0001683168-22-003694 | 10-Q | XBRL Viewer

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Cover - shares	9 Months Ended
Cover - shares	Mar. 31, 2022	May 15, 2022
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2022
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2022
Current Fiscal Year End Date	--06-30
Entity File Number	001-40391
Entity Registrant Name	iPower Inc.
Entity Central Index Key	0001830072
Entity Tax Identification Number	82-5144171
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	2399 Bateman Avenue
Entity Address, City or Town	Duarte
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	91010
City Area Code	626
Local Phone Number	863-7344
Title of 12(b) Security	Common Stock
Trading Symbol	IPW
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		29,572,382

Unaudited Condensed Consolidated Balance Sheets (Unaudited) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Current assets
Cash and cash equivalent	$ 2,641,584	$ 6,651,705
Accounts receivable, net	19,083,554	7,896,347
Inventories, net	22,410,936	13,065,741
Other receivables – related party	20,746	0
Prepayments and other current assets	7,813,772	4,693,000
Total current assets	51,970,592	32,306,793
Non-current assets
Right of use - non current	9,095,158	1,819,421
Property and equipment, net	165,071	55,659
Non-current prepayments	1,033,541	1,357,292
Goodwill	6,094,144	0
Investment in joint venture	37,711	0
Intangible assets, net	5,091,785	0
Other non-current assets	300,346	99,645
Total non-current assets	21,817,756	3,332,017
Total assets	73,788,348	35,638,810
Current liabilities
Accounts payable	6,342,835	3,940,963
Credit cards payable	745,585	584,311
Customer deposit	204,490	297,407
Other payables and accrued liabilities	4,895,528	2,487,441
Advance from shareholders	97,476	0
Short-term loans payable	0	162,769
Investment payable	1,500,000	0
Lease liability - current	1,790,688	731,944
Long-term loan payable - current portion	29,244	29,244
Long-term promissory note payable - current portion	1,826,564	0
Income taxes payable	864,109	790,823
Total current liabilities	18,296,519	9,024,902
Non-current liabilities
Long-term loan payable	434,201	458,571
Long-term revolving loan payable, net	11,166,577	0
Long-term promissory note payable, net	1,800,315	0
Deferred tax liabilities	836,330	0
Lease liability - non-current	7,573,610	1,169,552
Total non-current liabilities	21,811,033	1,628,123
Total liabilities	40,107,552	10,653,025
Commitments and contingency
Stockholders' Equity
Preferred stock, $0.001 par value; 20,000,000 shares authorized; 0 shares issued and outstanding at March 31, 2022 and June 30, 2021	0	0
Common stock, $0.001 par value; 180,000,000 shares authorized; 29,572,382 and 26,448,663 shares issued and outstanding at March 31, 2022 and June 30, 2021	29,573	26,449
Additional paid in capital	29,046,300	23,214,263
Retained earnings	4,612,219	1,745,073
Non-controlling interest	(4,070)	0
Accumulated other comprehensive income (loss)	(3,226)	0
Total equity	33,680,796	24,985,785
Total liabilities and equity	$ 73,788,348	$ 35,638,810

Unaudited Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Mar. 31, 2022	Jun. 30, 2021
Statement of Financial Position [Abstract]
preferred stock, par value	$ 0.001	$ 0.001
Preferred stock shares authorized	20,000,000	20,000,000
Preferred stock shares issued	0	0
Preferred stock shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	180,000,000	180,000,000
Common stock, shares issued	29,572,382	26,448,663
Common stock, shares outstanding	29,572,382	26,448,663

Unaudited Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Income Statement [Abstract]
REVENUES	$ 22,808,214	$ 13,133,902	$ 57,300,642	$ 39,348,154
TOTAL REVENUES	22,808,214	13,133,902	57,300,642	39,348,154
COST OF REVENUES	13,598,563	7,369,127	33,219,677	23,073,000
GROSS PROFIT	9,209,651	5,764,775	24,080,965	16,275,154
OPERATING EXPENSES:
Selling and fulfillment	5,030,267	3,071,897	12,338,027	9,070,320
General and administrative	2,802,395	1,904,144	7,940,349	4,486,621
Total operating expenses	7,832,662	4,976,041	20,278,376	13,556,941
INCOME FROM OPERATIONS	1,376,989	788,734	3,802,589	2,718,213
OTHER INCOME (EXPENSE)
Interest income (expenses)	(152,030)	(60,118)	(227,142)	(109,656)
Other financing expenses	(71,010)	(60,692)	(80,010)	(98,139)
PPP loan forgiveness	0	175,500	0	175,500
Gain (Loss) on equity method investment	(12,289)	0	(12,289)	0
Other non-operating income (expense)	75,882	(812,434)	85,473	(794,582)
Total other (expenses), net	(159,447)	(757,744)	(233,968)	(826,877)
INCOME BEFORE INCOME TAXES	1,217,542	30,990	3,568,621	1,891,336
PROVISION FOR INCOME TAXES	39,855	237,813	705,545	760,687
NET INCOME (LOSS)	1,177,687	(206,823)	2,863,076	1,130,649
Non-controlling interest	(4,070)	0	(4,070)	0
NET INCOME (LOSS) ATTRIBUTABLE TO IPOWER INC.	1,181,757	(206,823)	2,867,146	1,130,649
OTHER COMPREHENSIVE LOSS
Foreign currency translation adjustments	(3,226)	0	(3,226)	0
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO IPOWER INC.	$ 1,178,531	$ (206,823)	$ 2,863,920	$ 1,130,649
WEIGHTED AVERAGE NUMBER OF COMMON STOCK*
Basic	28,045,130	20,204,496	26,999,342	20,204,496
Diluted	28,045,130	20,204,496	26,999,342	20,204,496
EARNINGS (LOSSES) PER SHARE
Basic	$ 0.042	$ (0.010)	$ 0.106	$ 0.056
Diluted	$ 0.042	$ (0.010)	$ 0.106	$ 0.056

Unaudited Condensed Consolidated Statements of Changes in Stockholder's Equity - USD ($)	Common Stock [Member]	Class B Common Stock [Member]	Subscription Receivable [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Noncontrolling Interest [Member]	AOCI Attributable to Parent [Member]	Total
Balance, December 31, 2020, unaudited at Jun. 30, 2020	$ 20,204	$ 14,000	$ (14,000)	$ 389,490	$ 2,520,822			$ 2,930,516
Beginning balance, shares at Jun. 30, 2020	20,204,496	14,000,000
Net income					761,996			761,996
Balance, March 31, 2021, unaudited at Sep. 30, 2020	$ 20,204	$ 14,000	(14,000)	389,490	3,282,818			3,692,512
Ending balance, shares at Sep. 30, 2020	20,204,496	14,000,000
Balance, December 31, 2020, unaudited at Jun. 30, 2020	$ 20,204	$ 14,000	(14,000)	389,490	2,520,822			2,930,516
Beginning balance, shares at Jun. 30, 2020	20,204,496	14,000,000
Net income								1,130,649
Foreign currency translation adjustments								(0)
Foreign currency translation adjustments								0
Balance, March 31, 2021, unaudited at Mar. 31, 2021	$ 20,204	$ 14,000		389,490	3,651,471			4,075,165
Ending balance, shares at Mar. 31, 2021	20,204,496	14,000,000
Balance, December 31, 2020, unaudited at Sep. 30, 2020	$ 20,204	$ 14,000	(14,000)	389,490	3,282,818			3,692,512
Beginning balance, shares at Sep. 30, 2020	20,204,496	14,000,000
Net income					575,476			575,476
Cash for Class B common stock			14,000
Cash for Class B common stock								14,000
Balance, March 31, 2021, unaudited at Dec. 31, 2020	20,204	$ 14,000		389,490	3,858,294			4,281,988
Ending balance, shares at Dec. 31, 2020		14,000,000
Net income					(206,823)			(206,823)
Foreign currency translation adjustments								(0)
Foreign currency translation adjustments								0
Balance, March 31, 2021, unaudited at Mar. 31, 2021	$ 20,204	$ 14,000		389,490	3,651,471			4,075,165
Ending balance, shares at Mar. 31, 2021	20,204,496	14,000,000
Balance, December 31, 2020, unaudited at Jun. 30, 2021	$ 26,449			23,214,263	1,745,073			24,985,785
Beginning balance, shares at Jun. 30, 2021	26,448,663	0
Net income					887,528			887,528
Restricted stock units vested				103,054				103,054
Balance, March 31, 2021, unaudited at Sep. 30, 2021	$ 26,449			23,317,317	2,632,601			25,976,367
Ending balance, shares at Sep. 30, 2021	26,448,663	0
Balance, December 31, 2020, unaudited at Jun. 30, 2021	$ 26,449			23,214,263	1,745,073			24,985,785
Beginning balance, shares at Jun. 30, 2021	26,448,663	0
Net income								2,867,146
Foreign currency translation adjustments								3,226
Foreign currency translation adjustments								(3,226)
Balance, March 31, 2021, unaudited at Mar. 31, 2022	$ 29,573			29,046,300	4,612,219	(4,070)	(3,226)	33,680,796
Ending balance, shares at Mar. 31, 2022	29,572,382	0
Balance, December 31, 2020, unaudited at Sep. 30, 2021	$ 26,449			23,317,317	2,632,601			25,976,367
Beginning balance, shares at Sep. 30, 2021	26,448,663	0
Net income					797,861			797,861
Restricted stock units vested				54,435				54,435
Restricted shares issued for vested RSUs	$ 40			(40)
Restricted shares issued for vested RSUs shares	40,019
Balance, March 31, 2021, unaudited at Dec. 31, 2021	$ 26,489			23,371,712	3,430,462			26,828,663
Ending balance, shares at Dec. 31, 2021	26,488,682	0
Net income					1,181,757			1,181,757
Restricted stock units vested				149,299				149,299
Non-controlling interest						4,070		4,070
Shares issued for acquisition	$ 3,084			5,525,289				5,528,373
Shares issued for acquisition, shares	3,083,700
Foreign currency translation adjustments							3,226	3,226
Non-controlling interest						(4,070)		(4,070)
Foreign currency translation adjustments							(3,226)	(3,226)
Balance, March 31, 2021, unaudited at Mar. 31, 2022	$ 29,573			$ 29,046,300	$ 4,612,219	$ (4,070)	$ (3,226)	$ 33,680,796
Ending balance, shares at Mar. 31, 2022	29,572,382	0

Unaudited Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 2,867,146	$ 1,130,649
Adjustments to reconcile net income to cash used in operating activities:
Depreciation and amortization expense	95,325	8,394
Inventory reserve	92,659	0
Credit loss reserve	70,000	189,206
PPP loan forgiven	0	(175,500)
Stock-based compensation expense	306,788	0
Amortization of debt issuance costs	113,016	0
Loss on equity method investment	12,289	0
Non-cash operating lease expense	181,781	86,321
Preferred stock warrant expense	0	8,047
Amortization of debt discount and non-cash financing costs	0	501,562
Change in fair value of warrants and conversion features	0	334,564
Change in operating assets and liabilities
Accounts receivable	(11,257,207)	(2,214,794)
Inventories	(9,437,854)	(4,272,742)
Deferred tax liabilities	(552,783)	(52,947)
Prepayments and other current assets	(2,502,967)	(2,307,340)
Non-current prepayments	323,751	0
Other non-current assets	(200,701)	(99,395)
Accounts payable	2,401,872	2,765,091
Credit cards payable	161,274	(639,240)
Customer deposit	(92,917)	(113,221)
Other payables and accrued liabilities	2,584,973	(51,215)
Income taxes payable	73,286	116,483
Net cash used in operating activities	(14,760,269)	(4,786,077)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of equipment	(41,420)	(61,498)
Cash acquired on acquisition	268,828	0
Investment in joint venture	(50,000)	0
Net cash provided by (used in) investing activities	177,408	(61,498)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from related parties	0	532,222
Payments to related parties	(20,746)	(150,498)
Proceeds from short-term loans	1,604,292	22,414,846
Payments of financing fees	(796,035)	(120,000)
Payments on short-term loans	(1,767,061)	(21,691,308)
Proceeds from convertible notes	0	3,000,000
Proceeds from long-term loans	11,602,367	0
Payments on long-term loans	(24,370)	0
Shares issued	0	359,000
Net cash provided by financing activities	10,598,447	4,344,262
EFFECT OF EXCHANGE RATE ON CASH	(25,707)	0
CHANGES IN CASH	(4,010,121)	(503,313)
CASH AND CASH EQUIVALENT, beginning of year	6,651,705	977,635
CASH AND CASH EQUIVALENT, end of year	2,641,584	474,322
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for income tax	1,181,710	696,119
Cash paid for interest	0	109,656
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING TRANSACTIONS:
Shares issued for acquisition	5,528,373	0
Promissory note issued for acquisition	3,600,627	0
Investment payable for acquisition	1,500,000	0
Goodwill acquired in business acquisition	6,094,144	0
Deferred tax liabilities	1,389,113	0
Identifiable intangible assets acquired in business acquisition	5,172,956	0
Net assets acquired in business acquisition	751,015	0
Right of use assets acquired under new operating leases	$ 7,780,766	$ 2,346,200

Nature of business and organization

9 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of business and organization

Note 1 - Nature of business and organization

iPower Inc., formerly known as BZRTH Inc., a Nevada corporation (the “Company”), was incorporated on April 11, 2018. The Company is principally engaged in the marketing and sale of advanced indoor and greenhouse lighting, ventilation systems, nutrients, growing media, grow tents, trimming machines, pumps and accessories mainly in the North America.

Effective on March 1, 2020, as amended and restated pursuant to an agreement dated October 26, 2020, the Company entered into an agreement with E Marketing Solution Inc. (“E Marketing”), an entity incorporated in California and owned by one of the shareholders of the Company. Pursuant to the terms of the agreement, the Company agreed to provide technical support, management services and other services on an exclusive basis in relation to E Marketing’s business during the term of the agreement. The Company also agreed to fund E Marketing for operational cash flow needs and bear the risk of E Marketing’s losses from operations and E Marketing agreed that iPower has rights to E Marketing’s net profits, if any. Under the terms of the agreement, the Company may at any time, at its option, acquire for nominal consideration 100% of either the equity of E Marketing or its assets subject to assumption of all of its liabilities. E Marketing was considered a variable interest entity (“VIE”). On May 18, 2021, the Company acquired 100% equity ownership of E Marketing. As a result, E Marketing has become the Company’s wholly owned subsidiary.

