Sugarmade (SGMD) 10-K 1 Nov 16 2016 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Jun. 30, 2016	Oct. 28, 2016
Document And Entity Information
Entity Registrant Name	Sugarmade, Inc.
Entity Central Index Key	919,175
Document Type	10-K
Document Period End Date	Jun. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Public Float		$ 15,168,365
Entity Common Stock, Shares Outstanding		202,244,871
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2,016

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Jun. 30, 2016	Jun. 30, 2015
Current assets:
Cash	$ 911	$ 58,260
Accounts receivable, net	117,866	85,958
Inventory, net	468,262	617,557
Loan receivables	20,000	144,050
Other current assets	84,505	52,832
Total current assets	691,543	958,657
Equipment, net	78,453	119,150
Intangible assets		1,814
Other assets	23,281	33,781
Total assets	793,277	1,113,402
Current liabilities:
Bank overdraft	28,377	65,243
Note payable due to bank	25,982	25,982
Accounts payable and accrued liabilities	1,481,961	1,891,152
Customer deposits	248,299	243,087
Unearned revenue	93,522
Other payable	296,259
Accrued interest	272,708	241,513
Notes payable due to shareholder	85,666	273,000
Accrued compensation and personnel related payables	11,403	11,403
Loans payable	427,581	521,037
Convertible notes payable, net	394,167	419,167
Derivative liabilities	701,000	304,000
Total liabilities	4,066,923	3,995,584
Stockholders' deficiency:
Preferred stock ($0.001 par value, 10,000,000 shares authorized, none issued and outstanding)
Common stock ($0.001 par value, 300,000,000 shares authorized, 10,538,526 Shares outstanding & issued	178,686	157,746
Additional paid-in capital	17,151,379	16,389,946
Shares to be issued, preferred stock	2,000,000	1,500,000
Shares to be issued, common stock	1,246,000	461,668
Accumulated deficit	(23,849,712)	(21,391,542)
Total stockholders' deficiency	(3,273,647)	(2,882,182)
Totoal liabilities and stockholder's deficiency	$ 793,277	$ 1,113,402

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2016	Jun. 30, 2015
Condensed Consolidated Balance Sheets Parenthetical
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	178,685,388	157,745,198
Common stock, shares outstanding	178,685,388	157,745,198

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($)	12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Consolidated Statements Of Operations
Revenues, net	$ 4,348,256	$ 2,908,407
Cost of goods sold:
Materials and freight costs	2,889,754	2,045,592
Total cost of goods sold	2,889,754	2,045,592
Gross profit	1,458,502	862,815
Operating expenses:
Selling, general and administrative expenses	3,451,862	5,192,203
Total operating expenses	3,451,862	5,192,203
Loss from operations	(1,993,360)	(4,329,388)
Non-operating income (expense):
Interest expense	(18,789)	(64,136)
Change in fair value of derivative liabilities	(397,000)	(82,737)
Commission	3,395	10,263
Loss on extinguishment of debt	(55,498)	(5,765,486)
Other income	3,082	960
Total non-operating income (expense)	(464,810)	(5,901,136)
Net loss	$ (2,458,170)	$ (10,230,524)
Basic net loss per share	$ (0.01)	$ (0.11)
Diluted net loss per share	$ (0.01)	$ (0.11)
Basic weighted average common shares outstanding	172,845,853	95,878,436
Diluted weighted average common shares outstanding	172,845,853	95,878,436

Consolidated Statements of Cash

Consolidated Statements of Cash Flows Statement - USD ($)	12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net loss	$ (2,458,170)	$ (10,230,524)
Adjustments to reconcile net loss to cash flows from operating activities:
Bad debt expense	44,488	104,548
Loss on extinguishment of liability	55,498	5,765,486
Change in fair value of derivative liability	397,000	82,737
Stock compensation expense	1,246,000	681,668
Issuance of common stock for services		1,890,000
Depreciation and amortization	48,587	57,549
Changes in operating assets and liabilities:
Accounts receivable	(76,394)	166,615
Inventory	149,296	17,050
Undeposited funds		(7,925)
Employee advance		(2,216)
Prepaid expense		18,842
Other assets	23,827	(135,000)
Bank overdraft	(36,866)	65,243
Accounts payable and accrued liabilities	(595,605)	(576,883)
Company credit card		(79,906)
Customer deposits	5,212	8,890
Unearned revenue	93,522
Payroll liabilities		30,134
Sales tax payable		(1,358)
Accrued interest	524,074	65,028
Net cash used in operating activities	(579,531)	(1,815,022)
Cash flows from investing activities:
Loan receivables	79,050	39,972
Payment for acquisition of property and equipment	(6,077)	(31,558)
Cash acquired from acquisition of SWC		209,214
Net cash provided by (used in) investing activities	72,973	217,628
Cash flows from financing activities:
Proceeds from issuance of common stock	230,000	290,000
Proceeds from (repayment to) loan	(93,457)	12,654
Payments for note payable	(187,334)	(147,000)
Proceeds from EB-Five investment	500,000	1,500,000
Net cash provided by (used in) financing activities	(449,209)	1,655,654
Net increase (decrease) in cash	(57,349)	58,260
Cash, beginning of period	58,260
Cash, end of period	911	58,260
Cash paid during the period for:
Interest
Income taxes
Supplemental disclosure of non-cash financing activities
Debts settled through shares issuance	$ 35,206	$ 1,845,736

Nature of Business

Nature of Business	12 Months Ended
	Jun. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Business	1. Nature of Business Sugarmade, Inc. (hereinafter referred to as “we”, “us” or “the/our Company”) is a publicly traded company incorporated in the state of Delaware. Our previous legal name was Diversified Opportunities, Inc.  Our Company, Sugarmade, Inc. operates through our subsidiary, Sugarmade, Inc., a California corporation (“SWC Group, Inc., - CA”). As of the end of the reporting period, June 30, 2016, we were involved in several businesses including the supply of products to the quick service restaurant sub-sector of the restaurant industry and as a distributor of paper products derived from non-wood sources. We are headquartered in City of Industry, California, a suburb of Los Angeles, with two additional warehouse locations in Southern California. As of date of this filing, we employ 21 full and part-time workers and contractors. Our main business operation, CarryOutSuppies.com, is a producer and wholesaler of custom printed and generic supplies servicing more than 3,000 quick service restaurants. Our products include double poly paper cups for cold beverage; disposable, clear, plastic cold cups, paper coffee cups, yogurt cups, ice cream cups, cup lids, cup sleeves, food containers, soup containers, plastic spoons and many other similar products for this market sector. CarryOutSupplies.com was founded in 2009 when the founders gained first-hand experience within the restaurant industry of the difficulty for restaurant owners to acquire custom printed supplies at a reasonable cost. Many quick service restaurants wish to acquire custom printed products, such as those embossed with logos, but the minimum order size for such customization had been cost prohibitive. With that in mind, carry out supplies was founded to provide products to this underserved section of the market. Since that time, the company has become a key supplier to many popular U.S. franchises, particularly in the frozen dessert segments. The company estimates it holds approximately 40% market share of generic and printed products within the take out frozen yogurt and ice cream industries. We also hold a product supply and licensing agreement FreeHand® ThumbTray™ for the western part of the United States. We are also a distributor of paper made from 100% reclaimed sugarcane fiber, enhanced with bamboo. Sugarcane fiber, called bagasse, is a discarded byproduct of sugarcane production. Sugarmade, Inc. was founded in 2010. As is explained below, in 2014, CarryOutSupplies.com was acquired by Sugarmade, Inc., creating the Company as it is today. Relative to Sugarmade Paper, our third-party contract manufacturer uses bagasse and bamboo, as opposed to wood products significantly reducing its manufacturing carbon footprint, energy consumption, and attendant water pollution during the manufacture of its products. This allows us to offer our unique, exclusive, tree-free paper products at price-parity equal to or less than current recycled fiber products already on the market. Our products are unique and we believe offer an ideal solution for those consumers (both corporate and individual) seeking to meet their sustainability mandates or personal environmentally conscious goals, at a price that is equal to or less than current recycled products. Our primary focus for this business unit as of filing of this report is the organization and administration of fundraisers and paper drives for schools, non-profits and other institutions. During September of 2016, the Company completed negotiations for and signed a license agreement with HUY FONG FOODS, INC. (“HFFI”), the maker of Sriracha Hot Chili Sauce. Under the terms of the agreement, the Company is granted license to use the licensed marks of HFFI on and for products the Company is currently in process of designing and testing. Based on this agreement and a separate license agreement signed during 2015 with Seasoning Stixs International, LLC, the Company plans to introduce a new culinary seasoning product named Sriracha Seasoning Stixs. Sriracha Seasoning Stixs are encapsulated Huy Fong Sriracha Sauce and other seasonings in the form of a stick, which are inserted into meat, fish and poultry prior to cooking. Sriracha Seasoning Stixs are a hard solid at room temperature, but as heat is applied the sticks begin to liquefy allowing the meat fibers to act like a sponge absorbing the seasonings and flavors that had previously been encapsulated in the stick. The Company plans to introduce this product via a nationwide advertising and social media campaign during the December quarter of 2016.

