| Organizations and Summary of Significant Accounting Policies | NOTE 1 - ORGANIZATIONS AND SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES Organization and Operations On May 15, 2016, the Company, and Xiuhua
Song (the “Purchaser”) entered into a Stock Purchase Agreement (the “Purchase Agreement”), pursuant to
which IPLO (the “Seller”) would sell to the Purchaser, and the Purchaser will purchase from the Seller, an aggregate
of 3,915,000 newly issued shares of IPLO Common Stock (the “Shares”), which Shares represented 87% of the issued and
outstanding shares of Common Stock. On July 1, 2016, this transaction was completed. On July 1, 2016, Standard Resources Ltd.
(“Standard”) previously IPLO’s Majority Stockholder, and IPLO entered into a share purchase agreement (“H&H
Vend Out”) whereby Standard would cancel 3,915,000 shares of IPLO common stock held by it in exchange for all of the outstanding
shares of H&H Glass. The H&H Glass Vend Out was completed on August 31, 2016. On July 1, 2016, the Company executed a
Share Exchange Agreement (“ Exchange Agreement Yibaoccyb Yibaoccyb
Shareholders YibaoHK Yibao PRC China Confucian The Exchange Agreement was completed on
August 31, 2016 concurrent with the H&H Vend Out. The Company issued 2,040,000 shares of the Registrant’s common stock
(the “ IPLO Shares Exchange Agreement On December 22, 2016, the Company amended
its Certificate of Incorporation (the “Amendment”). As a result of the Amendment, the Company’s corporate name
was changed from International Packaging and Logistics Group, Inc. to YBCC, Inc. Yibaoccyb Limited is a limited liability
company incorporated under the laws of the British Virgin Islands on May 30, 2016. Other than all the issued and outstanding shares
of Yibao Confucian Co. Ltd., Yibaoccyb has no other assets or operations. YibaoHK is a limited liability company
incorporated under the laws of the Hong Kong on June 15, 2016, which was formed by Yibaoccyb, a British Virgin Island. YibaoHK
entered a series of contractual arrangements with the Confucian Co., Ltd. Confucian was founded on October 31, 2012.
Confucian is in Food Industrial Park inside the economic development Zone of JinXiang County, Jining City in the province of Shandong
in China. Confucian possesses manufacturing permits
for food product, hygienic products, sanitary products, and health products. The Company's main business includes research and
development of chondroitin and garlic oil; trading, cold storage, and pretreating of garlic, fruit, and vegetables products; trading
of chemical products (excluding hazardous chemicals); import and export of goods and technology (excluding those restricted by
China government); and, the manufacturing and sale of health products including powder, granules, tablets, hard capsule, soft capsule
products. Details of the Company’s structure
as of December 31, 2018, is as follow: [organizational
chart here] Reverse
Merger Accounting Basis of Accounting and Presentation Principles of Consolidation The consolidated financial statements include
the accounts of YBCC and its subsidiaries (collectively the “Company”). The Company’s subsidiaries include 51%
of Yibaoccyb, YibaoHK and Confucian, of which 49% of Yibaoccyb’s consolidated operating results was shown in non-controlling
interest on the consolidated balance sheets. Intercompany accounts and transactions
have been eliminated upon consolidation. Use of Estimates Cash and
Cash Equivalents Accounts Receivable As of December 31, 2018 and 2017, accounts
receivable was $67,339 and $0, respectively. The Company believes that its accounts receivables are fully collectable and determined
that an allowance for doubtful accounts was not necessary. Account balances are charged off against
the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company
does not have any off-balance-sheet credit exposure related to its customers. Inventories
December 31, December 31,
Finished goods $ 135,996 $ 7,106
Work in progress 45,012 47,292
Raw materials 87,193 46,902
Packaging material 36,960 26,035
Total $ 305,161 $ 127,335 The Company periodically estimates an inventory
allowance for estimated unmarketable inventories. Inventory amounts are reported net of such allowances, if any. There were no
allowances for inventory as of December 31, 2018 and 2017. Property, Plant and
Equipment Expenditures for maintenance and repairs
are charged to operations; major expenditures for renewals and betterments are capitalized. Assets that are still kept in service
after reaching the end of their estimated useful lives are depreciated over the estimated useful life of their residual value.