On September 4, 2020, the Company entered into an agreement with Global Product Marketing Inc. (“GPM”), an entity incorporated in the State of Nevada on September 4, 2020. GPM was then wholly owned by Chenlong Tan, the Chairman, CEO and President and one of the majority shareholders of the Company. Pursuant to the terms of the agreement, the Company was to provide technical support, management services and other services on an exclusive basis in relation to GPM’s business during the term of the Agreement. In addition, the Company agreed to fund GPM for operational cash flow needs and bear the risk of GPM’s losses from operations and GPM agreed that the Company has the right to GPM’s net profits, if any. Under the terms of the agreement, the Company may at any time, at its option, acquire for nominal consideration 100% of either the equity of GPM or its assets subject to assumption of all of its liabilities. GPM was considered a VIE. On May 18, 2021, the Company acquired 100% equity ownership of GPM. As a result, GPM has become the Company’s wholly owned subsidiary.

On January 13, 2022, the Company entered into a joint venture agreement and formed a Nevada limited liability company, Box Harmony, LLC (“Box Harmony”), for the principal purpose of providing logistic services primarily for foreign-based manufacturers or distributors who desire to sell their products online in the United States, with such logistic services to include, without limitation, receiving, storing and transporting such products. The Company owns 40% of the equity interest in Box Harmony, retaining significant influence, but does not own a majority equity interest or otherwise control of Box Harmony. See details on Note 3 below.

On February 10, 2022, the Company entered into another joint venture agreement and formed a Nevada limited liability company, Global Social Media, LLC (“GSM”), for the principal purpose of providing a social media platform, contents and services to assist businesses, including the Company and other businesses, in marketing their products. The Company owns 60% of the equity interest in GSM and controls its operations. See details on Note 3 below.

On February 15, 2022, the Company acquired 100% of the ordinary shares of Anivia Limited (“Anivia”), a corporation organized under the laws of the British Virgin Islands (“BVI”), in accordance with the terms of a share transfer framework agreement (the “Transfer Agreement”), dated February 15, 2022, by and between the Company, White Cherry Limited, a BVI company (“White Cherry”), White Cherry’s equity holders, Li Zanyu and Xie Jing (together with White Cherry, the “Sellers”), Anivia, Fly Elephant Limited, a Hong Kong company, Dayou Renzai (Shenzhen) Technology Company Limited, and Daheshou (Shenzhen) Information Technology Limited. Anivia owns 100% of the equity of Fly Elephant Limited, which in turn owns 100% of the equity of Dayou Renzai (Shenzhen) Technology Co., Ltd., a corporation located in the People’s Republic of China (“PRC”) and which is a wholly foreign-owned enterprise (“WFOE”) of Fly Elephant Limited. The WFOE controls, through contractual arrangements summarized below, the business, revenues and profits of Daheshou (Shenzhen) Information Technology Co., Ltd., a company organized under the Laws of the PRC (“DHS”) and located in Shenzhen, China. See details on Note 4 below.

Basis of Presentation and Summary of significant accounting policies

9 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Basis of Presentation and Summary of significant accounting policies

Note 2 – Basis of Presentation and Summary of significant accounting policies

Basis of presentation

The unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP can be condensed or omitted. These unaudited condensed consolidated financial statements have been prepared on the same basis as its annual consolidated financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for the fair statement of the Company’s financial information. These interim results are not necessarily indicative of the results to be expected for the fiscal year ending June 30, 2022, or for any other interim period or for any other future year. All intercompany balances and transactions have been eliminated in consolidation.

These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the Annual Report for the year ended June 30, 2021, which are included in the Company’s Annual Report on Form 10-K filed on September 28, 2021.

Principles of Consolidation

The unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries, E Marketing Solution Inc., Global Product Marketing Inc., Global Social Media, LLC, and Anivia Limited and its subsidiaries and VIE. All inter-company balances and transactions have been eliminated.

Reclassifications

Certain prior period expense accounts have been reclassified in conformity with current period presentation including reclassification of $1.8 million from general administrative expenses to selling and fulfillment expenses for the nine months ended March 31, 2021. The reclassification had no effect to the company’s unaudited condensed consolidated statements of operations, statements of cash flow or statements of changes in stockholders’ equity.

Use of estimates and assumptions

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities reported and disclosures of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results could differ from these estimates.

Foreign currency translation and transactions

The reporting and functional currency of iPower and subsidiaries is the U.S. dollar (USD). iPower’s VIE in China uses the local currency, Renminbi (“RMB”), as its functional currency. Assets and liabilities of the VIE are translated at the current exchange rate as quoted by the People’s Bank of China (the “PBOC”) at the end of the period. Income and expense accounts are translated at the average translation rates and the equity accounts are translated at historical rates. Translation adjustments resulting from this process are included in accumulated other comprehensive income (loss) in the statement of changes stockholders’ in equity. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.

The balance sheet amounts of the VIE, with the exception of equity, on March 31, 2022, were translated at 6.34 RMB to $1.00. The equity accounts were stated at their historical rates. The average translation rates applied to statements of operations and comprehensive income (loss) accounts for the quarter ended March 31, 2022 was 6.35 RMB to $1.00. Cash flows were also translated at average translation rates for the period and, therefore, amounts reported on the statement of cash flows would not necessarily agree with changes in the corresponding balances on the consolidated balance sheet.

Cash and cash equivalents

Cash and cash equivalents consist of amounts held as cash on hand and deposits in financial institutions.

From time to time, the Company 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). The Company has 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, net

During the ordinary course of business, the Company extends unsecured credit to its customers. Accounts receivable are stated at the amount the Company expects to collect from customers. Management reviews its accounts receivable balances each reporting period to determine if an allowance for credit loss is required.

In July 2020, the Company adopted ASU 2016-13, Topics 326 - Credit Loss, Measurement of Credit Losses on Financial Instruments, which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (CECL) methodology, for its accounting standard for its trade accounts receivable.

The Company evaluates the creditworthiness of all of its customers individually before accepting them and continuously monitors the recoverability of accounts receivable. If there are any indicators that a customer may not make payment, the Company may consider making provision for non-collectability for that particular customer. At the same time, the Company may cease further sales or services to such customer. The following are some of the factors that the Company develops allowance for credit losses:

the customer fails to comply with its payment schedule;

the customer is in serious financial difficulty;

a significant dispute with the customer has occurred regarding job progress or other matters;

the customer breaches any of its contractual obligations;

the customer appears to be financially distressed due to economic or legal factors;

the business between the customer and the Company is not active; and

other objective evidence indicates non-collectability of the accounts receivable.

The adoption of the credit loss accounting standard has no material impact on the Company’s consolidated financial statements. Accounts receivable are recognized and carried at carrying amount less an allowance for credit losses, if any. The Company maintains an allowance for credit losses resulting from the inability of its customers to make required payments based on contractual terms. The Company reviews the collectability of its receivables on a regular and ongoing basis. The Company has also included in calculation of allowance for credit losses the potential impact of the COVID-19 pandemic on our customers’ businesses and their ability to pay their accounts receivable. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. The Company also considers external factors to the specific customer, including current conditions and forecasts of economic conditions, including the potential impact of the COVID-19 pandemic. In the event we recover amounts previously written off, we will reduce the specific allowance for credit losses.

Equity method investment

The Company accounts for its ownership interest in Box Harmony, a 40% owned joint venture, following the equity method of accounting, in accordance with ASC 323, Investments —Equity Method and Joint Ventures. Under this method, the carrying cost is initially recorded at cost and then increased or decreased by recording its percentage of gain or loss in its statement of operations and a corresponding charge or credit to the carrying value of the asset.

Business Combination

On February 15, 2022, the Company acquired 100% of the ordinary shares of Anivia Limited (“Anivia”) and its subsidiaries, including the VIE. The Company applies the acquisition method of accounting for business combinations. Under the acquisition method, the acquiring entity in a business combination recognizes 100% of the assets acquired and liabilities assumed at their acquisition date fair values. Management utilizes valuation techniques appropriate for the asset or liability being measured in determining these fair values. Any excess of the purchase price over amounts allocated to assets acquired, including identifiable intangible assets, and liabilities assumed is recorded as goodwill. Where amounts allocated to assets acquired and liabilities assumed is greater than the purchase price, a bargain purchase gain is recognized. Acquisition-related costs are expensed as incurred. See Note 4 for details on acquisition.

Variable interest entities

On February 15, 2022, the Company acquired 100% of the ordinary shares of Anivia Limited (“Anivia”) and its subsidiaries, including Daheshou (Shenzhen) Information Technology Co., Ltd., a company organized under the Laws of the PRC (“DHS”). Pursuant to the terms of the Agreements, the Company does not have direct ownership in DHS but is actively involved in DHS’s operations as the sole manager to direct the activities and significantly impact DHS’s economic performance. DHS’s operational funding is provided by the Company after February 15, 2022. During the term of the agreements, the Company bears all the risk of loss and has the right to receive all of the benefits from DHS. As such, based on the determination that the Company is the primary beneficiary of DHS, in accordance with ASC 810-10-25-38A through 25-38J, DHS is considered a variable interest entity (“VIE”) of the Company and the financial statements of DHS have been consolidated from the date such control existed, February 15, 2022. See Note 4 and Note 5 for details on acquisition.

Goodwill

Goodwill represents the excess of the purchase price over the fair value of assets acquired and liabilities assumed. The Company accounts for goodwill under ASC Topic 350, Intangibles-Goodwill and Other.

The Company does not have any other indefinite-lived intangible assets.

The impairment test for goodwill uses a two-step approach. Step one compares the estimated fair value of a reporting unit with goodwill to its carrying value. If the carrying value exceeds the estimated fair value, step two must be performed. Step two compares the carrying value of the reporting unit to the fair value of all of the assets and liabilities of the reporting unit (including any unrecognized intangibles) as if the reporting unit was acquired in a business combination. If the carrying amount of a reporting unit’s goodwill exceeds the implied fair value of its goodwill, an impairment loss is recognized in an amount equal to the excess.

Intangible Assets, net

Finite life intangible assets at March 31, 2022 include covenant not to compete, supplier relationship, and software recognized as part of the acquisition of Anivia Limited. Intangible assets are recorded at the estimated fair value of these items at the date of acquisition, February 15, 2022. Intangible assets are amortized on a straight-line basis over their estimated useful life as followings:

Schedule of estimated useful life
		Useful Life
Covenant Not to Compete		10 years
Supplier relationship		6 years
Software		5 years

Fair values of financial instruments

ASC 825, “Disclosures about Fair Value of Financial Instruments,” requires disclosure of fair value information about financial instruments. ASC 820, “Fair Value Measurements” defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements.

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and all other current assets and liabilities approximate fair values due to their short-term nature.

On February 15, 2022, as part of the consideration for the acquisition of Anivia Limited, the Company issued a two-year unsecured 6% subordinated promissory note, payable in equal semi-annual installments commencing August 15, 2022 (the “Purchase Note”). The principal amount of the Purchase Note was $3.5 million. On February 15, 2022, the Company evaluated the fair value of the Purchase Note to be $3.6 million using the following inputs:

Corporate bond yield 3.1%

Risk-free rate 1.6%

Liquidity premium 0.4%

Discount rate 3.5%

As of March 31, 2022, the outstanding principal balance of the Purchase Note was $3,626,879, including premium of $100,629 and $26,250 of accrued interest.

For other financial instruments to be reported at fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines the fair value of its financial instruments based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels:

Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Level 2 – Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and

Level 3 – Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data.

Revenue recognition

The Company has adopted Accounting Standards Codification (“ASC”) 606 since its inception on April 11, 2018 and recognizes revenue from product sales in the United States, Canada, Europe and other regions, net of promotional discounts and return allowances, when the following revenue recognition criteria are met: a contract has been identified, separate performance obligations are identified, the transaction price is determined, the transaction price is allocated to separate performance obligations and revenue is recognized upon satisfying each performance obligation. The Company transfers the risk of loss or damage upon shipment, therefore, revenue from product sales is recognized when it is shipped to the customer. Return allowances, which reduce product revenue by the Company’s best estimate of expected product returns, are estimated using historical experience.

The Company evaluates the criteria of ASC 606 - Revenue Recognition Principal Agent Considerations in determining whether it is appropriate to record the gross amount of product sales and related costs or the net amount earned as commissions. Generally, when the Company is primarily responsible for fulfilling the promise to provide a specified good or service, the Company is subject to inventory risk before the good or service has been transferred to a customer and the Company has discretion in establishing the price, revenue is recorded at gross.

Payments received prior to the delivery of goods to customers are recorded as customer deposits.

The Company periodically provides incentive offers to its customers to encourage purchases. Such offers include current discount offers, such as percentage discounts off current purchases and other similar offers. Current discount offers, when accepted by the Company’s customers, are treated as a reduction to the purchase price of the related transaction.

Sales discounts are recorded in the period in which the related sale is recognized. Sales return allowances are estimated based on historical amounts and are recorded upon recognizing the related sales. Shipping and handling costs are recorded as selling expenses.

Advertising costs

Advertising costs are expensed as incurred. Total advertising and promotional costs included in selling and fulfillment expenses for the three and nine months were as following:

Schedule of advertising costs
	Three Months Ended March 31,				Nine Months Ended March 31,
	2022		2021		2022		2021
Advertising and promotion	$	733,241	$	443,163	$	1,945,222	$	1,164,119

Cost of revenue

Cost of revenue mainly consists of costs for purchases of products and related inbound freight and delivery fees.

Inventory, net

Inventory consists of finished goods ready for sale and is stated at the lower of cost or market. The Company values its inventory using the weighted average costing method. The Company’s policy is to include as a part of cost of goods sold any freight incurred to ship the product from its vendors to warehouses. Outbound freight costs related to shipping costs to customers are considered periodic costs and are reflected in selling and fulfillment expenses. The Company regularly reviews inventory and considers forecasts of future demand, market conditions and product obsolescence.