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Jun. 30, 2016
Summary Of Significant Accounting Policies
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United States of America. Principles of consolidation These consolidated financial statements include the accounts of our Company and its wholly-owned subsidiary, Sugarmade-CA. All significant intercompany transactions and balances have been eliminated in consolidation. Going concern The Company sustained continued operating losses during the years ended June 30, 2016 and 2015. The Company’s continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations, in which it has not been successful, and/or obtaining additional financing from its shareholders or other sources, as may be required. Our Management is endeavoring to increase revenue generating operations. While priority is on generating cash from operations through the sale of the Company’s products, management is also seeking to raise additional working capital through various financing sources, including the sale of the Company’s equity and/or debt securities, which may not be available on commercially reasonable terms to our Company, or which may not be available at all. If such financing is not available on satisfactory terms, we may be unable to continue our business as desired and our operating results will be adversely affected. In addition, any financing arrangement may have potentially adverse effects on us and/or our stockholders. Debt financing (if available and undertaken) will increase expenses, must be repaid regardless of operating results and may involve restrictions limiting our operating flexibility. If we issue equity securities to raise additional funds, the percentage ownership of our existing stockholders will be reduced and the new equity securities may have rights, preferences or privileges senior to those of the current holders of our common stock. Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. Revenue recognition We recognize revenue in accordance with Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) No. 605, Revenue Recognition As a value added service to our customers, we offer on-site storage for products that have been paid for and for which title passed to the customer. These products remain the property of the customer even though such products are still housed at our facility. While the Company acts in good faith to protect the products from loss or damage, the customer is responsibility for any loss or damage that could occur while such products are stored. All stored products are custom printed units that bear the product or brand markings of the customer and as such are not returnable for exchange or refund at any time under any circumstances. Cash Cash and cash equivalents consist of amounts held as bank deposits and highly liquid debt instruments purchased with an original maturity of three months or less. From time to time, we may maintain bank balances in interest bearing accounts in excess of the $250,000 currently insured by the Federal Deposit Insurance Corporation for interest bearing accounts (there is currently no insurance limit for deposits in noninterest bearing accounts). We have not experienced any losses with respect to cash. Management believes our Company is not exposed to any significant credit risk with respect to its cash. Accounts receivable Accounts receivable are carried at their estimated collectible amounts, net of any estimated allowances for doubtful accounts. We grant unsecured credit to our customer’s deemed credit worthy. Ongoing credit evaluations are performed and potential credit losses estimated by management are charged to operations on a regular basis. At the time any particular account receivable is deemed uncollectible, the balance is charged to the allowance for doubtful accounts. The Company had allowances of accounts receivable of $115,260 and $70,772 as of June 30, 2016 and 2015 respectively. Equipment Equipment is stated at cost, less accumulated depreciation. Expenditures for maintenance and repairs are charged to Inventory Inventory consists of finished goods paper and paper-based products such as paper cups and food containers ready for sale and is stated at the lower of cost or market. We value our inventory using the weighted average costing method. Our Company’s policy is to include as a part of inventory any freight incurred to ship the product from our contract manufacturers to our warehouses. Outbound freights costs related to shipping costs to our customers are considered period costs and reflected in selling, general and administrative expenses. We regularly review inventory and consider forecasts of future demand, market conditions and product obsolescence. If the estimated realizable value of our inventory is less than cost, we make provisions in order to reduce its carrying value to its estimated market value. On a consolidated basis, as of June 30, 2016 and 2015, the balance for the inventory totaled $468,262 and $617,557, respectively. No amounts were recognized as an obsolescence reserve at June 30, 2016 and 2015. Income taxes We account for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their perspective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the 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. Valuation allowances are recorded, when necessary, to reduce deferred tax assets to the amount expected to be realized. As a result of the implementation of certain provisions of ASC 740, Income Taxes (“ASC 740”), which clarifies the accounting and disclosure for uncertainty in tax position, as defined, ASC 740 seeks to reduce the diversity in practice associated with certain aspect of the recognition and measurement related to accounting for income taxes. We adopted the provisions of ASC 740 as of October 2, 2008, and have analyzed filing positions in each of the federal and state jurisdictions where we are required to file income tax returns, as well as open tax years in these jurisdictions. We have identified the U.S. federal and California as our “major” tax jurisdictions and generally, we remain subject to Internal Revenue Service examination of our 2013 U.S. federal income tax returns. However, we have certain tax attribute carryforwards, which will remain subject to review and adjustment by the relevant tax authorities until the statute of limitations closes with respect to the year in which such attributes are utilized. We believe that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial position. Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740. In addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740. Our policy for recording interest and penalties associated with income-based tax audits is to record such items as a component of income taxes. We have no interest or penalties as of June 30, 2015. Stock based compensation Stock based compensation cost to employees is measured at the date of grant, based on the calculated fair value of the stock-based award, and will be recognized as expense over the employee’s requisite service period (generally the vesting period of the award). We estimate the fair value of employee stock options granted using the Black-Scholes-Merton Option Pricing Model. Key assumptions used to estimate the fair value of stock options will include the exercise price of the award, the fair value of our common stock on the date of grant, the expected option term, the risk free interest rate at the date of grant, the expected volatility and the expected annual dividend yield on our common stock. We use our company’s own data among other information to estimate the expected price volatility and the expected forfeiture rate. Share-based compensation awards issued to non-employees for services rendered are recorded at either the fair value of the services rendered or the fair value of the share-based payment, whichever is more readily determinable. Loss per share Basic Earnings (loss) per share is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted EPS is computed similar to basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if all the potential common shares, warrants and stock options had been issued and if the additional common shares were dilutive. Diluted EPS is based on the assumption that all dilutive convertible shares and stock options and warrants were converted or exercised. Dilution is computed by applying the treasury stock method for the outstanding options and warrants, and the if-converted method for the outstanding convertible instruments. Under the treasury stock method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later) and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Under the if-converted method, outstanding convertible instruments are assumed to be converted into common stock at the beginning of the period (or at the time of issuance, if later). 296,857 potential shares issuable upon conversion of convertible debts and 69,122 potential shares issuable upon exercising of warrants were excluded in calculating diluted loss per share for the year ended June 30, 2016 due to the fact that issuance of the shares is anti-dilutive as a result of the Company's net loss. Fair value of financial instruments ASC Topic 820 defines fair value, establishes a framework for measuring fair value, establishes a three-level valuation hierarchy for disclosure of fair value measurement and enhances disclosure requirements for fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level 1 - observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - include other inputs that are directly or indirectly observable in the marketplace. Level 3 - unobservable inputs which are supported by little or no market activity. The Company used Level 2 inputs for its valuation methodology for the derivative liabilities in determining the fair value using the Black-Scholes option-pricing model with the following assumption inputs: June 30, 2016 Annual dividend yield — Expected life (years) 0.01 Risk-free interest rate 0.21 % Expected volatility 449 % Carrying Value Fair Value Measurements at As of June 30, 2016 June 30, Using Fair Value Hierarchy 2016 Level 1 Level 2 Level 3 Liabilities Derivative liabilities $ 701,000 $ — $ 701,000 $ — Total $ 701,000 $ — $ 701,000 $ — June 30, 2015 Annual dividend yield — Expected life (years) 0.99 Risk-free interest rate 0.27 % Expected volatility 377 % Carrying Value Fair Value Measurements at As of June 30, 2015 June 30, Using Fair Value Hierarchy 2015 Level 1 Level 2 Level 3 Liabilities Derivative liabilities $ 304,000 $ — $ 304,000 $ — Total $ 304,000 $ — $ 304,000 $ — Derivative instruments The fair value of derivative instruments is recorded and shown separately under current liabilities. Changes in the fair value of derivatives liability are recorded in the consolidated statement of operations under non-operating income (expense). Our Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the consolidated statements of operations. For stock-based derivative financial instruments, the Company uses a weighted average Black-Scholes-Merton option pricing model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. Refer to Note 6 for details. Segment Reporting FASB ASC Topic 280, “Segment Reporting”, requires use of the “management approach” model for segment reporting. The management approach FASB ASC Topic 280 has no effect on the Company’s financial statements as substantially all of its operations are conducted in one industry segment – paper and paper-based products such as paper cups, cup lids, food containers, etc. New accounting pronouncements not yet adopted In August 2014, the Financial Accounting Standards Board (“FASB”) issued Presentation of Financial Statements — Going Concern. This standard requires management to evaluate for each annual and interim reporting period whether it is probable that the reporting entity will not be able to meet its obligations as they become due within one year after the date that the financial statements are issued. If the entity is in such a position, the standard provides for certain disclosures depending on whether or not the entity will be able to successfully mitigate its going concern status. This guidance is effective for annual periods ending after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016. Early application is permitted. The Company does not anticipate that this adoption will have a significant impact on its consolidated financial position, results of operations, or cash flows. The FASB has issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers. This ASU supersedes the revenue recognition requirements in Accounting Standards Codification 605 - Revenue Recognition and most industry-specific guidance throughout the Codification. The standard requires that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. This ASU is effective on January 1, 2017 and should be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the ASU recognized at the date of initial application. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. The amendment in this ASU defers the effective date of ASU No. 2014-09 for all entities for one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 31, 2016, including interim reporting periods within that reporting period. The Company is in the process of evaluating the impact of adoption of this guidance on the consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, Inventory, which requires an entity to measure inventory within the scope at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The effective date for the standard is for fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company does not anticipate that this adoption will have a significant impact on its consolidated financial position, results of operations, or cash flows. In September 2015, the FASB issued ASU No. 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments. To simplify the accounting for adjustments made to provisional amounts recognized in a business combination, the amendments eliminate the requirement to retrospectively account for those adjustments. For public business entities, the amendments are effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. For all other entities, the amendments in this update are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. The amendments should be applied prospectively to adjustments to provisional amounts that occur after the effective date with earlier application permitted for financial statements that have not been issued. The Company does not anticipate that this adoption will have a significant impact on its consolidated financial position, results of operations, or cash flows. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The new standard 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. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is in the process of evaluating the impact of adoption of this ASU on the consolidated financial statements. On March 17, 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers - Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which provides guidance on assessing whether an entity is a principal or an agent in a revenue transaction and whether an entity reports revenue on a gross or net basis. On April 14, 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers - Identifying Performance Obligations and Licensing, which provides guidance on identifying performance obligations and accounting for licenses of intellectual property. The effective date and transition requirements for ASU No. 2016-08 and ASU No. 2016-10 are the same as the effective date and transition requirements of ASU No. 2014-09. The Company is evaluating the effect that ASU No. 2016-08 and ASU No. 2016-10 will have on the Company’s consolidated financial statements and related disclosures. On March 30, 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which includes amendments to accounting for income taxes at settlement, forfeitures, and net settlements to cover withholding taxes. The amendments in ASU 2016-09 are effective for public companies for fiscal years beginning after December 31, 2016, and interim periods within those annual periods. Early adoption is permitted but requires all elements of the amendments to be adopted at once rather than individually. The Company is evaluating the effect that ASU No. 2016-09 will have on the Company’s consolidated financial statements and related disclosures.

