0001830072 2022-07-01 2022-12-31 0001830072 2023-02-14 0001830072 2022-12-31 0001830072 2022-06-30 0001830072 2022-10-01 2022-12-31 0001830072 2021-10-01 2021-12-31 0001830072 2021-07-01 2021-12-31 0001830072 us-gaap:CommonStockMember 2022-06-30 0001830072 us-gaap:AdditionalPaidInCapitalMember 2022-06-30 0001830072 us-gaap:RetainedEarningsMember 2022-06-30 0001830072 us-gaap:NoncontrollingInterestMember 2022-06-30 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-06-30 0001830072 us-gaap:CommonStockMember 2022-09-30 0001830072 us-gaap:AdditionalPaidInCapitalMember 2022-09-30 0001830072 us-gaap:RetainedEarningsMember 2022-09-30 0001830072 us-gaap:NoncontrollingInterestMember 2022-09-30 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-09-30 0001830072 2022-09-30 0001830072 us-gaap:CommonStockMember 2021-06-30 0001830072 us-gaap:AdditionalPaidInCapitalMember 2021-06-30 0001830072 us-gaap:RetainedEarningsMember 2021-06-30 0001830072 us-gaap:NoncontrollingInterestMember 2021-06-30 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-06-30 0001830072 2021-06-30 0001830072 us-gaap:CommonStockMember 2021-09-30 0001830072 us-gaap:AdditionalPaidInCapitalMember 2021-09-30 0001830072 us-gaap:RetainedEarningsMember 2021-09-30 0001830072 us-gaap:NoncontrollingInterestMember 2021-09-30 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-09-30 0001830072 2021-09-30 0001830072 us-gaap:CommonStockMember 2022-07-01 2022-09-30 0001830072 us-gaap:AdditionalPaidInCapitalMember 2022-07-01 2022-09-30 0001830072 us-gaap:RetainedEarningsMember 2022-07-01 2022-09-30 0001830072 us-gaap:NoncontrollingInterestMember 2022-07-01 2022-09-30 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-07-01 2022-09-30 0001830072 2022-07-01 2022-09-30 0001830072 us-gaap:CommonStockMember 2022-10-01 2022-12-31 0001830072 us-gaap:AdditionalPaidInCapitalMember 2022-10-01 2022-12-31 0001830072 us-gaap:RetainedEarningsMember 2022-10-01 2022-12-31 0001830072 us-gaap:NoncontrollingInterestMember 2022-10-01 2022-12-31 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-10-01 2022-12-31 0001830072 us-gaap:CommonStockMember 2021-07-01 2021-09-30 0001830072 us-gaap:AdditionalPaidInCapitalMember 2021-07-01 2021-09-30 0001830072 us-gaap:RetainedEarningsMember 2021-07-01 2021-09-30 0001830072 us-gaap:NoncontrollingInterestMember 2021-07-01 2021-09-30 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-07-01 2021-09-30 0001830072 2021-07-01 2021-09-30 0001830072 us-gaap:CommonStockMember 2021-10-01 2021-12-31 0001830072 us-gaap:AdditionalPaidInCapitalMember 2021-10-01 2021-12-31 0001830072 us-gaap:RetainedEarningsMember 2021-10-01 2021-12-31 0001830072 us-gaap:NoncontrollingInterestMember 2021-10-01 2021-12-31 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-10-01 2021-12-31 0001830072 us-gaap:CommonStockMember 2022-12-31 0001830072 us-gaap:AdditionalPaidInCapitalMember 2022-12-31 0001830072 us-gaap:RetainedEarningsMember 2022-12-31 0001830072 us-gaap:NoncontrollingInterestMember 2022-12-31 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-12-31 0001830072 us-gaap:CommonStockMember 2021-12-31 0001830072 us-gaap:AdditionalPaidInCapitalMember 2021-12-31 0001830072 us-gaap:RetainedEarningsMember 2021-12-31 0001830072 us-gaap:NoncontrollingInterestMember 2021-12-31 0001830072 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-12-31 0001830072 2021-12-31 0001830072 currency:CNY 2022-12-31 0001830072 currency:CNY 2022-07-01 2022-12-31 0001830072 IPW:BoxHarmonyMember 2022-12-31 0001830072 IPW:AniviaLimitedMember 2022-02-14 2022-02-15 0001830072 IPW:AniviaPurchaseNoteMember 2022-02-15 0001830072 IPW:AmazonSalesToCanadaAndOtherForeignCountriesMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2022-07-01 2022-12-31 0001830072 IPW:HydroponicProductsMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2022-07-01 2022-12-31 0001830072 IPW:GeneralGardeningMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2022-07-01 2022-12-31 0001830072 country:CN 2022-12-31 0001830072 us-gaap:NoncompeteAgreementsMember 2022-07-01 2022-12-31 0001830072 IPW:SupplierRelationshipMember 2022-07-01 2022-12-31 0001830072 IPW:SoftwareMember 2022-07-01 2022-12-31 0001830072 IPW:CorporateBondYieldMember 2022-02-14 2022-02-15 0001830072 us-gaap:MeasurementInputRiskFreeInterestRateMember 2022-02-14 2022-02-15 0001830072 IPW:LiquidityPremiumMember 2022-02-14 2022-02-15 0001830072 us-gaap:MeasurementInputDiscountRateMember 2022-02-14 2022-02-15 0001830072 us-gaap:FairValueInputsLevel12And3Member us-gaap:FairValueMeasurementsRecurringMember us-gaap:GoodwillMember 2022-12-31 0001830072 us-gaap:FairValueInputsLevel1Member us-gaap:FairValueMeasurementsRecurringMember us-gaap:GoodwillMember 2022-12-31 0001830072 us-gaap:FairValueInputsLevel2Member us-gaap:FairValueMeasurementsRecurringMember us-gaap:GoodwillMember 2022-12-31 0001830072 us-gaap:FairValueInputsLevel3Member us-gaap:FairValueMeasurementsRecurringMember us-gaap:GoodwillMember 2022-12-31 0001830072 IPW:GPMMember 2022-12-31 0001830072 IPW:AniviaMember 2022-02-14 2022-02-15 0001830072 IPW:AniviaMember IPW:PurchaseNoteMember 2022-02-14 2022-02-15 0001830072 IPW:AniviaMember us-gaap:RestrictedStockMember 2022-02-14 2022-02-15 0001830072 IPW:AnivaMember 2022-02-15 0001830072 IPW:AnivaMember 2022-02-14 2022-02-15 0001830072 IPW:JPMMember IPW:AnivaMember 2022-02-14 2022-02-15 0001830072 IPW:AniviaMember us-gaap:NoncompeteAgreementsMember 2022-02-15 0001830072 IPW:AniviaMember IPW:SupplierRelationshipMember 2022-02-15 0001830072 IPW:AniviaMember IPW:SoftwareMember 2022-02-15 0001830072 IPW:AniviaMember 2022-02-15 0001830072 us-gaap:VariableInterestEntityPrimaryBeneficiaryMember 2022-12-31 0001830072 us-gaap:VariableInterestEntityPrimaryBeneficiaryMember 2022-06-30 0001830072 us-gaap:VariableInterestEntityPrimaryBeneficiaryMember 2022-10-01 2022-12-31 0001830072 us-gaap:VariableInterestEntityPrimaryBeneficiaryMember 2022-07-01 2022-12-31 0001830072 IPW:AdvanceToSuppliersMember 2022-12-31 0001830072 IPW:AdvanceToSuppliersMember 2022-06-30 0001830072 IPW:PrepaidIncomeTaxesMember 2022-12-31 0001830072 IPW:PrepaidIncomeTaxesMember 2022-06-30 0001830072 IPW:PrepaidAndOtherMember 2022-12-31 0001830072 IPW:PrepaidAndOtherMember 2022-06-30 0001830072 IPW:ProductSourcingMember 2022-12-31 0001830072 IPW:CarPrepaymentMember 2022-12-31 0001830072 us-gaap:NoncompeteAgreementsMember 2022-12-31 0001830072 IPW:SupplierRelationshipMember 2022-12-31 0001830072 IPW:SoftwareMember 2022-12-31 0001830072 IPW:WFCMember 2020-11-16 0001830072 IPW:WFCMember 2022-12-31 0001830072 IPW:WFCMember 2022-06-30 0001830072 IPW:SbaLoanMember 2022-04-01 2022-06-30 0001830072 IPW:SbaLoanMember 2022-12-31 0001830072 IPW:SbaLoanMember 2022-06-30 0001830072 IPW:AssetBasedRevolvingLoanMember 2021-11-11 2021-11-12 0001830072 IPW:AssetBasedRevolvingLoanMember 2022-12-31 0001830072 IPW:AssetBasedRevolvingLoanMember 2022-06-30 0001830072 IPW:AniviaPurchaseNoteMember 2022-10-01 2022-12-31 0001830072 IPW:AniviaPurchaseNoteMember 2022-07-01 2022-12-31 0001830072 IPW:AniviaPurchaseNoteMember 2022-12-31 0001830072 2022-02-15 0001830072 IPW:USTaxAuthoritiesMember 2022-12-31 0001830072 IPW:ChineseTaxAuthoritiesMember 2022-12-31 0001830072 IPW:USTaxAuthoritiesMember 2022-06-30 0001830072 IPW:ChineseTaxAuthoritiesMember 2022-06-30 0001830072 IPW:StockIssuedForVestedRsusMember 2022-07-01 2022-12-31 0001830072 2022-02-14 2022-02-15 0001830072 IPW:EquityIncentivePlanMember 2022-12-31 0001830072 us-gaap:RestrictedStockUnitsRSUMember IPW:LetterAgreementsMember 2020-07-01 2021-05-14 0001830072 us-gaap:RestrictedStockUnitsRSUMember 2022-07-01 2022-12-31 0001830072 us-gaap:RestrictedStockUnitsRSUMember 2022-10-01 2022-12-31 0001830072 us-gaap:RestrictedStockUnitsRSUMember 2021-10-01 2021-12-31 0001830072 us-gaap:RestrictedStockUnitsRSUMember 2021-07-01 2021-12-31 0001830072 us-gaap:RestrictedStockUnitsRSUMember 2022-12-31 0001830072 us-gaap:RestrictedStockUnitsRSUMember 2022-06-30 0001830072 2022-05-01 2022-05-12 0001830072 IPW:ChenlongTanMember 2022-05-01 2022-05-12 0001830072 IPW:MrVassilyMember 2022-05-01 2022-05-12 0001830072 2022-05-13 0001830072 2022-05-12 0001830072 2022-05-11 2022-05-12 0001830072 IPW:OptionsGrantedMember 2022-10-01 2022-12-31 0001830072 IPW:OptionsGrantedMember 2022-07-01 2022-12-31 0001830072 IPW:OptionsGrantedMember 2021-07-01 2021-12-31 0001830072 IPW:PlacementAgentMember IPW:SeriesAConvertiblePreferredStockMember us-gaap:PrivatePlacementMember 2020-12-30 0001830072 IPW:PlacementAgentMember IPW:SeriesAConvertiblePreferredStockMember 2020-12-30 0001830072 IPW:PlacementAgentMember IPW:SeriesAConvertiblePreferredStockMember us-gaap:PrivatePlacementMember 2020-12-01 2020-12-30 0001830072 IPW:TwoAccreditedInvestorsMember us-gaap:PrivatePlacementMember 2021-01-26 2021-01-27 0001830072 IPW:BousteadSecuritiesLLCMember 2021-05-14 0001830072 IPW:WarrantLiabilityMember us-gaap:MeasurementInputExpectedTermMember 2020-07-01 2021-05-14 0001830072 IPW:WarrantLiabilityMember us-gaap:MeasurementInputPriceVolatilityMember 2020-07-01 2021-05-14 0001830072 IPW:WarrantLiabilityMember us-gaap:MeasurementInputRiskFreeInterestRateMember 2020-07-01 2021-05-14 0001830072 IPW:WarrantLiabilityMember us-gaap:MeasurementInputExpectedDividendRateMember 2020-07-01 2021-05-14 0001830072 IPW:WarrantLiabilityMember IPW:MeasurementInputProbablityMember 2020-07-01 2021-05-14 0001830072 IPW:AmazonVendorAndAmazonSellerMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2022-07-01 2022-12-31 0001830072 IPW:AmazonVendorAndAmazonSellerMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2021-07-01 2021-12-31 0001830072 IPW:AmazonVendorAndAmazonSellerMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2022-07-01 2022-12-31 0001830072 IPW:AmazonVendorAndAmazonSellerMember us-gaap:AccountsReceivableMember us-gaap:CustomerConcentrationRiskMember 2021-07-01 2022-06-30 0001830072 us-gaap:CostOfSalesMember us-gaap:ProductConcentrationRiskMember IPW:TwoSuppliersMember 2022-07-01 2022-12-31 0001830072 us-gaap:CostOfSalesMember us-gaap:ProductConcentrationRiskMember IPW:OneSupplierMember 2021-07-01 2021-09-30 0001830072 us-gaap:CostOfSalesMember us-gaap:ProductConcentrationRiskMember IPW:AnotherSupplierMember 2022-07-01 2022-12-31 0001830072 us-gaap:CostOfSalesMember us-gaap:ProductConcentrationRiskMember IPW:TwoSuppliersMember 2021-07-01 2021-12-31 0001830072 us-gaap:CostOfSalesMember us-gaap:ProductConcentrationRiskMember IPW:OneSupplierMember 2021-07-01 2021-12-31 0001830072 us-gaap:CostOfSalesMember us-gaap:ProductConcentrationRiskMember IPW:AnotherSupplierMember 2021-07-01 2021-12-31 0001830072 us-gaap:AccountsPayableMember us-gaap:ProductConcentrationRiskMember IPW:TwoSuppliersMember 2022-07-01 2022-12-31 0001830072 us-gaap:AccountsPayableMember us-gaap:ProductConcentrationRiskMember IPW:OneSupplierMember 2022-07-01 2022-09-30 0001830072 us-gaap:AccountsPayableMember us-gaap:ProductConcentrationRiskMember IPW:AnotherSupplierMember 2022-07-01 2022-09-30 0001830072 us-gaap:AccountsPayableMember us-gaap:ProductConcentrationRiskMember IPW:TwoSuppliersMember 2021-07-01 2022-06-30 0001830072 us-gaap:AccountsPayableMember us-gaap:ProductConcentrationRiskMember IPW:OneSupplierMember 2021-07-01 2022-06-30 0001830072 us-gaap:AccountsPayableMember us-gaap:ProductConcentrationRiskMember IPW:AnotherSupplierMember 2021-07-01 2022-06-30 iso4217:USD shares iso4217:USD shares pure 0001830072 false --06-30 2023 Q2 10-Q true 2022-12-31 false 001-40391 iPower Inc. NV 82-5144171 2399 Bateman Avenue Duarte CA 91010 (626) 863-7344 Common Stock IPW NASDAQ Yes Yes Non-accelerated Filer true true false false 29710939 3997125 1821947 11646757 17432287 23258161 30433766 39853 51762 3714473 5444463 42656369 55184225 9161836 10453282 603518 544633 849579 0 709790 925624 3034110 6094144 36057 43385 4604756 4929442 401312 406732 19400958 23397242 62057327 78581467 12109715 9533408 223039 807687 368717 273457 2070567 5915220 89592 92246 0 1500000 2563468 2582933 1977502 1879065 290946 299563 19693546 22883579 9334819 12314627 881445 1781705 0 939115 7023320 8265611 17239584 23301058 36933130 46184637 0.001 0.001 20000000 20000000 0 0 0 0 0 0 0.001 0.001 180000000 180000000 29572382 29572382 29572382 29572382 29573 29573 29382011 29111863 -4209867 3262948 -18872 -13232 -58648 5678 25124197 32396830 62057327 78581467 19254590 17125663 45277263 34492428 19254590 17125663 45277263 34492428 11285064 9568051 27322021 19621114 7969526 7557612 17955242 14871314 9338737 3641839 17757549 7307760 2713355 2780488 5813531 5137954 0 0 3060034 0 12052092 6422327 26631114 12445714 -4082566 1135285 -8675872 2425600 -314119 -75112 -562160 -75112 -0 -0 -0 9000 -3938 0 -7328 0 59600 60403 271360 9591 -258457 -14709 -298128 -74521 -4341023 1120576 -8974000 2351079 -1047749 322715 -1495545 665690 -3293274 797861 -7478455 1685389 -2835 0 -5640 0 -3290439 797861 -7472815 1685389 47149 0 -64326 0 -3243290 797861 -7537141 1685389 29742620 26491103 29687878 26487816 29742620 26491103 29687878 26487816 -0.11 0.03 -0.25 0.06 -0.11 0.03 -0.25 0.06 29572382 29573 29111863 3262948 -13232 5678 32396830 -4182376 -2805 -4185181 137882 137882 -111475 -111475 29572382 29573 29249745 -919428 -16037 -105797 28238056 -3290439 -2835 -3293274 132266 132266 47149 47149 29572382 29573 29382011 -4209867 -18872 -58648 25124197 26448663 26449 23214263 1745073 24985785 887528 887528 103054 103054 26448663 26449 23317317 2632601 25976367 797861 797861 40019 40 -40 54435 54435 26488682 26489 23371712 3430462 26828663 -7478455 1685389 393168 8894 74998 55958 0 70000 -7328 -0 3060034 0 270148 157489 30023 -11425 107349 44203 -5785530 7727169 -7100607 6898717 1788694 -0 -1729990 2111371 -215834 -215834 -5420 229599 2607691 604965 -584648 -34001 95260 -69246 -3844758 2412063 -8617 -416310 7778208 -12243043 127367 56424 -127367 -56424 94409 0 82500 -0 31385 1604292 -0 796035 1500000 -0 906385 1767061 3022655 7715383 6200000 17059 -5540436 6739520 64773 0 2175178 -5559947 1821947 6651705 3997125 1091758 55000 1082000 0 0 <p id="xdx_80E_eus-gaap--OrganizationConsolidationAndPresentationOfFinancialStatementsDisclosureTextBlock_z0qBvtUJm59d" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 1 - <span id="xdx_82B_zTFWJmeAcxU">Nature of business and organization</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">iPower Inc., formerly known as BZRTH Inc., a Nevada corporation (the “Company”), was incorporated on April 11, 2018. The Company is a U.S.-based online seller and supplier of consumer home, garden and pet products. </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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% of the equity ownership of E Marketing. As a result, E Marketing has become the Company’s wholly owned subsidiary.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 variable interest entity (“VIE”). On May 18, 2021, the Company acquired 100% of the equity ownership of GPM. As a result, GPM has become the Company’s wholly owned subsidiary.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">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 logistics services primarily for foreign-based manufacturers or distributors who desire to sell their products online in the United States, with such logistics 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">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, with 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">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, Dayourenzai (Shenzhen) Technology Co., Ltd., and Daheshou (Shenzhen) Information Technology Co., Ltd. Anivia owns 100% of the equity of Fly Elephant Limited, which in turn owns 100% of the equity of Dayourenzai (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 in Note 4 below, the business, revenues and profits of Daheshou (Shenzhen) Information Technology Co., Ltd., a company organized under the Laws of the PRC (“DHS” or “VIE”) and located in Shenzhen, China. See details on Note 4 below.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_80E_eus-gaap--SignificantAccountingPoliciesTextBlock_zRrZ5meyl5wf" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Note 2 – <span id="xdx_825_zLkq2lTNmS15">Basis of Presentation and Summary of significant accounting policies</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p> <p id="xdx_842_eus-gaap--BasisOfAccountingPolicyPolicyTextBlock_z0Av80XpUlb9" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_86D_zSpuVcroNRUa">Basis of Presentation</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries and VIE 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, 2023, or for any other interim period or for any other future year. All intercompany balances and transactions have been eliminated in consolidation.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 Company’s Annual Report for the year ended June 30, 2022, which are included in the Form 10-K filed with the SEC on September 28, 2022.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p id="xdx_84F_eus-gaap--ConsolidationPolicyTextBlock_zKIkVFAiqI9k" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_862_ztMFDrcWIdT7">Principles of Consolidation</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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, including Fly Elephant Limited, Dayourenzai (Shenzhen) Technology Co., Ltd., and Daheshou (Shenzhen) Information Technology Co., Ltd. All inter-company balances and transactions have been eliminated.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_841_ecustom--EmergingGrowthCompanyStatusPolicyTextBlock_zRYR0u7WiVr3" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_865_zCvDDaiQTcS">Emerging Growth Company Status</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended, (the “Securities Act”), as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of utilizing the emerging growth company reduced reporting requirements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84E_eus-gaap--UseOfEstimates_zrzlf2ONPB26" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_86E_zSHS4aii1Ysa">Use of estimates and assumptions</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_84E_eus-gaap--ForeignCurrencyTransactionsAndTranslationsPolicyTextBlock_zbXjOzG6KFwf" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_86D_zuv4oATy0NS6">Foreign currency translation and transactions</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The reporting and functional currency of iPower and subsidiaries is the U.S. dollar (USD). iPower’s WFOE and 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 in stockholders’ 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The balance sheet amounts of the VIE, with the exception of equity, on December 31, 2022, were translated at <span id="xdx_902_eus-gaap--ForeignCurrencyExchangeRateTranslation1_c20221231__srt--CurrencyAxis__currency--CNY_pdd" title="Translation rate at period end">6.8979</span> 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 six months ended December 31, 2022 was <span id="xdx_90E_ecustom--ForeignCurrencyExchangeRateTranslation2_c20220701__20221231__srt--CurrencyAxis__currency--CNY_pdd" title="Translation rate during period">6.978613</span> 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 unaudited condensed consolidated balance sheet.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84C_eus-gaap--CashAndCashEquivalentsPolicyTextBlock_ze6rAp06Kkm7" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_868_z2HUxAyrasv4">Cash and cash equivalents</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Cash and cash equivalents consist of amounts held as cash on hand and bank deposits.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">From time to time, the Company may maintain bank balances in interest bearing accounts in excess of the $250,000, which is currently the maximum amount insured by the Federal Deposit Insurance Corporation for interest bearing accounts (there is currently no insurance limit for deposits in noninterest bearing accounts). To date, the Company has not experienced any losses with respect to cash. Management believes the Company is not exposed to any significant credit risk with respect to its cash.