If the estimated realizable value of the inventory is less than cost, the Company makes provisions in order to reduce its carrying value to its estimated market value. The Company also reviews inventory for slow moving inventory and obsolescence and records allowance for obsolescence.

Segment reporting

The Company follows ASC 280, Segment Reporting. The Company’s chief operating decision maker, the Chief Executive Officer, reviews the consolidated results of operations when making decisions about allocating resources and assessing the performance of the Company as a whole and, hence, the Company has only one reportable segment. The Company does not distinguish between markets or segments for the purpose of internal reporting. For the nine months ended March 31, 2022, sales through Amazon to Canada were approximately 5.7% of the Company’s total sales. The Company’s majority of long-lived assets are located in California, United States, and majority of the Company’s revenues are derived from within the United States. Therefore, no geographical segments are presented.

Leases

On its inception date, April 11, 2018, the Company adopted ASC 842 – Leases (“ASC 842”), which requires lessees to record right-of-use (“ROU”) assets and related lease obligations on the balance sheet, as well as disclose key information regarding leasing arrangements.

ROU assets represent our right to use an underlying asset for the lease terms and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company generally uses its incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Stock-based Compensation

The Company applies ASC No. 718, “Compensation-Stock Compensation,” which requires that share-based payment transactions with employees and nonemployees upon adoption of ASU 2018-07, be measured based on the grant date fair value of the equity instrument and recognized as compensation expense over the requisite service period, with a corresponding addition to equity. Under this method, compensation cost related to employee share options or similar equity instruments is measured at the grant date based on the fair value of the award and is recognized over the period during which an employee is required to provide service in exchange for the award, which generally is the vesting period.

The Company will recognize forfeitures of such equity-based compensation as they occur.

Income taxes

The Company accounts 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 aspects of the recognition and measurement related to accounting for income taxes. The Company has adopted the provisions of ASC 740 since inception, April 11, 2018, and has analyzed filing positions in each of the federal and state jurisdictions where the Company is required to file income tax returns, as well as open tax years in such jurisdictions. The Company has identified the U.S. federal jurisdiction, and the states of Nevada and California, as its “major” tax jurisdictions. However, the Company has 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.

The Company believes that our income tax filing positions and deductions will be sustained upon audit and do not anticipate any adjustments that will result in a material change to its financial position. Therefore, no reserves for uncertain income tax positions have been recorded pursuant to ASC 740. The Company’s policy for recording interest and penalties associated with income-based tax audits is to record such items as a component of income taxes.

Commitments and contingencies

In the ordinary course of business, the Company is subject to certain contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. The Company recognizes a liability for such contingency if it determines it is probable that a loss has occurred and a reasonable estimate of the loss can be made. The Company may consider many factors in making these assessments including historical and specific facts and circumstances of each matter.

Earnings per share

Basic earnings per share are computed by dividing net income attributable to holders of common stock by the weighted average number of shares of common stock outstanding during the year. Diluted earnings per share reflect the potential dilution that could occur if securities to issue common stock were exercised.

Recently issued accounting pronouncements

In August 2020, the FASB issued ASU 2020-06, “Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40).” This ASU reduces the number of accounting models for convertible debt instruments and convertible preferred stock, as well as amends the guidance for the derivatives scope exception for contracts in an entity’s own equity for purposes of reducing form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related EPS guidance. This standard becomes effective for the Company on July 1, 2022, including interim periods within those fiscal years. Adoption is either a modified retrospective method or a fully retrospective method of transition. The Company does not expect the adoption of this standard have a material impact on the consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) – Simplifying the Accounting for Income Taxes. The update is intended to simplify the current rules regarding the accounting for income taxes and addresses several technical topics including accounting for franchise taxes, allocating income taxes between a loss in continuing operations and in other categories such as discontinued operations, reporting income taxes for legal entities that are not subject to income taxes, and interim accounting for enacted changes in tax laws. The new standard is effective for fiscal years beginning after December 15, 2020; however, early adoption is permitted. Adoption of this standard did not have a material impact on the consolidated financial statements.

The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the consolidated financial position, statements of operations and cash flows.

Subsequent events

The Company evaluated subsequent events and transactions that occurred after the balance sheet date through the date that the consolidated financial statements are available to be issued. Material subsequent events that required recognition or additional disclosure in the consolidated financial statements are presented.

Joint Ventures

9 Months Ended

Mar. 31, 2022

Joint Ventures

Joint Ventures

Note 3 - Joint Ventures

Box Harmony, LLC

On January 13, 2022, the Company entered into a joint venture agreement (the “Joint Venture Agreement”) with Titanium Plus Autoparts, Inc., a California corporation (“TPA”), Tony Chiu (“Chiu”) and Bin Xiao (“Xiao”). Pursuant to the terms of the Joint Venture Agreement, the parties formed a Nevada limited liability company, Box Harmony, LLC (“Box Harmony”), for the principal purpose of providing logistic services primarily for foreign-based manufacturers or distributors who desire to sell their products online in the United States, with such logistic services to include, without limitation, receiving, storing and transporting such products.

Following entry into the Joint Venture Agreement, Box Harmony issued a total of 6,000 certificated units of membership interest, designated as Class A voting units (“Equity Units”), as follows: (i) the Company agreed to contribute $50,000 in cash in exchange for 2,400 Equity Units in Box Harmony and agreed to provide Box Harmony with the use and access to certain warehouse facilities leased by the Company (see below), and (ii) TPA received 1,200 Equity Units in exchange for (a) $1,200 and contributing the TPA IP License referred to below, (b) its existing and future customer contracts, and (c) granting Box Harmony the use of shipping accounts (FedEx and UPS) and all other TPA carrier contracts, and (iii) Xiao received 2,400 Equity Units in exchange for $2,400 and his agreement to manage the day to day operations of Box Harmony.

Under the terms of the Box Harmony limited liability operating agreement (the “LLC Agreement”), TPA and Xiao each granted to the Company an unconditional and irrevocable right and option to purchase from Xiao and TPA at any time within the first 18 months following January 13, 2022, up to 1,200 Class A voting units, at an exercise price of $550 per Class A voting unit, for a total exercise price of up to $660,000. If such option is fully exercised, the Company would own 3,600 Equity Units or 60% of the total outstanding Equity Units. The LLC Agreement prohibits the issuance of additional Equity Units and certain other actions unless approved in advance by the Company, that a noncontrolling right that would not be substantive to overcome the majority voting interests held by TPA and Xiao.

As a result, the Company owns 40% of the equity interest in Box Harmony with significant influence but does not own a majority equity interest or otherwise control of Box Harmony. The Company accounts for its ownership interest in Box Harmony following the equity method of accounting, in accordance with ASC 323, Investments —Equity Method and Joint Ventures. Under this method, the carrying cost is initially recorded at cost and then increased or decreased by recording its percentage of gain or loss in its statement of operations and a corresponding charge or credit to the carrying value of the asset.

Global Social Media, LLC

On February 10, 2022, the Company entered into a joint venture agreement with Bro Angel, LLC, Ji Shin and Bing Luo (the “GSM Joint Venture Agreement”). Pursuant to the terms of the GSM Joint Venture Agreement, the parties formed a Nevada limited liability company, Global Social Media, LLC (“GSM”), for the principal purpose of providing a social media platform, contents and services to assist businesses, including the Company and other businesses, in marketing their products.

Following entry into the GSM Joint Venture Agreement, GSM issued 10,000 certificated units of membership interest (the “GSM Equity Units”), of which the Company was issued 6,000 GSM Equity Units and Bro Angel was issued 4,000 GSM Equity Units. Messrs. Shin and Luo are the owners of 100% of the equity of Bro Angel. The LLC Agreement prohibits the issuance of additional Equity Units and certain other actions unless approved in advance by Bro Angel, creating a noncontrolling right that would not be substantive to overcome the majority voting interests held by the Company.

As of the date of this report, the members had not completed the capital contributions and no receivables were recorded.

Pursuant to the terms of the Agreements, the Company owns 60% of the equity interest in GSM and control of the operations. Based on ASU 2015-02, the Company consolidate GSM due to its majority equity ownership and control over operations. For the three and nine months ended March 31, 2022, the impact of GSM’s activities were immaterial to the Company’s consolidated financial statements.

Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entity

9 Months Ended

Mar. 31, 2022

Acquisition Of Anivia Limited And Subsidiaries And Variable Interest Entity

Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entity

Note 4 - Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entity

On February 15, 2022, the Company acquired 100% of the ordinary shares of Anivia Limited (“Anivia”), a corporation organized under the laws of the British Virgin Islands (“BVI”), in accordance with the terms of a share transfer framework agreement (the “Transfer Agreement”), dated February 15, 2022, by and between the Company, White Cherry Limited, a BVI company (“White Cherry”), White Cherry’s equity holders, Li Zanyu and Xie Jing (together with White Cherry, the “Sellers”), Anivia, Fly Elephant Limited, a Hong Kong company, Dayou Renzai (Shenzhen) Technology Company Limited and Daheshou (Shenzhen) Information Technology Limited. Anivia owns 100% of the equity of Fly Elephant Limited, which in turn owns 100% of the equity of Dayou Renzai (Shenzhen) Technology Co., Ltd., a corporation located in the People’s Republic of China (“PRC”) and which is a wholly foreign-owned enterprise (“WFOE”) of Fly Elephant Limited. The WFOE controls, through contractual arrangements summarized below, the business, revenues and profits of Daheshou (Shenzhen) Information Technology Co., Ltd., a company organized under the Laws of the PRC (“DHS”) and located in Shenzhen, China.

The contractual arrangements between the WFOE and DHS are established through a variable interest operating entity structure, which is reflected in (i) an exclusive business cooperation agreement, dated December 15, 2021, between the WFOE and DHS, (ii) an exclusive equity interest pledge agreement, dated December 15, 2021, between the WFOE and DHS in which the equity of DHS was pledged to the WFOE, (iii) an exclusive option agreement, dated December 15, 2021, between the WFOE, DHS and its equity holders, Li Zanyu and Xie Jing (the “Equity Holders), pursuant to which the Equity Holders give the WFOE the irrevocable and exclusive right to purchase the equity interests in DHS, and (iii) a power of attorney, dated December 15, 2021, pursuant to which Li Zanyu and Xie Jing, the holders of 100% of the equity interest of DHS, granted the WFOE all voting and other rights to their equity interest in DHS. According to the exclusive business cooperation agreement, in consideration for the services provided by the WFOE, DHS shall pay a service fee to the WFOE on annual basis (or at any time agreed by the Parties). The service fees for each year (or for any other period agreed to by the Parties) shall consist of a management fee and a fee for services provided, which shall be reasonably determined by the WFOE based on the nature, complexity, time, and other market and operation factors. The WFOE may provide a separate confirmation letter and/or invoice to DHS to indicate the amount of service fees due for each service period; or the amount of services fees may be as set forth in the relevant contracts separately executed by the Parties. DHS is principally engaged in selling a wide range of products and providing logistic services in the PRC.

Pursuant to the terms of the Agreements, the Company does not have direct ownership in DHS but is actively involved in DHS’s operations as the sole manager to direct the activities and significantly impact DHS’s economic performance. As such, based on the determination that the Company is the primary beneficiary of DHS, in accordance with ASC 810-10-25-38A through 25-38J, DHS is considered a variable interest entity (“VIE”) of the Company and the financial statements of DHS have been consolidated from the date such control existed, February 15, 2022.

Total fair value of the consideration for the transaction was $10,629,000, which was paid to White Cherry as follows: at closing, the Company (i) paid $3,500,000 in the form of a two-year unsecured 6% subordinated promissory note, payable in equal semi-annual installments commencing August 15, 2022 (the “Purchase Note”), (ii) issued 3,083,700 restricted shares (subject to a lock-up period of 180 days and insider trading rules) of the Company’s Class A common stock, and (iii) an additional $1,500,000 in cash was to be paid after closing.

JP Morgan Chase Bank, the Company’s senior secured lender (“JPM”), consented to the transaction. In conjunction with obtaining JPM’s consent, the Company delivered an amendment to the pledge and security agreement with JPM, pursuant to which the Company pledged to JPM 65% of the equity interest of Anivia Limited, Fly Elephant Limited and the WFOE.

In addition, in conjunction with the closing of the transaction, the WFOE entered into an employment agreement with Li Zanyu, dated February 15, 2022 (the “Employment Agreement”), pursuant to which Mr. Li has been appointed to serve as general manager of the WFOE for a term of 10 years (through February 14, 2032), with annual base compensation of up to 500,000 RMB plus bonus as may be determined by the WFOE from time to time, in its sole discretion, based on Mr. Li’s performance. During such employment, Mr. Li may not engage in other employment without the consent of the WFOE.

The acquisition of Anivia was accounted for as a business combination under ASC 805. As the acquirer for accounting purposes, the Company has estimated the fair value of Anivia and its subsidiaries’ assets acquired and conformed the accounting policies of Anivia to its own accounting policies. The Company applied the income approach and cost approach in determining the fair value of the intangible assets, which intangible assets consisted of a covenant not to compete, supplier relationship and software. The fair value of the remaining assets acquired and liabilities assumed were not significantly different from their carrying values at the acquisition date. The Company recognized an approximately $6.1 million of goodwill in the transaction, which is primarily due to the subsumed assembled workforce intangible assets. Goodwill is not deductible for income tax purposes. The Company expensed with the acquisition, certain legal and accounting costs of $54,702, as general and administration expenses and $50,000 paid to JPM as financing fees.

The following information summarizes the purchase consideration and allocation of the fair values assigned to the assets at the purchase date, February 15, 2022:


Fair Value of Purchase Price:
Cash	$	1,500,000
Promissory note issued		3,600,627
Common stock issued		5,528,373
Total purchase consideration	$	10,629,000

Purchase Price Allocation:
Covenant not to compete	$	3,459,120
Supplier relationship		1,179,246
Software		534,591
Current assets		1,104,407
Property and equipment		46,548
ROU asset		175,231
Goodwill		6,094,144
Deferred tax liabilities		(1,389,113	)
Current liabilities		(394,659	)
Lease liability		(180,515	)
Total purchase consideration	$	10,629,000

As of the date of this report, the cash portion of the consideration, $1.5 million, had not been paid as the seller’s bank account was still not opened due to the delay caused by the COVID-19 conditions in Hong Kong and China.