Concentration

Concentration	12 Months Ended
	Jun. 30, 2016
Risks and Uncertainties [Abstract]
Concentration	3. Concentration Customers For the year ended June 30, 2016, our Company earned net revenues of $4,348,257 million. The vast majority of these revenues were derived from a large number of customers. No customers accounted for over 10% of the Company’s total revenues for the year ended June 30, 2016. For the year ended June 30, 2015, our Company earned net revenues of $2.91 million. The vast majority of these revenues were derived from a large number of customers. No customers accounted for over 10% of the Company’s total revenues for the year ended June 30, 2015. Suppliers For the year ended June 30, 2016, we purchased products for sale by CarryOutSupplies from several contract manufacturers located in Asia. A substantial portion of the Company’s inventory was purchased from one supplier that functioned as an independent foreign procurement agent. Two suppliers accounted for 60.7% and 14.9% of the Company’s total inventory purchase in the year ended June 30, 2016, respectively.

Litigation

Litigation	12 Months Ended
	Jun. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
Litigation	4. Litigation From time to time and in the course of business, we may become involved in various legal proceedings seeking monetary damages and other relief. The amount of the ultimate liability, if any, from such claims cannot be determined. As of June 30, 2015, there were no legal claims currently pending or threatened against us that in the opinion of our management would be likely to have a material adverse effect on our financial position, results of operations or cash flows. However, as of the date of this filing, we were involved in the following legal proceedings. As of the date of this filing , On May 24, 2014, the Labor Commissioner, State of California issued an Order, Decision or Award of the Labor Commissioner against the Company in the amount of $56,365. On October 28, 2014, the Company entered into a settlement agreement, which was effective October 28, 2014, to resolve a judgment against the Company via the issuance of 502,533 restricted shares and a $30,000 cash payment. On December 11, 2013, the Company was served with a complaint from two Convertible Note Holders and investors in the Company, Lovitt & Hannan, Inc. Salary Deferral Plan FBO J. Thomas Hannan, Attorney at Law 401K Plan and Trust, and Kevin M. Kearney. The Company’s former CEO, Scott Lantz, was also named in the suit. The complaint alleges Hannan was induced to make a series of investments in the Company by the material misrepresentations and omissions made by the Company. We believe the Hannan case is now in the middle of depositions and it appears a trial is scheduled, tentatively, in the second quarter of 2017. We believe the claims in that case are still primarily of two categories, the first being repayment of the promissory notes and a series of allegations about improper investment solicitations and other misrepresentations. We believe the Company's exposure to the claim concerning the Notes may be approximately $125,000. We also believe there could be some associated legal fees, but we do not believe this amount will be material. There can be no assurances the ultimate liability relative to these law suits will not exceed what is outlined above.

Convertible Notes

Convertible Notes	12 Months Ended
	Jun. 30, 2016
Convertible Notes
Convertible Notes	5. Convertible Notes As of June 30, 2016 and 2015 the balance owing on convertible notes was $394,167 and $419,167 respectively. On various dates during June 2014 and July 2014, the Company and holders of certain convertible notes agreed to 1) cancel $0.50 warrants and retained the $0.01 warrant, as defined in the original Convertible Note Purchase Agreements warrants to purchase common shares in the Company, 2) extend the due dates on the Notes to July 1, 2016, and 3) reduce the interest on the notes to 10% from 14%. As of June 30, 2014, the Company extended, seven of the convertible notes totaling $275,000 for two years until July 1, 2016. The remaining $250,000 convertible notes have reached maturity and the Company was in the process of negotiating a settlement. The convertible promissory notes must be repaid by our Company within six months from the date of issuance; accrue interest at the rate of 14%; and are subject to conversion at the election of the investors at such time as our Company has raised a minimum of $500,000 in a subsequent equity financing. The conversion price will be the lower of 80% of the per share purchase price paid for by the new investors in the subsequent financing, or $0.50 per share. Unless these promissory notes are converted or repaid earlier, our Company must pay the note-holders the amount of the then accrued interest on the three, six, and nine month anniversaries of the issue date. As of June 30, 2015, one convertible promissory note, in the amount of $100,000, was converted to restricted common shares. As of June 30, 2016, the Company’s convertible notes consisted of following: As of June 30, 2016 Note Type and Investor Due Date Balance Discount Carrying Value Convertible Note 7/1/2016 $ 25,000 $ — $ 25,000 Convertible Note 7/1/2016 40,000 — 40,000 Convertible Note 7/1/2016 50,000 — 50,000 Convertible Note 7/1/2016 25,000 — 25,000 Convertible Note 6/18/2014 25,000 — 25,000 Convertible Note 6/18/2014 25,000 — 25,000 Convertible Note 12/28/2014 25,000 — 25,000 Convertible Note 7/1/2016 8,333 — 8,333 Convertible Note 7/1/2016 20,834 — 20,834 Convertible Note 7/31/2014 25,000 — 25,000 Convertible Note 7/1/2016 25,000 — 25,000 Convertible Note 7/1/2016 100,000 — 100,000 Total Convertible Promissory Notes $ 394,167 $ 394,167 As of June 30, 2015, the Company’s convertible notes consisted of the following As of June 30, 2015 Note Type and Investor 14% Notes Convertible at $0.50 Due Date Balance Discount Carrying Value Convertible Note 7/1/2016 $ 25,000 $ - $ 25,000 Convertible Note 7/1/2016 25,000 - 25,000 Convertible Note 7/1/2016 40,000 - 40,000 Convertible Note 7/1/2016 50,000 - 50,000 Convertible Note 7/1/2016 25,000 - 25,000 Convertible Note 6/18/2014 25,000 - 25,000 Convertible Note 6/18/2014 25,000 - 25,000 Convertible Note 12/28/2014 25,000 - 25,000 Convertible Note 7/1/2016 8,333 - 8,333 Convertible Note 7/1/2016 25,000 - 25,000 Convertible Note 7/31/2014 25,000 - 25,000 Convertible Note 7/1/2016 20,833 - 20,833 Convertible Note 7/1/2016 100,000 - 100,000 Total Convertible Promissory Notes $ 419,167 $ 419,167

Derivative Liabilities

Derivative Liabilities	12 Months Ended
	Jun. 30, 2016
Derivative Liabilities
Derivative Liabilities	6. Derivative liabilities The derivative liability is derived from the conversion features in note 5 and stock warrant in note 7. All were valued June 30, 2016 June 30, 2015 Annual dividend yield — — Expected life (years) 0.01 0.99 Risk-free interest rate 0.21 % 0.27 % Expected volatility 449 % 377 %