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84E_eus-gaap--ReceivablesPolicyTextBlock_zbExJojiHSDb" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_868_zAN8QK6HbIVh">Accounts receivable, net</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 24px"> </td> <td style="width: 24px"><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the customer fails to comply with its payment schedule;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the customer is in serious financial difficulty;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">a significant dispute with the customer has occurred regarding job progress or other matters;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the customer breaches any of its contractual obligations;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the customer appears to be financially distressed due to economic or legal factors;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the business between the customer and the Company is not active; and</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">other objective evidence indicates non-collectability of the accounts receivable.</span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_843_eus-gaap--EquityMethodInvestmentsPolicy_zryiGrNxBQ92" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86F_zFMQ6mqcQBJi">Equity method investment</span> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company accounts for its ownership interest in Box Harmony, a <span id="xdx_907_eus-gaap--EquityMethodInvestmentOwnershipPercentage_iI_dp_c20221231__srt--ScheduleOfEquityMethodInvestmentEquityMethodInvesteeNameAxis__custom--BoxHarmonyMember_z3naErE6TJQ" title="Equity Method Investment, Ownership Percentage">40</span>% 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 Box Harmony’s statement of operations and a corresponding charge or credit to the carrying value of the asset.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_846_eus-gaap--BusinessCombinationsPolicy_zvloQ4PDIvwh" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86D_z16YiMlScd2d">Business Combination</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 15, 2022, the Company acquired <span id="xdx_907_eus-gaap--VariableInterestEntityOwnershipPercentage_dp_c20220214__20220215__srt--OwnershipAxis__custom--AniviaLimitedMember_zlG5GNfbDS5f" title="Variable interest percentage">100</span>% of the ordinary shares of Anivia Limited (“Anivia”) and its subsidiaries, including its variable interest entity (“VIE”), Daheshou (Shenzhen) Information Technology Co., Ltd., a company organized under the laws of the People’s Republic of China (“DHS”). 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 paid 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_844_ecustom--VariableInterestEntitiesPolicyTextBlock_zRN6LoIiHHXe" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86B_zhpsb9sxHOTa">Variable interest entities</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 15, 2022, the Company acquired 100% of the ordinary shares of Anivia Limited (“Anivia”) and its subsidiaries, including DHS. Pursuant to the terms of the Agreements for the Company’s acquisition of Anivia and its subsidiaries, including DHS, 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 has been provided by the Company following the February 15, 2022 acquisition. 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 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84D_eus-gaap--GoodwillAndIntangibleAssetsGoodwillPolicy_zaau93yXsppk" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_869_zKrdN7Y3zCad">Goodwill</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill represents the excess of the purchase price over the fair value of assets acquired and liabilities assumed. The Company accounts for goodwill under <i>ASC Topic 350, Intangibles-Goodwill and Other</i>.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill is not amortized but is reviewed for potential impairment on an annual basis, or if events or circumstances indicate a potential impairment, at the reporting unit level. The Company’s review for impairment includes an assessment of qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value, including goodwill. If it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value, including goodwill, a quantitative goodwill impairment test is performed, which compares the fair value of the reporting unit with its carrying amounts, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. However, if the carrying amount of the reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The Company engaged an independent third-party valuation firm in August 2022 to conduct an evaluation of goodwill impairment for the Company as a whole at the consolidated reporting unit level as of June 30, 2022, which evaluation was conducted prior to the Company’s filing of its Annual Report on Form 10-K. Due to the decrease in the Company’s share price subsequent to the filing of the Form 10-K and the net loss incurred during the quarter ended September 30, 2022, the Company engaged the same valuation firm to review goodwill for impairment. Based on this review, the Company concluded an impairment loss of $<span id="xdx_907_eus-gaap--GoodwillImpairmentLossNetOfTax_pp0p0_c20220701__20221231_zRtL7G2Bnqnf" title="Goodwill impairment loss">3,060,034</span> as of September 30, 2022 was required. The impairment amount was determined based on the discounted cash flows with the revised projections reflecting the increase in freight and storage costs in the current interim quarter. The Company also considered the Market Capital Method, which is an alternative market approach, suggested the Company’s goodwill is partially impaired.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the three months ended December 31, 2022, the Company performed a qualitative goodwill impairment analysis following the steps laid out in ASC 350-20-35-3C and noted no goodwill impairment. As of December 31, 2022, the remaining goodwill balance amounted to $<span id="xdx_90B_eus-gaap--Goodwill_c20221231_pp0p0" title="Goodwill">3,034,110</span>.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_845_eus-gaap--IntangibleAssetsFiniteLivedPolicy_zSbzeJWwjkw9" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86E_zdYbIBK3mt4c">Intangible Assets, net</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Finite life intangible assets at December 31, 2022 included a covenant not to compete, supplier relationships, 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:</p> <table cellpadding="0" cellspacing="0" id="xdx_894_ecustom--IntangibleAssetsUsefulLivesTableTextBlock_zraUWYNLShK2" style="font: 10pt Times New Roman, Times, Serif; width: 55%; border-collapse: collapse" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details - Useful Lives)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B1_zIrD5OOrKFXf" style="display: none"> Schedule of estimated useful life</span></td> <td style="text-align: center"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Useful Life</span></td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 67%"><span style="font-size: 10pt">Covenant Not to Compete</span></td> <td style="width: 33%; text-align: center"><span style="font-size: 10pt"><span id="xdx_90A_eus-gaap--FiniteLivedIntangibleAssetUsefulLife_dtY_c20220701__20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__us-gaap--NoncompeteAgreementsMember_zC5W0bkifcV4" title="Intangible Asset, Useful Life">10</span> years</span></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Supplier relationships</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_900_eus-gaap--FiniteLivedIntangibleAssetUsefulLife_dtY_c20220701__20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SupplierRelationshipMember_zvrPemkm91f3" title="Intangible Asset, Useful Life">6</span> years</span></td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Software</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_907_eus-gaap--FiniteLivedIntangibleAssetUsefulLife_dtY_c20220701__20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SoftwareMember_zEogdVMjZ9Rf" title="Intangible Asset, Useful Life">5</span> years</span></td></tr> </table> <p id="xdx_8A9_zxKkvInQWfx3" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company reviews the recoverability of long-lived assets, including intangible assets, when events or changes in circumstances occur that indicate the carrying value of the asset may not be recoverable. The assessment of possible impairment on asset group level is based on the ability to recover the carrying value of the asset from the expected future pretax cash flows (undiscounted and without interest charges) of the related operations. If these cash flows are less than the carrying value of such asset, an impairment loss is recognized for the difference between estimated fair value and carrying value. The measurement of impairment requires management to make estimates of these cash flows related to long-lived assets, as well as other fair value determinations. As of December 31, 2022, there were no indicators of impairment.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84B_eus-gaap--FairValueOfFinancialInstrumentsPolicy_zkKpDAvtton6" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86D_zXNDpDddQlel">Fair values of financial instruments</span> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 $<span id="xdx_90A_eus-gaap--DebtInstrumentFaceAmount_iI_dm_c20220215__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_zcAa0derSgU8" title="Debt Instrument, Face Amount">3.5 million</span>. On February 15, 2022, the Company evaluated the fair value of the Purchase Note to be $<span id="xdx_90B_eus-gaap--DebtInstrumentFairValue_iI_dm_c20220215__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_zCtD2wyUVrMa" title="Debt Instrument, Fair Value Disclosure">3.6 million</span> using the following inputs:</p> <table cellpadding="0" cellspacing="0" id="xdx_89C_ecustom--ScheduleOfAssumptionsUsedFairValuePurchaseNoteTableTextBlock_zIeJ4ZjHI0Sb" style="font: 10pt Times New Roman, Times, Serif; width: 55%; border-collapse: collapse" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details - Assumptions)"> <tr style="vertical-align: top"> <td><span id="xdx_8B8_zEZU8BJOR2pa" style="display: none"> Schedule of assumptions</span></td> <td> </td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td style="width: 67%"><span style="font-size: 10pt">Corporate bond yield</span></td> <td style="text-align: center; width: 33%"><span style="font-size: 10pt"><span id="xdx_90A_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__custom--CorporateBondYieldMember_zTq6R7L2NgUe" title="Derivatives, Determination of Fair Value">3.1</span>%</span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Risk-free rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_900_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputRiskFreeInterestRateMember_z3yulqfYimDk" title="Derivatives, Determination of Fair Value">1.6</span>%</span></td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Liquidity premium</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_900_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__custom--LiquidityPremiumMember_zf57JtoS7IHe" title="Derivatives, Determination of Fair Value">0.4</span>%</span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Discount rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_907_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputDiscountRateMember_zO33KCMgvq2e" title="Derivatives, Determination of Fair Value">3.5</span>%</span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p id="xdx_8AF_zxtPTfCpzAdh" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">As of December 31, 2022, the outstanding balance of the Purchase Note was $<span id="xdx_90F_eus-gaap--LongTermDebt_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Long-Term Debt">2,858,947</span>, including a premium of $<span id="xdx_908_eus-gaap--DebtInstrumentUnamortizedPremium_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Debt Instrument, Unamortized Premium">56,759</span> and $<span id="xdx_90F_eus-gaap--InterestPayableCurrent_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Interest Payable, Current">177,188</span> of accrued interest.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company does not have any assets or liabilities measured at fair value on a recurring basis. We measure certain non-financial assets on a non-recurring basis, including goodwill. As a result of those measurements, we recognized an impairment charge of $0 and $3.1 million during the three and six months ended December 31, 2022, as follows: </p> <table cellpadding="0" cellspacing="0" id="xdx_89E_eus-gaap--FairValueAssetsMeasuredOnNonrecurringBasisTextBlock_zDERCVCYcCqb" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details - Fair Values of Financial Instruments)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B8_zHR8VMOgr6E7" style="display: none">Schedule of fair value on nonrecurring basis</span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total Fair Value</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Level 1</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Level 2</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Level 3</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total Impairment Loss</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 30%"><span style="font-size: 10pt">Goodwill</span></td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_988_eus-gaap--AssetsFairValueDisclosure_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel12And3Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_pp0p0" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">3,034,110</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_980_eus-gaap--AssetsFairValueDisclosure_iI_pp0p0_d0_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_z3Zz2DYEcijf" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">–</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_989_eus-gaap--AssetsFairValueDisclosure_iI_pp0p0_d0_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_zzeTbiQlI64b" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">–</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_98F_eus-gaap--AssetsFairValueDisclosure_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_pp0p0" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">3,034,110</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_986_eus-gaap--GoodwillImpairmentLoss_c20220701__20221231_pp0p0" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Goodwill, Impairment Loss"><span style="font-size: 10pt">3,060,034</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Total</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">3,034,110</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">–</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">–</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">3,034,110</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">3,060,034</span></td> <td> </td></tr> </table> <p id="xdx_8AA_zBkSH4HHjTej" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill, with a total carrying value of $6.1 million was written down to its fair value of $3.0 million, resulting in an impairment charge of $3,060,034, which was recorded in earnings for the six months ended December 31, 2022. The fair value of goodwill was determined based on the discounted cash flow method, which is an income approach, which required the use of inputs that were unobservable in the marketplace (Level 3), including a discount rate that would be used by a market participant, projections of revenues and cash flows with the revised projections reflecting the increase in freight and storage costs in the current interim quarter, among others.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in"> </p> <p id="xdx_84D_eus-gaap--RevenueFromContractWithCustomerPolicyTextBlock_zXZcSNFfv2M4" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86F_zsn8WXEyL08g">Revenue recognition</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has adopted Accounting Standards Codification (“ASC”) 606 since its inception on April 11, 2018 and recognizes revenue from product sales revenues, 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">Payments received prior to the delivery of goods to customers are recorded as customer deposits.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_842_eus-gaap--AdvertisingCostsPolicyTextBlock_zWts2WEgS4B6" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_866_znUuKnehrnnk">Advertising costs</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Advertising costs are expensed as incurred. Total advertising and promotional costs included in selling and fulfillment expenses for the three and six months ended December 31, 2022 and 2021 were as following. </p> <table cellpadding="0" cellspacing="0" id="xdx_899_ecustom--ScheduleOfAdvertisingCostsTableTextBlock_z0V2v1TarLGh" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details -Advertising Costs)"> <tr style="vertical-align: bottom"> <td style="text-align: left"><span id="xdx_8B7_zk17pipN4Z4a" style="display: none">Schedule of advertising costs </span></td><td> </td> <td style="text-align: left"> </td><td id="xdx_49E_20221001__20221231_ziNv8kEt36ga" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_49E_20211001__20211231_zogvrFwakgB2" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_494_20220701__20221231_zMSIkA0Lwm38" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_497_20210701__20211231_ziycX2xVmMG9" style="text-align: center"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_407_eus-gaap--AdvertisingExpense_zwRY9wvWXbO9" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 40%; text-align: left; padding-bottom: 2.5pt">Advertising and promotion</td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">1,306,112</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">578,565</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">2,472,461</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">1,211,981</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p id="xdx_8A5_zcTlJcBnKwm2" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_84B_ecustom--CostOfRevenuePolicyTextBlock_zm5YG7BasQVc" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_866_z8341pgXHdxf">Cost of revenue</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Cost of revenue mainly consists of costs for purchases of products and related inbound freight and delivery fees.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84E_ecustom--OperatingExpensesPolicyTextBlock_zfswzYMIA4a4" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86A_z2OTR7hZxMM8">Operating expenses</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">Operating expenses, which consist of selling and fulfillment and general and administrative expenses, are expensed as incurred.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_842_eus-gaap--InventoryPolicyTextBlock_zXGBAke8WOrj" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86C_zG3KlbHT0U52">Inventory</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">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 inventory and costs 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_847_ecustom--DebtIssuanceCostsPolicyTextBlock_zdcDRKEd2Eak" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86D_zSOzYSOxVmRf">Debt Issuance Costs</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Costs incurred in connection with the issuance of debt are deferred and amortized as interest expense over the term of the related debt using the effective interest method. To the extent that the debt is outstanding, these amounts are reflected in the consolidated balance sheets as direct deductions from the carrying amount of the outstanding borrowings.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_846_eus-gaap--SegmentReportingPolicyPolicyTextBlock_zdeWZiwRfeT4" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_863_z36UfP3P3VA9">Segment reporting</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 six months ended December 31, 2022, sales through Amazon to Canada and other foreign countries were approximately <span id="xdx_90A_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--AmazonSalesToCanadaAndOtherForeignCountriesMember_zbELT1KBiuSl" title="Concentration risk percentage">13.5</span>% of the Company’s total sales. Sales of hydroponic products, including ventilation and grow light systems, were approximately <span id="xdx_90E_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--ProductOrServiceAxis__custom--HydroponicProductsMember_zJ8lemSZ5zv9" title="Concentration risk percentage">47</span>% of the Company’s total sales and the remaining <span id="xdx_907_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--ProductOrServiceAxis__custom--GeneralGardeningMember_zJ9WIfzZfer1" title="Concentration risk percentage">53</span>% consisted of general gardening, home goods and other products and accessories. As of December 31, 2022, there were approximately $<span id="xdx_90F_eus-gaap--InventoryGross_iI_dm_c20221231__srt--StatementGeographicalAxis__country--CN_zAwtX70fCa4j" title="Inventory gross">3.0 million</span> of inventory stored in China. 