The results of operations of Anivia for the period from February 16, 2022 through March 31, 2022 were included in the Company's consolidated financial statements as of and for the period ended March 31, 2022. See Note 5 for details.

Pro Forma Financial Information

The following pro forma information presents a summary of the Company’s combined operating results for the nine months ended March 31, 2022 and 2021, as if the acquisition had occurred on July 1, 2020. The following pro forma financial information is not necessarily indicative of the Company’s operating results as they would have been had the acquisition been effected on the assumed date, nor is it necessarily an indication of trends in future results for a number of reasons, including, but not limited to, differences between the assumptions used to prepare the pro forma information, basic shares outstanding and dilutive equivalents, cost savings from operating efficiencies, potential synergies, and the impact of incremental costs incurred in integrating the businesses.


	Nine months ended
	March 31,
	2022		2021
Total Revenues	$	57,300,642	$	39,348,154
Income from Operations	$	4,623,664	$	3,043,253
Basic and diluted income per share	$	0.12	$	0.06

Variable interest entity

9 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Variable interest entity

Note 5 – Variable interest entity

Effective February 15, 2022, upon acquisition of Anivia, the Company assumed the contractual arrangements between the WFOE and DHS through a variable interest operating entity structure. See Note 4 for details.

The Company did not provide financial or other support to the VIE for the periods presented where the Company was not otherwise contractually required to provide such support.

As of March 31, 2022 and June 30, 2021, there was no pledge or collateralization of the VIE assets that would be used to settle obligations of the VIE.

The carrying amounts of the assets, liabilities and the results of operations of the VIE included in the Company’s consolidated balance sheets and statements of operations and comprehensive income after the elimination of intercompany balances and transactions with the VIE are as follows:

The carrying amount of the VIE’s assets and liabilities were as follows for the periods indicated:


	March 31, 2022		June 30, 2021
Cash in bank	$	730,227	$	–
Prepayments and other receivables	$	1,289,406	$	–
Office equipment, net	$	52,142	$	–
Right of use - noncurrent	$	156,706		–
Advance from shareholders	$	97,476	$	–
Lease liability	$	161,401		–
Income tax payable	$	119,291	$	–
Other payables	$	147,010	$	–

The operating results of the VIE were as follows for the period from February 15, 2022 to March 31, 2022:

Operating results of the VIE
	March 31, 2022
Revenue	$	–
Net loss	$	650,194

For the period from February 15, 2022 to March 31, 2022, the VIE contributed approximately $1.3 million of revenue and $0.4 million of net income before elimination.

Accounts receivable, net

9 Months Ended

Mar. 31, 2022

Receivables [Abstract]

Accounts receivable, net

Note 6 - Accounts receivable, net

Accounts receivable, net for the Company consisted of the following as of the dates indicated below:

Schedule of accounts receivable
	March 31, 2022			June 30, 2021
Accounts receivable	$	19,153,554		$	7,896,347
Less: allowance for credit losses		(70,000	)		–
Total accounts receivable, net	$	19,083,554		$	7,896,347

There was a $70,000 allowance for credit loss for the three and nine months ended March 31, 2022 and $0 recorded for the year ended June 30, 2021, respectively.

Inventories, net

9 Months Ended

Mar. 31, 2022

Inventory Disclosure [Abstract]

Inventories, net

Note 7 – Inventories, net

As of March 31, 2022 and June 30, 2021, inventories consisted of finished goods ready for sale, net of allowance for obsolescence, amounted to $22,410,936 and $13,065,741, respectively.

As of March 31, 2022 and June 30, 2021, allowance for obsolescence was $188,233 and $95,574, respectively. There was $36,701 and $92,659 allowance for obsolescence for the three and nine months ended March 31, 2022.

Prepayments and other current assets

9 Months Ended

Mar. 31, 2022

Prepayments And Other Current Assets

Prepayments and other current assets

Note 8 – Prepayments and other current assets

As of March 31, 2022 and June 30, 2021, prepayments and other current assets consisted of the following:


	March 31, 2022		June 30, 2021
Advance to suppliers	$	6,571,914	$	3,969,625
Prepaid expenses and other receivables		1,241,858		723,375

Total	$	7,813,772	$	4,693,000

Other receivables consisted of delivery fees of $156,590 and $178,581 and receivables from two unrelated parties for their use of the Company’s courier accounts at March 31, 2022 and June 30, 2021.

Non-current prepayments

9 Months Ended

Mar. 31, 2022

Non-current Prepayments

Non-current prepayments

Note 9 – Non-current prepayments

Non-current prepayments included $955,416 for product sourcing, marketing research and promotion, and other management advisory and consulting services to companies owned by an employee and minority shareholder and by relatives of a minority shareholder of the Company. The terms of these services are from two years to five years. In addition, there was a $78,125 down payment on a four-year car lease. As of March 31, 2022 and June 30, 2021, total non-current prepayments were $1,033,541 and $1,357,292, respectively. For the three and nine months ended March 31, 2022, the Company recorded amortization expenses of $107,917 and $323,751, respectively. For the three and nine months ended March 31, 2021, the Company recorded amortization expenses of $0.

Intangible assets, net

9 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible assets, net

Note 10 – Intangible assets, net

As of March 31, 2022, intangible assets, net, consisted of the following:

Schedule of intangible assets
	March 31, 2022
Covenant Not to Compete		3,459,120
Supplier relationship		1,179,245
Software		534,591
Accumulated amortization		(81,171	)
Total		5,091,785

The intangible assets were acquired on February 15, 2022 through acquisition of Anivia. The weighted average remaining life for finite-lived intangible assets at March 31, 2022 was approximately 8.57 years, and the amortization expense for the three and nine months ended March 31, 2022 was $81,171. At March 31, 2022, finite-lived intangible assets are expected to be amortized over their estimated useful lives, which ranges from a period of five to 10 years, and the estimated remaining amortization expense for each of the five succeeding years and periods thereafter is as follows:

Schedule of future amortization

Year Ending June 30,	Amount
2022	$	162,343
2023	649,371
2024	649,371
2025	649,371
2026	649,371
Thereafter	2,331,958
	$	5,091,785

Loans payable

9 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Loans payable

Note 11 – Loans payable

Short-term loans

Revolving credit facility

On May 3, 2019, the Company entered into an agreement with WFC Fund LLC (“WFC") for a revolving loan of up to $2,000,000. The revolving loan bore interest equal to the prime rate plus 4.25% per annum on the outstanding amount. On May 26, 2020, the Loan and Security Agreement was amended and restated as a Receivable Purchase Agreement (the “Original RPA”). On November 16, 2020, the Original RPA was further amended and restated (the “Restated RPA”) to increase the credit limit of the revolving credit facility from $2,000,000 to $3,000,000. The Restated RPA bore a discount rate of 3.055555%, subject to a rebate of 0.0277% per day. This revolving credit facility was secured by all of the Company’s assets and guaranteed by Chenlong Tan, the CEO and one of the Company’s major shareholders and founders. Pursuant to the terms of the agreement, all purchases of accounts receivable were without recourse to the Company, and WFC assumed the risk of nonpayment of the accounts receivable due to a customer’s financial inability to pay the accounts receivable or the customer’s insolvency but not the risk of non-payment of the accounts receivable for any other reason. The Company was obligated to collect the accounts receivables and to repurchase or pay back the amount drawn down if the accounts receivable were not collected.

During the three months ended September 30, 2021, the Company terminated the Restated RPA and paid off the balance due to WFC.

As of March 31, 2022 and June 30, 2021, the outstanding balance due under the RPA was $0 and $162,769, respectively.

Long-term loan

SBA loan payable

On April 18, 2020, the Company entered into an agreement with the U.S. Small Business Administration (“SBA”) for a loan of $500,000 under Section 7(b) of the Small Business Act pursuant to which we issued a promissory note (the “SBA Note”) to the SBA. The SBA Note bears interest at the rate of 3.75% per annum and matures 30 years from the date of the SBA Note. Monthly installment payments, including principal and interest, will begin twelve months from the date of the SBA Note. As of March 31, 2022 and June 30, 2021, the outstanding balance of the SBA Note was $463,445 and $487,815, which included a current portion of $29,244 and a non-current portion of $434,201 and $458,571, respectively.

Asset-based revolving loan

On November 12, 2021, the Company entered to a Credit Agreement with JPMorgan Chase Bank, N.A., as administrative agent, issuing bank and swingline lender, for an asset-based revolving loan (“ABL”) of up to $25 million with key terms listed as follows:

Borrowing base equal to the sum of

Ø Up to 90% of eligible credit card receivables

Ø Up to 85% of eligible trade accounts receivable

Ø Up to the lesser of (i) 65% of cost of eligible inventory or (ii) 85% of net orderly liquidation value of eligible inventory

· Interest rates of between LIBOR plus 2% and LIBOR plus 2.25% depending on utilization

· Undrawn fee of between 0.25% and 0.375% depending on utilization

· Maturity Date of November 12, 2024

In addition, the ABL includes an accordion feature that allows the Company to borrow up to an additional $25 million. To secure complete payment and performance of the secured obligations, the Company granted a security interest in all of its right, title and interest in, to and under all of the Company’s assets as collateral to the ABL. Upon closing of the ABL, the Company paid $796,035 financing fees including 2% of $25.0 million or $500,000 paid to its financial advisor. The financing fees are recorded as debt discount and to be amortized over three years as financing expenses, the term of the ABL. For the three months ended March 31, 2022, the Company recorded in interest expense – $68,813 of amortization of debt discount and $50,419 of interest expense and credit utilization fees. For the nine months ended March 31, 2022, the Company recorded in interest expense – $113,016 of amortization of debt discount and $81,328 of interest expense and credit utilization fees. As of March 31, 2022, the outstanding amount of the long-term revolving loan payable, net of debt discount, was $11,166,577, including interest payable of $81,328.

Promissory note payable

On February 15, 2022, as part of the consideration for acquisition of Anivia Limited, the Company issued a two-year unsecured 6% subordinated promissory note, payable in equal semi-annual installments commencing August 15, 2022 (the “Purchase Note”). The principal amount of the Purchase Note was $3.5 million with a fair value of $3.6 million on February 15, 2022. For the quarter ended March 31, 2022, the Company recorded accrued interest of $26,250. As of March 31, 2022, the outstanding principal balance of the Purchase Note was $3,626,879, including $26,250 of accrued interest.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

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+ Details

Related party transactions

9 Months Ended

Mar. 31, 2022

Related party transactions

Note 12 – Related party transactions

On December 1, 2018, the Company acquired certain assets and assumed liabilities from BizRight, LLC, an entity owned and managed by the founders and officers of the Company and the purchase price was recorded as payable due to related parties. During the nine months ended March 31, 2021, the Company recorded proceeds of $532,222 and payments of $150,498, respectively. The Company had paid off the amount due to related party during the quarter ended June 30, 2021. The amount due to related parties was $0 as of March 31, 2022 and June 30, 2021.

Starting March 1, 2022, the Company subleases 50,000 square feet of its warehouse space to Box Harmony, LLC, which is a 40% owned joint venture of the Company as disclosed on Note 1 and Note 2 above. For the quarter ended March 31, 2022, the Company recorded sublease fee of $82,500 as other non-operating income. As of March 31, 2022, other receivables due from Box Harmony was 20,746.

On February 15, 2022, the Company assumed $97,476 of advance from shareholders of DHS through acquisition of Anivia. This amount was for capital injection pending capital inspection by the local government in accordance with the PRC rules. As of March 31, 2022, the balance of advance from shareholders was $97,476.

Income taxes

9 Months Ended

Mar. 31, 2022

Income Tax Disclosure [Abstract]

Income taxes

Note 13 – Income taxes

On December 22, 2017, the President of the United States signed into law H.R.1, formerly known as the Tax Cuts and Jobs Act (the “Tax Legislation”). The Tax Legislation significantly revised the U.S. tax code by (i) lowering the U.S. federal statutory income tax rate from 35% to 21%, (ii) implementing a territorial tax system, (iii) imposing a one-time transition tax on deemed repatriated earnings of foreign subsidiaries, (iv) requiring a current inclusion of global intangible low taxed income of certain earnings of controlled foreign corporations in U.S. federal taxable income, (v) creating the base erosion anti-abuse tax regime, (vi) implementing bonus depreciation that will allow for full expensing of qualified property, and (vii) limiting deductibility of interest and executive compensation expense, among other changes. The Company has computed its tax expenses using the new statutory rate effective on January 1, 2018 of 21%.

In addition, upon completion of the acquisition of Anivia, the Company is subject to corporate income taxes in People’s Republic of China (“PRC”). Anivia and its subsidiaries were subject to BVI or Hong Kong income taxes but did not have any operations for the period ended March 31, 2022. DHS, the operating VIE of Anivia, is considered a Controlled Foreign Corporation (CFC) defined under IRC Sec. 957(a) since the Company indirectly owns more than 50% voting control of DHS as a result of the Transfer Agreement. Therefore, DHS is subject to the GILTI Tax. DHS is subject to 25% tax rate in PRC. The Company made an election to apply the GILTI high-tax exclusion for DHS under the Final Regulations (T.D. 9902). As the result of the election, no GILTI tax was recorded as of March 31, 2022. In addition, as a result of the acquisition the Company booked a $6,094,144 of goodwill. Since the acquisition was a stock acquisition, the Goodwill is not deductible for tax purposes.

Other provisions of the new legislation include, but are not limited to, limiting deductibility of interest and executive compensation expense. These additional items have been considered in the income tax provision for the nine months ended March 31, 2022 and 2021. For the three and nine months ended March 31, 2022, the Company recorded deferred tax liabilities of $1,389,113 resulting from intangible assets acquired, and deferred tax assets of $552,784 resulting from other temporary differences, including stock compensation expense, depreciation expenses, lease expenses, etc. For the three and nine months ended March 31, 2021, the Company recorded deferred tax assets of $52,947, which was resulted from allowance for credit loss of $189,206.