Stock warrants

Stock warrants	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Stock warrants	7. Stock warrants In connection with the issuance of the promissory notes, the investors in the aggregate received two-year warrants to purchase up to a total of 50,000 shares of common stock at $0.50 per share, and two-year warrants purchasing up to a total of 81,250 shares of common stock at $0.01 per share. For purposes of accounting for the detachable warrants issued in connection with the convertible notes, the fair value of the warrants was estimated using the Black-Scholes-Merton option pricing formula. The value of all warrants granted at the date of issuance totaled $508,413 and was recorded as a discount to the notes payable. The amount will be amortized over the nine month term of the respective convertible note as additional interest expense. Number of Shares Weighted Average Exercise Price Outstanding at June 30, 2014 180,000 0.20 Granted — — Exercised — — Forfeited September 30, 2014 38,750 0.09 Forfeited December 31, 2014 10,000 0.04 Outstanding at June 30, 2015 $ 131,250 $ 0.20 Granted — — Exercised — — Forfeited — — Outstanding at June 30, 2016 $ 131,250 $ 0.20 Following is a summary of the status of warrants outstanding at June 30, 2016: Date Issued Exercise Price Number of Shares Expiration Date 8/17/12 $ 0.01 6,250 7/1/2016 8/20/12 $ 0.01 6,250 7/1/2016 9/10/12 $ 0.01 10,000 7/1/2016 9/13/12 $ 0.01 12,500 7/1/2016 9/18/12 $ 0.01 6,250 7/1/2016 10/5/12 $ 0.01 2,500 7/1/2016 10/25/12 $ 0.01 6,250 7/1/2016 1/31/13 $ 0.01 6,250 7/1/2016 10/22/12 $ 0.01 25,000 7/1/2016 8/24/12 $ 0.50 50,000 8/24/2016 Total warrants as of June 30, 2016 131,250 Following is a summary of the status of warrants outstanding at June 30, 2015: Date Issued Exercise Price Number of Shares Expiration Date 8/17/12 $ 0.01 6,250 7/1/2016 8/20/12 $ 0.01 6,250 7/1/2016 9/10/12 $ 0.01 10,000 7/1/2016 9/13/12 $ 0.01 12,500 7/1/2016 9/18/12 $ 0.01 6,250 7/1/2016 10/5/12 $ 0.01 2,500 7/1/2016 10/25/12 $ 0.01 6,250 7/1/2016 1/31/13 $ 0.01 6,250 7/1/2016 10/22/12 $ 0.01 25,000 7/1/2016 8/24/12 $ 0.50 50,000 8/24/2016 Total warrants as of June 30, 2015 131,250

Note payable

Note payable	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Note payable	8. Note payable Note payable due to bank During October 2011, we entered into a revolving demand note (line of credit) arrangement with HSBC Bank USA, with a revolving borrowing limit of $150,000. The line of credit bears a variable interest rate of one quarter percent (0.25%) above the prime rate (3.25% as of September 30, 2013). In the event the deposit account is not established or minimum balance maintained, HSBC can charge a higher rate of interest of up to 4.0% above prime rate. As of June 30, 2016 and 2015, the loan principal balance was $25,982. Note payable to others On January 23, 2013, the Company entered into a promissory note with Mira Ablaza (a former employee of the Company owns less than 5% of the Company’s stock). The original principal amount was $40,000 and the note bore no interest. The note was payable upon demand. As of June 30, 2016, this note had a balance of $23,000. On December 31, 2013, the Company entered into a promissory note with Kalvin Kwong (an employee of the Company, whom owns less than 5% of the Company’s stock). The principal amount was $20,000 and the interest rate on the note was 10%. The note had a term of six months. However, this note was now payable upon demand per the oral agreement with the lender. As of June 30, 2016, this note had a balance of $20,000. On January 13, 2014, the Company entered into a promissory note with Tsz Ming Wong (an employee of the Company, whom owns less than 5% of the Company’s stock). The principal amount was $25,000 and the note bore no interest. The note had a term of 24 months and was due on January 13, 2016, and became payable upon demand after January 13, 2016. As of June 30, 2016, this note had a balance of $12,666. On January 14, 2015, the Company entered into a promissory note with Richard Ko (an employee of the Company, whom owns less than 5% of the Company’s stock). The principle amount was $30,000 and the note bore no interest. The note had a term of one year and was due on January 14, 2016, and became payable upon demand after January 14, 2016. As of June 30, 2016, this note had a balance of $30,000.

Shares issued for services

Shares issued for services	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Shares issued for services	9. Shares issued for services On June 30, 2016, the Company granted a consultant, Yang Zuo, 1,527,778 restricted shares with fair value of $50,000 for compensation for services provided to the Company. On June 30, 2016, the Company granted a consultant, Tony Thai, 1,527,778 restricted shares with fair value of $50,000 for compensation for services provided to the Company. On June 30, 2016, the Company granted a CEO, Jimmy Chan, 5,000,000 restricted shares with fair value of $450,000 in lieu of salary. On June 30, 2016, the Company granted Director, Waylon Huang, 3,000,000 restricted shares with fair value of $270,000 in lieu of salary. On June 30, 2016, the Company granted Director, Richard Ko, 3,000,000 restricted shares with fair value of $270,000 in lieu of salary. On April 1, 2016, the Company granted a consulting agreement with Katherine Zuniga and/or K Marie Marketing, LLC, 8,000,000 restricted shares with fair value of $320,000 for marketing and sales related services. These shares were fully vested as of April 1, 2016. On September 25, 2015, the Company entered into a consulting agreement with Tony Thai & George Zuo, respectively. The term is from the date of the agreement through June 30, 2016. Stock compensation to each shall be 10% of all revenue generated by a Restaurant Supplies website as of June 30, 2016, which will equal the restricted stock award (“Stock Award”). The consultant shall receive restricted common shares of the Company in the amount of the Stock Award, unless the amount of the Stock Award is less than $50,000, in which case the amount of the Restricted Stock Award shall be assumed to be $50,000. The share price at which the stock will be awarded shall be the average closing trading price of the common shares on the 22 trading days preceding June 30, 2016. As of June 30, 2016, the consultant shall receive a bonus amount equaling 7.5% of the net profitability of the website if the profitability margins of the business exceed 5% on a full year.

Common shares issued for equity

Common shares issued for equity financing	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Common shares issued for equity financing	10. Common shares issued for equity financing On October 15, 2015, the Company sold 833,333 shares of restricted common stock to two accredited investors for $25,000 pursuant to an exemption from registration relying on Section 4(a)(2) and Rule 506b of Regulation D, under the Securities Act of 1933, as amended. On October 7, 2015, the Company sold 1,250,000 shares of restricted common stock to an accredited investor for $25,000 pursuant to an exemption from registration relying on Section 4(a)(2) and Rule 506b of Regulation D, under the Securities Act of 1933, as amended. On October 2, 2015, the Company sold 1,000,000 shares of restricted common stock to an accredited investor for $30,000 pursuant to an exemption from registration relying on Section 4(a)(2) and Rule 506b of Regulation D, under the Securities Act of 1933, as amended. On August 27, 2015, the Company sold 2,500,000 shares of restricted common stock to each of two accredited investors for $50,000 each pursuant to an exemption from registration relying on Section 4(a)(2) and Rule 506b of Regulation D, under the Securities Act of 1933, as amended. On July 14, 2015, the Company sold 1,666,667 shares of restricted common stock to an accredited investor for $50,000 pursuant to an exemption from registration relying on Section 4(a)(2) and Rule 506b of Regulation D, under the Securities Act of 1933, as amended.

Common shares reserved for futu

Common shares reserved for future issuances	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Common shares reserved for future issuances	11. Common shares reserved for future issuances The following table summarizes shares of our common stock reserved for future issuance at June 30, 2016: Common shares to be issued under conversion feature 11,702,118 Common shares to be issued under $0.01 warrants 81,250 Common shares to be issued under $0.50 warrants 50,000 Total common shares reserved for future issuance 11,833,368

Related Party Transactions

Related Party Transactions	12 Months Ended
	Jun. 30, 2016
Related Party Transactions
Related Party Transactions	12. Related party transactions On June 30, 2016, the Company granted a CEO, Jimmy Chan, 5,000,000 restricted shares in lieu of salary. On June 30, 2016, the Company granted Director, Waylon Huang, 3,000,000 restricted shares in lieu of salary. On June 30, 2016, the Company granted Director, Richard Ko, 3,000,000 restricted shares in lieu of salary. At June 30, 2016, the Company had outstanding balance of $264,449 borrowed from LMK Capital., LLC a company affiliated with CEO Chan. In addition, Mr. Richard Ko, a Director is owed $30,000. These borrowings have no interest, and were payable upon demand.

Loans payable

Loans payable	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Loans payable	13. Loans payable On August 14, 2009, SWC entered a loan agreement with a bank for $50,000 with maturity on August 14, 2016. The loan had an annual interest rate of 7% with monthly payment of $755. At June 30, 2016, the outstanding balance under this loan was $1,709. On March 1, 2012, SWC entered an equipment loan agreement with a bank with maturity on January 1, 2017. The monthly payment is $435. At June 30, 2016, the outstanding balance under this loan was $3,053. On July 1, 2012, SWC entered an equipment loan agreement with a bank with maturity on June 1, 2017. The monthly payment is $255. At June 30, 2016, the outstanding balance under this loan was $3,087. At June 30, 2016, the Company had outstanding balance of $264,449 borrowed from LMK Capital., LLC a company affiliated with CEO Chan. On January 5, 2016, the Company received a loan for $100,000 from an investor. The note bears 0% annual interest and is due on December 31, 2017. As of June 30, 2016 the balance under this loan is $90,000. On March 5, 2013, the company entered an equipment loan agreement with Toyota financial services with maturity date of April 4, 2018. As of June 30, 2016 the balance under this loan is $10,771 On June 30, 2016, the company had outstanding balance of $54,511 borrowed from shareholders.