Gain or loss on disposal of property, plant, and equipment is recognized as non-operating income or expenses. Depreciation is computed by applying the
following methods and estimated lives:
Category Estimated Life Method
Manufacturing equipment 10 Straight Line
Office equipment 5 Straight Line
Buildings 20 Straight Line Intangible Assets Non-Controlling Interest Revenue Recognition Amounts billed and due from our customers are classified as
accounts receivables on our consolidated balance sheets and require payment on a short-term basis. Invoices are generally issued
at the point control transfers and substantially all of our invoices are due within 30 days or less. Periodically, we require
payment prior to the point in time we recognize revenue. Amounts received from customers prior to revenue recognition on a contract
are contract liabilities, are classified as customer deposit on our consolidated balance sheets and are typically applied
to an invoice within 30 days of receipt. There were around $0.14 million in customer deposit as of December 31, 2018. Cost
of goods sold Impairment
of Long-Lived Assets Income Taxes In accordance with ASC Topic 740-10, “Accounting
for Uncertainty in Income Taxes — An Interpretation of FASB ASC Topic 740”, which requires income tax positions to
meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Tax positions that previously failed
to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that
threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized
in the first subsequent financial reporting period in which that threshold is no longer met. As of December 31, 2018 and 2017,
management considered that the Company had no uncertain tax positions, and will continue to evaluate for uncertain positions in
the future. The application of tax laws and regulations
is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change
because of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual
liability may be materially different from our estimates, which could result in the need to record additional tax liabilities or
potentially reverse previously recorded tax liabilities or deferred tax asset valuation allowance. The Company has made a comprehensive review
of its portfolio of tax positions in accordance with recognition standards established by ASC 740-10 and has not recognized any
material uncertain tax positions. In addition, companies in the PRC are required
to pay an Enterprise Income Tax at 25%. Foreign Currency Translation The exchange rates used to translate amounts
in RMB into USD for the purposes of preparing the financial statements were as follows:
December 31, 2018
Balance sheet RMB 6.88 to US $1.00
Statement of operation and other comprehensive income RMB 6.61 to US $1.00
December 31, 2017
Balance sheet RMB 6.51 to US $1.00
Statement of operation and other comprehensive income RMB 6.76 to US $1.00 Fair Value of Financial Instruments Level 1 Inputs - Unadjusted
quoted market prices for identical assets and liabilities in an active market that the Company has the ability to access. Level 2 Inputs - Inputs other than the quoted
prices in active markets that are observable either directly or indirectly. Level 3 Inputs - Inputs
based on valuation techniques that are both unobservable and significant to the overall fair value measurements. ASC 820 requires the use of observable
market data, when available, in making fair value measurements. When inputs used to measure, fair value fall within different levels
of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant
to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of
unobservable inputs. The Company did not identify any assets
or liabilities that are required to be presented at fair value on a recurring basis. Carrying values of non-derivative financial
instruments, including cash and cash equivalents, accounts receivable, inventories, prepaid expenses, advances from customers,
accounts payable, taxes payable, accrued liabilities and other payables, and loan from bank, approximated their fair values due
to the short maturity of these financial instruments. There were no changes in methods or assumptions during the periods presented. Net Earnings(loss) Per Share Reclassifications Recent Accounting Pronouncements In April 2016,
the FASB issued ASU 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and
Licensing”. The amendments add further guidance on identifying performance obligations and also to improve the operability
and understandability of the licensing implementation guidance. The amendments do not change the core principle of the guidance
in Topic 606. The effective date and transition requirements for the amendments are the same as the effective date and transition
requirements in Topic 606. The Company has adopted this ASU and its adoption did not have a material effect on its consolidated
financial statements. In May 2016, the
FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”.
The amendments, among other things: (1) clarify the objective of the collectability criterion for applying paragraph 606-10-25-7;
(2) permit an entity to exclude amounts collected from customers for all sales (and other similar) taxes from the transaction price;
(3) specify that the measurement date for noncash consideration is contract inception; (4) provide a practical expedient that permits
an entity to reflect the aggregate effect of all modifications that occur before the beginning of the earliest period presented
when identifying the satisfied and unsatisfied performance obligations, determining the transaction price, and allocating the transaction
price to the satisfied and unsatisfied performance obligations; (5) clarify that a completed contract for purposes of transition
is a contract for which all (or substantially all) of the revenue was recognized under legacy GAAP before the date of initial application,
and (6) clarify that an entity that retrospectively applies the guidance in Topic 606 to each prior reporting period is not required
to disclose the effect of the accounting change for the period of adoption. The effective date of these amendments is at the same
date that Topic 606 is effective. The Company has adopted this ASU and its adoption did not have a material effect on its consolidated
financial statements. In October
2016, the FASB issued ASU 2016-17, “ Consolidation (Topic 810): Interests Held through Related Parties That Are
under Common Control”. In November 2016,
the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash”. In July
2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic
480); Derivatives and Hedging (Topic 815): In February 2018,
the FASB issued ASU No. 2018-02 Income Statement—Reporting Comprehensive Income (Topic 220)—Reclassification of
Certain Tax Effects from Accumulated Other Comprehensive Income. The Company has
considered all new accounting pronouncements and has concluded that there are no new pronouncements that may have a material impact
on results of operations, financial condition, or cash flows, based on current information. |