The income tax provision for the three and nine months ended March 31, 2022 and 2021 consisted of the following:


	Three Months Ended March 31,						Nine Months Ended March 31,
	2022			2021			2022			2021
Current:
Federal	$	402,373		$	198,079		$	859,341		$	555,430
State		67,642			92,681			276,364			258,204
PRC		122,623			–			122,623			–
Total current income tax provision		592,638			290,760			1,258,328			813,634
Deferred:
Federal		(432,290	)		(36,221	)		(432,290	)		(36,221	)
State		(120,493	)		(16,726	)		(120,493	)		(16,726	)
PRC		–			–			–			–
Total deferred tax		(552,783	)		(52,947	)		(552,783	)		(52,947	)
Total provision for income taxes	$	39,855		$	237,813		$	705,545		$	760,687

The Company is subject to PRC and U.S. federal income tax as well as state income tax in certain jurisdictions. The tax years 2018 to 2020 remain open to examination by the major taxing jurisdictions to which the Company is subject. The following is a reconciliation of income tax expenses at the effective rate to income tax at the calculated statutory rates:


	Three Months Ended March 31,			Nine Months Ended March 31,
	2022		2021	2022		2021
US calculated statutory tax rate
Federal	21.00%		21.00%	21.00%		21.00%
State (net of federal benefit)	5.45%		8.84%	5.71%		8.84%
Foreign tax rate difference	(1.59%	)	–	(0.54%	)	–
Net effect of state income tax deduction and other
Permanent and temporary differences	(21.59%	)	737.57%	(6.40%	)	10.38%
Effective tax rate	3.27%		767.41%	19.77%		40.22%

As of March 31, 2022 and June 30, 2021, the income taxes payable were $864,109 and $790,823, respectively.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Earnings per share

9 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Earnings per share

Note 14 – Earnings per share

The following table sets forth the computation of basic and diluted earnings per share for the periods presented:


	Three Months Ended March 31,					Nine Months Ended March 31,
	2022		2021			2022		2021
Numerator:
Net Income	$	1,181,757	$	(206,823	)	$	2,867,146	$	1,130,649

Denominator:
Weighted-average shares used in computing basic and diluted earnings per share*
Basic		28,045,130		20,204,496			26,999,342		20,204,496
Diluted		28,045,130		20,204,496			26,999,342		20,204,496

Earnings per share:
Basic	$	0.042	$	(0.010	)	$	0.106	$	0.056
Diluted	$	0.042	$	(0.010	)	$	0.106	$	0.056

____________________

On November 16, 2020, the Company implemented a 2-for-1 forward split of the issued and outstanding shares of Class A Common Stock of the Company. The computation of basic and diluted EPS was retroactively adjusted for all periods presented.

The computation of basic and diluted EPS did not include the Class B Common Stock as the holders of Class B Common Stock have no dividend or liquidation right until such time as their shares of Class B Common Stock have been converted into Class A Common Stock.

The computation of diluted EPS did not include the underlying shares of warrants calculated using treasury method for the three and nine months ended March 31, 2022 as the exercise price was greater than the market price of the shares.

For the three and nine months ended March 31, 2022, the 107,625 vested shares of restricted stock units under the Amended and Restated 2020 Equity Incentive Plan (as discussed in Note 15) are considered issued shares and therefore are included in the computation of basic earnings (loss) per share as of grant date when the shares are fully vested. Impact of nonvested RSU is immaterial to the EPS.

Equity

9 Months Ended

Mar. 31, 2022

Equity [Abstract]

Equity

Note 15 – Equity

Common Stock

The Company was incorporated in Nevada on April 11, 2018. As of September 30, 2021, the total authorized shares of capital stock were 200,000,000 shares consisting of 180,000,000 shares of Common Stock (“Common Stock”) and 20,000,000 shares of preferred stock (the “Preferred Stock”), each with a par value of $0.001 per share.

On November 16, 2020, the Company filed an amended and restated articles of incorporation in Nevada to consummate a 2-for-1 forward split of our outstanding shares of Class A Common Stock. All share numbers of Class A Common Stock are stated at a post-split basis.

Under the amended and restated articles of incorporation, the holders of Class A Common Stock were be entitled to one vote per share in voting or consenting to the election of directors and for all other corporate purposes. The Company issued 20,000,000 shares to its founders at inception.

On January 15, 2020, pursuant to a rescission and mutual release agreement with an unrelated company, the Company issued 204,496 shares of its Class A Common Stock as settlement for a payment of $427,010 received by the Company.

On October 20, 2020, the Company entered into stock purchase agreements with Chenlong Tan and Allan Huang (the “Founders”) pursuant to which each of the Founders received 7,000,000 shares of the Company’s Class B Common Stock, for a purchase price of $0.001 per share in cash. Based on the fact that other than the total consideration of $14,000 (total par value of the Class B Common Stock issued), the Founders did not provide additional services or other means of considerations for the issuance of these shares of Class B Common Stock, the issuance of the Class B Common Stock to the Founders was considered as a nominal issuance, in substance a recapitalization transaction. As such, in accordance with FASB ASC 260-10-55-12 and SAB Topic 4D, the Company recorded and presented the issuance retroactively as outstanding for all reporting periods.

The Class B Common Stock was entitled to ten (10) votes per share in voting or consenting to the election of directors and for all other corporate purposes. In accordance with the Company’s amended and restated articles of incorporation, the Class B Common Stock was eligible to convert into shares of Class A Common Stock, on a ten-for-one basis, at any time following twelve (12) months after the Company’s completion of the initial public offering of its Class A Common Stock. Holders of Class B Common Stock had no dividend or liquidation rights until such time as their shares of Class B Common Stock were converted into shares of Class A Common Stock. As of June 30, 2020, the outstanding shares of Class B Common Stock were retroactively stated as 14,000,000 and 14,000,000, respectively.

Effective April 14, 2021, the Company amended its articles of incorporation to allow for conversion of its Class B Common Stock at any time after issuance. On that same date, the Class B Common stockholders, Chenlong Tan and Allan Huang, elected to convert all of their 14,000,000 outstanding shares of the Class B Common Stock into 1,400,000 shares of Class A Common Stock. Following that, on April 23, 2021, the Company further amended and restated its articles of incorporation to eliminate the Class A and Class B Common Stock designations and authorize for issuance a total of 180,000,000 shares which are solely designated as Common Stock.

On May 14, 2021, the Company closed its initial public offering (“IPO”) under a registration statement, effective May 11, 2021, in which it issued and sold 3,360,000 shares of its Common Stock at a purchase price of $5.00 per share. On May 21, 2021, the Company closed on the IPO’s overallotment option, selling an additional 504,000 shares of Common Stock to the IPO’s underwriters at the public offering price of $5.00 per share. The Company received net proceeds of approximately $16.6 million from the IPO after deducting underwriting discounts and offering expenses.

On May 14, 2021, upon closing on the Company’s IPO, the outstanding Series A convertible preferred stock and Convertible Notes were converted into an aggregate of 955,716 shares of the Company’s Common Stock.

On May 14, 2021, the Company issued 24,451 shares of Common Stock upon cashless exercise of warrants held by Boustead Securities LLC, the placement agent for the Company’s private placement offerings completed in December 2020 and January 2021.

During the nine months ended March 31, 2022, the Company issued 40,019 shares of restricted common stock for RSUs vested in the quarter ended September 30, 2021.

On February 15, 2022, as part of the consideration for the acquisition of Anivia and subsidiaries, the Company issued 3,083,700 restricted shares of the Company’s common stock, valued at $2.27 per share, which was the closing price of the Company’s Common Stock as traded on Nasdaq on February 15, 2022. These shares have a lock-up period of 180 days and are subject to insider trading restrictions. The fair value of the shares was $5,528,373, calculated with a discount of lack of marketability of 21%, which is determined using the Black Scholes Model.

As of March 31, 2022 and June 30, 2021, there were 29,572,382 and 26,448,663 shares of Common Stock issued and outstanding, respectively.

Preferred Stock

The Preferred Stock was authorized as “blank check” series of Preferred Stock, providing that the Board of Directors is expressly authorized, subject to limitations prescribed by law, by resolution or resolutions and by filing a certificate pursuant to the applicable law of the State of Nevada, to provide, out of the authorized but unissued shares of Preferred Stock, for series of Preferred Stock, and to establish from time to time the number of shares to be included in each such series, and to fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations or restrictions thereof. As of March 31, 2022 and June 30, 2021, respectively, there were no shares of Preferred Stock was issued and outstanding.

Equity Incentive Plan

On May 5, 2021, the Company’s Board of Directors adopted, and its stockholders approved and ratified, the iPower Inc. Amended and Restated 2020 Equity Incentive Plan (the “Plan”). The Plan allows for the issuance of up to 5,000,000 shares of Common Stock, whether in the form of options, restricted stock, restricted stock units, stock appreciation rights, performance units, performance shares and other stock or cash awards. The general purpose of the Plan is to provide an incentive to the Company’s directors, officers, employees, consultants and advisors by enabling them to share in the future growth of the Company’s business.

Following completion of the IPO on May 14, 2021, pursuant to their letter agreements, the Company awarded 46,546 restricted stock units (“RSUs”) under the Plan to its independent directors, Chief Financial Officer, and certain other employees and consultants, all of which are subject to certain vesting conditions in the next 12 months and restrictions until filing of a Form S-8 for registration of the shares. The fair value of the RSUs was determined to be based on $5.00 per share, the initial listing price of the Company’s Common Stock on the grant date. During the nine months ended March 31, 2022, the Company granted additional 97,128 shares of RSUs – 11,745 shares in the quarter ended September 30, 2021, 13,216 shares in the quarter ended December 31, 2021 and 72,167 shares in the quarter ended March 31, 2022. For the three and nine months ended March 31, 2022, the Company recorded $149,299 and $306,788 of stock-based compensation expense. As of March 31, 2022, the unamortized expense was $22,500.

Information relating to RSU grants is summarized as follows:

Schedule of RSU activity
	Total RSUs Issued			Total Fair Market Value of RSUs Issued as Compensation (1)
RSUs granted, but not vested, at June 30, 2021		24,409
RSUs granted		97,128		$	227,237
RSUs forfeited		(4,000	)
RSUs vested		(107,625	)
RSUs granted, but not vested, at March 31, 2022		9,912

_____________________

(1)	The total fair value was based on the current stock price on the grant date.

As of March 31, 2022, of the 107,625 vested RSUs, 17,882 shares of Common Stock were issued, and 89,743 shares were to be issued in the next quarter.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (g)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496189-112644

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (h)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496171-112644

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496189-112644

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 16
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496180-112644

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (i)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 50
-Paragraph 6
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126731327&loc=SL126733271-114008

+ Details

Warrants

9 Months Ended

Mar. 31, 2022

Warrants

Warrants

Note 16 – Warrants

On January 27, 2021, the Company completed a private placement offering pursuant to which the Company sold to two accredited investors an aggregate of $3,000,000 in Convertible Notes and warrants to purchase shares of Class A Common Stock equaling 80% of the number of shares of Class A Common Stock issuable upon conversion of the Convertible Notes. The convertible note warrants are exercisable for a period of three years from the IPO completion date at a per share exercise price equal to the IPO, or $5.00 per share. In accordance with the terms of the warrants, in the event the Convertible Notes are repaid in cash by the Company, the warrants issued in conjunction with the Convertible Notes will expire and have no further value.

In connection with the Convertible Note offering, the Company also issued placement agent warrants to purchase 7.0% of the shares of Common Stock underlying the Convertible Notes exercisable at the conversion price of the Convertible Note (the “Conversion Price”). The placement agent warrants had an exercise period of five years from the issuance date.

On May 14, 2021, upon closing of its IPO, the Company remeasured the warrants to fair value using the Modified Black Scholes Option Pricing Model, based on the expected fair value of the underlying stock with the following assumptions:


	As of May 14, 2021
Expected term	1 day to 3 years
Expected volatility	3.3% to 58%
Risk-free interest rate	0.35% to 0.92%
Expected dividend rate	0%
Probability	100%

As of May 14, 2021, the fair value of the warrant liabilities was $1,361,347, which includes $4,610 preferred stock warrants, $1,324,668 warrants issued to the Convertible Note investors and $32,069 warrants issued to the placement agent. The increase in fair value immediately before the IPO was $617,593, which was reported in other non-operating expenses for the year ended June 30, 2021.

Upon closing the IPO on May 14, 2021, the Placement Agent exercised its warrants in full to purchase a total of 24,451 shares of the Company’s Common Stock and, as such, there were no Placement Agent Warrants outstanding as of June 30, 2021. At the same time, the outstanding warrants held by the Convertible Note investors were reclassified to additional paid in capital as the terms became fixed upon closing of the IPO. Through March 31, 2022, none of the private placement investors had exercised any of their warrants. As such, as of March 31, 2022 and June 30, 2021, the number of shares issuable under the outstanding warrants was 685,715, with an exercise price of $5.0 per share.

Concentration of risk

9 Months Ended

Mar. 31, 2022

Risks and Uncertainties [Abstract]

Concentration of risk

Note 17 - Concentration of risk

Credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable.

As of March 31, 2022 and June 30, 2021, $2,641,584 and $6,651,705, respectively, were deposited with various major financial institutions in the United States and PRC. Accounts at each institution in the United States, are insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000. The Company had approximately $2.0 million and $5.4 million, respectively, in excess of the FDIC insurance limit, as of March 31, 2022 and June 30, 2021.

Accounts receivable are typically unsecured and derived from revenue earned from customers, thereby exposing the Company to credit risk. The risk is mitigated by the Company’s assessment of its customers’ creditworthiness and its ongoing monitoring of outstanding balances. The Company maintains reserves for estimated credit losses, and such losses have generally been within expectations.

The business of DHS, the Company’s VIE, may be impacted by Chinese economic conditions, changes in regulations and laws, and other uncertainties.