Shares to be issued

Shares to be issued	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Shares to be issued	14. Shares to be issued At June 30, 2016, the Company was obligated to issue 2,000,000 shares of Series B Convertible Preferred Stock for three EB-5 investments with the total amount of $1,500,000. The Company received $2,000,000 proceeds during the year ended June 30, 2016 with fair value of $2,000,000. On April 1, 2015, the Company completed a series of transactions and amended its Articles of Incorporation creating a series of preferred stock of 10,000,000 shares, which shall be designated Series B Convertible Preferred Stock, par value $0.001 per share (the “Series B Preferred Stock”). Series B will not be eligible for dividends. Five years from the date of issue (the “Conversion Date”), assuming the Series B investor is approved for l-526 under the U.S Government’s EB-5 Investment Program, each Preferred Share will automatically convert into that number of Common Shares having a “fair market value” of the Initial Investment plus a five (5) percent annualized return on Initial Investment. Fair market value will be determined by averaging the closing sale price of a Common Share for the 40 trading days immediately preceding the date of conversion on the U.S. stock exchange on which Common Shares are publicly traded. The offering was made pursuant to SEC Rule 506 Section 4(2), which provides exemption from registration for transactions, which are not public offerings. The funds received were used for general working capital purposes and to accelerate order deliveries to customers . In addition, at June 30, 2016, the Company was obligated to issue 1,527,778 restricted shares with fair value of $50,000 for compensation for services to each of two consultants; 5,000,000 restricted shares with fair value of $450,000 to the Company’s CEO in lieu of salary; 3,000,000 restricted shares with fair value of $270,000 to the one of the Company’s director in lieu of compensation; 3,000,000 restricted shares with fair value of $270,000 to the Company’s another director in lieu of compensation; and 8,000,000 restricted shares with fair value of $320,000 to a consulting company for marketing and sales related services.

Income Taxes

Income Taxes	12 Months Ended
	Jun. 30, 2016
Income Tax Disclosure [Abstract]
Income Taxes	15. Income Taxes The NOL carryforwards will expire after 20 years beginning from the year it occurred if not utilized, for federal and state purposes and could be limited for use under IRC Section 382. We have recorded a valuation allowance against the entire net deferred tax asset balance due because we believe there exists a substantial doubt that we will be able to realize the benefits due to our lack of a history of earnings and due to possible limitations under IRC Section 382. We file income tax returns in the U.S. and in the state of California with varying statutes of limitations. Our policy is to recognize interest expense and penalties related to income tax matters as a component of our provision for income taxes. There were no accrued interest and penalties associated with uncertain tax positions as of June 30, 2016. All operations are in California and the Company believes it has no tax positions which could more-likely-than not be challenged by tax authorities. We have no unrecognized tax benefits and thus no interest or penalties included in the financial statements. Net deferred tax assets consist of the following components as of June 30, 2016 and 2015: 2016 2015 Deferred tax assets: NOL carryover $ 9,999,51 $ 9,140,022 Valuation allowance (9,999,512 ) (9,140,022 ) Net deferred tax asset $ — $ — The income tax provision is summarized as follows: 2016 2015 Federal income tax benefit, net of state $ (621,834 ) $ (3,145,246 ) State income tax benefit (177,355 ) (897,064 ) Valuation allowance 799,189 4,042,310 $ — $ — At June 30, 2016, the Company had net operating loss carry forwards of approximately $21 million that may be offset against future taxable income through 2036. No tax benefit has been reported in the June 30, 2016 and 2015 consolidated financial statements since the potential tax benefit is offset by a valuation allowance of the same amount. We believe that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial position. Therefore, no reserves for uncertain income tax position have been recorded pursuant to ASC 740.

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Jun. 30, 2016
Commitments And Contingencies
Commitments and Contingencies	16. Commitments and contingencies On April 1, 2015, the Company entered into a lease for general office and warehouse in City of Industry, California with a lease term of one years. The Company renewed the lease to March 31, 2017. Monthly rent was $11,884 up to March 31, 2016, and increased to $13,238 from April 1, 2016 to March 31, 2017. Monthly rent increased to $13,238 from April 1, 2016 to March 31, 2017. Future minimum annual rental payments required under operating leases as of June 30, 2016 were as below (by year): 2016 $ 79,427 2017 39,714 Total $ 119,141

Other events

Other events	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Other events	17. Other events On July 20, 2015, the Company entered in a Memorandum of Understanding (MOU) to acquire Bao Coc International Paper and Plastic Company Limited, a manufacture of high-grade post consumer paper products, including napkins, for the U.S. food industry. Under the terms of the non-binding MOU, the Company will acquire 100% of Bao Coc International Paper and Plastic Company Limited in exchange for a combination of cash, restricted common shares of the Company and a long-term profit sharing incentive to the management team of Bao Coc International Paper and Plastic Company Limited. Company did not proceed with acquisition as of the date of this filing. Mr. Er Wang was replaced as a director on January 1, 2016 with Mr. Ko assuming a director role.

Acquisition of SWC Group, Inc.

Acquisition of SWC Group, Inc.	12 Months Ended
	Jun. 30, 2016
Business Combinations [Abstract]
Acquisition of SWC Group, Inc.	18. Acquisition of SWC Group, Inc. On July 16, 2014 the Company entered into an agreement to acquire City of Industry, California based SWC Group, Inc., a California Corporation, which does business as CarryOutSupplies.com. CarryOutSupplies.com is a producer and wholesaler of custom printed and generic takeout supplies. CarryOutSupplies.com, which services more than 32,500 takeout establishments, restaurants and other food service operators, is headquartered at 167 N Sunset Ave, City of Industry, CA 91744, with two additional warehouse locations in Southern California. The acquisition closed on October 28, 2014. On this date, the Board of Directors of the Company executed the final Acquisition and Share Exchange Agreement (the “Share Exchange Agreement”) ratifying the Pending Acquisition. Under the terms of the Share Exchange Agreement, the Company will issue Thirty Five Million (35,000,000) common shares of the Company to the holders of CarryOutSupplies.com in exchange for all of the outstanding shares in CarryOutSupplies.com. The number of Company shares exchanged shall be modified to Forty Million (40,000,000) shares Thirty (30) days after the effective date of this Share Exchange Agreement should CarryOutSupplies.com demonstrate revenues for the three (3) month period ending June 30, 2014 did not fall below a level equal to 70% of the revenues for the three (3) month period ending June 30, 2013. The number of shares exchanged shall be modified to Seventy One Million (71,000,000) Seventy Five (75) days after the effective date of this Share Exchange Agreement should CarryOutSupplies.com demonstrate revenues for the three (3) month period ending September 30, 2014 did not fall below a level equal to 70% of the revenues for the three (3) month period ending September 30, 2013. As of the date of this filing, all of the 71,000,000 shares had been issued to the owners of CarryOutSupplies.com. With the merger behind the Company now, we are in the process of rolling out three new verticals under the corporate umbrella; state side manufacturing and printing, ad support products, and online restaurant supplies catalogue. All of which is leveraging the strength of Sugarmade’s core business. The acquisition was accounted as transactions between entities under common control in accordance with ASC Topic 805-50-25 since both Sugarmade and CarryOutSupplies.com had one common major shareholder and officer. When accounting for a transfer of assets or exchange of shares between entities under common control, the entity that receives the net assets or the equity interests, shall initially measure the recognized assets and liabilities transferred at their carrying amounts in the accounts of the transferring entity at the date of transfer. The following table summarizes the carrying values of the assets acquired and liabilities assumed at the date of acquisition (or transfer): Cash $ 209,214 Accounts receivable 388,399 Inventory 565,287 Other current assets 44,033 Security deposit 23,281 Loan receivables 312,521 Fixed assets 143,916 Intangible assets 3,039 Accounts payable (1,727,870 ) Credit card payable (420,773 ) Due to Sugarmade (685,000 ) Customer deposits (234,197 ) Loans payable (529,064 ) Other payables (297,047 ) Long term notes payables (460,000 ) Net assets at carrying value: $ (2,664,261 ) Years ended June 30, 2015 Net sales $ 5,806,410 Net income (loss) $ (10,320,322

Subsequent Event

Subsequent Event	12 Months Ended
	Jun. 30, 2016
Subsequent Event
Subsequent Event	19. Subsequent events On October 3, 2016, the Company issued 1,503,928 restricted common shares for conversion of convertible notes. On September 28, 2016, the Company sold 250,000 shares of restricted common stock to an investor for $12,500 pursuant to an exemption from registration relying on Section 4(a)(2) and Rule 506b of Regulation D, under the Securities Act of 1933, as amended. On September 26, 2016, the Company received a loan from Greater Asia Technology for $100,000. The loan bears 40% annual interest and is due on November 25, 2017. On September 26, 2016, the Company received a loan from Greater Asia Technology for $12,500. The loan bears 100% annual interest and is due on November 23, 2017. On September 22, 2016, the Company sold 250,000 shares of restricted common stock to an accredited investors for $12,500 pursuant to an exemption from registration relying on Section 4(a)(2) and Rule 506b of Regulation D, under the Securities Act of 1933, as amended. On August 30, 2016, a note holder converted existing principle and accrued interest in exchange for 1,503,928 shares. On July 11, 2016, the Company received a loan from Greater Asia Technology for $150,000. There were loan fees of $8,000 associated with origination of the loan, which bears 40% annual interest and is due on January 15, 2017.

