLC [Member] | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Goodwill, Beginning Balance | ||
Addition | 1,741,000 | |
Impairment | ||
Goodwill, Ending Balance | 1,741,000 | |
Healthy Choice Markets IV LLC [Member] | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Goodwill, Beginning Balance | ||
Addition | 3,090,000 | |
Impairment | ||
Goodwill, Ending Balance | $ 3,090,000 |
SCHEDULE OF INTANGIBLE ASSETS,
SCHEDULE OF INTANGIBLE ASSETS, NET (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Indefinite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 6,840,000 | $ 6,840,000 | $ 2,054,000 |
Accumulated Amortization | (2,722,415) | (2,059,496) | (1,356,338) |
Net Carrying Amount | $ 4,117,585 | $ 4,780,504 | 697,662 |
Minimum [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Useful lives (years) | 4 years | 4 years | |
Maximum [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Useful lives (years) | 10 years | 10 years | |
Trade Names [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 2,569,000 | $ 2,569,000 | 923,000 |
Accumulated Amortization | (951,193) | (725,724) | (536,661) |
Net Carrying Amount | $ 1,617,807 | $ 1,843,276 | $ 386,339 |
Trade Names [Member] | Minimum [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Useful lives (years) | 8 years | 8 years | 8 years |
Trade Names [Member] | Maximum [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Useful lives (years) | 10 years | 10 years | 10 years |
Customer Relationship [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 2,669,000 | $ 2,669,000 | $ 883,000 |
Accumulated Amortization | (1,256,556) | (1,033,306) | (685,823) |
Net Carrying Amount | $ 1,412,444 | $ 1,635,694 | $ 197,177 |
Customer Relationship [Member] | Minimum [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Useful lives (years) | 4 years | 4 years | 4 years |
Customer Relationship [Member] | Maximum [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Useful lives (years) | 6 years | 6 years | 5 years |
Non-Compete [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 1,602,000 | $ 1,602,000 | $ 238,000 |
Accumulated Amortization | (514,666) | (300,466) | (133,646) |
Net Carrying Amount | $ 1,087,334 | $ 1,301,533 | $ 104,354 |
Non-Compete [Member] | Minimum [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Useful lives (years) | 4 years | 4 years | 4 years |
Non-Compete [Member] | Maximum [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Useful lives (years) | 5 years | 5 years | 5 years |
Website [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Useful lives (years) | 4 years | ||
Gross Carrying Amount | $ 10,000 | ||
Accumulated Amortization | (208) | ||
Net Carrying Amount | $ 9,792 |
SCHEDULE OF FUTURE ANNUAL ESTIM
SCHEDULE OF FUTURE ANNUAL ESTIMATED AMORTIZATION EXPENSE (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Year one | $ 220,973 | $ 883,891 |
Year two | 883,891 | 883,891 |
Year three | 878,391 | 878,391 |
Year four | 801,355 | 801,355 |
Year five | 662,550 | 662,550 |
Thereafter | 670,425 | 670,426 |
Total | $ 4,117,585 | $ 4,780,504 |
INTANGIBLE ASSETS, NET (Details
INTANGIBLE ASSETS, NET (Details Narrative) - 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 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||
Amortization of intangible assets | $ 221,000 | $ 156,000 | $ 663,000 | $ 446,000 | $ 723,000 | $ 351,000 |
SCHEDULE OF PURCHASE PRICE ALLO
SCHEDULE OF PURCHASE PRICE ALLOCATION (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |||||
Oct. 14, 2022 | Feb. 09, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||||||
Cash consideration paid | $ 5,150,000 | $ 10,291,674 | $ 75,000 | ||||
Goodwill | $ 5,747,000 | $ 5,747,000 | $ 916,000 | $ 916,000 | |||
Mother Earth's Storehouse, Inc. [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Cash consideration paid | $ 5,150,000 | ||||||
Inventory | 805,000 | ||||||
Property, plant, and equipment | 1,278,000 | ||||||
Total intangible assets | 1,609,000 | ||||||
Right of use asset - operating lease | 1,797,000 | ||||||
Other liabilities | (283,000) | ||||||
Operating lease liability | (1,797,000) | ||||||
Goodwill | 1,741,000 | ||||||
Net assets acquired | 5,150,000 | ||||||
Mother Earth's Storehouse, Inc. [Member] | Trade Names [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Total intangible assets | $ 513,000 | ||||||
Useful lives (years) | 8 years | ||||||
Mother Earth's Storehouse, Inc. [Member] | Customer Relationships [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Useful lives (years) | 6 years | ||||||
Mother Earth's Storehouse, Inc. [Member] | Customer Relationship [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Total intangible assets | $ 683,000 | ||||||
Mother Earth's Storehouse, Inc. [Member] | Noncompete Agreements [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Useful lives (years) | 5 years | ||||||
Mother Earth's Storehouse, Inc. [Member] | Non-Compete [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Total intangible assets | $ 413,000 | ||||||
Greens Natural Foods [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Cash consideration paid | $ 5,142,000 | ||||||
Inventory | 1,642,000 | ||||||
Property, plant, and equipment | 1,478,000 | ||||||
Total intangible assets | 3,251,000 | ||||||
Right of use asset - operating lease | 6,427,000 | ||||||
Other liabilities | (211,000) | ||||||
Operating lease liability | (6,427,000) | ||||||
Goodwill | 3,090,000 | ||||||