Customer and vendor concentration risk

For the nine months ended March 31, 2022 and 2021, Amazon Vendor and Amazon Seller customers accounted for 89% and 78% of the Company's total revenues, respectively. As of March 31, 2022 and June 30, 2021, accounts receivable from Amazon Vendor and Amazon Seller accounted for 92% and 98% of the Company’s total accounts receivable.

For the nine months ended March 31, 2022 and 2021, two suppliers accounted for 27% (19% and 8%) and 28% (17% and 11%) of the Company's total purchases, respectively. As of March 31, 2022, accounts payable to three suppliers accounted for 44% (20%, 13% and 11%) of the Company’s total accounts payable. As of June 30, 2021, accounts payable to two suppliers accounted for 11% and 10% of the Company’s total accounts payable.

Commitments and contingencies

9 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and contingencies

Note 18 - Commitments and contingencies

Lease commitment

The Company has adopted ASC842 since its inception date, April 11, 2018. The Company has entered into a lease agreement for office and warehouse space with a lease period from December 1, 2018 until December 31, 2020. On August 24, 2020, the Company negotiated for new terms to extend the lease. As a result, the lease term was amended and extended through December 31, 2023.

On September 1, 2020, in addition to the primary fulfillment center, the Company leased a second fulfillment center in City of Industry, California. The base rental fee is $27,921 to $29,910 per month through October 31, 2023.

On February 15, 2022, upon completion of the acquisition of Anivia Limited, the Company assumed operating lease of offices in Shenzhen, People’s Republic of China.

On July 28, 2021, the Company entered into a Lease agreement (the “Lease Agreement”) with 9th & Vineyard, LLC, a Delaware limited liability company (the “Landlord”), to lease from the Landlord approximately 99,347 square feet of space located at 8798 9th Street, Rancho Cucamonga, California (the “Premises”). The term of the Lease Agreement was for 62 months, commencing on the date on which the Landlord completes certain prescribed improvements on the property (the “Rent Commencement Date”). The Lease Agreement does not provide for an option to renew.

In addition, the Company will be responsible for its pro rata share of certain costs, including utility costs, insurance and common area costs, as further detailed in the Lease Agreement. Following the Rent Commencement Date, the first two months of the Base Rent will be abated.

The lease was not started under the original agreement as the construction was not completed. On February 23, 2022, the Company entered into an amended agreement to extend the lease term to 74 months. The lease commencement date is February 10, 2022, the rent commencement date is May 11, 2022 and the expiration date is May 31, 2028. The base rental fee is $114,249 to $140,079 per month through the expiration date, May 31, 2028.

Total commitment for the full term of these leases is $10,466,658. $9,095,158 and $1,819,421 of operating lease right-of-use assets and $9,364,298 and $1,901,496 of operating lease liabilities were reflected on the March 31, 2022 and June 30, 2021 financial statements, respectively.

Three Months Ended March 31, 2022 and 2021:


Lease cost	March 31, 2022		March 31, 2021
Operating lease cost (included in selling and fulfillment expenses in the Company's statement of operations)	$	427,692	$	189,647
Other information
Cash paid for amounts included in the measurement of lease liabilities	$	234,504	$	130,893
Remaining term in years		1.33 – 6.17		2.5
Average discount rate - operating leases		5% – 8%		8%

Nine Months Ended March 31, 2022 and 2021:

Lease cost	March 31, 2022		March 31, 2021
Operating lease cost (included in selling and fulfillment expenses in the Company's statement of operations)	$	838,726	$	559,606
Other information
Cash paid for amounts included in the measurement of lease liabilities	$	656,961	$	473,285
Remaining term in years		1.33 – 6.17		2.5
Average discount rate - operating leases		5% – 8%		8%

The supplemental balance sheet information related to leases for the period is as follows:


Operating leases	March 31, 2022		6/30/2021
Right of use asset - non-current	$	9,095,158	$	1,819,421

Lease Liability - current	$	1,790,688	$	731,944
Lease Liability - non-current		7,573,610		1,169,552
Total operating lease liabilities	$	9,364,298	$	1,901,496

Maturities of the Company’s lease liabilities are as follows:


For years ending June 30:	Operating Lease
2022	$	473,908
2023		2,381,601
2024		1,815,637
2025		1,486,231
2026 and after		4,579,896
Total lease payments		10,737,273
Less: Imputed interest/present value discount		(1,372,975	)
Present value of lease liabilities	$	9,364,298

Contingencies

Except as disclosed below, the Company is not currently a party to any material legal proceedings, investigation or claims. However, the Company may, from time to time, be involved in legal matters arising in the ordinary course of its business. While the Company is not presently subject to any material legal proceedings, other than the proceeding detailed below, there can be no assurance that such matters will not arise in the future or that any such matters in which the Company is involved, or which may arise in the ordinary course of the Company’s business, will not at some point proceed to litigation or that such litigation will not have a material adverse effect on the business, financial condition or results of operations of the Company.

Pursuant to an engagement agreement, dated and effective August 31, 2020 (the “Engagement Agreement”), with Boustead Securities LLC (“Boustead”), the Company engaged Boustead to act as its exclusive placement agent for private placements of its securities and as a potential underwriter for its initial public offering. On February 28, 2021, the Company informed Boustead that it was terminating the Engagement Agreement and any continuing obligations the Company may have had under its terms. On April 15, 2021, the Company provided formal written notice to Boustead of its termination of the Engagement Agreement and all obligations thereunder, effective immediately. On April 30, 2021, Boustead filed a statement of claim with the Financial Institute Regulatory Authority, or FINRA, demanding to arbitrate the dispute, and is seeking, among other things, monetary damages against the Company and D.A. Davidson & Co. (who acted as underwriter in the Company’s IPO). The FINRA arbitration, which had originally been scheduled for June 20, 2022, has now been delayed and is tentatively scheduled to be heard at the end of October, 2022. The Company has agreed to indemnify D.A. Davidson & Co. and the other underwriters against any liability or expense they may incur or be subject to arising out of the Boustead dispute. Additionally, Chenlong Tan, the Company’s Chairman, President and Chief Executive Officer and a beneficial owner more than 5% of the Company’s Common Stock, has agreed to reimburse the Company for any judgments, fines and amounts paid or actually incurred by the Company or an indemnitee in connection with such legal action or in connection with any settlement agreement entered into by the Company or an indemnitee up to a maximum of $3.5 million in the aggregate, with the sole source of funding of such reimbursement to come from sales of shares then owned by Mr. Tan.

In an effort to contain or slow the COVID-19 outbreak, authorities across the world have implemented various measures, some of which have been subsequently rescinded or modified, including travel bans, stay-at-home orders and shutdowns of certain businesses. The Company anticipates that these actions and the global health crisis caused by the COVID-19 outbreak, including any resurgences, will continue to negatively impact global economic activity. While the COVID-19 outbreak has not had a material adverse impact on the Company’s operations to date, it is difficult to predict all of the positive or negative impacts the COVID-19 outbreak will have on the Company’s business.

In February 2022, the Russian Federation began conducting military operations against Ukraine, resulting in global economic uncertainty and increased cost of various commodities. In response to these types of events, we might suspend operations, implement extraordinary procedures, seek alternate sources for product supply, or suffer consequences that are unexpected and difficult to mitigate. Any of these risks might have a materially adverse impact on our business operations and our financial position or results of operations. Although, it is difficult to predict the impact that these factors may have on our business in the future, they did not have a material effect on our results of operations, financial condition, or liquidity for the period ended March 31, 2022.

Subsequent events

9 Months Ended

Mar. 31, 2022

Subsequent Events [Abstract]

Subsequent events

Note 19 - Subsequent events

On May 12, 2022, the Compensation Committee of the Board of Directors approved an incentive plan for the Company’s executive officers consisting of a cash performance bonus of $60,000 to be awarded to Kevin Vassily, CFO of the Company, and grants of stock option (the “Option Grants”) in the amount of (i) 3,000,000 shares to Chenlong Tan, CEO and (ii) 330,000 shares to Mr. Vassily. The Option Grants, which were issued on May 13, 2022, have an exercise price of $1.12 per share (the closing price on the grant date) and have a term of 10 years, will vest in stages upon the Company’s achievement of certain market capitalization and revenue or operating income targets set forth in the grant agreements.

On or about May 12, 2022, the Company determined that it may have miscalculated when determining the financial significance of DHS, its recently acquired subsidiary, which would place it just above the 20% significance threshold under Rule 3-05 of Regulation S-X under the Securities Act of 1933, as amended. As such, the Company may need to file with the SEC one year’s audited financial statements for the subsidiary, plus unaudited financial statements for the interim period. The Company is presently evaluating the requirements, including consulting with the SEC, and will make any necessary disclosures, as required.

On May 16, 2022, the Company and its subsidiaries E Marketing Solutions Inc. and Global Product Solution Inc. (together with the Company, the “Loan Parties”), entered into a first amendment and limited waiver to credit agreement (the “Amendment and Waiver Agreement”) with the Company’s senior lender, JP Morgan Chase Bank, NA (“JPM”). The Amendment and Waiver Agreement was entered into for purposes of waiving certain non-financial defaults by the Loan Parties under the terms of the credit agreement, dated November 12, 2021, between the Loan Parties and JPM. Under the terms of the Amendment and Waiver Agreement, JPM agreed to a limited waiver of the defaults, thus allowing the Loan Parties additional time to deliver certain documents, which included failure to deliver compliance certificates during the months of October 2021 through March 2022, failure to timely deliver deposit control agreements as required, failure to provide evidence that the Company’s obligations owed to the Small Business Administration had been satisfied, and failure to timely pledge the Company’s 40% equity interest in its joint venture, Box Harmony LLC. In exchange for entry into the Amendment and Waiver Agreement, the Loan Parties agreed to satisfy the aforementioned defaults and pay JPM all of its fees borne in relation to entry into the Amendment and Waiver Agreement, including but not limited to legal fees and disbursements.

Basis of Presentation and Summary of significant accounting policies (Policies)

9 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Basis of presentation

Principles of Consolidation

Reclassifications

Use of estimates and assumptions

Foreign currency translation and transactions

Cash and cash equivalents

Cash and cash equivalents consist of amounts held as cash on hand and deposits in financial institutions.

Accounts receivable, net

the customer fails to comply with its payment schedule;

the customer is in serious financial difficulty;

a significant dispute with the customer has occurred regarding job progress or other matters;

the customer breaches any of its contractual obligations;

the customer appears to be financially distressed due to economic or legal factors;

the business between the customer and the Company is not active; and

other objective evidence indicates non-collectability of the accounts receivable.

Equity method investment

Business Combination

Variable interest entities

Goodwill

The Company does not have any other indefinite-lived intangible assets.

Intangible Assets, net

Schedule of estimated useful life
		Useful Life
Covenant Not to Compete		10 years
Supplier relationship		6 years
Software		5 years

Fair values of financial instruments

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and all other current assets and liabilities approximate fair values due to their short-term nature.

Corporate bond yield 3.1%

Risk-free rate 1.6%

Liquidity premium 0.4%

Discount rate 3.5%

As of March 31, 2022, the outstanding principal balance of the Purchase Note was $3,626,879, including premium of $100,629 and $26,250 of accrued interest.

Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Level 3 – Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data.

Revenue recognition

Payments received prior to the delivery of goods to customers are recorded as customer deposits.

Advertising costs

Advertising costs are expensed as incurred. Total advertising and promotional costs included in selling and fulfillment expenses for the three and nine months were as following:

Schedule of advertising costs
	Three Months Ended March 31,				Nine Months Ended March 31,
	2022		2021		2022		2021
Advertising and promotion	$	733,241	$	443,163	$	1,945,222	$	1,164,119

Cost of revenue

Cost of revenue mainly consists of costs for purchases of products and related inbound freight and delivery fees.

Inventory, net

Segment reporting

Leases

Stock-based Compensation

The Company will recognize forfeitures of such equity-based compensation as they occur.

Income taxes

Commitments and contingencies

Earnings per share

Recently issued accounting pronouncements

Subsequent events

Basis of Presentation and Summary of significant accounting policies (Tables)

9 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Schedule of estimated useful life

Schedule of estimated useful life
		Useful Life
Covenant Not to Compete		10 years
Supplier relationship		6 years
Software		5 years

Schedule of advertising costs

Schedule of advertising costs
	Three Months Ended March 31,				Nine Months Ended March 31,
	2022		2021		2022		2021
Advertising and promotion	$	733,241	$	443,163	$	1,945,222	$	1,164,119

Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entity (Tables)

9 Months Ended

Mar. 31, 2022

Acquisition Of Anivia Limited And Subsidiaries And Variable Interest Entity

Schedule of allocation of acquisition price


Fair Value of Purchase Price:
Cash	$	1,500,000
Promissory note issued		3,600,627
Common stock issued		5,528,373
Total purchase consideration	$	10,629,000

Purchase Price Allocation:
Covenant not to compete	$	3,459,120
Supplier relationship		1,179,246
Software		534,591
Current assets		1,104,407
Property and equipment		46,548
ROU asset		175,231
Goodwill		6,094,144
Deferred tax liabilities		(1,389,113	)
Current liabilities		(394,659	)
Lease liability		(180,515	)
Total purchase consideration	$	10,629,000

Schedule of Business Acquisition, Pro Forma Information


	Nine months ended
	March 31,
	2022		2021
Total Revenues	$	57,300,642	$	39,348,154
Income from Operations	$	4,623,664	$	3,043,253
Basic and diluted income per share	$	0.12	$	0.06

Variable interest entity (Tables)

9 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Carrying amount of VIE assets and liabilities


	March 31, 2022		June 30, 2021
Cash in bank	$	730,227	$	–
Prepayments and other receivables	$	1,289,406	$	–
Office equipment, net	$	52,142	$	–
Right of use - noncurrent	$	156,706		–
Advance from shareholders	$	97,476	$	–
Lease liability	$	161,401		–
Income tax payable	$	119,291	$	–
Other payables	$	147,010	$	–

Operating results of the VIE

Operating results of the VIE
	March 31, 2022
Revenue	$	–
Net loss	$	650,194

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

+ References + Details

Accounts receivable, net (Tables)