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_841_eus-gaap--LesseeLeasesPolicyTextBlock_z6GgPm05h2Wl" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_862_z9ex4NEK5EY">Leases</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_848_eus-gaap--ShareBasedCompensationForfeituresPolicyTextBlock_z8y00vykRJce" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_868_zRzlwVsl61y">Stock-based Compensation</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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. In addition to requisite service period, the Company also evaluates the performance condition and market condition under ASC 718-10-20. For an award which contains both a performance and a market condition, and where both conditions must be satisfied for the award to vest, the market condition is incorporated into the fair value of the award, and that fair value is recognized over the employee’s requisite service period or nonemployee’s vesting period if it is probable the performance condition will be met. If the performance condition is ultimately not met, compensation cost related to the award should not be recognized (or should be reversed) because the vesting condition in the award has not been satisfied.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company will recognize forfeitures of such equity-based compensation as they occur.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_845_eus-gaap--IncomeTaxPolicyTextBlock_zrmJUq05EEW4" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86E_z1trZOQdq4Wd">Income taxes</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">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. Deferred income tax assets are recognized only to the extent that management determines that it is more-likely-than-not that the deferred income tax assets will be realized. Valuation allowances are recorded, when necessary, to reduce deferred tax assets to the amount expected to be realized.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company believes that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_844_eus-gaap--CommitmentsAndContingenciesPolicyTextBlock_zEtEuNWKVRC9" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_866_zHWhy3osEt6k">Commitments and contingencies</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_84C_eus-gaap--EarningsPerSharePolicyTextBlock_zYCExcfV7pQ6" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_865_zBHzpAPuKHF1">Earnings per share</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84B_eus-gaap--NewAccountingPronouncementsPolicyPolicyTextBlock_zgnTmpzuZRei" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86A_zPYhNLqY8Wdi">Recently issued accounting pronouncements</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In June 2022, FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. The amendments in this ASU clarify the guidance in ASC 820 on the fair value measurement of an equity security that is subject to a contractual sale restriction and require specific disclosures related to such an equity security. This standard is effective for fiscal years beginning after December 15, 2024. The Company does not expect the adoption of this standard to have a material impact on the consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASU 2014-09, Revenue from Contracts with Customers (Topic 606) as if the entity had originated the contracts. The guidance is effective for fiscal years beginning after December 15, 2023, with early application permitted. The Company does not expect the adoption of this standard to have a material impact on the consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In March 2020 and January 2021, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU No. 2021-01, Reference Rate Reform (Topic 848): Scope, respectively (collectively, “Topic 848”). Topic 848 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by Topic 848 are effective for all entities as of March 12, 2020 through December 31, 2022. The Company does not expect the adoption of this standard to have a material impact on the Company's consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 amend the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related EPS guidance. This standard is effective for the Company on July 1, 2024, 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 to have a material impact on the consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In January 2020, the FASB issued ASU 2020-01, “Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.” This ASU among other things clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investments—Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. The new ASU clarifies that, when determining the accounting for certain forward contracts and purchased options a company should not consider, whether upon settlement or exercise, if the underlying securities would be accounted for under the equity method or fair value option. ASU 2020-01 is effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021. An entity should apply ASU 2020-01 prospectively at the beginning of the interim period that includes the adoption date. The adoption of ASU 2020-01 did not have material impact on the Company's consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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, 2021, and interim periods within fiscal years beginning after December 15, 2022; however, early adoption is permitted. The adoption of this standard did not have material impact on the consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” which eliminates step two from the goodwill impairment test. Under ASU 2017-04, an entity should recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds its fair value up to the amount of goodwill allocated to that reporting unit. ASU 2017-04 became effective for accelerated filing companies for annual periods or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. All other entities, including not-for-profit entities, that are adopting the amendments in this Update should do so for their annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2022. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after  January 1, 2017. The Company has adopted ASU 2017-04. See disclosures above on Goodwill for further details.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_844_eus-gaap--SubsequentEventsPolicyPolicyTextBlock_zS6mQQ5ju3X3" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_866_zWkIEIN0Ppx8">Subsequent events</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_842_eus-gaap--BasisOfAccountingPolicyPolicyTextBlock_z0Av80XpUlb9" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_86D_zSpuVcroNRUa">Basis of Presentation</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries and VIE 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, 2023, or for any other interim period or for any other future year. All intercompany balances and transactions have been eliminated in consolidation.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 Company’s Annual Report for the year ended June 30, 2022, which are included in the Form 10-K filed with the SEC on September 28, 2022.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p id="xdx_84F_eus-gaap--ConsolidationPolicyTextBlock_zKIkVFAiqI9k" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_862_ztMFDrcWIdT7">Principles of Consolidation</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.25in; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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, including Fly Elephant Limited, Dayourenzai (Shenzhen) Technology Co., Ltd., and Daheshou (Shenzhen) Information Technology Co., Ltd. All inter-company balances and transactions have been eliminated.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_841_ecustom--EmergingGrowthCompanyStatusPolicyTextBlock_zRYR0u7WiVr3" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_865_zCvDDaiQTcS">Emerging Growth Company Status</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended, (the “Securities Act”), as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of utilizing the emerging growth company reduced reporting requirements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84E_eus-gaap--UseOfEstimates_zrzlf2ONPB26" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_86E_zSHS4aii1Ysa">Use of estimates and assumptions</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_84E_eus-gaap--ForeignCurrencyTransactionsAndTranslationsPolicyTextBlock_zbXjOzG6KFwf" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_86D_zuv4oATy0NS6">Foreign currency translation and transactions</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The reporting and functional currency of iPower and subsidiaries is the U.S. dollar (USD). iPower’s WFOE and 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 in stockholders’ 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The balance sheet amounts of the VIE, with the exception of equity, on December 31, 2022, were translated at <span id="xdx_902_eus-gaap--ForeignCurrencyExchangeRateTranslation1_c20221231__srt--CurrencyAxis__currency--CNY_pdd" title="Translation rate at period end">6.8979</span> 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 six months ended December 31, 2022 was <span id="xdx_90E_ecustom--ForeignCurrencyExchangeRateTranslation2_c20220701__20221231__srt--CurrencyAxis__currency--CNY_pdd" title="Translation rate during period">6.978613</span> 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 unaudited condensed consolidated balance sheet.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> 6.8979 6.978613 <p id="xdx_84C_eus-gaap--CashAndCashEquivalentsPolicyTextBlock_ze6rAp06Kkm7" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_868_z2HUxAyrasv4">Cash and cash equivalents</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Cash and cash equivalents consist of amounts held as cash on hand and bank deposits.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">From time to time, the Company may maintain bank balances in interest bearing accounts in excess of the $250,000, which is currently the maximum amount insured by the Federal Deposit Insurance Corporation for interest bearing accounts (there is currently no insurance limit for deposits in noninterest bearing accounts). To date, the Company has not experienced any losses with respect to cash. Management believes the Company is not exposed to any significant credit risk with respect to its cash.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84E_eus-gaap--ReceivablesPolicyTextBlock_zbExJojiHSDb" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_868_zAN8QK6HbIVh">Accounts receivable, net</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 24px"> </td> <td style="width: 24px"><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the customer fails to comply with its payment schedule;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the customer is in serious financial difficulty;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">a significant dispute with the customer has occurred regarding job progress or other matters;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the customer breaches any of its contractual obligations;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the customer appears to be financially distressed due to economic or legal factors;</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">the business between the customer and the Company is not active; and</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td> </td> <td> </td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td><span style="font-size: 10pt">other objective evidence indicates non-collectability of the accounts receivable.</span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_843_eus-gaap--EquityMethodInvestmentsPolicy_zryiGrNxBQ92" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86F_zFMQ6mqcQBJi">Equity method investment</span> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company accounts for its ownership interest in Box Harmony, a <span id="xdx_907_eus-gaap--EquityMethodInvestmentOwnershipPercentage_iI_dp_c20221231__srt--ScheduleOfEquityMethodInvestmentEquityMethodInvesteeNameAxis__custom--BoxHarmonyMember_z3naErE6TJQ" title="Equity Method Investment, Ownership Percentage">40</span>% 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 Box Harmony’s statement of operations and a corresponding charge or credit to the carrying value of the asset.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> 0.40 <p id="xdx_846_eus-gaap--BusinessCombinationsPolicy_zvloQ4PDIvwh" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86D_z16YiMlScd2d">Business Combination</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 15, 2022, the Company acquired <span id="xdx_907_eus-gaap--VariableInterestEntityOwnershipPercentage_dp_c20220214__20220215__srt--OwnershipAxis__custom--AniviaLimitedMember_zlG5GNfbDS5f" title="Variable interest percentage">100</span>% of the ordinary shares of Anivia Limited (“Anivia”) and its subsidiaries, including its variable interest entity (“VIE”), Daheshou (Shenzhen) Information Technology Co., Ltd., a company organized under the laws of the People’s Republic of China (“DHS”). 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 paid 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> 1 <p id="xdx_844_ecustom--VariableInterestEntitiesPolicyTextBlock_zRN6LoIiHHXe" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86B_zhpsb9sxHOTa">Variable interest entities</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 15, 2022, the Company acquired 100% of the ordinary shares of Anivia Limited (“Anivia”) and its subsidiaries, including DHS. Pursuant to the terms of the Agreements for the Company’s acquisition of Anivia and its subsidiaries, including DHS, 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 has been provided by the Company following the February 15, 2022 acquisition. 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 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84D_eus-gaap--GoodwillAndIntangibleAssetsGoodwillPolicy_zaau93yXsppk" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_869_zKrdN7Y3zCad">Goodwill</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill represents the excess of the purchase price over the fair value of assets acquired and liabilities assumed. The Company accounts for goodwill under <i>ASC Topic 350, Intangibles-Goodwill and Other</i>.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill is not amortized but is reviewed for potential impairment on an annual basis, or if events or circumstances indicate a potential impairment, at the reporting unit level. The Company’s review for impairment includes an assessment of qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value, including goodwill. If it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying value, including goodwill, a quantitative goodwill impairment test is performed, which compares the fair value of the reporting unit with its carrying amounts, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. However, if the carrying amount of the reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. The Company engaged an independent third-party valuation firm in August 2022 to conduct an evaluation of goodwill impairment for the Company as a whole at the consolidated reporting unit level as of June 30, 2022, which evaluation was conducted prior to the Company’s filing of its Annual Report on Form 10-K. Due to the decrease in the Company’s share price subsequent to the filing of the Form 10-K and the net loss incurred during the quarter ended September 30, 2022, the Company engaged the same valuation firm to review goodwill for impairment. Based on this review, the Company concluded an impairment loss of $<span id="xdx_907_eus-gaap--GoodwillImpairmentLossNetOfTax_pp0p0_c20220701__20221231_zRtL7G2Bnqnf" title="Goodwill impairment loss">3,060,034</span> as of September 30, 2022 was required. The impairment amount was determined based on the discounted cash flows with the revised projections reflecting the increase in freight and storage costs in the current interim quarter. The Company also considered the Market Capital Method, which is an alternative market approach, suggested the Company’s goodwill is partially impaired.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the three months ended December 31, 2022, the Company performed a qualitative goodwill impairment analysis following the steps laid out in ASC 350-20-35-3C and noted no goodwill impairment. As of December 31, 2022, the remaining goodwill balance amounted to $<span id="xdx_90B_eus-gaap--Goodwill_c20221231_pp0p0" title="Goodwill">3,034,110</span>.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> 3060034 3034110 <p id="xdx_845_eus-gaap--IntangibleAssetsFiniteLivedPolicy_zSbzeJWwjkw9" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86E_zdYbIBK3mt4c">Intangible Assets, net</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Finite life intangible assets at December 31, 2022 included a covenant not to compete, supplier relationships, 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:</p> <table cellpadding="0" cellspacing="0" id="xdx_894_ecustom--IntangibleAssetsUsefulLivesTableTextBlock_zraUWYNLShK2" style="font: 10pt Times New Roman, Times, Serif; width: 55%; border-collapse: collapse" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details - Useful Lives)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B1_zIrD5OOrKFXf" style="display: none"> Schedule of estimated useful life</span></td> <td style="text-align: center"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Useful Life</span></td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 67%"><span style="font-size: 10pt">Covenant Not to Compete</span></td> <td style="width: 33%; text-align: center"><span style="font-size: 10pt"><span id="xdx_90A_eus-gaap--FiniteLivedIntangibleAssetUsefulLife_dtY_c20220701__20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__us-gaap--NoncompeteAgreementsMember_zC5W0bkifcV4" title="Intangible Asset, Useful Life">10</span> years</span></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Supplier relationships</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_900_eus-gaap--FiniteLivedIntangibleAssetUsefulLife_dtY_c20220701__20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SupplierRelationshipMember_zvrPemkm91f3" title="Intangible Asset, Useful Life">6</span> years</span></td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Software</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_907_eus-gaap--FiniteLivedIntangibleAssetUsefulLife_dtY_c20220701__20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SoftwareMember_zEogdVMjZ9Rf" title="Intangible Asset, Useful Life">5</span> years</span></td></tr> </table> <p id="xdx_8A9_zxKkvInQWfx3" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company reviews the recoverability of long-lived assets, including intangible assets, when events or changes in circumstances occur that indicate the carrying value of the asset may not be recoverable. The assessment of possible impairment on asset group level is based on the ability to recover the carrying value of the asset from the expected future pretax cash flows (undiscounted and without interest charges) of the related operations. If these cash flows are less than the carrying value of such asset, an impairment loss is recognized for the difference between estimated fair value and carrying value. The measurement of impairment requires management to make estimates of these cash flows related to long-lived assets, as well as other fair value determinations. As of December 31, 2022, there were no indicators of impairment.