Promissory note | 3,000,000 | ||||||
Total Purchase Consideration | 9,250,000 | ||||||
Net assets acquired | 9,250,000 | ||||||
Greens Natural Foods [Member] | Trade Names [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Total intangible assets | $ 1,133,000 | ||||||
Useful lives (years) | 8 years | ||||||
Greens Natural Foods [Member] | Customer Relationships [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Total intangible assets | $ 1,103,000 | ||||||
Useful lives (years) | 6 years | ||||||
Greens Natural Foods [Member] | Noncompete Agreements [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Total intangible assets | $ 1,015,000 | ||||||
Useful lives (years) | 5 years | ||||||
Sellers [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Total Purchase Consideration | $ 1,108,000 |
SCHEDULE OF ASSET ACQUISITION C
SCHEDULE OF ASSET ACQUISITION CONTINGENT CONSIDERATION (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2023 | |
Business Acquisition [Line Items] | |||
Balance beginning | $ 774,900 | ||
Balance ending | $ 774,900 | ||
Fair Value, Inputs, Level 3 [Member] | Greens Natural Foods [Member] | |||
Business Acquisition [Line Items] | |||
Balance beginning | 372,000 | 1,108,000 | 774,900 |
Remeasurement | (372,000) | (333,100) | (774,900) |
Balance ending | $ 774,900 |
SCHEDULE OF UNAUDITED PROFORMA
SCHEDULE OF UNAUDITED PROFORMA INFORMATION (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Mother Earth Storehouse and Greens Natural Foods [Member] | ||||
Business Acquisition [Line Items] | ||||
Sales | $ 54,846,023 | $ 60,773,310 | ||
Net loss | $ (790,119) | $ 1,803,584 | ||
Greens Natural Foods [Member] | ||||
Business Acquisition [Line Items] | ||||
Sales | $ 13,207,282 | $ 39,984,097 | ||
Net loss | $ (1,294,861) | $ (2,678,379) |
ACQUISITIONS (Details Narrative
ACQUISITIONS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Oct. 14, 2022 | Feb. 09, 2022 | Nov. 30, 2021 | Dec. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | ||||||||||
Cash purchase price | $ 5,150,000 | $ 10,291,674 | $ 75,000 | |||||||
Revenue | $ 12,704,600 | $ 5,775,543 | 39,839,202 | 16,700,596 | 29,009,640 | 11,235,041 | ||||
Net income | (919,673) | (835,464) | (2,440,952) | (1,524,230) | (3,322,695) | (1,812,604) | ||||
Net income (loss) | $ 919,673 | $ 835,464 | $ 2,440,952 | $ 1,524,230 | 3,322,695 | $ 1,812,604 | ||||
EIR Hydration [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Transaction cost | $ 75,000 | |||||||||
Intangible assets | $ 54,000 | |||||||||
Mother Earth's Storehouse, Inc. [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash purchase price | $ 5,150,000 | |||||||||
Inventory | $ 805,000 | |||||||||
Amortization period for goodwill for tax purposes (years) | 15 years | |||||||||
Revenue | 11,900,000 | |||||||||
Net income | 300,000 | |||||||||
Net income (loss) | (300,000) | |||||||||
Mother Earth's Storehouse, Inc. [Member] | Selling, General and Administrative Expenses [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Aquisition related cost | 157,000 | |||||||||
Greens Natural Foods [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash purchase price | $ 5,142,000 | |||||||||
Inventory | $ 1,642,000 | |||||||||
Amortization period for goodwill for tax purposes (years) | 15 years | |||||||||
Revenue | 6,300,000 | |||||||||
Net income | (50,000) | |||||||||
Promissory note | $ 3,000,000 | |||||||||
Contingent consideration | 9,250,000 | |||||||||
Net income (loss) | 50,000 | |||||||||
Greens Natural Foods [Member] | Acquisition-related Costs [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Aquisition related cost | 1,063,000 | |||||||||
Greens Natural Foods [Member] | Selling, General and Administrative Expenses [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Aquisition related cost | $ 906,000 | |||||||||
Asset Purchase Agreement [Member] | Mother Earth's Storehouse, Inc. [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash purchase price | $ 4,472,500 | |||||||||
Inventory | $ 677,500 | |||||||||
Asset Purchase Agreement [Member] | Greens Natural Foods [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash purchase price | 5,142,000 | |||||||||
Promissory note | 3,000,000 | |||||||||
Asset Purchase Agreement [Member] | Greens Natural Foods [Member] | Fair Value, Inputs, Level 3 [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Contingent consideration | $ 1,108,000 | |||||||||
Contingent consideration discount rate | 3.80% |
SCHEDULE OF CONTRACT LIABILITIE
SCHEDULE OF CONTRACT LIABILITIES ACTIVITY (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Beginning Balance as of January 1, 2021 | $ 198,606 | $ 18,514 | $ 16,014 |
Issued | 664,003 | 859,383 | 24,733 |
Redeemed | (664,294) | (623,348) | (21,764) |
Breakage recognized | (53,454) | (55,943) | (469) |
Ending balance as of December 31, 2021 | $ 144,861 | 198,606 | 18,514 |
Greens Natural Foods, Inc. [Member] | |||
Beginning Balance as of January 1, 2021 | $ 309,358 | 215,528 | |
Issued | 40,741 | ||
Redeemed | (42,792) | ||
Ending balance as of December 31, 2021 | $ 309,358 |
SCHEDULE OF ACCOUNTS PAYABLE AN
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | |||
Trade creditors | $ 3,160,017 | $ 3,118,757 | $ 324,890 |
Accrued expenses | 210,143 | 370,787 | 52,174 |
Total | $ 3,370,160 | $ 3,489,544 | $ 377,064 |
SCHEDULE OF DEBT (Details)
SCHEDULE OF DEBT (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Short-Term Debt [Line Items] | |||