9 Months Ended

Mar. 31, 2022

Receivables [Abstract]

Schedule of accounts receivable

Schedule of accounts receivable
	March 31, 2022			June 30, 2021
Accounts receivable	$	19,153,554		$	7,896,347
Less: allowance for credit losses		(70,000	)		–
Total accounts receivable, net	$	19,083,554		$	7,896,347

Prepayments and other current assets (Tables)

9 Months Ended

Mar. 31, 2022

Prepayments And Other Current Assets

Schedule of prepayments and other current assets


	March 31, 2022		June 30, 2021
Advance to suppliers	$	6,571,914	$	3,969,625
Prepaid expenses and other receivables		1,241,858		723,375

Total	$	7,813,772	$	4,693,000

Intangible assets, net (Tables)

9 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of intangible assets

Schedule of intangible assets
	March 31, 2022
Covenant Not to Compete		3,459,120
Supplier relationship		1,179,245
Software		534,591
Accumulated amortization		(81,171	)
Total		5,091,785

Schedule of future amortization

Schedule of future amortization

Year Ending June 30,	Amount
2022	$	162,343
2023	649,371
2024	649,371
2025	649,371
2026	649,371
Thereafter	2,331,958
	$	5,091,785

Income taxes (Tables)

9 Months Ended

Mar. 31, 2022

Income Tax Disclosure [Abstract]

Schedule of provision for income tax expense


	Three Months Ended March 31,						Nine Months Ended March 31,
	2022			2021			2022			2021
Current:
Federal	$	402,373		$	198,079		$	859,341		$	555,430
State		67,642			92,681			276,364			258,204
PRC		122,623			–			122,623			–
Total current income tax provision		592,638			290,760			1,258,328			813,634
Deferred:
Federal		(432,290	)		(36,221	)		(432,290	)		(36,221	)
State		(120,493	)		(16,726	)		(120,493	)		(16,726	)
PRC		–			–			–			–
Total deferred tax		(552,783	)		(52,947	)		(552,783	)		(52,947	)
Total provision for income taxes	$	39,855		$	237,813		$	705,545		$	760,687

Schedule of reconciliation of effective income tax rate


	Three Months Ended March 31,			Nine Months Ended March 31,
	2022		2021	2022		2021
US calculated statutory tax rate
Federal	21.00%		21.00%	21.00%		21.00%
State (net of federal benefit)	5.45%		8.84%	5.71%		8.84%
Foreign tax rate difference	(1.59%	)	–	(0.54%	)	–
Net effect of state income tax deduction and other
Permanent and temporary differences	(21.59%	)	737.57%	(6.40%	)	10.38%
Effective tax rate	3.27%		767.41%	19.77%		40.22%

Earnings per share (Tables)

9 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Schedule of computation of earnings per share


	Three Months Ended March 31,					Nine Months Ended March 31,
	2022		2021			2022		2021
Numerator:
Net Income	$	1,181,757	$	(206,823	)	$	2,867,146	$	1,130,649

Denominator:
Weighted-average shares used in computing basic and diluted earnings per share*
Basic		28,045,130		20,204,496			26,999,342		20,204,496
Diluted		28,045,130		20,204,496			26,999,342		20,204,496

Earnings per share:
Basic	$	0.042	$	(0.010	)	$	0.106	$	0.056
Diluted	$	0.042	$	(0.010	)	$	0.106	$	0.056

Equity (Tables)

9 Months Ended

Mar. 31, 2022

Equity [Abstract]

Schedule of RSU activity

Schedule of RSU activity
	Total RSUs Issued			Total Fair Market Value of RSUs Issued as Compensation (1)
RSUs granted, but not vested, at June 30, 2021		24,409
RSUs granted		97,128		$	227,237
RSUs forfeited		(4,000	)
RSUs vested		(107,625	)
RSUs granted, but not vested, at March 31, 2022		9,912

Warrants (Tables)

9 Months Ended

Mar. 31, 2022

Warrants

Schedule of assumptions for warrant liabilities


	As of May 14, 2021
Expected term	1 day to 3 years
Expected volatility	3.3% to 58%
Risk-free interest rate	0.35% to 0.92%
Expected dividend rate	0%
Probability	100%

Commitments and contingencies (Tables)

9 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Schedule of lease cost and other information


Lease cost	March 31, 2022		March 31, 2021
Operating lease cost (included in selling and fulfillment expenses in the Company's statement of operations)	$	427,692	$	189,647
Other information
Cash paid for amounts included in the measurement of lease liabilities	$	234,504	$	130,893
Remaining term in years		1.33 – 6.17		2.5
Average discount rate - operating leases		5% – 8%		8%

Nine Months Ended March 31, 2022 and 2021:

Lease cost	March 31, 2022		March 31, 2021
Operating lease cost (included in selling and fulfillment expenses in the Company's statement of operations)	$	838,726	$	559,606
Other information
Cash paid for amounts included in the measurement of lease liabilities	$	656,961	$	473,285
Remaining term in years		1.33 – 6.17		2.5
Average discount rate - operating leases		5% – 8%		8%

Supplemental balance sheet information related to leases


Operating leases	March 31, 2022		6/30/2021
Right of use asset - non-current	$	9,095,158	$	1,819,421

Lease Liability - current	$	1,790,688	$	731,944
Lease Liability - non-current		7,573,610		1,169,552
Total operating lease liabilities	$	9,364,298	$	1,901,496

Schedule of maturities of lease liabilities


For years ending June 30:	Operating Lease
2022	$	473,908
2023		2,381,601
2024		1,815,637
2025		1,486,231
2026 and after		4,579,896
Total lease payments		10,737,273
Less: Imputed interest/present value discount		(1,372,975	)
Present value of lease liabilities	$	9,364,298

Nature of business and organization (Details Narrative)	May 18, 2021
GPM [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Ownership Percentage	100.00%

Basis of Presentation and Summary of significant accounting policies (Details)	9 Months Ended
	Mar. 31, 2022
Noncompete Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible Asset, Useful Life	10 years
Supplier Relationship [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible Asset, Useful Life	6 years
Software [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible Asset, Useful Life	5 years

Basis of Presentation and Summary of significant accounting policies (Details 1) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Accounting Policies [Abstract]
Advertising and promotion	$ 733,241	$ 443,163	$ 1,945,222	$ 1,164,119

Basis of Presentation and Summary of significant accounting policies (Details Narrative)	3 Months Ended	9 Months Ended
	Mar. 31, 2022 USD ($)	Mar. 31, 2022 USD ($)	Feb. 15, 2022 USD ($)
Product Information [Line Items]
Excess FDIC amount	$ 250,000	$ 250,000
Revenue Benchmark [Member] \| Customer Concentration Risk [Member] \| Amazon Sales To Canada [Member]
Product Information [Line Items]
Concentration Risk, Percentage		5.70%
Anivia Purchase Note [Member]
Product Information [Line Items]
Debt Instrument, Interest Rate, Stated Percentage			6.00%
Debt Instrument, Face Amount			$ 3,500,000
Fair value of promissory note			$ 3,600,000
Long-Term Debt	3,626,879	$ 3,626,879
Debt Instrument, Unamortized Premium	100,629	100,629
Interest Payable, Current	$ 26,250	$ 26,250
Box Harmony [Member]
Product Information [Line Items]
Equity Method Investment, Ownership Percentage	40.00%	40.00%
China, Yuan Renminbi
Product Information [Line Items]
Translation rate at period end	6.34	6.34
Translation rate during period	6.35

Joint Ventures (Details Narrative)	Mar. 31, 2022
Box Harmony [Member]
Equity Method Investment, Ownership Percentage	40.00%
Global Social Media [Member]
Equity Method Investment, Ownership Percentage	60.00%

Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entities (Details) - USD ($)		3 Months Ended
	Feb. 15, 2022	Mar. 31, 2022	Jun. 30, 2021
Restructuring Cost and Reserve [Line Items]
Stock Issued During Period, Value, Acquisitions		$ 5,528,373
Goodwill		$ 6,094,144	$ 0
Anivia [Member]
Restructuring Cost and Reserve [Line Items]
Payments to Acquire Businesses, Net of Cash Acquired	$ 1,500,000
[custom:PromissoryNotesIssued1]	3,600,627
Stock Issued During Period, Value, Acquisitions	5,528,373
Business Combination, Consideration Transferred	10,629,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets	1,104,407
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment	46,548
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets	175,231
Goodwill	6,094,144
[custom:BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedCurrentLiabilities1-0]	(1,389,113)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities	(394,659)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Other	(180,515)
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net	10,629,000
Anivia [Member] \| Noncompete Agreements [Member]
Restructuring Cost and Reserve [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	3,459,120
Anivia [Member] \| Supplier Relationship [Member]
Restructuring Cost and Reserve [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	1,179,246
Anivia [Member] \| Software [Member]
Restructuring Cost and Reserve [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles	$ 534,591

Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entities (Details 1) - USD ($)	9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Acquisition Of Anivia Limited And Subsidiaries And Variable Interest Entity
Total Revenues	$ 57,300,642	$ 39,348,154
Income from Operations	$ 4,623,664	$ 3,043,253
Basic and diluted income per share	$ 0.12	$ 0.06

Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entity (Details Narrative) - USD ($)	Feb. 15, 2022	Mar. 31, 2022	Jun. 30, 2021
Restructuring Cost and Reserve [Line Items]
Goodwill		$ 6,094,144	$ 0
Anivia [Member]
Restructuring Cost and Reserve [Line Items]
Payments to Acquire Businesses, Gross	$ 10,629,000
Notes Issued	3,500,000
Goodwill	$ 6,094,144
Anivia [Member] \| Common Class A [Member]
Restructuring Cost and Reserve [Line Items]
Stock Issued During Period, Shares, Acquisitions	3,083,700
Business Combination, Consideration Transferred, Other	$ 1,500,000
Aniva [Member]
Restructuring Cost and Reserve [Line Items]
Goodwill	6,100,000
Other General and Administrative Expense	54,702,000
Aniva [Member] \| JPM [Member]
Restructuring Cost and Reserve [Line Items]
Payments of Financing Costs	$ 50,000,000

Variable interest entity (Details) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Right of Use Noncurrent	$ 9,095,158	$ 1,819,421
Advance from shareholders	97,476	0
Lease Liability	9,364,298	1,901,496
Accrued Income Taxes	864,109	790,823
Variable Interest Entity, Primary Beneficiary [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Cash	730,227	0
Prepaid Expense and Other Assets	1,289,406	0
Office Equipment Net	52,142	0
Right of Use Noncurrent	156,706	0
Advance from shareholders	97,476	0
Lease Liability	161,401	0
Accrued Income Taxes	119,291	0
Accounts Payable and Other Accrued Liabilities	$ 147,010	$ 0

Variable interest entity (Details 1) - USD ($)	2 Months Ended	3 Months Ended						9 Months Ended
Variable interest entity (Details 1) - USD ($)	Mar. 31, 2022	Mar. 31, 2022	Dec. 31, 2021	Sep. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Mar. 31, 2022	Mar. 31, 2021
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Revenues		$ 22,808,214			$ 13,133,902			$ 57,300,642	$ 39,348,154
Net Income (Loss) Attributable to Parent		$ (1,181,757)	$ (797,861)	$ (887,528)	$ 206,823	$ (575,476)	$ (761,996)	$ (2,867,146)	$ (1,130,649)
Variable Interest Entity, Primary Beneficiary [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Revenues	$ 0
Net Income (Loss) Attributable to Parent	$ 650,194

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Accounts receivable, net (Details) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Receivables [Abstract]
Accounts receivable	$ 19,153,554	$ 7,896,347
Less: allowance for credit losses	(70,000)	0
Total accounts receivable, net	$ 19,083,554	$ 7,896,347

Accounts receivable, net (Details Narrative) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Receivables [Abstract]
Accounts Receivable, Credit Loss Expense (Reversal)	$ 70,000	$ (0)

Inventories, net (Details Narrative) - USD ($)	3 Months Ended	9 Months Ended
Inventories, net (Details Narrative) - USD ($)	Mar. 31, 2022	Mar. 31, 2022	Jun. 30, 2021
Inventory Disclosure [Abstract]
Inventory, net	$ 22,410,936	$ 22,410,936	$ 13,065,741
Inventory, LIFO Reserve	188,233	188,233	$ 95,574
Inventory, LIFO Reserve, Period Charge	$ 36,701	$ 92,659

Prepayments and other current assets (Details) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Prepaid Expense and Other Assets, Current	$ 7,813,772	$ 4,693,000
Advance To Suppliers [Member]
Prepaid Expense and Other Assets, Current	6,571,914	3,969,625
Prepaid And Other [Member]
Prepaid Expense and Other Assets, Current	$ 1,241,858	$ 723,375

Prepayments and other current assets (Details Narrative) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Prepayments And Other Current Assets
Delivery fees receivable	$ 156,590	$ 178,581

Non-current prepayments (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
Non-current prepayments (Details Narrative) - USD ($)	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021	Jun. 30, 2021
Offsetting Assets [Line Items]
Non-current prepayments	$ 1,033,541		$ 1,033,541		$ 1,357,292
Amortization expenses	107,917	$ 0	323,751	$ 0
Product Sourcing [Member]
Offsetting Assets [Line Items]
Non-current prepayments	955,416		955,416
Car Prepayment [Member]
Offsetting Assets [Line Items]
Non-current prepayments	$ 78,125		$ 78,125

Intangible assets, net (Details) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Net	$ 5,091,785
Finite-Lived Intangible Assets, Accumulated Amortization	(81,171)
Intangible Assets, Net (Excluding Goodwill)	5,091,785	$ 0
Noncompete Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Net	3,459,120
Supplier Relationship [Member]
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Net	1,179,245
Software [Member]
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Assets, Net	$ 534,591

Intangible assets (Details - Future Amortization)	Mar. 31, 2022 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Finite-Lived Intangible Asset, Expected Amortization, Remainder of Fiscal Year	$ 162,343
Finite-Lived Intangible Asset, Expected Amortization, Year One	649,371
Finite-Lived Intangible Asset, Expected Amortization, Year Two	649,371
Finite-Lived Intangible Asset, Expected Amortization, Year Three	649,371
Finite-Lived Intangible Asset, Expected Amortization, Year Four	649,371
Finite-Lived Intangible Asset, Expected Amortization, after Year Five	2,331,958
Finite-Lived Intangible Assets, Net	$ 5,091,785