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <table cellpadding="0" cellspacing="0" id="xdx_894_ecustom--IntangibleAssetsUsefulLivesTableTextBlock_zraUWYNLShK2" style="font: 10pt Times New Roman, Times, Serif; width: 55%; border-collapse: collapse" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details - Useful Lives)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B1_zIrD5OOrKFXf" style="display: none"> Schedule of estimated useful life</span></td> <td style="text-align: center"> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Useful Life</span></td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 67%"><span style="font-size: 10pt">Covenant Not to Compete</span></td> <td style="width: 33%; text-align: center"><span style="font-size: 10pt"><span id="xdx_90A_eus-gaap--FiniteLivedIntangibleAssetUsefulLife_dtY_c20220701__20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__us-gaap--NoncompeteAgreementsMember_zC5W0bkifcV4" title="Intangible Asset, Useful Life">10</span> years</span></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Supplier relationships</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_900_eus-gaap--FiniteLivedIntangibleAssetUsefulLife_dtY_c20220701__20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SupplierRelationshipMember_zvrPemkm91f3" title="Intangible Asset, Useful Life">6</span> years</span></td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Software</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_907_eus-gaap--FiniteLivedIntangibleAssetUsefulLife_dtY_c20220701__20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SoftwareMember_zEogdVMjZ9Rf" title="Intangible Asset, Useful Life">5</span> years</span></td></tr> </table> P10Y P6Y P5Y <p id="xdx_84B_eus-gaap--FairValueOfFinancialInstrumentsPolicy_zkKpDAvtton6" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86D_zXNDpDddQlel">Fair values of financial instruments</span> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 $<span id="xdx_90A_eus-gaap--DebtInstrumentFaceAmount_iI_dm_c20220215__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_zcAa0derSgU8" title="Debt Instrument, Face Amount">3.5 million</span>. On February 15, 2022, the Company evaluated the fair value of the Purchase Note to be $<span id="xdx_90B_eus-gaap--DebtInstrumentFairValue_iI_dm_c20220215__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_zCtD2wyUVrMa" title="Debt Instrument, Fair Value Disclosure">3.6 million</span> using the following inputs:</p> <table cellpadding="0" cellspacing="0" id="xdx_89C_ecustom--ScheduleOfAssumptionsUsedFairValuePurchaseNoteTableTextBlock_zIeJ4ZjHI0Sb" style="font: 10pt Times New Roman, Times, Serif; width: 55%; border-collapse: collapse" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details - Assumptions)"> <tr style="vertical-align: top"> <td><span id="xdx_8B8_zEZU8BJOR2pa" style="display: none"> Schedule of assumptions</span></td> <td> </td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td style="width: 67%"><span style="font-size: 10pt">Corporate bond yield</span></td> <td style="text-align: center; width: 33%"><span style="font-size: 10pt"><span id="xdx_90A_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__custom--CorporateBondYieldMember_zTq6R7L2NgUe" title="Derivatives, Determination of Fair Value">3.1</span>%</span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Risk-free rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_900_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputRiskFreeInterestRateMember_z3yulqfYimDk" title="Derivatives, Determination of Fair Value">1.6</span>%</span></td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Liquidity premium</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_900_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__custom--LiquidityPremiumMember_zf57JtoS7IHe" title="Derivatives, Determination of Fair Value">0.4</span>%</span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Discount rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_907_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputDiscountRateMember_zO33KCMgvq2e" title="Derivatives, Determination of Fair Value">3.5</span>%</span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p id="xdx_8AF_zxtPTfCpzAdh" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">As of December 31, 2022, the outstanding balance of the Purchase Note was $<span id="xdx_90F_eus-gaap--LongTermDebt_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Long-Term Debt">2,858,947</span>, including a premium of $<span id="xdx_908_eus-gaap--DebtInstrumentUnamortizedPremium_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Debt Instrument, Unamortized Premium">56,759</span> and $<span id="xdx_90F_eus-gaap--InterestPayableCurrent_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Interest Payable, Current">177,188</span> of accrued interest.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company does not have any assets or liabilities measured at fair value on a recurring basis. We measure certain non-financial assets on a non-recurring basis, including goodwill. As a result of those measurements, we recognized an impairment charge of $0 and $3.1 million during the three and six months ended December 31, 2022, as follows: </p> <table cellpadding="0" cellspacing="0" id="xdx_89E_eus-gaap--FairValueAssetsMeasuredOnNonrecurringBasisTextBlock_zDERCVCYcCqb" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details - Fair Values of Financial Instruments)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B8_zHR8VMOgr6E7" style="display: none">Schedule of fair value on nonrecurring basis</span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total Fair Value</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Level 1</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Level 2</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Level 3</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total Impairment Loss</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 30%"><span style="font-size: 10pt">Goodwill</span></td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_988_eus-gaap--AssetsFairValueDisclosure_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel12And3Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_pp0p0" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">3,034,110</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_980_eus-gaap--AssetsFairValueDisclosure_iI_pp0p0_d0_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_z3Zz2DYEcijf" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">–</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_989_eus-gaap--AssetsFairValueDisclosure_iI_pp0p0_d0_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_zzeTbiQlI64b" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">–</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_98F_eus-gaap--AssetsFairValueDisclosure_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_pp0p0" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">3,034,110</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_986_eus-gaap--GoodwillImpairmentLoss_c20220701__20221231_pp0p0" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Goodwill, Impairment Loss"><span style="font-size: 10pt">3,060,034</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Total</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">3,034,110</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">–</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">–</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">3,034,110</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">3,060,034</span></td> <td> </td></tr> </table> <p id="xdx_8AA_zBkSH4HHjTej" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Goodwill, with a total carrying value of $6.1 million was written down to its fair value of $3.0 million, resulting in an impairment charge of $3,060,034, which was recorded in earnings for the six months ended December 31, 2022. The fair value of goodwill was determined based on the discounted cash flow method, which is an income approach, which required the use of inputs that were unobservable in the marketplace (Level 3), including a discount rate that would be used by a market participant, projections of revenues and cash flows with the revised projections reflecting the increase in freight and storage costs in the current interim quarter, among others.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in"> </p> 3500000 3600000 <table cellpadding="0" cellspacing="0" id="xdx_89C_ecustom--ScheduleOfAssumptionsUsedFairValuePurchaseNoteTableTextBlock_zIeJ4ZjHI0Sb" style="font: 10pt Times New Roman, Times, Serif; width: 55%; border-collapse: collapse" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details - Assumptions)"> <tr style="vertical-align: top"> <td><span id="xdx_8B8_zEZU8BJOR2pa" style="display: none"> Schedule of assumptions</span></td> <td> </td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td style="width: 67%"><span style="font-size: 10pt">Corporate bond yield</span></td> <td style="text-align: center; width: 33%"><span style="font-size: 10pt"><span id="xdx_90A_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__custom--CorporateBondYieldMember_zTq6R7L2NgUe" title="Derivatives, Determination of Fair Value">3.1</span>%</span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Risk-free rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_900_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputRiskFreeInterestRateMember_z3yulqfYimDk" title="Derivatives, Determination of Fair Value">1.6</span>%</span></td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Liquidity premium</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_900_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__custom--LiquidityPremiumMember_zf57JtoS7IHe" title="Derivatives, Determination of Fair Value">0.4</span>%</span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Discount rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_907_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_dp_c20220214__20220215__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputDiscountRateMember_zO33KCMgvq2e" title="Derivatives, Determination of Fair Value">3.5</span>%</span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> 3.1 1.6 0.4 3.5 <table cellpadding="0" cellspacing="0" id="xdx_89E_eus-gaap--FairValueAssetsMeasuredOnNonrecurringBasisTextBlock_zDERCVCYcCqb" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details - Fair Values of Financial Instruments)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B8_zHR8VMOgr6E7" style="display: none">Schedule of fair value on nonrecurring basis</span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total Fair Value</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Level 1</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Level 2</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Level 3</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total Impairment Loss</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 30%"><span style="font-size: 10pt">Goodwill</span></td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_988_eus-gaap--AssetsFairValueDisclosure_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel12And3Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_pp0p0" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">3,034,110</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_980_eus-gaap--AssetsFairValueDisclosure_iI_pp0p0_d0_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_z3Zz2DYEcijf" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">–</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_989_eus-gaap--AssetsFairValueDisclosure_iI_pp0p0_d0_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_zzeTbiQlI64b" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">–</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_98F_eus-gaap--AssetsFairValueDisclosure_c20221231__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__us-gaap--GoodwillMember_pp0p0" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Assets"><span style="font-size: 10pt">3,034,110</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="border-bottom: black 1pt solid; width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_986_eus-gaap--GoodwillImpairmentLoss_c20220701__20221231_pp0p0" style="border-bottom: black 1pt solid; width: 11%; text-align: right" title="Goodwill, Impairment Loss"><span style="font-size: 10pt">3,060,034</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Total</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">3,034,110</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">–</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">–</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">3,034,110</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">3,060,034</span></td> <td> </td></tr> </table> 3034110 0 0 3034110 3060034 <p id="xdx_84D_eus-gaap--RevenueFromContractWithCustomerPolicyTextBlock_zXZcSNFfv2M4" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86F_zsn8WXEyL08g">Revenue recognition</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has adopted Accounting Standards Codification (“ASC”) 606 since its inception on April 11, 2018 and recognizes revenue from product sales revenues, 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">Payments received prior to the delivery of goods to customers are recorded as customer deposits.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_842_eus-gaap--AdvertisingCostsPolicyTextBlock_zWts2WEgS4B6" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_866_znUuKnehrnnk">Advertising costs</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Advertising costs are expensed as incurred. Total advertising and promotional costs included in selling and fulfillment expenses for the three and six months ended December 31, 2022 and 2021 were as following. </p> <table cellpadding="0" cellspacing="0" id="xdx_899_ecustom--ScheduleOfAdvertisingCostsTableTextBlock_z0V2v1TarLGh" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details -Advertising Costs)"> <tr style="vertical-align: bottom"> <td style="text-align: left"><span id="xdx_8B7_zk17pipN4Z4a" style="display: none">Schedule of advertising costs </span></td><td> </td> <td style="text-align: left"> </td><td id="xdx_49E_20221001__20221231_ziNv8kEt36ga" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_49E_20211001__20211231_zogvrFwakgB2" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_494_20220701__20221231_zMSIkA0Lwm38" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_497_20210701__20211231_ziycX2xVmMG9" style="text-align: center"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_407_eus-gaap--AdvertisingExpense_zwRY9wvWXbO9" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 40%; text-align: left; padding-bottom: 2.5pt">Advertising and promotion</td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">1,306,112</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">578,565</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">2,472,461</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">1,211,981</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p id="xdx_8A5_zcTlJcBnKwm2" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <table cellpadding="0" cellspacing="0" id="xdx_899_ecustom--ScheduleOfAdvertisingCostsTableTextBlock_z0V2v1TarLGh" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Basis of Presentation and Summary of significant accounting policies (Details -Advertising Costs)"> <tr style="vertical-align: bottom"> <td style="text-align: left"><span id="xdx_8B7_zk17pipN4Z4a" style="display: none">Schedule of advertising costs </span></td><td> </td> <td style="text-align: left"> </td><td id="xdx_49E_20221001__20221231_ziNv8kEt36ga" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_49E_20211001__20211231_zogvrFwakgB2" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_494_20220701__20221231_zMSIkA0Lwm38" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_497_20210701__20211231_ziycX2xVmMG9" style="text-align: center"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_407_eus-gaap--AdvertisingExpense_zwRY9wvWXbO9" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 40%; text-align: left; padding-bottom: 2.5pt">Advertising and promotion</td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">1,306,112</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">578,565</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">2,472,461</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 12%; text-align: right">1,211,981</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> 1306112 578565 2472461 1211981 <p id="xdx_84B_ecustom--CostOfRevenuePolicyTextBlock_zm5YG7BasQVc" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_866_z8341pgXHdxf">Cost of revenue</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Cost of revenue mainly consists of costs for purchases of products and related inbound freight and delivery fees.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84E_ecustom--OperatingExpensesPolicyTextBlock_zfswzYMIA4a4" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86A_z2OTR7hZxMM8">Operating expenses</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">Operating expenses, which consist of selling and fulfillment and general and administrative expenses, are expensed as incurred.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_842_eus-gaap--InventoryPolicyTextBlock_zXGBAke8WOrj" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86C_zG3KlbHT0U52">Inventory</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">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 inventory and costs 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_847_ecustom--DebtIssuanceCostsPolicyTextBlock_zdcDRKEd2Eak" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86D_zSOzYSOxVmRf">Debt Issuance Costs</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Costs incurred in connection with the issuance of debt are deferred and amortized as interest expense over the term of the related debt using the effective interest method. To the extent that the debt is outstanding, these amounts are reflected in the consolidated balance sheets as direct deductions from the carrying amount of the outstanding borrowings.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_846_eus-gaap--SegmentReportingPolicyPolicyTextBlock_zdeWZiwRfeT4" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_863_z36UfP3P3VA9">Segment reporting</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 six months ended December 31, 2022, sales through Amazon to Canada and other foreign countries were approximately <span id="xdx_90A_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--AmazonSalesToCanadaAndOtherForeignCountriesMember_zbELT1KBiuSl" title="Concentration risk percentage">13.5</span>% of the Company’s total sales. Sales of hydroponic products, including ventilation and grow light systems, were approximately <span id="xdx_90E_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--ProductOrServiceAxis__custom--HydroponicProductsMember_zJ8lemSZ5zv9" title="Concentration risk percentage">47</span>% of the Company’s total sales and the remaining <span id="xdx_907_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--ProductOrServiceAxis__custom--GeneralGardeningMember_zJ9WIfzZfer1" title="Concentration risk percentage">53</span>% consisted of general gardening, home goods and other products and accessories. As of December 31, 2022, there were approximately $<span id="xdx_90F_eus-gaap--InventoryGross_iI_dm_c20221231__srt--StatementGeographicalAxis__country--CN_zAwtX70fCa4j" title="Inventory gross">3.0 million</span> of inventory stored in China. 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> 0.135 0.47 0.53 3000000.0 <p id="xdx_841_eus-gaap--LesseeLeasesPolicyTextBlock_z6GgPm05h2Wl" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_862_z9ex4NEK5EY">Leases</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_848_eus-gaap--ShareBasedCompensationForfeituresPolicyTextBlock_z8y00vykRJce" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_868_zRzlwVsl61y">Stock-based Compensation</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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. In addition to requisite service period, the Company also evaluates the performance condition and market condition under ASC 718-10-20. For an award which contains both a performance and a market condition, and where both conditions must be satisfied for the award to vest, the market condition is incorporated into the fair value of the award, and that fair value is recognized over the employee’s requisite service period or nonemployee’s vesting period if it is probable the performance condition will be met. If the performance condition is ultimately not met, compensation cost related to the award should not be recognized (or should be reversed) because the vesting condition in the award has not been satisfied.