Total debt | $ 2,515,013 | $ 2,914,603 | $ 3,419 |
Current portion of long-term debt | (560,322) | (536,542) | (2,604) |
Long-term debt | 1,954,691 | 2,378,061 | |
Promissory Notes [Member] | |||
Short-Term Debt [Line Items] | |||
Total debt | 2,515,013 | 2,913,788 | |
Other Debt [Member] | |||
Short-Term Debt [Line Items] | |||
Total debt | $ 815 | $ 3,419 |
DEBT (Details Narrative)
DEBT (Details Narrative) - USD ($) | Oct. 14, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | Aug. 16, 2021 | Apr. 30, 2020 |
Greens Natural Foods, Inc. [Member] | |||||
Short-Term Debt [Line Items] | |||||
Interest rate | 5% | ||||
Note payable | $ 88,574 | $ 109,108 | |||
Small Business Administrations [Member] | Mother Earth's Storehouse, Inc. [Member] | |||||
Short-Term Debt [Line Items] | |||||
Loan from bank | $ 669,500 | ||||
Promissory Notes [Member] | |||||
Short-Term Debt [Line Items] | |||||
Loan amount | $ 3,000,000 | ||||
Loan term | 5 years | ||||
Interest rate | 6% | ||||
Paycheck Protection Program [Member] | Greens Natural Foods, Inc. [Member] | |||||
Short-Term Debt [Line Items] | |||||
Loan amount | $ 817,927 |
SCHEDULE OF MATURITY OF LEASE L
SCHEDULE OF MATURITY OF LEASE LIABILITIES (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
2022 (remaining three months) | $ 675,033 | $ 2,572,637 | ||
2023 | 2,593,309 | 1,995,148 | ||
2024 | 2,331,433 | 1,688,859 | ||
2025 | 1,995,684 | 1,504,408 | ||
2026 | 1,092,715 | 1,177,509 | ||
Thereafter | 2,041,925 | 2,934,186 | ||
Total undiscounted operating lease payments | 10,730,099 | 11,872,747 | ||
Less: Imputed interest | (914,686) | (1,602,391) | ||
Present value of operating lease liabilities | $ 9,815,413 | $ 10,270,356 | $ 2,998,551 | |
Greens Natural Foods, Inc. [Member] | ||||
2022 (remaining three months) | $ 432,127 | 1,706,695 | ||
2023 | 1,774,056 | 1,557,868 | ||
2024 | 1,232,391 | 1,227,570 | ||
2025 | 982,606 | 1,005,515 | ||
2026 | 859,607 | 908,237 | ||
Thereafter | 1,296,758 | |||
Total undiscounted operating lease payments | 6,577,545 | 8,406,202 | ||
Less: Imputed interest | (541,441) | |||
Present value of operating lease liabilities | $ 6,036,104 | 1,317,182 | ||
Lessee operating lease liability payments due after year thereafter | $ 2,000,317 |
SCHEDULE OF COMPANY_S OPERATING
SCHEDULE OF COMPANY’S OPERATING LEASE (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Right of use asset | $ 10,055,199 | $ 10,604,935 | $ 3,423,123 | |
Operating lease liability, current | 2,321,018 | 2,228,852 | 323,056 | |
Operating lease liability, net of current | 7,494,395 | 8,041,504 | 2,675,495 | |
Total operating lease liabilities | $ 9,815,413 | $ 10,270,356 | 2,998,551 | |
Greens Natural Foods, Inc. [Member] | ||||
Right of use asset | $ 6,036,104 | |||
Operating lease liability, current | 1,661,788 | |||
Operating lease liability, net of current | 4,374,315 | |||
Total operating lease liabilities | $ 6,036,104 | $ 1,317,182 |
SCHEDULE OF OPERATING LEASE TER
SCHEDULE OF OPERATING LEASE TERM (Details) | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Weighted-average remaining lease term for operating leases | 5 years | 6 years | 10 years | |
Weighted-average discount rate for operating leases | 3.87% | 3.83% | 4.75% | |
Greens Natural Foods, Inc. [Member] | ||||
Weighted-average remaining lease term for operating leases | 5 years | |||
Weighted-average discount rate for operating leases | 1.30% |
SCHEDULE OF COMPONENTS OF LEASE
SCHEDULE OF COMPONENTS OF LEASE EXPENSE (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 | |
Operating lease cost | $ 586,247 | $ 143,280 | $ 1,742,748 | $ 408,273 | $ 759,207 | $ 372,454 |
Variable lease cost | 205,355 | 82,603 | 650,211 | 217,738 | 355,924 | 216,073 |
Short-term lease cost | 38,637 | 9,041 | 114,802 | 26,647 | 284,013 | |
Total rent expense | $ 830,239 | 234,924 | $ 2,507,761 | 652,658 | $ 1,399,144 | $ 588,527 |
Weighted-average remaining lease term for operating leases | 5 years | 5 years | 6 years | 10 years | ||
Weighted-average discount rate for operating leases | 3.87% | 3.87% | 3.83% | 4.75% | ||
Greens Natural Foods, Inc. [Member] | ||||||
Operating lease cost | 322,629 | 964,753 | ||||
Variable lease cost | 77,633 | 267,301 | ||||
Short-term lease cost | 89,455 | 267,496 | ||||
Total rent expense | $ 489,717 | $ 1,499,550 | ||||
Weighted-average remaining lease term for operating leases | 5 years | 5 years | ||||
Weighted-average discount rate for operating leases | 1.30% | 1.30% |
LEASES (Details Narrative)
LEASES (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Sep. 01, 2021 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Amortization of the right-of-use asset | $ 625,000 | $ 152,000 | $ 1,687,522 | $ 434,919 | $ 1,043,220 | $ 372,454 | ||
Rent expense | 830,000 | 235,000 | 2,508,000 | 653,000 | 1,400,000 | 600,000 | ||
Cash payments | 1,593,000 | 376,000 | 953,000 | 302,000 | ||||
Lease allowance | 205,355 | 82,603 | 650,211 | 217,738 | 355,924 | 216,073 | ||
Lease expense | 9,815,413 | 9,815,413 | $ 10,270,356 | 2,998,551 | ||||
Mother Earth's Storehouse, Inc. [Member] | ||||||||
Cash payments | $ 15,923 | $ 14,709 | ||||||
Increase in percentage of monthly rent expenses | 2% | |||||||
Operating lease expiry date | Aug. 31, 2029 | |||||||
Lease term extended | ten years | |||||||
Operating lease expense | $ 188,582 | $ 251,074 | ||||||
Greens Natural Foods, Inc. [Member] | ||||||||
Rent expense | $ 1,500,000 | 500,000 | ||||||
Cash payments | $ 1,100,000 | |||||||