Summary of Significant Accoun25

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Jun. 30, 2016
Summary Of Significant Accounting Policies Policies
Basis of presentation	Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United States of America.
Principles of consolidation	Principles of consolidation These consolidated financial statements include the accounts of our Company and its wholly-owned subsidiary, Sugarmade-CA. All significant intercompany transactions and balances have been eliminated in consolidation.
Going concern	Going concern The Company sustained continued operating losses during the years ended June 30, 20166 and 2015. The Company’s continuation as a going concern is dependent on its ability to generate sufficient cash flows from operations to meet its obligations, in which it has not been successful, and/or obtaining additional financing from its shareholders or other sources, as may be required. Our Management is endeavoring to increase revenue generating operations. While priority is on generating cash from operations through the sale of the Company’s products, management is also seeking to raise additional working capital through various financing sources, including the sale of the Company’s equity and/or debt securities, which may not be available on commercially reasonable terms to our Company, or which may not be available at all. If such financing is not available on satisfactory terms, we may be unable to continue our business as desired and our operating results will be adversely affected. In addition, any financing arrangement may have potentially adverse effects on us and/or our stockholders. Debt financing (if available and undertaken) will increase expenses, must be repaid regardless of operating results and may involve restrictions limiting our operating flexibility. If we issue equity securities to raise additional funds, the percentage ownership of our existing stockholders will be reduced and the new equity securities may have rights, preferences or privileges senior to those of the current holders of our common stock.
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 our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates.
Revenue recognition	Revenue recognition We recognize revenue in accordance with Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) No. 605, Revenue Recognition As a value added service to our customers, we offer on-site storage for products that have been paid for and for which title passed to the customer. These products remain the property of the customer even though such products are still housed at our facility. While the Company acts in good faith to protect the products from loss or damage, the customer is responsibility for any loss or damage that could occur while such products are stored. All stored products are custom printed units that bear the product or brand markings of the customer and as such are not returnable for exchange or refund at any time under any circumstances.
Cash	Cash Cash and cash equivalents consist of amounts held as bank deposits and highly liquid debt instruments purchased with an original maturity of three months or less. From time to time, we may maintain bank balances in interest bearing accounts in excess of the $250,000 currently insured by the Federal Deposit Insurance Corporation for interest bearing accounts (there is currently no insurance limit for deposits in noninterest bearing accounts). We have not experienced any losses with respect to cash. Management believes our Company is not exposed to any significant credit risk with respect to its cash.
Accounts receivable	Accounts receivable Accounts receivable are carried at their estimated collectible amounts, net of any estimated allowances for doubtful accounts. We grant unsecured credit to our customer’s deemed credit worthy. Ongoing credit evaluations are performed and potential credit losses estimated by management are charged to operations on a regular basis. At the time any particular account receivable is deemed uncollectible, the balance is charged to the allowance for doubtful accounts. The Company had allowances of accounts receivable of $115,260 and $70,772 as of June 30, 2016 and 2015 respectively.
Equipment	Equipment Equipment is stated at cost, less accumulated depreciation. Expenditures for maintenance and repairs are charged to
Inventory	Inventory Inventory consists of finished goods paper and paper-based products such as paper cups and food containers ready for sale and is stated at the lower of cost or market. We value our inventory using the weighted average costing method. Our Company’s policy is to include as a part of inventory any freight incurred to ship the product from our contract manufacturers to our warehouses. Outbound freights costs related to shipping costs to our customers are considered period costs and reflected in selling, general and administrative expenses. We regularly review inventory and consider forecasts of future demand, market conditions and product obsolescence. If the estimated realizable value of our inventory is less than cost, we make provisions in order to reduce its carrying value to its estimated market value. On a consolidated basis, as of June 30, 2016 and 2015, the balance for the inventory totaled $468,262 and $617,557, respectively. No amounts were recognized as an obsolescence reserve at June 30, 2016 and 2015.
Income taxes	Income taxes We account for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their perspective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the 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. Valuation allowances are recorded, when necessary, to reduce deferred tax assets to the amount expected to be realized. As a result of the implementation of certain provisions of ASC 740, Income Taxes (“ASC 740”), which clarifies the accounting and disclosure for uncertainty in tax position, as defined, ASC 740 seeks to reduce the diversity in practice associated with certain aspect of the recognition and measurement related to accounting for income taxes. We adopted the provisions of ASC 740 as of October 2, 2008, and have analyzed filing positions in each of the federal and state jurisdictions where we are required to file income tax returns, as well as open tax years in these jurisdictions. We have identified the U.S. federal and California as our “major” tax jurisdictions and generally, we remain subject to Internal Revenue Service examination of our 2013 U.S. federal income tax returns. However, we have certain tax attribute carryforwards, which will remain subject to review and adjustment by the relevant tax authorities until the statute of limitations closes with respect to the year in which such attributes are utilized. We believe that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to our financial position. Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740. In addition, we did not record a cumulative effect adjustment related to the adoption of ASC 740. Our policy for recording interest and penalties associated with income-based tax audits is to record such items as a component of income taxes. We have no interest or penalties as of June 30, 2015.
Stock based compensation	Stock based compensation Stock based compensation cost to employees is measured at the date of grant, based on the calculated fair value of the stock-based award, and will be recognized as expense over the employee’s requisite service period (generally the vesting period of the award). We estimate the fair value of employee stock options granted using the Black-Scholes-Merton Option Pricing Model. Key assumptions used to estimate the fair value of stock options will include the exercise price of the award, the fair value of our common stock on the date of grant, the expected option term, the risk free interest rate at the date of grant, the expected volatility and the expected annual dividend yield on our common stock. We use our company’s own data among other information to estimate the expected price volatility and the expected forfeiture rate. Share-based compensation awards issued to non-employees for services rendered are recorded at either the fair value of the services rendered or the fair value of the share-based payment, whichever is more readily determinable.
Loss per share	Loss per share Basic Earnings (loss) per share is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted EPS is computed similar to basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if all the potential common shares, warrants and stock options had been issued and if the additional common shares were dilutive. Diluted EPS is based on the assumption that all dilutive convertible shares and stock options and warrants were converted or exercised. Dilution is computed by applying the treasury stock method for the outstanding options and warrants, and the if-converted method for the outstanding convertible instruments. Under the treasury stock method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later) and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Under the if-converted method, outstanding convertible instruments are assumed to be converted into common stock at the beginning of the period (or at the time of issuance, if later). 296,857 potential shares issuable upon conversion of convertible debts and 69,122 potential shares issuable upon exercising of warrants were excluded in calculating diluted loss per share for the year ended June 30, 2016 due to the fact that issuance of the shares is anti-dilutive as a result of the Company's net loss.
Fair Value of Financial Instruments	Fair value of financial instruments ASC Topic 820 defines fair value, establishes a framework for measuring fair value, establishes a three-level valuation hierarchy for disclosure of fair value measurement and enhances disclosure requirements for fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level 1 - observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 - include other inputs that are directly or indirectly observable in the marketplace. Level 3 - unobservable inputs which are supported by little or no market activity. The Company used Level 2 inputs for its valuation methodology for the derivative liabilities in determining the fair value using the Black-Scholes option-pricing model with the following assumption inputs: June 30, 2016 Annual dividend yield — Expected life (years) 0.01 Risk-free interest rate 0.21 % Expected volatility 449 % Carrying Value Fair Value Measurements at As of June 30, 2016 June 30, Using Fair Value Hierarchy 2016 Level 1 Level 2 Level 3 Liabilities Derivative liabilities $ 701,000 $ — $ 701,000 $ — Total $ 701,000 $ — $ 701,000 $ — June 30, 2015 Annual dividend yield — Expected life (years) 0.99 Risk-free interest rate 0.27 % Expected volatility 377 % Carrying Value Fair Value Measurements at As of June 30, 2015 June 30, Using Fair Value Hierarchy 2015 Level 1 Level 2 Level 3 Liabilities Derivative liabilities $ 304,000 $ — $ 304,000 $ — Total $ 304,000 $ — $ 304,000 $ —
Derivative Instruments	Derivative instruments The fair value of derivative instruments is recorded and shown separately under current liabilities. Changes in the fair value of derivatives liability are recorded in the consolidated statement of operations under non-operating income (expense). Our Company evaluates all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the consolidated statements of operations. For stock-based derivative financial instruments, the Company uses a weighted average Black-Scholes-Merton option pricing model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument could be required within 12 months of the balance sheet date. Refer to Note 6 for details.
Segment Reporting	Segment Reporting FASB ASC Topic 280, “Segment Reporting”, requires use of the “management approach” model for segment reporting. The management approach FASB ASC Topic 280 has no effect on the Company’s financial statements as substantially all of its operations are conducted in one industry segment – paper and paper-based products such as paper cups, cup lids, food containers, etc.
New Accounting Pronouncements Not Yet Adopted	New accounting pronouncements not yet adopted In August 2014, the Financial Accounting Standards Board (“FASB”) issued Presentation of Financial Statements — Going Concern. This standard requires management to evaluate for each annual and interim reporting period whether it is probable that the reporting entity will not be able to meet its obligations as they become due within one year after the date that the financial statements are issued. If the entity is in such a position, the standard provides for certain disclosures depending on whether or not the entity will be able to successfully mitigate its going concern status. This guidance is effective for annual periods ending after December 15, 2016 and interim periods within annual periods beginning after December 15, 2016. Early application is permitted. The Company does not anticipate that this adoption will have a significant impact on its consolidated financial position, results of operations, or cash flows. The FASB has issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers. This ASU supersedes the revenue recognition requirements in Accounting Standards Codification 605 - Revenue Recognition and most industry-specific guidance throughout the Codification. The standard requires that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. This ASU is effective on January 1, 2017 and should be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the ASU recognized at the date of initial application. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. The amendment in this ASU defers the effective date of ASU No. 2014-09 for all entities for one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 31, 2016, including interim reporting periods within that reporting period. The Company is in the process of evaluating the impact of adoption of this guidance on the consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, Inventory, which requires an entity to measure inventory within the scope at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The effective date for the standard is for fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company does not anticipate that this adoption will have a significant impact on its consolidated financial position, results of operations, or cash flows. In September 2015, the FASB issued ASU No. 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments. To simplify the accounting for adjustments made to provisional amounts recognized in a business combination, the amendments eliminate the requirement to retrospectively account for those adjustments. For public business entities, the amendments are effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. For all other entities, the amendments in this update are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. The amendments should be applied prospectively to adjustments to provisional amounts that occur after the effective date with earlier application permitted for financial statements that have not been issued. The Company does not anticipate that this adoption will have a significant impact on its consolidated financial position, results of operations, or cash flows. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The new standard 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. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is in the process of evaluating the impact of adoption of this ASU on the consolidated financial statements. On March 17, 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers - Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which provides guidance on assessing whether an entity is a principal or an agent in a revenue transaction and whether an entity reports revenue on a gross or net basis. On April 14, 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers - Identifying Performance Obligations and Licensing, which provides guidance on identifying performance obligations and accounting for licenses of intellectual property. The effective date and transition requirements for ASU No. 2016-08 and ASU No. 2016-10 are the same as the effective date and transition requirements of ASU No. 2014-09. The Company is evaluating the effect that ASU No. 2016-08 and ASU No. 2016-10 will have on the Company’s consolidated financial statements and related disclosures. On March 30, 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which includes amendments to accounting for income taxes at settlement, forfeitures, and net settlements to cover withholding taxes. The amendments in ASU 2016-09 are effective for public companies for fiscal years beginning after December 31, 2016, and interim periods within those annual periods. Early adoption is permitted but requires all elements of the amendments to be adopted at once rather than individually. The Company is evaluating the effect that ASU No. 2016-09 will have on the Company’s consolidated financial statements and related disclosures.