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company will recognize forfeitures of such equity-based compensation as they occur.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_845_eus-gaap--IncomeTaxPolicyTextBlock_zrmJUq05EEW4" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86E_z1trZOQdq4Wd">Income taxes</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">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. Deferred income tax assets are recognized only to the extent that management determines that it is more-likely-than-not that the deferred income tax assets will be realized. Valuation allowances are recorded, when necessary, to reduce deferred tax assets to the amount expected to be realized.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company believes that our income tax filing positions and deductions will be sustained on audit and do not anticipate any adjustments that will result in a material change to 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_844_eus-gaap--CommitmentsAndContingenciesPolicyTextBlock_zEtEuNWKVRC9" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_866_zHWhy3osEt6k">Commitments and contingencies</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_84C_eus-gaap--EarningsPerSharePolicyTextBlock_zYCExcfV7pQ6" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_865_zBHzpAPuKHF1">Earnings per share</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_84B_eus-gaap--NewAccountingPronouncementsPolicyPolicyTextBlock_zgnTmpzuZRei" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline"><span id="xdx_86A_zPYhNLqY8Wdi">Recently issued accounting pronouncements</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In June 2022, FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. The amendments in this ASU clarify the guidance in ASC 820 on the fair value measurement of an equity security that is subject to a contractual sale restriction and require specific disclosures related to such an equity security. This standard is effective for fiscal years beginning after December 15, 2024. The Company does not expect the adoption of this standard to have a material impact on the consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805), Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with ASU 2014-09, Revenue from Contracts with Customers (Topic 606) as if the entity had originated the contracts. The guidance is effective for fiscal years beginning after December 15, 2023, with early application permitted. The Company does not expect the adoption of this standard to have a material impact on the consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In March 2020 and January 2021, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU No. 2021-01, Reference Rate Reform (Topic 848): Scope, respectively (collectively, “Topic 848”). Topic 848 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by Topic 848 are effective for all entities as of March 12, 2020 through December 31, 2022. The Company does not expect the adoption of this standard to have a material impact on the Company's consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 amend the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related EPS guidance. This standard is effective for the Company on July 1, 2024, 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 to have a material impact on the consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In January 2020, the FASB issued ASU 2020-01, “Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the Interactions between Topic 321, Topic 323, and Topic 815.” This ASU among other things clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investments—Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. The new ASU clarifies that, when determining the accounting for certain forward contracts and purchased options a company should not consider, whether upon settlement or exercise, if the underlying securities would be accounted for under the equity method or fair value option. ASU 2020-01 is effective for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2021. An entity should apply ASU 2020-01 prospectively at the beginning of the interim period that includes the adoption date. The adoption of ASU 2020-01 did not have material impact on the Company's consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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, 2021, and interim periods within fiscal years beginning after December 15, 2022; however, early adoption is permitted. The adoption of this standard did not have material impact on the consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” which eliminates step two from the goodwill impairment test. Under ASU 2017-04, an entity should recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds its fair value up to the amount of goodwill allocated to that reporting unit. ASU 2017-04 became effective for accelerated filing companies for annual periods or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. All other entities, including not-for-profit entities, that are adopting the amendments in this Update should do so for their annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2022. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after  January 1, 2017. The Company has adopted ASU 2017-04. See disclosures above on Goodwill for further details.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_844_eus-gaap--SubsequentEventsPolicyPolicyTextBlock_zS6mQQ5ju3X3" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline"><span id="xdx_866_zWkIEIN0Ppx8">Subsequent events</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p id="xdx_805_ecustom--JointVenturesDisclosureTextBlock_z6gweKp1PpY7" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 3 - <span id="xdx_827_zWccRwLDISkd">Joint Ventures</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Box Harmony, LLC</i></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">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, (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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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. As of the date of this report, the Company had not exercised the option to purchase additional voting units from Xiao and TPA. 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As a result, the Company owns <span id="xdx_905_eus-gaap--EquityMethodInvestmentOwnershipPercentage_iI_dp_c20221231__srt--ScheduleOfEquityMethodInvestmentEquityMethodInvesteeNameAxis__custom--BoxHarmonyMember_zWk1KexHvEZa" title="Equity Method Investment, Ownership Percentage">40</span>% 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b><i>Global Social Media, LLC</i></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">As of the date of this report, the members had not completed the capital contributions and no receivables were recorded.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Pursuant to the terms of the Agreements, the Company owns <span id="xdx_907_eus-gaap--EquityMethodInvestmentOwnershipPercentage_iI_dp_c20221231__srt--ScheduleOfEquityMethodInvestmentEquityMethodInvesteeNameAxis__custom--GPMMember_zPqpWoMv3J4l" title="Equity Method Investment, Ownership Percentage">60</span>% 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 six months ended December 31, 2022 and 2021, the impact of GSM’s activities were immaterial to the Company’s unaudited condensed consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> 0.40 0.60 <p id="xdx_806_ecustom--AcquisitionOfAniviaLimitedAndSubsidiariesVariableInterestEntityDisclosureTextBlock_zjYEErfVuClj" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 4 - <span id="xdx_82E_z4cHSHENsMva">Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entity</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">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, Dayourenzai (Shenzhen) Technology Co., Ltd. and Daheshou (Shenzhen) Information Technology Co., Ltd. Anivia owns 100% of the equity of Fly Elephant Limited, which in turn owns 100% of the equity of Dayourenzai (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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">Total fair value of the consideration for the transaction was $<span id="xdx_904_eus-gaap--BusinessCombinationConsiderationTransferred1_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" title="Payments to Acquire Businesses, Gross">10,629,000</span>, which was paid to White Cherry as follows: at closing, the Company (i) paid $<span id="xdx_90A_eus-gaap--NotesIssued1_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember__us-gaap--LongtermDebtTypeAxis__custom--PurchaseNoteMember_pp0p0" title="Notes Issued">3,500,000</span> 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 <span id="xdx_900_eus-gaap--StockIssuedDuringPeriodSharesAcquisitions_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember__us-gaap--StatementClassOfStockAxis__us-gaap--RestrictedStockMember_pdd" title="Number of shares issued for acquisition">3,083,700</span> restricted shares of the Company’s common stock (subject to a lock-up period of 180 days and insider trading rules), and (iii) owed an additional $<span id="xdx_905_eus-gaap--PaymentsToAcquireBusinessesGross_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" title="Business Combination, Consideration Transferred, Other">1,500,000</span> in cash, which was to be paid after closing.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">On October 7, 2022, in conjunction with the Company’s entry into the Second Amendment to the Credit Agreement, the Company’s promissory note holder, White Cherry Limited, an exempted company incorporated under the laws of the British Virgin Islands (“White Cherry”), entered into an amendment (the “Amendment”) to the subordination agreement, originally dated March 9, 2022 (the “Subordination Agreement”). The Amendment to the Subordination Agreement was amended solely for purposes of adjusting the definition of payment conditions under Section 2 of the Subordination Agreement such that “payment conditions” shall be deemed satisfied in connection with a permitted payment if (a) no event of default has occurred under the credit agreement and is continuing and (b) the Company shall have Excess Availability in the 30 days prior to the payment (as defined in the Second Amendment to the Credit Agreement) of no less than $7,500,000.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">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 relationships 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. In addition, pursuant to the Transfer Agreement, the Sellers made certain representations and warranties, including that other than the items presented on the balance sheet on February 15, 2022, DHS, the operating VIE, was not subject to any loans, debts, liabilities, guarantees or other contingent liabilities at the Closing date. In the event of any breach of any of the representations and warranties, the sellers shall bear joint and several liability for any direct or indirect losses suffered by the Company as a result thereof. The Company recognized approximately $<span id="xdx_902_eus-gaap--Goodwill_iI_dm_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AnivaMember_z12N3rMZr009" title="Goodwill">6.1 million</span> of goodwill in the transaction, which was 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 $<span id="xdx_90E_eus-gaap--OtherGeneralAndAdministrativeExpense_pp0p0_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AnivaMember_zb0YClMGrfX9" title="General and administrative expense">54,702</span> as general and administration expenses and $<span id="xdx_905_eus-gaap--PaymentsOfFinancingCosts_pp0p0_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AnivaMember__srt--CounterpartyNameAxis__custom--JPMMember_zglPsN4OtOId" title="Payments of financing cost">50,000</span> paid to JPM as financing fees.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The following information summarizes the purchase consideration and allocation of the fair values assigned to the assets at the purchase date, February 15, 2022:</p> <table cellpadding="0" cellspacing="0" id="xdx_88F_eus-gaap--ScheduleOfBusinessAcquisitionsByAcquisitionTextBlock_za9cpUbHWpMk" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entities (Details - Acquisition allocation)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8BD_zJYwq5kygEG3" style="display: none"> Schedule of allocation of acquisition price</span></td> <td> </td> <td colspan="2"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td><span style="font-size: 10pt"><b>Fair Value of Purchase Price:</b></span></td> <td> </td> <td colspan="2"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt; width: 84%"><span style="font-size: 10pt">Cash</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_982_eus-gaap--PaymentsToAcquireBusinessesNetOfCashAcquired_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="width: 13%; text-align: right" title="Cash"><span style="font-size: 10pt">1,500,000</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Promissory note issued</span></td> <td> </td> <td> </td> <td id="xdx_987_ecustom--PromissoryNotesIssued1_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Promissory note issued"><span style="font-size: 10pt">3,600,627</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Common stock issued</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td id="xdx_980_eus-gaap--BusinessCombinationConsiderationTransferredEquityInterestsIssuedAndIssuable_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="border-bottom: black 1pt solid; text-align: right" title="Common stock issued"><span style="font-size: 10pt">5,528,373</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Total purchase consideration</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td id="xdx_98C_eus-gaap--BusinessCombinationConsiderationTransferred1_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="border-bottom: black 2.25pt double; text-align: right" title="Total purchase consideration"><span style="font-size: 10pt">10,629,000</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt"><b>Purchase Price Allocation:</b></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Covenant not to compete</span></td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_986_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__us-gaap--NoncompeteAgreementsMember_pp0p0" style="text-align: right" title="Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles"><span style="font-size: 10pt">3,459,120</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Supplier relationships</span></td> <td> </td> <td> </td> <td id="xdx_985_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SupplierRelationshipMember_pp0p0" style="text-align: right" title="Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles"><span style="font-size: 10pt">1,179,246</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Software</span></td> <td> </td> <td> </td> <td id="xdx_989_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SoftwareMember_pp0p0" style="text-align: right" title="Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles"><span style="font-size: 10pt">534,591</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Current assets</span></td> <td> </td> <td> </td> <td id="xdx_983_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedCurrentAssets_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Current assets"><span style="font-size: 10pt">1,784,113</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Property and equipment</span></td> <td> </td> <td> </td> <td id="xdx_984_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedPropertyPlantAndEquipment_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Property and equipment"><span style="font-size: 10pt">46,548</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Rent deposit</span></td> <td> </td> <td> </td> <td id="xdx_98C_ecustom--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedRentDeposit_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Rent deposit"><span style="font-size: 10pt">52,707</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">ROU asset</span></td> <td> </td> <td> </td> <td id="xdx_989_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedOtherNoncurrentAssets_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="ROU asset"><span style="font-size: 10pt">234,578</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Goodwill</span></td> <td> </td> <td> </td> <td id="xdx_98A_eus-gaap--Goodwill_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Goodwill"><span style="font-size: 10pt">6,094,144</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Deferred tax liabilities</span></td> <td> </td> <td> </td> <td id="xdx_980_ecustom--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedCurrentLiabilities1_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Deferred tax liabilities"><span style="font-size: 10pt">(1,389,113</span></td> <td><span style="font-size: 10pt">)</span></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Current liabilities</span></td> <td> </td> <td> </td> <td id="xdx_980_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedCurrentLiabilities_iNI_pp0p0_di_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_zHLWi5OtUEt2" style="text-align: right" title="Current liabilities"><span style="font-size: 10pt">(1,143,076</span></td> <td><span style="font-size: 10pt">)</span></td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Lease liability</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td id="xdx_982_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedNoncurrentLiabilitiesOther_iNI_pp0p0_di_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_zMwUgVXGdwx9" style="border-bottom: black 1pt solid; text-align: right" title="Lease liability"><span style="font-size: 10pt">(223,858</span></td> <td><span style="font-size: 10pt">)</span></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Total purchase consideration</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td id="xdx_981_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredGoodwillAndLiabilitiesAssumedNet_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="border-bottom: black 2.25pt double; text-align: right" title="Total purchase consideration"><span style="font-size: 10pt">10,629,000</span></td> <td> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="background-color: white">In October 2022, the $1.5 million cash portion of the consideration, which was presented as investment payable, had been fully paid off.