Lease allowance | 77,633 | 267,301 | ||||||
Lease expense | $ 6,036,104 | $ 6,036,104 | $ 1,317,182 | |||||
Greens Natural Foods, Inc. [Member] | Eastchester NY [Member] | ||||||||
Lease term extended | In August 2014, the lease was renewed for an additional ten-year term through November 2024 | |||||||
Greens Natural Foods, Inc. [Member] | Bria Cliff Manor NY [Member] | ||||||||
Lease term extended | The lease was renewed through September 30, 2023 | |||||||
Greens Natural Foods, Inc. [Member] | Mount Kisco NY [Member] | ||||||||
Lease term extended | renewed through July 31, 2022 and again through July 31, 2027 | |||||||
Greens Natural Foods, Inc. [Member] | Somers NY [Member] | ||||||||
Cash payments | $ 10,300 | |||||||
Increase in percentage of monthly rent expenses | 3% | |||||||
Greens Natural Foods, Inc. [Member] | Dean Natural Food Market Inc [Member] | First Five Years [Member] | ||||||||
Cash payments | $ 17,460 | |||||||
Greens Natural Foods, Inc. [Member] | Dean Natural Food Market Inc [Member] | Second Five Years [Member] | ||||||||
Cash payments | $ 18,333 | |||||||
Greens Natural Foods, Inc. [Member] | Deans Natural Food Market Of Shrewsbury Inc [Member] | ||||||||
Lease term extended | The lease was renewed for five years on March 30, 2018 | |||||||
Greens Natural Foods, Inc. [Member] | Deans Natural Food Market of Basking Ridge LLC [Member] | First Five Years [Member] | ||||||||
Lease term extended | The lease was renewed for another five-year term through April 2023 and an option to renew for two additional five-year terms | |||||||
Greens Natural Foods, Inc. [Member] | Deans Natural Food Market of Chester LLC [Member] | ||||||||
Lease term extended | option for 2 five-year renewal terms | |||||||
Lease allowance | $ 203,359 | |||||||
Lease allowance | $ 128,794 | |||||||
Maximum [Member] | ||||||||
Lease term | 20 years | 20 years | 20 years |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - 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 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | |||||||
Allocation amount | $ 600,000 | $ 600,000 | $ 2,000,000 | $ 1,600,000 | $ 3,400,000 | $ 1,500,000 | |
Net operating expense | 5,897,769 | 2,706,123 | 17,743,763 | 7,566,602 | 14,251,075 | 5,812,754 | |
Net receivable balance | $ 2,900,000 | 2,900,000 | 2,300,000 | 1,400,000 | |||
Greens Natural Foods, Inc. [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Net operating expense | 3,034,727 | 9,419,009 | 10,194,504 | ||||
Notes Payable | 88,574 | 88,574 | 109,108 | ||||
Healthier Choices Management Corp [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Funds from parent company | 13,800,000 | 2,100,000 | |||||
Net operating expense | 2,000,000 | 1,600,000 | 2,800,000 | 1,500,000 | |||
Loan payment | 100,000 | $ 11,000,000 | 500,000 | ||||
Due from affiliates | 80,000 | ||||||
Funds from parent company | $ 2,100,000 | 6,800,000 | |||||
Mother Earth's Subsidiaries, Inc. [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Loan payment | 5,200,000 | ||||||
Notes Payable One [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Notes Payable | $ 543,750 | ||||||
Notes Payable Two [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Notes Payable | $ 56,250 | ||||||
Related Party [Member] | Greens Natural Foods, Inc. [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Consulting fees | $ 45,000 | $ 179,000 | $ 216,792 |
SCHEDULE OF PROVISION FOR INCOM
SCHEDULE OF PROVISION FOR INCOME TAX (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 | |
Income Tax Disclosure [Abstract] | ||||||
Provision/(benefit) at statutory rate | $ (697,766) | $ (380,647) | ||||
State tax provision/(benefit) net of federal benefit | (165,565) | (50,719) | ||||
Change in valuation allowance | 929,300 | 400,532 | ||||
Change in tax rate | (19,027) | 7,150 | ||||
Other | (46,942) | 23,684 | ||||
Income tax provision/(benefit) |
SCHEDULE OF DEFERRED TAX ASSETS
SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets (liabilities): | ||
NOL & AMT credit carryforward | $ 1,586,187 | $ 913,063 |
Accrued expenses and deferred Income | 2,541 | |
Charitable contribution | 69 | |
Fixed assets | (15,414) | 20,550 |
Intangible assets | 434,547 | 196,209 |
ASC 842 - Lease Accounting | 44,485 | (11,927) |
Total net deferred tax assets | 2,049,805 | 1,120,505 |
Valuation allowance | (2,049,805) | (1,120,505) |
Net deferred tax assets |
INCOME TAX (Details Narrative)
INCOME TAX (Details Narrative) | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |
Income tax rate | 21% |
Valuation allowance | $ 930,000 |
Net Operating loss carryforwards, federal | 6,206,000 |
Net Operating loss carryforwards, state | $ 6,177,000 |
Taxable income | 80% |
Minimum tax | 15% |
Excise tax | 1% |
Maximum [Member] | |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |
Valuation allowance | $ 1,200,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Sep. 28, 2023 | Oct. 14, 2022 | Aug. 16, 2021 |
Greens Natural Foods, Inc. [Member] | |||
Subsequent Event [Line Items] | |||
Asset acquisition consideration transferred | $ 2,250,000 | ||
Asset Purchase Agreement [Member] | Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Asset acquisition consideration transferred | $ 1,500,000 | ||
Asset acquisition consideration transferred liability | $ 750,000 | ||
Asset Purchase Agreement [Member] | Subsequent Event [Member] | Greens Natural Foods, Inc. [Member] | |||
Subsequent Event [Line Items] | |||