Summary of Significant Accoun26

Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Jun. 30, 2016
Summary Of Significant Accounting Policies Tables
Schedule of fair value of derivative liabilities	June 30, 2016 Annual dividend yield — Expected life (years) 0.01 Risk-free interest rate 0.21 % Expected volatility 449 % Carrying Value Fair Value Measurements at As of June 30, 2016 June 30, Using Fair Value Hierarchy 2016 Level 1 Level 2 Level 3 Liabilities Derivative liabilities $ 701,000 $ — $ 701,000 $ — Total $ 701,000 $ — $ 701,000 $ — June 30, 2015 Annual dividend yield — Expected life (years) 0.99 Risk-free interest rate 0.27 % Expected volatility 377 % Carrying Value Fair Value Measurements at As of June 30, 2015 June 30, Using Fair Value Hierarchy 2015 Level 1 Level 2 Level 3 Liabilities Derivative liabilities $ 304,000 $ — $ 304,000 $ — Total $ 304,000 $ — $ 304,000 $ —

Convertible Notes (Tables)

Convertible Notes (Tables)	12 Months Ended
	Jun. 30, 2016
Convertible Notes Tables
Schedule of Promissory Notes	As of June 30, 2016, the Company’s convertible notes consisted of following: As of June 30, 2016 Note Type and Investor Due Date Balance Discount Carrying Value Convertible Note 7/1/2016 $ 25,000 $ — $ 25,000 Convertible Note 7/1/2016 40,000 — 40,000 Convertible Note 7/1/2016 50,000 — 50,000 Convertible Note 7/1/2016 25,000 — 25,000 Convertible Note 6/18/2014 25,000 — 25,000 Convertible Note 6/18/2014 25,000 — 25,000 Convertible Note 12/28/2014 25,000 — 25,000 Convertible Note 7/1/2016 8,333 — 8,333 Convertible Note 7/1/2016 20,834 — 20,834 Convertible Note 7/31/2014 25,000 — 25,000 Convertible Note 7/1/2016 25,000 — 25,000 Convertible Note 7/1/2016 100,000 — 100,000 Total Convertible Promissory Notes $ 394,167 $ 394,167 As of June 30, 2015, the Company’s convertible notes consisted of the following As of June 30, 2015 Note Type and Investor 14% Notes Convertible at $0.50 Due Date Balance Discount Carrying Value Convertible Note 7/1/2016 $ 25,000 $ - $ 25,000 Convertible Note 7/1/2016 25,000 - 25,000 Convertible Note 7/1/2016 40,000 - 40,000 Convertible Note 7/1/2016 50,000 - 50,000 Convertible Note 7/1/2016 25,000 - 25,000 Convertible Note 6/18/2014 25,000 - 25,000 Convertible Note 6/18/2014 25,000 - 25,000 Convertible Note 12/28/2014 25,000 - 25,000 Convertible Note 7/1/2016 8,333 - 8,333 Convertible Note 7/1/2016 25,000 - 25,000 Convertible Note 7/31/2014 25,000 - 25,000 Convertible Note 7/1/2016 20,833 - 20,833 Convertible Note 7/1/2016 100,000 - 100,000 Total Convertible Promissory Notes $ 419,167 $ 419,167

Stock warrants (Tables)

Stock warrants (Tables)	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Schedule of Convertible Stock Warrants	Number of Shares Weighted Average Exercise Price Outstanding at June 30, 2014 180,000 0.20 Granted — — Exercised — — Forfeited September 30, 2014 38,750 0.09 Forfeited December 31, 2014 10,000 0.04 Outstanding at June 30, 2015 $ 131,250 $ 0.20 Granted — — Exercised — — Forfeited — — Outstanding at June 30, 2016 $ 131,250 $ 0.20
Schedule of Warrants Outstanding	Following is a summary of the status of warrants outstanding at June 30, 2016: Date Issued Exercise Price Number of Shares Expiration Date 8 /17/12 $ 0.01 6,250 7 /1/2016 8 /20/12 $ 0.01 6,250 7 /1/2016 9 /10/12 $ 0.01 10,000 7 /1/2016 9 /13/12 $ 0.01 12,500 7 /1/2016 9 /18/12 $ 0.01 6,250 7 /1/2016 10 /5/12 $ 0.01 2,500 7 /1/2016 10 /25/12 $ 0.01 6,250 7 /1/2016 1 /31/13 $ 0.01 6,250 7 /1/2016 10 /22/12 $ 0.01 25,000 7 /1/2016 8 /24/12 $ 0.50 50,000 8 /24/2016 Total warrants as of June 30, 2016 131,250 Following is a summary of the status of warrants outstanding at June 30, 2015: Date Issued Exercise Price Number of Shares Expiration Date 8 /17/12 $ 0.01 6,250 7 /1/2016 8 /20/12 $ 0.01 6,250 7 /1/2016 9 /10/12 $ 0.01 10,000 7 /1/2016 9 /13/12 $ 0.01 12,500 7 /1/2016 9 /18/12 $ 0.01 6,250 7 /1/2016 10 /5/12 $ 0.01 2,500 7 /1/2016 10 /25/12 $ 0.01 6,250 7 /1/2016 1 /31/13 $ 0.01 6,250 7 /1/2016 10 /22/12 $ 0.01 25,000 7 /1/2016 8 /24/12 $ 0.50 50,000 8 /24/2016 Total warrants as of June 30, 2015 131,250

Common shares reserved for fu29

Common shares reserved for future issuances (Tables)	12 Months Ended
	Jun. 30, 2016
Notes to Financial Statements
Schedule of Common Shares Reserved for Furture Issuance	Common shares to be issued under conversion feature 11,702,118 Common shares to be issued under $0.01 warrants 81,250 Common shares to be issued under $0.50 warrants 50,000 Total common shares reserved for future issuance 11,833,368

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Jun. 30, 2016
Income Taxes Tables
Schedule of Deferred Tax Assets	Net deferred tax assets consist of the following components as of June 30, 2016 and 2015: 2016 2015 Deferred tax assets: NOL carryover $ 9,999,51 $ 9,140,022 Valuation allowance (9,999,512 ) (9,140,022 ) Net deferred tax asset $ — $ —
Schedule of Income Tax provision	The income tax provision is summarized as follows: 2016 2015 Federal income tax benefit, net of state $ (621,834 ) $ (3,145,246 ) State income tax benefit (177,355 ) (897,064 ) Valuation allowance 799,189 4,042,310 $ — $ —

Acquisition of SWC Group, Inc.