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">The results of operations of Anivia since February 16, 2022 have been included in the Company's consolidated financial statements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; background-color: white"/> 10629000 3500000 3083700 1500000 6100000 54702 50000 <table cellpadding="0" cellspacing="0" id="xdx_88F_eus-gaap--ScheduleOfBusinessAcquisitionsByAcquisitionTextBlock_za9cpUbHWpMk" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Acquisition of Anivia Limited and Subsidiaries and Variable Interest Entities (Details - Acquisition allocation)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8BD_zJYwq5kygEG3" style="display: none"> Schedule of allocation of acquisition price</span></td> <td> </td> <td colspan="2"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td><span style="font-size: 10pt"><b>Fair Value of Purchase Price:</b></span></td> <td> </td> <td colspan="2"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt; width: 84%"><span style="font-size: 10pt">Cash</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_982_eus-gaap--PaymentsToAcquireBusinessesNetOfCashAcquired_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="width: 13%; text-align: right" title="Cash"><span style="font-size: 10pt">1,500,000</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Promissory note issued</span></td> <td> </td> <td> </td> <td id="xdx_987_ecustom--PromissoryNotesIssued1_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Promissory note issued"><span style="font-size: 10pt">3,600,627</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Common stock issued</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td id="xdx_980_eus-gaap--BusinessCombinationConsiderationTransferredEquityInterestsIssuedAndIssuable_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="border-bottom: black 1pt solid; text-align: right" title="Common stock issued"><span style="font-size: 10pt">5,528,373</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Total purchase consideration</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td id="xdx_98C_eus-gaap--BusinessCombinationConsiderationTransferred1_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="border-bottom: black 2.25pt double; text-align: right" title="Total purchase consideration"><span style="font-size: 10pt">10,629,000</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt"><b>Purchase Price Allocation:</b></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Covenant not to compete</span></td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_986_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__us-gaap--NoncompeteAgreementsMember_pp0p0" style="text-align: right" title="Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles"><span style="font-size: 10pt">3,459,120</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Supplier relationships</span></td> <td> </td> <td> </td> <td id="xdx_985_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SupplierRelationshipMember_pp0p0" style="text-align: right" title="Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles"><span style="font-size: 10pt">1,179,246</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Software</span></td> <td> </td> <td> </td> <td id="xdx_989_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedIntangibles_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SoftwareMember_pp0p0" style="text-align: right" title="Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles"><span style="font-size: 10pt">534,591</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Current assets</span></td> <td> </td> <td> </td> <td id="xdx_983_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedCurrentAssets_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Current assets"><span style="font-size: 10pt">1,784,113</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Property and equipment</span></td> <td> </td> <td> </td> <td id="xdx_984_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedPropertyPlantAndEquipment_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Property and equipment"><span style="font-size: 10pt">46,548</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Rent deposit</span></td> <td> </td> <td> </td> <td id="xdx_98C_ecustom--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedRentDeposit_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Rent deposit"><span style="font-size: 10pt">52,707</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">ROU asset</span></td> <td> </td> <td> </td> <td id="xdx_989_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedOtherNoncurrentAssets_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="ROU asset"><span style="font-size: 10pt">234,578</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Goodwill</span></td> <td> </td> <td> </td> <td id="xdx_98A_eus-gaap--Goodwill_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Goodwill"><span style="font-size: 10pt">6,094,144</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Deferred tax liabilities</span></td> <td> </td> <td> </td> <td id="xdx_980_ecustom--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedCurrentLiabilities1_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="text-align: right" title="Deferred tax liabilities"><span style="font-size: 10pt">(1,389,113</span></td> <td><span style="font-size: 10pt">)</span></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Current liabilities</span></td> <td> </td> <td> </td> <td id="xdx_980_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedCurrentLiabilities_iNI_pp0p0_di_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_zHLWi5OtUEt2" style="text-align: right" title="Current liabilities"><span style="font-size: 10pt">(1,143,076</span></td> <td><span style="font-size: 10pt">)</span></td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Lease liability</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td id="xdx_982_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredAndLiabilitiesAssumedNoncurrentLiabilitiesOther_iNI_pp0p0_di_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_zMwUgVXGdwx9" style="border-bottom: black 1pt solid; text-align: right" title="Lease liability"><span style="font-size: 10pt">(223,858</span></td> <td><span style="font-size: 10pt">)</span></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Total purchase consideration</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td id="xdx_981_eus-gaap--BusinessCombinationRecognizedIdentifiableAssetsAcquiredGoodwillAndLiabilitiesAssumedNet_c20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember_pp0p0" style="border-bottom: black 2.25pt double; text-align: right" title="Total purchase consideration"><span style="font-size: 10pt">10,629,000</span></td> <td> </td></tr> </table> 1500000 3600627 5528373 10629000 3459120 1179246 534591 1784113 46548 52707 234578 6094144 -1389113 1143076 223858 10629000 <p id="xdx_80F_eus-gaap--VariableInterestEntityDisclosureTextBlock_zokbgnw6ondk" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 5 – <span id="xdx_825_zp7uJXH9dU5a">Variable interest entity</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022 and 2021, there was no pledge or collateralization of the VIE assets that would be used to settle obligations of the VIE.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The carrying amount of the VIE’s assets and liabilities were as follows for the periods indicated: </p> <table cellpadding="0" cellspacing="0" id="xdx_89F_eus-gaap--ScheduleOfVariableInterestEntitiesTextBlock_zGsEtm6IBVY8" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Variable interest entity (Details - Assets and Liabilities)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B6_zQh2uVfWtxpg" style="display: none"> Carrying amount of VIE assets and liabilities</span></td><td> </td> <td colspan="2" id="xdx_494_20221231_srt--ConsolidatedEntitiesAxis_us-gaap--VariableInterestEntityPrimaryBeneficiaryMember" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_49B_20220630__srt--ConsolidatedEntitiesAxis__us-gaap--VariableInterestEntityPrimaryBeneficiaryMember_zWOEDteWRfIk" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">December 31,<br/> 2022</td><td style="padding-bottom: 1pt; font-weight: bold"> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">June 30,<br/> 2022</td><td style="padding-bottom: 1pt; font-weight: bold"> </td></tr> <tr id="xdx_40B_eus-gaap--Cash_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 68%; text-align: left">Cash in bank</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">296,482</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">271,164</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--PrepaidExpenseAndOtherAssets_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Prepayments and other receivables</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">519,284</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">1,374,698</td><td style="text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--DepositsAssetsCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Rent deposit</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">49,446</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">50,036</td><td style="text-align: left"> </td></tr> <tr id="xdx_401_ecustom--OfficeEquipmentNet_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Office equipment, net</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">46,464</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">57,730</td><td style="text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--OperatingLeaseRightOfUseAsset_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Right of use - noncurrent</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">77,735</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">153,064</td><td style="text-align: left"> </td></tr> <tr id="xdx_406_eus-gaap--DeferredTaxAssetsGross_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Deferred tax asset</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">222,202</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl0888">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_402_ecustom--AdvanceFromShareholders_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Advance from shareholders</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">89,592</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">92,246</td><td style="text-align: left"> </td></tr> <tr id="xdx_407_eus-gaap--AccountsPayableCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Accounts payable</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">116,913</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">121,073</td><td style="text-align: left"> </td></tr> <tr id="xdx_40F_eus-gaap--OperatingLeaseLiability_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Lease liability</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">77,990</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">154,418</td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--TaxesPayableCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Income tax payable</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">290,947</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">299,563</td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--AccountsPayableAndOtherAccruedLiabilities_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Other payables and accrued liabilities</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">267,589</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">188,066</td><td style="text-align: left"> </td></tr> </table> <p id="xdx_8AD_zPqob91pHCSl" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The operating results of the VIE were as follows for the three and six months ended December 31, 2022: </p> <table cellpadding="0" cellspacing="0" id="xdx_891_ecustom--ScheduleOfOperatingResultsOfTheVieTableTextBlock_zSQE1nwp8ypl" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Variable interest entity (Details - VIE Operations)"> <tr style="vertical-align: bottom"> <td style="text-align: left"><span id="xdx_8B7_ziQ0sDP9LWZ" style="display: none">Operating results of the VIE</span></td><td> </td> <td style="text-align: left"> </td><td id="xdx_495_20221001__20221231__srt--ConsolidatedEntitiesAxis__us-gaap--VariableInterestEntityPrimaryBeneficiaryMember_zSChFDnBiZBh" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_498_20220701_20221231_srt--ConsolidatedEntitiesAxis_us-gaap--VariableInterestEntityPrimaryBeneficiaryMember" style="text-align: center"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">Three Months</td><td style="padding-bottom: 1pt; font-weight: bold"> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">Six Months</td><td style="padding-bottom: 1pt; font-weight: bold"> </td></tr> <tr id="xdx_401_eus-gaap--Revenues_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Revenue</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl0907">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl0908">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--NetIncomeLoss_iN_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="width: 68%; text-align: left">Net loss after elimination of intercompany transactions</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">177,947</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">911,564</td><td style="width: 1%; text-align: left"> </td></tr> </table> <p id="xdx_8A2_zkuTeYtHKbT1" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the three months ended December 31, 2022, the VIE contributed approximately $<span id="xdx_90F_ecustom--RevenueBeforeConsolidation_dm_c20221001__20221231__srt--ConsolidatedEntitiesAxis__us-gaap--VariableInterestEntityPrimaryBeneficiaryMember_zgmNQacBU6A6" title="Revenue before consolidation">1.1 million</span> of revenue and $<span id="xdx_906_ecustom--NetIncomeLossBeforeConsolidation_dm_c20221001__20221231__srt--ConsolidatedEntitiesAxis__us-gaap--VariableInterestEntityPrimaryBeneficiaryMember_ztBVdmwx2Nt" title="Net income">0.1 million</span> of net loss before elimination. For the six months ended December 31, 2022, the VIE contributed approximately $<span id="xdx_906_ecustom--RevenueBeforeConsolidation_dm_c20220701__20221231__srt--ConsolidatedEntitiesAxis__us-gaap--VariableInterestEntityPrimaryBeneficiaryMember_zYZMgOeu0cY4" title="Revenue before consolidation">4.3 million</span> of revenue and $<span id="xdx_90F_ecustom--NetIncomeLossBeforeConsolidation_dm_c20220701__20221231__srt--ConsolidatedEntitiesAxis__us-gaap--VariableInterestEntityPrimaryBeneficiaryMember_zal8t4dtd7p1" title="Net income">0.6 million</span> of net loss before elimination.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> <table cellpadding="0" cellspacing="0" id="xdx_89F_eus-gaap--ScheduleOfVariableInterestEntitiesTextBlock_zGsEtm6IBVY8" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Variable interest entity (Details - Assets and Liabilities)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B6_zQh2uVfWtxpg" style="display: none"> Carrying amount of VIE assets and liabilities</span></td><td> </td> <td colspan="2" id="xdx_494_20221231_srt--ConsolidatedEntitiesAxis_us-gaap--VariableInterestEntityPrimaryBeneficiaryMember" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_49B_20220630__srt--ConsolidatedEntitiesAxis__us-gaap--VariableInterestEntityPrimaryBeneficiaryMember_zWOEDteWRfIk" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">December 31,<br/> 2022</td><td style="padding-bottom: 1pt; font-weight: bold"> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">June 30,<br/> 2022</td><td style="padding-bottom: 1pt; font-weight: bold"> </td></tr> <tr id="xdx_40B_eus-gaap--Cash_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 68%; text-align: left">Cash in bank</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">296,482</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">271,164</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--PrepaidExpenseAndOtherAssets_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Prepayments and other receivables</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">519,284</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">1,374,698</td><td style="text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--DepositsAssetsCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Rent deposit</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">49,446</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">50,036</td><td style="text-align: left"> </td></tr> <tr id="xdx_401_ecustom--OfficeEquipmentNet_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Office equipment, net</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">46,464</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">57,730</td><td style="text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--OperatingLeaseRightOfUseAsset_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Right of use - noncurrent</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">77,735</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">153,064</td><td style="text-align: left"> </td></tr> <tr id="xdx_406_eus-gaap--DeferredTaxAssetsGross_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Deferred tax asset</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">222,202</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl0888">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_402_ecustom--AdvanceFromShareholders_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Advance from shareholders</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">89,592</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">92,246</td><td style="text-align: left"> </td></tr> <tr id="xdx_407_eus-gaap--AccountsPayableCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Accounts payable</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">116,913</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">121,073</td><td style="text-align: left"> </td></tr> <tr id="xdx_40F_eus-gaap--OperatingLeaseLiability_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Lease liability</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">77,990</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">154,418</td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--TaxesPayableCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Income tax payable</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">290,947</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">299,563</td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--AccountsPayableAndOtherAccruedLiabilities_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Other payables and accrued liabilities</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">267,589</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">188,066</td><td style="text-align: left"> </td></tr> </table> 296482 271164 519284 1374698 49446 50036 46464 57730 77735 153064 222202 89592 92246 116913 121073 77990 154418 290947 299563 267589 188066 <table cellpadding="0" cellspacing="0" id="xdx_891_ecustom--ScheduleOfOperatingResultsOfTheVieTableTextBlock_zSQE1nwp8ypl" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Variable interest entity (Details - VIE Operations)"> <tr style="vertical-align: bottom"> <td style="text-align: left"><span id="xdx_8B7_ziQ0sDP9LWZ" style="display: none">Operating results of the VIE</span></td><td> </td> <td style="text-align: left"> </td><td id="xdx_495_20221001__20221231__srt--ConsolidatedEntitiesAxis__us-gaap--VariableInterestEntityPrimaryBeneficiaryMember_zSChFDnBiZBh" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_498_20220701_20221231_srt--ConsolidatedEntitiesAxis_us-gaap--VariableInterestEntityPrimaryBeneficiaryMember" style="text-align: center"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">Three Months</td><td style="padding-bottom: 1pt; font-weight: bold"> </td><td style="font-weight: bold; padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; font-weight: bold; text-align: center">Six Months</td><td style="padding-bottom: 1pt; font-weight: bold"> </td></tr> <tr id="xdx_401_eus-gaap--Revenues_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Revenue</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl0907">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl0908">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--NetIncomeLoss_iN_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="width: 68%; text-align: left">Net loss after elimination of intercompany transactions</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">177,947</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">911,564</td><td style="width: 1%; text-align: left"> </td></tr> </table> 177947 911564 1100000 100000 4300000 600000 <p id="xdx_802_eus-gaap--LoansNotesTradeAndOtherReceivablesDisclosureTextBlock_zHxvGM4Hxk4j" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 6 –<span id="xdx_829_zBXudxt5L0Rg"> Accounts receivable, net</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Accounts receivable for the Company consisted of the following as of the dates indicated below:</p> <table cellpadding="0" cellspacing="0" id="xdx_886_eus-gaap--ScheduleOfAccountsNotesLoansAndFinancingReceivableTextBlock_zEe1WDyxOeS7" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Accounts receivable (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B8_z99uZKU6Wlje" style="display: none"> Schedule of accounts receivable</span></td><td> </td> <td colspan="2" id="xdx_49C_20221231_zW5G4SmVhcI4" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_496_20220630_z5FhVq92LPt8" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>June 30,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_404_eus-gaap--AccountsReceivableGrossCurrent_iI_pp0p0_maARNCz5LI_zSLiITGSA8Nh" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 68%; text-align: left">Accounts receivable</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">11,716,757</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">17,502,287</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--AllowanceForDoubtfulAccountsReceivableCurrent_iNI_pp0p0_di_msARNCz5LI_zgyBwkT2QTBe" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Less: allowance for credit losses</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(70,000</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(70,000</td><td style="padding-bottom: 1pt; text-align: left">)</td></tr> <tr id="xdx_407_eus-gaap--AccountsReceivableNetCurrent_iTI_pp0p0_mtARNCz5LI_zVHlhf8alill" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 