Asset acquisition consideration transferred | $ 5,142,000 | ||
Asset acquisition consideration transferred liability | $ 3,000,000 |
SCHEDULE OF NET OF RETURNS AND
SCHEDULE OF NET OF RETURNS AND ALLOWANCES AND DISCOUNTS (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 | Dec. 31, 2020 | |
Total net sales | $ 12,704,600 | $ 5,775,543 | $ 39,839,202 | $ 16,700,596 | $ 29,009,640 | $ 11,235,041 | |
Mother Earth's Storehouse, Inc. [Member] | |||||||
Sales | 15,438,995 | $ 18,535,034 | |||||
Less: Allowances | 80,225 | 98,836 | |||||
Discounts | 1,066,604 | 1,401,976 | |||||
Total net sales | $ 14,292,166 | $ 17,034,222 |
SCHEDULE OF PROPERTY, PLANT A_2
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT AND ESTIMATED USEFUL LIVES OF THE RELATED ASSETS (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Total | $ 4,134,220 | $ 3,961,275 | $ 817,805 | |
Accumulated depreciation | (1,332,664) | (925,428) | (645,303) | |
Property, plant and equipment, net | $ 2,801,556 | $ 3,035,847 | 172,502 | |
Minimum [Member] | ||||
Property, plant and equipment, useful life | 2 years | 2 years | ||
Maximum [Member] | ||||
Property, plant and equipment, useful life | 7 years | 7 years | ||
Leasehold Improvements [Member] | ||||
Total | $ 1,925,385 | $ 1,910,719 | 112,503 | |
Furniture and Fixtures [Member] | ||||
Total | $ 501,342 | $ 469,338 | 71,600 | |
Mother Earth's Storehouse, Inc. [Member] | ||||
Total | 2,528,370 | $ 2,541,077 | ||
Accumulated depreciation | (1,642,953) | (1,546,897) | ||
Property, plant and equipment, net | 885,417 | 994,180 | ||
Mother Earth's Storehouse, Inc. [Member] | Building Improvements [Member] | ||||
Total | $ 386,362 | 386,362 | ||
Mother Earth's Storehouse, Inc. [Member] | Building Improvements [Member] | Minimum [Member] | ||||
Property, plant and equipment, useful life | 10 years | |||
Mother Earth's Storehouse, Inc. [Member] | Building Improvements [Member] | Maximum [Member] | ||||
Property, plant and equipment, useful life | 40 years | |||
Mother Earth's Storehouse, Inc. [Member] | Leasehold Improvements [Member] | ||||
Total | $ 1,587,125 | 1,587,125 | ||
Property, plant and equipment, useful life | 15 years | |||
Mother Earth's Storehouse, Inc. [Member] | Furniture and Fixtures [Member] | ||||
Total | $ 121,273 | 92,714 | ||
Property, plant and equipment, useful life | 7 years | |||
Mother Earth's Storehouse, Inc. [Member] | Office Equipment [Member] | ||||
Total | $ 11,685 | 31,724 | ||
Mother Earth's Storehouse, Inc. [Member] | Office Equipment [Member] | Minimum [Member] | ||||
Property, plant and equipment, useful life | 5 years | |||
Mother Earth's Storehouse, Inc. [Member] | Office Equipment [Member] | Maximum [Member] | ||||
Property, plant and equipment, useful life | 7 years | |||
Mother Earth's Storehouse, Inc. [Member] | Machinery and Equipment [Member] | ||||
Total | $ 421,925 | $ 443,152 | ||
Mother Earth's Storehouse, Inc. [Member] | Machinery and Equipment [Member] | Minimum [Member] | ||||
Property, plant and equipment, useful life | 5 years | |||
Mother Earth's Storehouse, Inc. [Member] | Machinery and Equipment [Member] | Maximum [Member] | ||||
Property, plant and equipment, useful life | 7 years |
CONCENTRATION OF CREDIT AND M_2
CONCENTRATION OF CREDIT AND MARKET RISK (Details Narrative) - USD ($) | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2023 | Dec. 31, 2022 | |
Concentration Risk [Line Items] | |||||
Cash FDIC insured amount | $ 949,677 | ||||
Mother Earth's Storehouse, Inc. [Member] | |||||
Concentration Risk [Line Items] | |||||
Cash FDIC insured amount | $ 2,210,000 | ||||
Mother Earth's Storehouse, Inc. [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | Vendor One [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 29% | 31% | |||
Mother Earth's Storehouse, Inc. [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | Vendor Two [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 21% | 21% | |||
Mother Earth's Storehouse, Inc. [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member] | Vendor One [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 58% | 50% | |||
Greens Natural Foods, Inc. [Member] | |||||
Concentration Risk [Line Items] | |||||
Cash FDIC insured amount | $ 250,000 | $ 219,600 | |||
Greens Natural Foods, Inc. [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | Vendor One [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 41% | 42% | |||
Greens Natural Foods, Inc. [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | Vendor Two [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 54% | 56% | |||
Greens Natural Foods, Inc. [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member] | Vendor One [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 10.50% | ||||
Greens Natural Foods, Inc. [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member] | Vendor Two [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 24.20% | ||||
Greens Natural Foods, Inc. [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member] | Vendor Alberts Organics [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 9% | ||||
Greens Natural Foods, Inc. [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member] | Vendor [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 25% |
NOTE RECEIVABLE (Details Narrat
NOTE RECEIVABLE (Details Narrative) - Mother Earth's Storehouse, Inc. [Member] - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Note receivables | $ 130,305 | $ 39,523 | |