Acquisition of SWC Group, Inc. (Tables)	12 Months Ended
	Jun. 30, 2016
Business Combinations [Abstract]
Schedule of Assets and Liabilities at Carring Values	Cash $ 209,214 Accounts receivable 388,399 Inventory 565,287 Other current assets 44,033 Security deposit 23,281 Loan receivables 312,521 Fixed assets 143,916 Intangible assets 3,039 Accounts payable (1,727,870 ) Credit card payable (420,773 ) Due to Sugarmade (685,000 ) Customer deposits (234,197 ) Loans payable (529,064 ) Other payables (297,047 ) Long term notes payables (460,000 ) Net assets at carrying value: $ (2,664,261 )
Schedule of Business Acquisition Pro Forma	Years ended June 30, 2015 Net sales $ 5,806,410 Net income (loss) $ (10,320,322

Summary of Significant Accoun32

Summary of Significant Accounting Policies (Details)	12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Summary Of Significant Accounting Policies Details
Annual dividend yield
Expected life (years)	4 days	11 months 26 days
Risk-free interest rate	0.21%	0.27%
Expected volatility	449.00%	377.00%

Summary of Significant Accoun33

Summary of Significant Accounting Policies (Details 2) - USD ($)	Jun. 30, 2016	Jun. 30, 2015
Derivative Liabilities	$ 701,000	$ 304,000
Liabilities [Member]
Derivative Liabilities	701,000	304,000
Liabilities [Member] | Fair Value, Inputs, Level 1 [Member]
Derivative Liabilities
Liabilities [Member] | Fair Value, Inputs, Level 2 [Member]
Derivative Liabilities	701,000	304,000
Liabilities [Member] | Fair Value, Inputs, Level 3 [Member]
Derivative Liabilities

Summary of Significant Accoun34

Summary of Significant Accounting Policies (Details Narrative)	12 Months Ended
	Jun. 30, 2016USD ($)
Summary Of Significant Accounting Policies Details Narrative
Cash issued to Federal Deposit Insurance Corporation	$ 250,000

Concentration (Details Narrativ

Concentration (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Risks and Uncertainties [Abstract]
Net Revenue	$ 4,348,256	$ 2,908,407

Litigation (Details Narrative)

Litigation (Details Narrative) - USD ($)	Oct. 28, 2014	May 24, 2014
Commitments and Contingencies Disclosure [Abstract]
Litigation Settlement, Amount		$ 56,365
Restricted Shares Issued	502,533
Litigation Cash Paid	$ 30,000

Convertible Notes (Details Narr

Convertible Notes (Details Narrative) - USD ($)	12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Convertible Notes Payable	$ 25,982	$ 25,982
Convertible Notes [Member]
Convertible Notes Payable	$ 25,000
Convertible Notes Due Date	Jul. 1, 2016
Convertible Notes [Member]
Convertible Notes Payable	$ 40,000
Convertible Notes Due Date	Jul. 1, 2016
Convertible Notes [Member]
Convertible Notes Payable	$ 50,000
Convertible Notes Due Date	Jul. 1, 2016
Convertible Notes [Member]
Convertible Notes Payable	$ 25,000
Convertible Notes Due Date	Jul. 1, 2016
Convertible Notes [Member]
Convertible Notes Payable	$ 25,000
Convertible Notes Due Date	Jun. 18, 2014
Convertible Notes [Member]
Convertible Notes Payable	$ 25,000
Convertible Notes Due Date	Jun. 18, 2014
Convertible Notes [Member]
Convertible Notes Payable	$ 25,000
Convertible Notes Due Date	Dec. 28, 2014
Convertible Notes [Member]
Convertible Notes Payable	$ 8,333
Convertible Notes Due Date	Jul. 1, 2016
Convertible Notes [Member]
Convertible Notes Payable	$ 20,834
Convertible Notes Due Date	Jul. 1, 2016
Convertible Notes [Member]
Convertible Notes Payable	$ 25,000
Convertible Notes Due Date	Jul. 31, 2014
Convertible Notes [Member]
Convertible Notes Payable	$ 25,000
Convertible Notes Due Date	Jul. 1, 2016
Convertible Notes [Member]
Convertible Notes Payable	$ 100,000
Convertible Notes Due Date	Jul. 1, 2016
Convertible Notes [Member]
Convertible Notes Payable	$ 394,167
Accured Interest Rate	14.00%

Stock warrants (Details)

Stock warrants (Details) - Stock Warrant [Member] - $ / shares	3 Months Ended	6 Months Ended	12 Months Ended
	Sep. 30, 2014	Dec. 31, 2014	Jun. 30, 2016	Jun. 30, 2015
Number of Shares
Outstanding at June 30, 2015	180,000	180,000	131,250	180,000
Granted
Exercised
Forfeited	38,750	10,000
Outstanding at June 30, 2016			131,250	131,250
Weighted Average Exercise Price
Outstanding at June 30, 2015	$ 0.20	$ 0.20	$ .20	$ 0.20
Granted
Exercised
Forfeited	$ .09	$ .04
Outstanding at June 30, 2016			$ 0.20	$ .20

Stock warrants (Details 2)

Stock warrants (Details 2) - $ / shares	12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2014
8/17/2012
Exercise Price	$ 0.01	$ 0.01
Number of Shares Outstanding	6,250	6,250
Expiration Date	Jul. 1, 2016	Jul. 1, 2016
8/20/2012
Exercise Price	$ 0.01	$ 0.01
Number of Shares Outstanding	6,250	6,250
Expiration Date	Jul. 1, 2016	Jul. 1, 2016
9/10/2012
Exercise Price	$ 0.01	$ 0.01
Number of Shares Outstanding	10,000	10,000
Expiration Date	Jul. 1, 2016	Jul. 1, 2016
9/13/2012
Exercise Price	$ 0.01	$ 0.01
Number of Shares Outstanding	12,500	12,500
Expiration Date	Jul. 1, 2016	Jul. 1, 2016
9/18/2012
Exercise Price	$ 0.01	$ 0.01
Number of Shares Outstanding	6,250	6,250
Expiration Date	Jul. 1, 2016	Jul. 1, 2016
10/5/2012
Exercise Price	$ 0.01	$ 0.01
Number of Shares Outstanding	2,500	2,500
Expiration Date	Jul. 1, 2016	Jul. 1, 2016
10/25/2012
Exercise Price	$ 0.01	$ 0.01
Number of Shares Outstanding	6,250	6,250
Expiration Date	Jul. 1, 2016	Jul. 1, 2016
1/31/2013
Exercise Price	$ 0.01	$ 0.01
Number of Shares Outstanding	6,250	6,250
Expiration Date	Jul. 1, 2016	Jul. 1, 2016
10/22/2012
Exercise Price	$ 0.01	$ 0.01
Number of Shares Outstanding	25,000	25,000
Expiration Date	Jul. 1, 2016	Jul. 1, 2016
8/24/2012
Exercise Price	$ 0.5	$ 0.50
Number of Shares Outstanding	50,000	50,000
Expiration Date	Aug. 24, 2016	Aug. 24, 2016
Stock Warrant [Member]
Exercise Price
Number of Shares Outstanding	131,250	131,250	180,000

Common shares issued for equi40

Common shares issued for equity financing (Details Narrative) - USD ($)	Oct. 15, 2015	Oct. 07, 2015	Oct. 02, 2015	Aug. 27, 2015	Jul. 14, 2015
Notes to Financial Statements
Restricted Common Shares Issued	833,333	1,250,000	1,000,000	2,500,000	1,666,667
Equity Financing	$ 25,000	$ 25,000	$ 30,000	$ 50,000	$ 50,000

Common shares reserved for fu41

Common shares reserved for future issuances (Details)	Jun. 30, 2016USD ($)
Notes to Financial Statements
Common shares to be issued under conversion feature	$ 11,702,118
Common shares to be issued under $0.01 warrants	81,250
Common shares to be issued under $0.50 warrants	50,000
Total common shares reserved for future issuance	$ 11,833,368

Income Taxes (Details)

Income Taxes (Details) - USD ($)	Jun. 30, 2016	Jun. 30, 2015
Income Taxes Tables
NOL carryover	$ 9,935,785	$ 9,140,022
Valuation allowance	(9,935,785)	(9,140,022)
Net deferred tax asset	$ 0	$ 0

Income Taxes (Details 2)

Income Taxes (Details 2) - USD ($)	12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Income Taxes Details 2
Federal income tax benefit, net of state	$ (575,728)	$ (3,145,246)
State income tax benefit	(164,205)	(897,064)
Valuation allowance	$ 739,933	$ 4,042,310

Commitments and Contingencies (

Commitments and Contingencies (Details)	Jun. 30, 2016USD ($)
Commitments And Contingencies Details Narrative
2,016	$ 79,427
2,017	39,714
Total	$ 119,141

Acquisition of SWC Group, Inc45

Acquisition of SWC Group, Inc. (Details) - USD ($)	Jun. 30, 2016	Jun. 30, 2015
Accounts receivable	$ 117,866	$ 85,958
Inventory	468,262	617,557
Other current assets	84,505	52,832
Customer deposits	248,299	$ 243,087
SWC Group, Inc. [Member]
Cash	209,214
Accounts receivable	388,399
Inventory	565,287
Other current assets	44,033
Security deposit	23,281
Loan receivables	312,521
Fixed assets	143,916
Intangible assets	3,039
Accounts payable	(1,727,870)
Credit card payable	(420,773)
Due to Sugarmade	(685,000)
Customer deposits	(234,197)
Loans payable	(529,064)
Other payables	(297,047)
Long term notes payables	(460,000)
Net assets at carrying value:	$ (2,664,261)

Acquisition of SWC Group, Inc46

Acquisition of SWC Group, Inc. (Details 2) - USD ($)	12 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Net loss	$ (2,458,170)	$ (10,230,524)
SWC Group, Inc. [Member]
Net sales		5,806,410
Net loss		$ (10,320,322)