Intangible assets, net (Details Narrative) - USD ($)	3 Months Ended	9 Months Ended
Intangible assets, net (Details Narrative) - USD ($)	Mar. 31, 2022	Mar. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
[custom:FiniteLivedIntangibleAssetRemainingUsefulLife]		8 years 6 months 25 days
Amortization of Intangible Assets	$ 81,171	$ 81,171

Loans payable (Details Narrative) - USD ($)		3 Months Ended	9 Months Ended
Loans payable (Details Narrative) - USD ($)	Nov. 12, 2021	Mar. 31, 2022	Mar. 31, 2022	Feb. 15, 2022	Jun. 30, 2021	Nov. 16, 2020
Line of Credit Facility [Line Items]
Loan payable - current		$ 29,244	$ 29,244		$ 29,244
SBA Loan [Member]
Line of Credit Facility [Line Items]
Loan payable		463,445	463,445		487,815
Loan payable - noncurrent		434,201	434,201		458,571
Anivia Purchase Note [Member]
Line of Credit Facility [Line Items]
Loan payable - noncurrent		3,626,879	3,626,879
Interest Payable, Current		26,250	26,250
Face amount				$ 3,500,000
Fair value				$ 3,600,000
Interest Payable		26,250	26,250
Notes Payable, Noncurrent		3,626,879	3,626,879
WFC [Member]
Line of Credit Facility [Line Items]
Proceeds from loan						$ 3,000,000
Long-Term Line of Credit		0	0		$ 162,769
Asset-based Revolving Loan [Member]
Line of Credit Facility [Line Items]
Proceeds from loan	$ 25,000,000
Long-Term Line of Credit		11,166,577	11,166,577
Maturity date	Nov. 12, 2024
Payments of Financing Costs	$ 796,035
Amortization of Debt Discount (Premium)		68,813	113,016
Interest Expense, Debt		50,419	81,328
Interest Payable, Current		$ 81,328	$ 81,328

Related party transactions (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Sep. 30, 2020	Mar. 31, 2022	Mar. 31, 2021	Jun. 30, 2021
Related Party Transaction [Line Items]
Proceeds from Related Party Debt			$ 0	$ 532,222
Repayments of Related Party Debt			20,746	150,498
Advance from shareholders	$ 97,476		97,476		$ 0
Sub Lease Fee [Member] \| Box Harmony [Member]
Related Party Transaction [Line Items]
Other Nonoperating Income	82,500
Other Receivables	20,746		20,746
Biz Right [Member]
Related Party Transaction [Line Items]
Proceeds from Related Party Debt		$ 532,222
Repayments of Related Party Debt				$ 150,498
Due to Related Parties	$ 0		$ 0		$ 0

Income taxes (Details) - USD ($)	3 Months Ended		9 Months Ended
Income taxes (Details) - USD ($)	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Current:
Federal	$ 402,373	$ 198,079	$ 859,341	$ 555,430
State	67,642	92,681	276,364	258,204
PRC	122,623	0	122,623	0
Total current income tax provision	592,638	290,760	1,258,328	813,634
Deferred:
Federal	(432,290)	(36,221)	(432,290)	(36,221)
State	(120,493)	(16,726)	(120,493)	(16,726)
PRC	0	0	0	0
Total deferred tax	(552,783)	(52,947)	(552,783)	(52,947)
Total provision for income taxes	$ 39,855	$ 237,813	$ 705,545	$ 760,687

Income taxes (Details - Reconcilation of effective income tax rate)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Income Tax Disclosure [Abstract]
Federal	21.00%	21.00%	21.00%	21.00%
State (net of federal benefit)	5.45%	8.84%	5.71%	8.84%
Foreign tax rate difference	(1.59%)	0.00%	(0.54%)	0.00%
Permanent and temporary differences	(21.59%)	737.57%	(6.40%)	10.38%
Effective tax rate	3.27%	767.41%	19.77%	40.22%

Income taxes (Details Narrative) - USD ($)	Mar. 31, 2022	Jun. 30, 2021	Mar. 31, 2021
Income Tax Disclosure [Abstract]
Deferred Tax Liabilities, Gross	$ 1,389,113
Deferred income tax asset	552,784		$ 52,947
Income taxes payable	$ 864,109	$ 790,823

Earnings per share (Details) - USD ($)	3 Months Ended		9 Months Ended
Earnings per share (Details) - USD ($)	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Earnings Per Share [Abstract]
Net Income	$ 1,181,757	$ (206,823)	$ 2,867,146	$ 1,130,649
Weighted-average shares used in computing basic and diluted earnings per share*
Basic	28,045,130	20,204,496	26,999,342	20,204,496
Diluted	28,045,130	20,204,496	26,999,342	20,204,496
Earnings per share:
Basic	$ 0.042	$ (0.010)	$ 0.106	$ 0.056
Diluted	$ 0.042	$ (0.010)	$ 0.106	$ 0.056
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Vested, Number of Shares	107,625

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

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+ Details

- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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+ Details

- Definition

Amount, after deduction of tax, noncontrolling interests, dividends on preferred stock and participating securities, and addition from assumption of issuance of common shares for dilutive potential common shares; of income (loss) available to common shareholders.

+ References + Details

Equity (Details) - USD ($)

3 Months Ended

9 Months Ended

Mar. 31, 2022

Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]

RSUs vested

(107,625)

Restricted Stock Units (RSUs) [Member]

Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]

RSU's outstanding at beginning

24,409

RSUs granted

97,128

Total Fair Market Value of RSUs Issued as Compensation

^[1]

$ 227,237

RSUs forfeited

(4,000)

RSUs vested

(107,625)

RSU's outstanding at ending

9,912

[1]	The total fair value was based on the current stock price on the grant date.

Equity (Details Narrative) - USD ($)				1 Months Ended	3 Months Ended			4 Months Ended	9 Months Ended		10 Months Ended
Equity (Details Narrative) - USD ($)	May 14, 2021	Nov. 16, 2020	Jan. 15, 2020	Feb. 15, 2022	Mar. 31, 2022	Dec. 31, 2021	Sep. 30, 2021	Oct. 20, 2020	Mar. 31, 2022	Mar. 31, 2021	May 14, 2021	May 14, 2020	Jun. 30, 2021
Class of Stock [Line Items]
Proceeds from Issuance or Sale of Equity									$ 0	$ 359,000
Stock Issued During Period, Shares, Restricted Stock Award, Forfeited				3,083,700
Sale of Stock, Price Per Share				$ 2.27
[custom:FairValueOfShare]				$ 5,528,373
Common stock, shares issued					29,572,382				29,572,382				26,448,663
Common stock, shares outstanding					29,572,382				29,572,382				26,448,663
Share-Based Payment Arrangement, Noncash Expense									$ 306,788	$ 0
Share-Based Payment Arrangement, Nonvested Award, Excluding Option, Cost Not yet Recognized, Amount					$ 22,500				$ 22,500
Stock issued for RSU's vested					17,882				17,882
Stock to be issued for RSU's vested					89,743				89,743
Equity Incentive Plan [Member]
Class of Stock [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized					5,000,000				5,000,000
Stock issued for vested RSU's [Member]
Class of Stock [Line Items]
Stock Issued During Period, Value, Conversion of Convertible Securities									40,019
Restricted Stock Units (RSUs) [Member]
Class of Stock [Line Items]
Stock Issued During Period, Value, Conversion of Convertible Securities					72,167	13,216	11,745		97,128
Share-Based Payment Arrangement, Noncash Expense					$ 149,299				$ 306,788
Restricted Stock Units (RSUs) [Member] \| Letter Agreements [Member]
Class of Stock [Line Items]
Stock Issued During Period, Value, Conversion of Convertible Securities											46,546
Boustead Securities L L C [Member]
Class of Stock [Line Items]
Warrnat exercise	24,451										24,451
IPO [Member]
Class of Stock [Line Items]
Stock issued new, shares												3,360,000
Proceeds from Issuance or Sale of Equity												$ 16,600,000
IPO [Member] \| Underwriters [Member]
Class of Stock [Line Items]
Stock issued new, shares												504,000
Common Class A [Member]
Class of Stock [Line Items]
Stock split		2-for-1 forward split
Stock issued for settlemtn payment, shares			204,496
Stock issued for settlemtn payment, value			$ 427,010
Common Class B [Member]
Class of Stock [Line Items]
Stock issued new, shares								7,000,000
Share price								$ 0.001
Stock issued new, value								$ 14,000
Series A Convertible Preferred Stock [Member] \| Convertible Notes [Member]
Class of Stock [Line Items]
Number of shares converted	955,716

Warrant (Details - Assumptions) - Warrant Liability [Member]	10 Months Ended
	May 14, 2021
Measurement Input, Expected Term [Member]
Offsetting Assets [Line Items]
Fair value measurement assumptions	1 day to 3 years
Measurement Input, Price Volatility [Member]
Offsetting Assets [Line Items]
Fair value measurement assumptions	3.3% to 58%
Measurement Input, Risk Free Interest Rate [Member]
Offsetting Assets [Line Items]
Fair value measurement assumptions	0.35% to 0.92%
Measurement Input, Expected Dividend Rate [Member]
Offsetting Assets [Line Items]
Fair value measurement assumptions	0%
Measurement Input Probablity [Member]
Offsetting Assets [Line Items]
Fair value measurement assumptions	100%

Warrants (Details Narrative) - USD ($)		9 Months Ended		12 Months Ended
Warrants (Details Narrative) - USD ($)	Jan. 27, 2021	Mar. 31, 2022	Mar. 31, 2021	Jun. 30, 2021	May 14, 2021
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Proceeds from sale of equity		$ 0	$ 359,000
Fair value of warrant liabilities					$ 1,361,347
Outstanding warrants		685,715		685,715
Class of Warrant or Right, Exercise Price of Warrants or Rights		$ 5.0
Placement Agent [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Warrants Exercised					24,451
Warrant [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Fair Value Adjustment of Warrants				$ 617,593
Preferred Stock Warrants [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Fair value of warrant liabilities					$ 4,610
Convertible Note Investors [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Fair value of warrant liabilities					1,324,668
Placement Agent Warrants [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Fair value of warrant liabilities					$ 32,069
Two Accredited Investors [Member] \| Private Placement [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Proceeds from sale of equity	$ 3,000,000
Boustead Securities L L C [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Warrants Exercised					24,451

Concentration of risk (Details Narrative) - USD ($)	9 Months Ended		12 Months Ended
Concentration of risk (Details Narrative) - USD ($)	Mar. 31, 2022	Mar. 31, 2021	Jun. 30, 2021
Concentration Risk [Line Items]
Cash and Cash Equivalents, at Carrying Value	$ 2,641,584		$ 6,651,705
Cash, Uninsured Amount	$ 2,000,000.0		$ 5,400,000
Cost of Sales [Member] \| Product Concentration Risk [Member] \| Two Suppliers [Member]
Concentration Risk [Line Items]
Concentration risk percent	27.00%	28.00%
Cost of Sales [Member] \| Product Concentration Risk [Member] \| One Suppliers [Member]
Concentration Risk [Line Items]
Concentration risk percent	19.00%	17.00%
Cost of Sales [Member] \| Product Concentration Risk [Member] \| Another Suppliers [Member]
Concentration Risk [Line Items]
Concentration risk percent	8.00%	11.00%
Accounts Payable [Member] \| Product Concentration Risk [Member] \| Three Supplier [Member]
Concentration Risk [Line Items]
Concentration risk percent	44.00%
Accounts Payable [Member] \| Product Concentration Risk [Member] \| One Supplier [Member]
Concentration Risk [Line Items]
Concentration risk percent	20.00%		11.00%
Accounts Payable [Member] \| Product Concentration Risk [Member] \| Two Supplier [Member]
Concentration Risk [Line Items]
Concentration risk percent	13.00%
Accounts Payable [Member] \| Product Concentration Risk [Member] \| Another Supplier [Member]
Concentration Risk [Line Items]
Concentration risk percent	11.00%		10.00%
Amazon Vendor And Amazon Seller [Member] \| Revenue Benchmark [Member] \| Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration risk percent	89.00%	78.00%
Amazon Vendor And Amazon Seller [Member] \| Accounts Receivable [Member] \| Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration risk percent	92.00%	98.00%

Commitments and contingencies (Details - Lease cost) - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
Operating lease cost	$ 427,692	$ 189,647	$ 838,726	$ 559,606
Cash paid for amounts included in the measurement of lease liabilities	$ 234,504	$ 130,893	$ 656,961	$ 473,285
Remaining lease term in years	1.33 – 6.17		1.33 – 6.17
Lease remaining term		2 years 6 months		2 years 6 months
Average discount rate - operating leases	5% – 8		5% – 8%
Average discount rate - operating leases		8.00%		8.00%

Commitments and contingencies (Details - Balance Sheet) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract]
Right of use asset - non-current	$ 9,095,158	$ 1,819,421
Lease Liability - current	1,790,688	731,944
Lease Liability - non-current	7,573,610	1,169,552
Total operating lease liabilities	$ 9,364,298	$ 1,901,496

Commitments and contingencies (Details - Lease maturity) - USD ($)	Mar. 31, 2022	Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract]
2022	$ 473,908
2023	2,381,601
2024	1,815,637
2025	1,486,231
2026 and after	4,579,896
Total lease payments	10,737,273
Less: Imputed interest/present value discount	(1,372,975)
Present value of lease liabilities	$ 9,364,298	$ 1,901,496

Commitments and contingencies (Details Narrative) - USD ($)	1 Months Ended	9 Months Ended
	Feb. 23, 2022	Mar. 31, 2022	Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract]
Rental fees	$ 114,249	$ 140,079
Lease commitment		10,466,658
Right of use - non current		9,095,158	$ 1,819,421
Operating lease liability		$ 9,364,298	$ 1,901,496