Poughkeepsie [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Purchase price payable | $ 175,000 | ||
Note receivable interest rate in percentage | 5% | ||
Note receivable maturity date | Nov. 01, 2022 | ||
Poughkeepsie [Member] | Notes Receivable [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Monthly installment in amounts | $ 3,294 | ||
Note receivables | $ 130,305 | $ 169,828 |
SCHEDULE OF POUGHKEEPSIE STORE
SCHEDULE OF POUGHKEEPSIE STORE ASSETS SOLD AND GAIN FROM THE SALE (Details) - Poughkeepsie [Member] - Mother Earth's Storehouse, Inc. [Member] | Sep. 30, 2020 USD ($) |
Cash | $ 50,000 |
Issuance of promissory note | 175,000 |
Consideration received | 225,000 |
Inventory | 175,000 |
Fixed assets, net book value | 102,530 |
Net Assets | 277,530 |
Net loss | $ (52,530) |
SALE OF STORE LOCATION (Details
SALE OF STORE LOCATION (Details Narrative) - Poughkeepsie [Member] - Mother Earth's Storehouse, Inc. [Member] | Sep. 30, 2020 USD ($) |
Proceeds from sale of poughkeepsie store | $ 225,000 |
Note receivable | $ 175,000 |
SETTLEMENT (Details Narrative)
SETTLEMENT (Details Narrative) | 12 Months Ended |
Dec. 31, 2020 USD ($) | |
Mother Earth's Storehouse, Inc. [Member] | |
Litigation settlement | $ 83,839 |
SCHEDULE OF SUPPLEMENTAL INFORM
SCHEDULE OF SUPPLEMENTAL INFORMATION OF OPERATION STATEMENTS (Details) - Mother Earth's Storehouse, Inc. [Member] - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Total store operating expenses | $ 829,412 | $ 1,089,580 |
Total employee costs | 2,760,397 | 3,414,863 |
Total general and administrative expenses | 306,274 | 471,199 |
Advertising [Member] | ||
Total store operating expenses | 76,379 | 86,071 |
Automobile [Member] | ||
Total store operating expenses | 10 | |
Trade Shows and Other Events [Member] | ||
Total store operating expenses | 953 | |
Laundry and Uniforms [Member] | ||
Total store operating expenses | 17,004 | 31,288 |
Licenses and Permits [Member] | ||
Total store operating expenses | 19,019 | 37,656 |
Materials and Supplies [Member] | ||
Total store operating expenses | 191,461 | 220,639 |
Outside Services [Member] | ||
Total store operating expenses | 22,840 | 30,480 |
Rent [Member] | ||
Total store operating expenses | 188,582 | 251,074 |
Real Estate Taxes [Member] | ||
Total store operating expenses | 67,008 | 92,869 |
Repairs and Maintenance [Member] | ||
Total store operating expenses | 121,467 | 181,828 |
Telephone [Member] | ||
Total store operating expenses | 10,235 | 17,135 |
Travel [Member] | ||
Total store operating expenses | 998 | 2,681 |
Utilities [Member] | ||
Total store operating expenses | 114,419 | 136,896 |
Salaries [Member] | ||
Total employee costs | 2,351,112 | 2,952,896 |
Payroll Taxes [Member] | ||
Total employee costs | 211,372 | 252,875 |
Employee Benefits [Member] | ||
Total employee costs | 143,193 | 142,135 |
Insurance WC [Member] | ||
Total employee costs | 41,164 | 55,588 |
Insurance DBL [Member] | ||
Total employee costs | 13,556 | 11,369 |
Bank and Credit Card Fees [Member] | ||
Total general and administrative expenses | 214,477 | 278,418 |
Corporation Tax [Member] | ||
Total general and administrative expenses | 750 | 3,750 |
Computer [Member] | ||
Total general and administrative expenses | 9,226 | 7,459 |
Donations [Member] | ||
Total general and administrative expenses | 479 | 444 |
Dues and Subscriptions [Member] | ||
Total general and administrative expenses | 9,899 | 13,121 |
Insurance [Member] | ||
Total general and administrative expenses | 29,293 | 30,286 |
Miscellaneous [Member] | ||
Total general and administrative expenses | 403 | 12,058 |
Settlement [Member] | ||
Total general and administrative expenses | 83,839 | |
Office [Member] | ||
Total general and administrative expenses | 17,709 | 19,365 |
Profesional Fees [Member] | ||
Total general and administrative expenses | 24,038 | 22,171 |
Training [Member] | ||
Total general and administrative expenses | $ 288 |
SCHEDULE OF DEBT MATURITIES (De
SCHEDULE OF DEBT MATURITIES (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Total debt | $ 2,515,013 | $ 2,914,603 | $ 3,419 | |
Greens Natural Foods, Inc. [Member] | ||||
2022 (3 remaining months) | $ 6,983 | 27,517 | ||
2023 | 28,638 | 28,638 | ||
2024 | 29,805 | 29,805 | ||
2025 | 23,148 | 23,148 | ||
Total debt | $ 88,574 | $ 109,108 |
NEW JERSEY ACQUISITION (Details
NEW JERSEY ACQUISITION (Details Narrative) - Greens Natural Foods, Inc. [Member] | Aug. 16, 2021 USD ($) |
Convertible debt | $ 2,500,000 |
Cash consideration | 2,250,000 |
Notes payable | $ 250,000 |
Interest rate | 5% |
STOCK_UNITS (Details Narrative)
STOCK/UNITS (Details Narrative) - Greens Natural Foods, Inc. [Member] - $ / shares | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Number of stock issued | 2,000 | 2,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares issued | 0 | 0 |
Common stock, shares outstanding | 0 | 0 |
Common Stock [Member] | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Common stock, shares authorized | 2,200 | 2,200 |
SCHEDULE OF RESTATEMENT OF COMB
SCHEDULE OF RESTATEMENT OF COMBAINED FINANCIAL STATEMENTS (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 | Dec. 31, 2020 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Sales | $ 12,704,600 | $ 5,775,543 | $ 39,839,202 | $ 16,700,596 | $ 29,009,640 | $ 11,235,041 | |
Gross profit | 4,642,634 | 1,866,353 | 14,639,323 | 6,030,156 | 10,083,465 | 4,047,340 | |
Operating costs: | |||||||
Total operating costs | 5,897,769 | 2,706,123 | 17,743,763 | 7,566,602 | 14,251,075 | 5,812,754 | |
Loss from operations | (1,255,135) | (839,770) | (3,104,440) | (1,536,446) | (4,167,610) | (1,765,414) | |
Other income (expenses): | |||||||
Other Income | 2,535 | 4,327 | 11,785 | 12,309 | 874,907 | (25) | |
Interest | (39,073) | (21) | (123,197) | (93) | (29,992) | (47,165) | |
Total other income (expenses) | 335,462 | 4,306 | 663,488 | 12,216 | 844,915 | (47,190) | |
Net loss | (919,673) | (835,464) | (2,440,952) | (1,524,230) | (3,322,695) | (1,812,604) | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | (919,673) | (835,464) | (2,440,952) | (1,524,230) | (3,322,695) | (1,812,604) | |
Changes in assets and liabilities: | |||||||
Accounts receivable | (75,677) | (24,397) | (26,883) | (14,776) | |||
Inventory | (1,317,816) | (723,894) | (1,471,859) | (530,874) | |||
Other current assets | 48,336 | (288,934) | |||||
Due to/from related parties | (542,718) | (608,654) | |||||
Other assets | (3,060) | (39,116) | (1,341,195) | 624,272 | |||
Contract liabilities | (53,745) | (243,857) | (313,257) | 2,500 | |||
Net cash provided by operating activities | (2,574,428) | (1,091,567) | (1,369,060) | (851,996) | |||
CASH FLOWS FROM INVESTING | |||||||
Purchase of property, plant, and equipment | (173,475) | (158,399) | (387,485) | (53,438) | |||
Net cash used for investing activities | (173,475) | (5,308,399) | (10,679,159) | (128,438) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Net cash used for financing activities | 1,669,135 | 6,753,051 | 13,712,417 | 1,254,804 | |||
NET DECREASE IN CASH AND CASH EQUIVALENTS | (1,078,768) | 353,085 | 1,664,198 | 274,370 | |||
CASH AND CASH EQUIVALENTS, Beginning of year | 2,020,571 | 356,373 | 356,373 | 82,003 | |||
CASH AND CASH EQUIVALENTS, End of year | 941,803 | 709,458 | 941,803 | 709,458 | 2,020,571 | 356,373 | $ 82,003 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||||
Cash paid for interest | 123,221 | 101 | 30,017 | 47,171 | |||
Inventory | 3,487,137 | 3,487,137 | 3,750,364 | 1,332,406 | |||
Contract liabilities | $ 144,861 | $ 144,861 | 198,606 | 18,514 | 16,014 | ||
Greens Natural Foods, Inc. [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Sales | 7,673,837 | 23,979,762 | 25,177,058 | ||||
Cost of sales | (4,538,358) | (14,014,132) | (15,067,426) | ||||
Returns and allowances | (242,098) | (779,136) | (442,291) | ||||
Gross profit | 2,893,381 | 9,186,494 | 9,667,341 | ||||
Operating costs: | |||||||
Salaries and wages | 1,629,352 | 4,955,330 | 4,914,031 | ||||
General and administrative | 1,319,764 | 4,207,019 | 4,914,388 | ||||
Depreciation | 85,611 | 256,660 | 366,085 | ||||
Total operating costs | 3,034,727 | 9,419,009 | 10,194,504 | ||||
Loss from operations | (141,346) | (232,515) | (527,163) | ||||
Other income (expenses): | |||||||
Forgiveness of paycheck protection program (PPP) loan | 817,927 | ||||||
Commission - market data services | 323,404 | ||||||
Other Income | (53,090) | (66,240) | 198,910 | ||||
Bad debt | |||||||
Taxes and fees | |||||||
Contributions and donations | (11,715) | ||||||
Interest | (1,232) | (7,793) | (14,427) | ||||
Total other income (expenses) | (54,322) | (74,033) | 1,314,099 | ||||
Net loss | (195,668) | (306,548) | 786,936 | ||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | (195,668) | (306,548) | 786,936 | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||
Forgiveness of PPP loan | (817,927) | ||||||
Changes in assets and liabilities: | |||||||
Accounts receivable | (54,973) | (10,267) | |||||
Inventory | 232,448 | (179,481) | |||||
Prepaid expenses | 47,795 | 72,678 | |||||
Other current assets | 975 | (11,907) | |||||
Due to/from related parties | 19,089 | ||||||
Other assets | 26,980 | ||||||
Deposits | 12,056 | (2,214) | |||||
Accounts payable | 135,154 | (189,561) | |||||
Accrued expenses | (29,308) | (5,541) | |||||
Payroll liabilities | (39,701) | (202,310) | |||||
Lease incentive | (13,557) | ||||||
Contract liabilities | (1,891) | (2,051) | |||||
Other current liabilities | 23,215 | (160,301) | |||||
Sales tax payable | (18,519) | 18,519 | |||||
Net cash provided by operating activities | 257,362 | (304,830) | |||||
CASH FLOWS FROM INVESTING | |||||||
Purchase of property, plant, and equipment | (521,826) | (20,117) | |||||
Net cash used for investing activities | (521,826) | (20,117) | |||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Payments on notes payable | (20,534) | (26,440) | |||||
Payments on notes payable to related parties | (600,000) | ||||||
Payments on lines of credit | |||||||
Distributions | (127,632) | ||||||
Proceeds from PPP loan | 817,927 | ||||||
Net cash used for financing activities | (20,534) | 63,855 | |||||
NET DECREASE IN CASH AND CASH EQUIVALENTS | (284,998) | (261,092) | |||||
CASH AND CASH EQUIVALENTS, Beginning of year | 500,762 | 500,762 | 761,854 | ||||
CASH AND CASH EQUIVALENTS, End of year | 215,764 | 215,764 | 500,762 | 761,854 | |||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||||
Cash paid for interest | 7,793 | 14,427 | |||||
Inventory | 1,589,447 | 1,589,447 | 1,821,895 | ||||
Accounts payable | 1,749,399 | 1,749,399 | 1,614,245 | ||||
Payroll liabilities | 470,923 | 470,923 | 510,624 | ||||
Contract liabilities | 309,358 | 215,528 | |||||
Other current liabilities | 27,376 | 27,376 | 4,160 | ||||
Accumulated loss | (3,136,818) | (3,136,818) | (2,922,234) | ||||
Additional paid in capital | $ 5,212,491 | 5,212,491 | 5,212,491 | ||||
Previously Reported [Member] | Greens Natural Foods, Inc. [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Sales | 35,731,191 | ||||||
Cost of sales | (21,163,894) | ||||||
Returns and allowances | (485,088) | ||||||
Gross profit | 14,082,209 | ||||||
Operating costs: | |||||||
Salaries and wages | 7,126,346 | ||||||
General and administrative | 6,383,033 | ||||||
Depreciation | 430,083 | ||||||
Total operating costs | 13,939,462 | ||||||
Loss from operations | 142,747 | ||||||
Other income (expenses): | |||||||
Forgiveness of paycheck protection program (PPP) loan | 817,927 | ||||||
Commission - market data services | 323,404 | ||||||
Other Income | 138,567 | ||||||
Bad debt | (8,336) | ||||||
Taxes and fees | (13,925) | ||||||
Contributions and donations | (21,563) | ||||||
Interest | (19,425) | ||||||
Total other income (expenses) | 1,216,649 | ||||||
Net loss | 1,359,396 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | 1,359,396 | ||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||
Forgiveness of PPP loan | (817,927) | ||||||
Changes in assets and liabilities: | |||||||
Accounts receivable | (23,827) | ||||||
Inventory | (124,156) | ||||||
Prepaid expenses | 49,610 | ||||||
Other current assets | (7,819) | ||||||
Due to/from related parties | 14,485 | ||||||
Other assets | 20,984 | ||||||
Deposits | (2,214) | ||||||
Accounts payable | (300,649) | ||||||
Accrued expenses | (13,142) | ||||||
Payroll liabilities | (178,013) | ||||||
Lease incentive | (13,557) | ||||||
Contract liabilities | (37,647) | ||||||
Other current liabilities | (171,453) | ||||||
Sales tax payable | 18,519 | ||||||
Net cash provided by operating activities | 202,673 | ||||||
CASH FLOWS FROM INVESTING | |||||||
Purchase of property, plant, and equipment | (34,303) | ||||||
Net cash used for investing activities | (34,303) | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Payments on notes payable | (113,806) | ||||||
Payments on notes payable to related parties | (600,000) | ||||||
Payments on lines of credit | (200,000) | ||||||
Distributions | (1,337,124) | ||||||
Proceeds from PPP loan | 817,927 | ||||||
Net cash used for financing activities | (1,433,003) | ||||||
NET DECREASE IN CASH AND CASH EQUIVALENTS | (1,264,633) | ||||||
CASH AND CASH EQUIVALENTS, Beginning of year | 500,762 | 500,762 | 1,765,395 | ||||
CASH AND CASH EQUIVALENTS, End of year | 500,762 | 1,765,395 | |||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||||
Cash paid for interest | 19,425 | ||||||
Inventory | 1,856,495 | ||||||
Accounts payable | 1,519,667 | ||||||
Payroll liabilities | 500,913 | ||||||
Contract liabilities | 289,359 | ||||||
Other current liabilities | 98,738 | ||||||
Accumulated loss | (2,985,556) | ||||||
Additional paid in capital | 5,340,123 | ||||||
Revision of Prior Period, Reclassification, Adjustment [Member] | Greens Natural Foods, Inc. [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Sales | (10,554,133) | ||||||
Cost of sales | 6,096,468 | ||||||
Returns and allowances | 42,797 | ||||||
Gross profit | (4,414,868) | ||||||
Operating costs: | |||||||
Salaries and wages | (2,212,315) | ||||||
General and administrative | (1,468,645) | ||||||
Depreciation | (63,998) | ||||||
Total operating costs | (3,744,958) | ||||||
Loss from operations | (669,910) | ||||||
Other income (expenses): | |||||||
Forgiveness of paycheck protection program (PPP) loan | |||||||
Commission - market data services | |||||||
Other Income | 60,343 | ||||||
Bad debt | 8,336 | ||||||
Taxes and fees | 13,925 | ||||||
Contributions and donations | 9,848 | ||||||
Interest | 4,998 | ||||||
Total other income (expenses) | 97,450 | ||||||
Net loss | (572,460) | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | (572,460) | ||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||
Forgiveness of PPP loan | |||||||
Changes in assets and liabilities: | |||||||
Accounts receivable | 13,560 | ||||||
Inventory | (55,325) | ||||||
Prepaid expenses | 23,068 | ||||||
Other current assets | (4,088) | ||||||
Due to/from related parties | 4,604 | ||||||
Other assets | 5,996 | ||||||
Deposits | |||||||
Accounts payable | 111,088 | ||||||
Accrued expenses | 7,601 | ||||||
Payroll liabilities | (24,297) | ||||||
Lease incentive | |||||||
Contract liabilities | 35,596 | ||||||
Other current liabilities | 11,152 | ||||||
Sales tax payable | |||||||
Net cash provided by operating activities | (507,503) | ||||||
CASH FLOWS FROM INVESTING | |||||||
Purchase of property, plant, and equipment | 14,186 | ||||||
Net cash used for investing activities | 14,186 | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Payments on notes payable | 87,366 | ||||||
Payments on notes payable to related parties | |||||||
Payments on lines of credit | 200,000 | ||||||
Distributions | 1,209,492 | ||||||
Proceeds from PPP loan | |||||||
Net cash used for financing activities | 1,496,858 | ||||||
NET DECREASE IN CASH AND CASH EQUIVALENTS | 1,003,541 | ||||||
CASH AND CASH EQUIVALENTS, Beginning of year | (1,003,541) | ||||||
CASH AND CASH EQUIVALENTS, End of year | $ (1,003,541) | ||||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||||
Cash paid for interest | (4,998) | ||||||
Inventory | (34,600) | ||||||
Accounts payable | 94,578 | ||||||
Payroll liabilities | 9,711 | ||||||
Contract liabilities | 19,999 | ||||||
Other current liabilities | (94,578) | ||||||
Accumulated loss | 63,322 | ||||||
Additional paid in capital | $ (127,632) |