2.5pt">Total accounts receivable</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">11,646,757</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">17,432,287</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <table cellpadding="0" cellspacing="0" id="xdx_886_eus-gaap--ScheduleOfAccountsNotesLoansAndFinancingReceivableTextBlock_zEe1WDyxOeS7" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Accounts receivable (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B8_z99uZKU6Wlje" style="display: none"> Schedule of accounts receivable</span></td><td> </td> <td colspan="2" id="xdx_49C_20221231_zW5G4SmVhcI4" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_496_20220630_z5FhVq92LPt8" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>June 30,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_404_eus-gaap--AccountsReceivableGrossCurrent_iI_pp0p0_maARNCz5LI_zSLiITGSA8Nh" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 68%; text-align: left">Accounts receivable</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">11,716,757</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">17,502,287</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--AllowanceForDoubtfulAccountsReceivableCurrent_iNI_pp0p0_di_msARNCz5LI_zgyBwkT2QTBe" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Less: allowance for credit losses</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(70,000</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(70,000</td><td style="padding-bottom: 1pt; text-align: left">)</td></tr> <tr id="xdx_407_eus-gaap--AccountsReceivableNetCurrent_iTI_pp0p0_mtARNCz5LI_zVHlhf8alill" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 2.5pt">Total accounts receivable</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">11,646,757</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">17,432,287</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> 11716757 17502287 70000 70000 11646757 17432287 <p id="xdx_804_eus-gaap--InventoryDisclosureTextBlock_z4TFAxNXAO25" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 7 – <span id="xdx_82C_zwphsaErJvTe">Inventories, net</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022 and June 30, 2022, inventories consisted of finished goods ready for sale, net of allowance for obsolescence, amounted to $<span id="xdx_90D_eus-gaap--InventoryNet_c20221231_pp0p0" title="Inventory, net">23,258,161</span> and $<span id="xdx_901_eus-gaap--InventoryNet_iI_pp0p0_c20220630_zorgUz24B2o" title="Inventory, net">30,433,766</span>, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022 and June 30, 2022, allowance for obsolescence was $<span id="xdx_902_eus-gaap--InventoryLIFOReserve_c20221231_pp0p0" title="Inventory, LIFO Reserve">394,998</span> and $<span id="xdx_90D_eus-gaap--InventoryLIFOReserve_iI_pp0p0_c20220630_zcUbllblrfp" title="Inventory, LIFO Reserve">320,000</span>, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> 23258161 30433766 394998 320000 <p id="xdx_801_ecustom--DeferredCostsPrepaidAndOtherAssetsDisclosureTextBlock_zmY184QWh1z5" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 8 – <span id="xdx_821_zwVOssevUxXe">Prepayments and other current assets</span> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">As of December 31, 2022 and June 30, 2022, prepayments and other current assets consisted of the following:</p> <table cellpadding="0" cellspacing="0" id="xdx_881_eus-gaap--DeferredCostsCapitalizedPrepaidAndOtherAssetsDisclosureTextBlock_zgRU111rZ2Sk" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Prepayments and other current assets (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8BC_zdIzP7SC8W8f" style="display: none"> Schedule of prepayments and other current assets</span></td><td> </td> <td colspan="2" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>June 30,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 68%; text-align: left">Advance to suppliers</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98A_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20221231__us-gaap--BalanceSheetLocationAxis__custom--AdvanceToSuppliersMember_pp0p0" style="width: 13%; text-align: right" title="Prepaid Expense and Other Assets, Current">2,375,797</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_985_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20220630__us-gaap--BalanceSheetLocationAxis__custom--AdvanceToSuppliersMember_pp0p0" style="width: 13%; text-align: right" title="Prepaid Expense and Other Assets, Current">3,938,881</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Prepaid income taxes</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20221231__us-gaap--BalanceSheetLocationAxis__custom--PrepaidIncomeTaxesMember_pp0p0" style="text-align: right" title="Prepaid Expense and Other Assets, Current">151,506</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98A_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20220630__us-gaap--BalanceSheetLocationAxis__custom--PrepaidIncomeTaxesMember_pp0p0" style="text-align: right" title="Prepaid Expense and Other Assets, Current">375,087</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 1pt">Prepaid expenses and other receivables</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td id="xdx_980_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20221231__us-gaap--BalanceSheetLocationAxis__custom--PrepaidAndOtherMember_pp0p0" style="border-bottom: Black 1pt solid; text-align: right" title="Prepaid Expense and Other Assets, Current">1,187,170</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td id="xdx_982_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20220630__us-gaap--BalanceSheetLocationAxis__custom--PrepaidAndOtherMember_pp0p0" style="border-bottom: Black 1pt solid; text-align: right" title="Prepaid Expense and Other Assets, Current">1,130,495</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_980_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20221231_pp0p0" style="border-bottom: Black 2.5pt double; text-align: right" title="Prepaid Expense and Other Assets, Current">3,714,473</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_982_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20220630_pp0p0" style="border-bottom: Black 2.5pt double; text-align: right" title="Prepaid Expense and Other Assets, Current">5,444,463</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Other receivables consisted of delivery fees of $<span id="xdx_90E_ecustom--DeliveryFeesReceivable_c20221231_pp0p0" title="Delivery fees receivable">118,170</span> and $<span id="xdx_908_ecustom--DeliveryFeesReceivable_c20220630_pp0p0" title="Delivery fees receivable">56,884</span> from two unrelated parties for their use of the Company’s courier accounts at December 31, 2022 and June 30, 2022. As of the date of this report, the amount had been fully collected.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <table cellpadding="0" cellspacing="0" id="xdx_881_eus-gaap--DeferredCostsCapitalizedPrepaidAndOtherAssetsDisclosureTextBlock_zgRU111rZ2Sk" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Prepayments and other current assets (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8BC_zdIzP7SC8W8f" style="display: none"> Schedule of prepayments and other current assets</span></td><td> </td> <td colspan="2" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>June 30,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 68%; text-align: left">Advance to suppliers</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98A_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20221231__us-gaap--BalanceSheetLocationAxis__custom--AdvanceToSuppliersMember_pp0p0" style="width: 13%; text-align: right" title="Prepaid Expense and Other Assets, Current">2,375,797</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_985_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20220630__us-gaap--BalanceSheetLocationAxis__custom--AdvanceToSuppliersMember_pp0p0" style="width: 13%; text-align: right" title="Prepaid Expense and Other Assets, Current">3,938,881</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Prepaid income taxes</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20221231__us-gaap--BalanceSheetLocationAxis__custom--PrepaidIncomeTaxesMember_pp0p0" style="text-align: right" title="Prepaid Expense and Other Assets, Current">151,506</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98A_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20220630__us-gaap--BalanceSheetLocationAxis__custom--PrepaidIncomeTaxesMember_pp0p0" style="text-align: right" title="Prepaid Expense and Other Assets, Current">375,087</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 1pt">Prepaid expenses and other receivables</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td id="xdx_980_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20221231__us-gaap--BalanceSheetLocationAxis__custom--PrepaidAndOtherMember_pp0p0" style="border-bottom: Black 1pt solid; text-align: right" title="Prepaid Expense and Other Assets, Current">1,187,170</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td id="xdx_982_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20220630__us-gaap--BalanceSheetLocationAxis__custom--PrepaidAndOtherMember_pp0p0" style="border-bottom: Black 1pt solid; text-align: right" title="Prepaid Expense and Other Assets, Current">1,130,495</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_980_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20221231_pp0p0" style="border-bottom: Black 2.5pt double; text-align: right" title="Prepaid Expense and Other Assets, Current">3,714,473</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_982_eus-gaap--PrepaidExpenseAndOtherAssetsCurrent_c20220630_pp0p0" style="border-bottom: Black 2.5pt double; text-align: right" title="Prepaid Expense and Other Assets, Current">5,444,463</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> 2375797 3938881 151506 375087 1187170 1130495 3714473 5444463 118170 56884 <p id="xdx_800_ecustom--NoncurerntPrepaymentTextBlock_zxRPio4Gnd2j" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 9 – <span id="xdx_820_zoxNKJyCK7Rf">Non-current prepayments</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Non-current prepayments included $<span id="xdx_90A_ecustom--NoncurrentPrepayments_c20221231__us-gaap--TransactionTypeAxis__custom--ProductSourcingMember_pp0p0" title="Non-current prepayments">650,415</span> 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 $<span id="xdx_90C_ecustom--NoncurrentPrepayments_c20221231__us-gaap--TransactionTypeAxis__custom--CarPrepaymentMember_pp0p0" title="Non-current prepayments">59,375</span> down payment on a four-year car lease. As of December 31, 2022 and June 30, 2022, total non-current prepayments were $<span id="xdx_902_ecustom--NoncurrentPrepayments_c20221231_pp0p0" title="Non-current prepayments">709,790</span> and $<span id="xdx_90C_ecustom--NoncurrentPrepayments_c20220630_pp0p0" title="Non-current prepayments">925,624</span>, respectively. For the three and six months ended December 31, 2022, the Company recorded $<span id="xdx_905_eus-gaap--AdjustmentForAmortization_pp0p0_c20221001__20221231_zsi7S4y7t44d" title="Amortization expenses">107,917</span> and $<span id="xdx_90E_eus-gaap--AdjustmentForAmortization_pp0p0_c20220701__20221231_zQVbkIHsb7tl" title="Amortization expenses">215,834</span> amortization of prepayments in the operating expenses, respectively. For the three and six months ended December 31, 2021, the Company recorded $<span id="xdx_90F_eus-gaap--AdjustmentForAmortization_pp0p0_c20211001__20211231_z5TjQh7seAE3" title="Amortization expenses">107,917</span> and $<span id="xdx_906_eus-gaap--AdjustmentForAmortization_c20210701__20211231_pp0p0" title="Amortization expenses">215,834</span> amortization of prepayments in the operating expenses, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> 650415 59375 709790 925624 107917 215834 107917 215834 <p id="xdx_806_eus-gaap--IntangibleAssetsDisclosureTextBlock_zCJtGfNFyGy8" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 10 – <span id="xdx_828_z7br7gMVLzS6">Intangible assets, net</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022, intangible assets, net, consisted of the following:</p> <table cellpadding="0" cellspacing="0" id="xdx_89C_eus-gaap--ScheduleOfFiniteLivedIntangibleAssetsTableTextBlock_zsiHLQxTM8zg" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Intangible assets, net (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8BB_zdJizPPwnKlf" style="display: none"> Schedule of intangible assets</span></td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31</b>,</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">2022</p></td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 84%; text-align: left">Covenant not to compete</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_985_eus-gaap--FiniteLivedIntangibleAssetsGross_c20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__us-gaap--NoncompeteAgreementsMember_pp0p0" style="width: 13%; text-align: right" title="Finite-Lived Intangible Assets, Net">3,459,120</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Supplier relationships</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--FiniteLivedIntangibleAssetsGross_c20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SupplierRelationshipMember_pp0p0" style="text-align: right" title="Finite-Lived Intangible Assets, Net">1,179,246</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Software</td><td> </td> <td style="text-align: left"> </td><td id="xdx_986_eus-gaap--FiniteLivedIntangibleAssetsGross_c20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SoftwareMember_pp0p0" style="text-align: right" title="Finite-Lived Intangible Assets, Net">534,591</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Accumulated amortization</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td id="xdx_988_eus-gaap--FiniteLivedIntangibleAssetsAccumulatedAmortization_c20221231_pp0p0" style="border-bottom: Black 1pt solid; text-align: right" title="Finite-Lived Intangible Assets, Accumulated Amortization">(568,201</td><td style="padding-bottom: 1pt; text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98D_eus-gaap--FiniteLivedIntangibleAssetsNet_iI_pp0p0_c20221231_zyFli0ZM7jCf" style="border-bottom: Black 2.5pt double; text-align: right" title="Intangible Assets, Net">4,604,756</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p id="xdx_8A9_zrp49iIDbXU7" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The intangible assets were acquired on February 15, 2022 through the acquisition of Anivia. The weighted average remaining life for finite-lived intangible assets at December 31, 2022 was approximately <span id="xdx_909_ecustom--FiniteLivedIntangibleAssetRemainingUsefulLife_dtY_c20220701__20221231_z1BojeyOSSKi" title="Finite-lived intangible assets remaining useful life">7.82</span> years, and the amortization expense for the three and six months ended December 31, 2022 was $<span id="xdx_90F_eus-gaap--AmortizationOfIntangibleAssets_pp0p0_c20221001__20221231_zudMI3vHPPIf" title="Amortization of Intangible Assets">162,343</span> and $<span id="xdx_90D_eus-gaap--AmortizationOfIntangibleAssets_c20220701__20221231_pp0p0" title="Amortization of Intangible Assets">324,686</span>, respectively. At December 31, 2022, finite-lived intangible assets are expected to be amortized over their estimated useful lives, which ranges from a period of five to 10 years, and the estimated remaining amortization expense for each of the five succeeding years thereafter is as follows:</p> <table cellpadding="0" cellspacing="0" id="xdx_89F_eus-gaap--ScheduleofFiniteLivedIntangibleAssetsFutureAmortizationExpenseTableTextBlock_z39RBcA4uiWl" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Intangible assets, net (Details - Future Amortization)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B6_zcEnna9H6uSl" style="display: none"> Schedule of future amortization</span></td> <td> </td> <td colspan="2" id="xdx_496_20221231_z3hWioM3oiu3" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1pt solid"><span style="font-size: 10pt"><b>Year Ending June 30,</b></span></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt"><b>Amount</b></span></td> <td> </td></tr> <tr id="xdx_406_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseNextTwelveMonths_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 84%"><span style="font-size: 10pt">2023</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">324,685</span></td> <td style="width: 1%"> </td></tr> <tr id="xdx_409_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseYearTwo_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">2024</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">649,371</span></td> <td> </td></tr> <tr id="xdx_402_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseYearThree_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2025</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">649,371</span></td> <td> </td></tr> <tr id="xdx_400_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseYearFour_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">2026</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">649,371</span></td> <td> </td></tr> <tr id="xdx_405_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseYearFive_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2027</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">649,371</span></td> <td> </td></tr> <tr id="xdx_40B_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseAfterYearFive_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Thereafter</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">1,682,587</span></td> <td> </td></tr> <tr id="xdx_409_eus-gaap--FiniteLivedIntangibleAssetsNet_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Intangible assets, net</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">4,604,756</span></td> <td> </td></tr> </table> <p id="xdx_8AA_zZBvpZXzXsPj" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"/> <table cellpadding="0" cellspacing="0" id="xdx_89C_eus-gaap--ScheduleOfFiniteLivedIntangibleAssetsTableTextBlock_zsiHLQxTM8zg" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Intangible assets, net (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8BB_zdJizPPwnKlf" style="display: none"> Schedule of intangible assets</span></td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31</b>,</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">2022</p></td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 84%; text-align: left">Covenant not to compete</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_985_eus-gaap--FiniteLivedIntangibleAssetsGross_c20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__us-gaap--NoncompeteAgreementsMember_pp0p0" style="width: 13%; text-align: right" title="Finite-Lived Intangible Assets, Net">3,459,120</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Supplier relationships</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--FiniteLivedIntangibleAssetsGross_c20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SupplierRelationshipMember_pp0p0" style="text-align: right" title="Finite-Lived Intangible Assets, Net">1,179,246</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Software</td><td> </td> <td style="text-align: left"> </td><td id="xdx_986_eus-gaap--FiniteLivedIntangibleAssetsGross_c20221231__us-gaap--FiniteLivedIntangibleAssetsByMajorClassAxis__custom--SoftwareMember_pp0p0" style="text-align: right" title="Finite-Lived Intangible Assets, Net">534,591</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1pt">Accumulated amortization</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td id="xdx_988_eus-gaap--FiniteLivedIntangibleAssetsAccumulatedAmortization_c20221231_pp0p0" style="border-bottom: Black 1pt solid; text-align: right" title="Finite-Lived Intangible Assets, Accumulated Amortization">(568,201</td><td style="padding-bottom: 1pt; text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98D_eus-gaap--FiniteLivedIntangibleAssetsNet_iI_pp0p0_c20221231_zyFli0ZM7jCf" style="border-bottom: Black 2.5pt double; text-align: right" title="Intangible Assets, Net">4,604,756</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> 3459120 1179246 534591 -568201 4604756 P7Y9M25D 162343 324686 <table cellpadding="0" cellspacing="0" id="xdx_89F_eus-gaap--ScheduleofFiniteLivedIntangibleAssetsFutureAmortizationExpenseTableTextBlock_z39RBcA4uiWl" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Intangible assets, net (Details - Future Amortization)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B6_zcEnna9H6uSl" style="display: none"> Schedule of future amortization</span></td> <td> </td> <td colspan="2" id="xdx_496_20221231_z3hWioM3oiu3" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1pt solid"><span style="font-size: 10pt"><b>Year Ending June 30,</b></span></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt"><b>Amount</b></span></td> <td> </td></tr> <tr id="xdx_406_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseNextTwelveMonths_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 84%"><span style="font-size: 10pt">2023</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">324,685</span></td> <td style="width: 1%"> </td></tr> <tr id="xdx_409_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseYearTwo_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">2024</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">649,371</span></td> <td> </td></tr> <tr id="xdx_402_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseYearThree_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2025</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">649,371</span></td> <td> </td></tr> <tr id="xdx_400_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseYearFour_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">2026</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">649,371</span></td> <td> </td></tr> <tr id="xdx_405_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseYearFive_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2027</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">649,371</span></td> <td> </td></tr> <tr id="xdx_40B_eus-gaap--FiniteLivedIntangibleAssetsAmortizationExpenseAfterYearFive_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Thereafter</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">1,682,587</span></td> <td> </td></tr> <tr id="xdx_409_eus-gaap--FiniteLivedIntangibleAssetsNet_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Intangible assets, net</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">4,604,756</span></td> <td> </td></tr> </table> 324685 649371 649371 649371 649371 1682587 4604756 <p id="xdx_808_eus-gaap--AccountsPayableAndAccruedLiabilitiesDisclosureTextBlock_zWbB7Kr8pkZ7" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 11 – <span id="xdx_827_zybYpSFGX519">Other payables and accrued liabilities</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">As of December 31, 2022 and June 30, 2022, other payables and accrued liabilities consisted of the following:</p> <table cellpadding="0" cellspacing="0" id="xdx_889_eus-gaap--ScheduleOfAccountsPayableAndAccruedLiabilitiesTableTextBlock_zNVlcFqmDtki" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Other payables and accrued liabilities (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B6_zooaVcNvQzh8" style="display: none"> Schedule of accounts payable and accrued liabilities</span></td><td> </td> <td colspan="2" id="xdx_496_20221231_zR00DMFZX8M8" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_496_20220630_zWk1btzkYJo5" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>June 30,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_40F_ecustom--AccruedPayablesForInventoryInTransit_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 68%; text-align: left">Accrued payables for inventory in transit</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">691,905</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">4,217,941</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40F_ecustom--AccruedAmazonFees_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Accrued Amazon fees</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">440,124</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">640,467</td><td style="text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--SalesAndExciseTaxPayableCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Sales taxes payable</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">578,956</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">307,152</td><td style="text-align: left"> </td></tr> <tr id="xdx_406_eus-gaap--AccruedPayrollTaxesCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Payroll liabilities</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">212,040</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">239,248</td><td style="text-align: left"> </td></tr> <tr id="xdx_40C_ecustom--OtherAccruedLiabilitiesAndPayables_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 1pt">Other accrued liabilities and payables</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">147,542</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">510,412</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--AccountsPayableAndOtherAccruedLiabilitiesCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">2,070,567</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">5,915,220</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s controlled VIE, DHS, facilitates the Company in the process of inventory procurement. Through this process, the Company purchased a total of $31,385 in inventories from a supplier which had a payment term of 90 days with a 2% premium on the purchase price. As of December 31, 2022, the outstanding balance was paid off.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <table cellpadding="0" cellspacing="0" id="xdx_889_eus-gaap--ScheduleOfAccountsPayableAndAccruedLiabilitiesTableTextBlock_zNVlcFqmDtki" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Other payables and accrued liabilities (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B6_zooaVcNvQzh8" style="display: none"> Schedule of accounts payable and accrued liabilities</span></td><td> </td> <td colspan="2" id="xdx_496_20221231_zR00DMFZX8M8" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_496_20220630_zWk1btzkYJo5" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>December 31,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center"><p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>June 30,</b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><b>2022</b></p></td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_40F_ecustom--AccruedPayablesForInventoryInTransit_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 68%; text-align: left">Accrued payables for inventory in transit</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">691,905</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">4,217,941</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40F_ecustom--AccruedAmazonFees_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Accrued Amazon fees</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">440,124</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">640,467</td><td style="text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--SalesAndExciseTaxPayableCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Sales taxes payable</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">578,956</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">307,152</td><td style="text-align: left"> </td></tr> <tr id="xdx_406_eus-gaap--AccruedPayrollTaxesCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Payroll liabilities</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">212,040</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">239,248</td><td style="text-align: left"> </td></tr> <tr id="xdx_40C_ecustom--OtherAccruedLiabilitiesAndPayables_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 1pt">Other accrued liabilities and payables</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">147,542</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">510,412</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--AccountsPayableAndOtherAccruedLiabilitiesCurrent_iI_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">2,070,567</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">5,915,220</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> 691905 4217941 440124 640467 578956 307152 212040 239248 147542 510412 2070567 5915220 <p id="xdx_80C_eus-gaap--DebtDisclosureTextBlock_zvoGTVuGU0Nk" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 12 – <span id="xdx_82F_z79E05nZEk4i">Loans payable</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline">Revolving credit facility</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 $<span id="xdx_907_eus-gaap--LineOfCreditFacilityMaximumBorrowingCapacity_iI_pp0p0_c20201116__us-gaap--CreditFacilityAxis__custom--WFCMember_zKPMF5JUwoRl" title="Line of credit facility">3,000,000</span>. 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 receivable and to repurchase or pay back the amount drawn down if the accounts receivable were not collected.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the three months ended September 30, 2021, the Company terminated the Restated RPA and paid off the balance due to WFC.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022 and June 30, 2022, the outstanding balance due under the RPA was $<span id="xdx_902_eus-gaap--LineOfCredit_c20221231__us-gaap--CreditFacilityAxis__custom--WFCMember_pp0p0" title="Long-Term Line of Credit">0</span> and $<span id="xdx_904_eus-gaap--LineOfCredit_c20220630__us-gaap--CreditFacilityAxis__custom--WFCMember_pp0p0" title="Long-Term Line of Credit">0</span>, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b/></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b><i>Long-term loan</i></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b><i> </i></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">SBA loan payable</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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. During the quarter ended June 30, 2022, the Company paid off the SBA Note, including accrued interest expense of $<span id="xdx_90A_eus-gaap--InterestPaid_c20220401__20220630__us-gaap--LongtermDebtTypeAxis__custom--SbaLoanMember_pp0p0" title="Accrued interest expense">39,237</span>. As of December 31, 2022 and June 30, 2022, the outstanding balance of the SBA Note was $<span id="xdx_904_eus-gaap--NotesPayable_c20221231__us-gaap--LongtermDebtTypeAxis__custom--SbaLoanMember_pp0p0" title="Notes Payable">0</span> and $<span id="xdx_902_eus-gaap--NotesPayable_c20220630__us-gaap--LongtermDebtTypeAxis__custom--SbaLoanMember_pp0p0" title="Notes Payable">0</span>, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Asset-based revolving loan</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On November 12, 2021, the Company entered into 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:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 9%"> </td> <td style="width: 2%"><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td style="width: 89%"><span style="font-size: 10pt">Borrowing base equal to the sum of</span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 11%"> </td> <td style="width: 1%"><span style="font-family: Wingdings; font-size: 10pt">Ø</span></td> <td style="width: 88%"><span style="font-size: 10pt">Up to 90% of eligible credit card receivables</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Wingdings; font-size: 10pt">Ø</span></td> <td><span style="font-size: 10pt">Up to 85% of eligible trade accounts receivable</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Wingdings; font-size: 10pt">Ø</span></td> <td><span style="font-size: 10pt">Up to the lesser of (i) 65% of cost of eligible inventory or (ii) 85% of net orderly liquidation value of eligible inventory</span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 9%"> </td> <td style="width: 2%"><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td style="width: 89%"><span style="font-size: 10pt">Interest rates of between LIBOR plus 2% and LIBOR plus 2.25% depending on utilization</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span><span style="font-size: 10pt"> </span></td> <td><span style="font-size: 10pt">Undrawn fee of between 0.25% and 0.375% depending on utilization</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span><span style="font-size: 10pt"> </span></td> <td><span style="font-size: 10pt">Maturity Date of <span id="xdx_903_eus-gaap--LineOfCreditFacilityExpirationDate1_dd_c20211111__20211112__us-gaap--CreditFacilityAxis__custom--AssetBasedRevolvingLoanMember_zY8p5QPt74oc" title="Maturity date">November 12, 2024</span></span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In addition, the ABL includes an accordion feature that allows the Company to borrow up to an additional $25.0 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 $<span id="xdx_90A_eus-gaap--PaymentsOfFinancingCosts_pp0p0_c20211111__20211112__us-gaap--CreditFacilityAxis__custom--AssetBasedRevolvingLoanMember_zOfycMe5UYF8" title="Payments of financing cost">796,035</span> in 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 are to be amortized over three years as financing expenses, the term of the ABL.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Below is a summary of the interest expense recorded for the three and six months ended December 31, 2022 and 2021:  </p> <table cellpadding="0" cellspacing="0" id="xdx_887_eus-gaap--InterestIncomeAndInterestExpenseDisclosureTableTextBlock_zSsI9ZC6i5fd" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Loans Payable (Details - Interest expense)"> <tr style="vertical-align: bottom"> <td style="text-align: left"><span id="xdx_8B9_zLGRLlqwe30l" style="display: none">Schedule of interest on loans payable</span></td><td> </td> <td style="text-align: left"> </td><td id="xdx_498_20221001__20221231_zferSF7GxWG4" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_49B_20211001__20211231_zylFG2ovciMa" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_49D_20220701__20221231_zclUBuu6saWj" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_49A_20210701__20211231_zCzJJ9LslBLd" style="text-align: center"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_401_ecustom--AccruedInterestExpense_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 36%; text-align: left">Accrued interest</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">207,292</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">30,909</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">363,547</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">30,909</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_406_ecustom--CreditUtilizationFees_i_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Credit utilization fees</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">6,824</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1082">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">13,586</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1084">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_40B_ecustom--AmortizationOfDebtDiscount_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 1pt">Amortization of debt discount</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">66,304</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">44,203</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">132,610</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">44,203</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--InterestExpense_i_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">280,420</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1092">–</span></td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">509,743</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1094">–</span></td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022, the outstanding amount of the revolving loan payable, net of debt discount and including interest payable of $<span id="xdx_904_eus-gaap--LineOfCredit_iI_pp0p0_c20221231__us-gaap--CreditFacilityAxis__custom--AssetBasedRevolvingLoanMember_zXC7Xs2RJYZ">377,133</span>, was $<span id="xdx_90F_eus-gaap--InterestPayableCurrent_iI_pp0p0_c20221231__us-gaap--CreditFacilityAxis__custom--AssetBasedRevolvingLoanMember_z0RWauV1xQwh">9,334,819</span>. As of June 30, 2022, the outstanding amount of the long-term revolving loan payable, net of debt discount, was $<span id="xdx_909_eus-gaap--LineOfCredit_iI_pp0p0_c20220630__us-gaap--CreditFacilityAxis__custom--AssetBasedRevolvingLoanMember_zZqBeZRaqJ2h">12,314,627</span>, including interest payable of $<span id="xdx_903_eus-gaap--InterestPayableCurrent_iI_pp0p0_c20220630__us-gaap--CreditFacilityAxis__custom--AssetBasedRevolvingLoanMember_zFjW24rC3rY8">182,543</span>. During the period from January 1, 2023 to the date of this report, the Company made a total payment of $2,400,000 to pay down the outstanding balance of the long-term revolving loan payable.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">On October 7, 2022, the Company entered into a second amendment to the credit agreement and consent (the “Second Amendment to the Credit Agreement”), originally dated November 12, 2021, as amended, with JPMorgan Chase Bank, N.A., as administrative agent and lender (“JPMorgan”). The Company entered into the Second Amendment to the Credit Agreement primarily for the purpose of changing the interest rate repayment calculations from LIBOR to the Secured Overnight Financing Rate, or SOFR, which adjustment had originally been anticipated under the terms of the original Credit Agreement. In addition, two of the negative covenants set forth in the original credit agreement were amended in order to (i) adjust the definition of “Covenant Testing Trigger Period” to increase the required cash availability from $3,000,000 to $4,000,000, or 10% of the aggregate revolving commitment for the preceding 30 days, and (ii) require that the Company will not and will not permit any of its subsidiaries, after reasonable due diligence and due inquiry, to knowingly sell their products, inventory or services directly to any commercial businesses that grow or cultivate cannabis; it being acknowledged, however, that the Company does not generally conduct due diligence on its individual retail customers.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">On November 11, 2022, the Company and JPMorgan entered into a default waiver and consent agreement (the “Waiver Letter”) pursuant to which the parties recognized that the Company was in default on its failure to satisfy the minimum Excess Availability requirement of $7,500,000, as defined in the Credit Agreement, and deliver a certificate to JPMorgan accurately reflecting the Excess Availability (together, the “Existing Defaults”). Under the terms of the Waiver Letter, JPMorgan agreed to waive the right to enforce an event of default based on the aforementioned Existing Defaults.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Promissory note payable</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 $<span id="xdx_908_eus-gaap--DebtInstrumentFaceAmount_iI_dm_c20220215__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_zoluLQuLkq69" title="Face amount">3.5 million</span> with a fair value of $<span id="xdx_902_eus-gaap--DebtInstrumentFairValue_iI_dm_c20220215__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_zre7HG2usDV8" title="Fair value">3.6 million</span> as of February 15, 2022. In October 2022, the Company paid the first installment of $875,000. For the three months ended December 31, 2022, the Company recorded accrued interest of $<span id="xdx_90D_eus-gaap--InterestExpenseDebt_pp0p0_c20221001__20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_zUBJiyR4FGuc" title="Interest Payable">45,938</span> and amortization of note premium of $<span id="xdx_903_eus-gaap--AmortizationOfDebtDiscountPremium_pp0p0_c20221001__20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_zt6mbKfqk1X1" title="Amortization of Debt Discount (Premium)">12,579</span>. For the six months ended December 31, 2022, the Company recorded accrued interest of $<span id="xdx_908_eus-gaap--InterestExpenseDebt_c20220701__20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Interest Payable">98,438</span> and amortization of note premium of $<span id="xdx_903_eus-gaap--AmortizationOfDebtDiscountPremium_c20220701__20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Amortization of Debt Discount (Premium)">25,261</span>. As of December 31, 2022, including $<span id="xdx_900_eus-gaap--InterestPayableCurrentAndNoncurrent_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Interest Payable">177,188</span> of accrued interest and $<span id="xdx_909_eus-gaap--DebtInstrumentUnamortizedDiscount_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Debt Instrument, Unamortized Discount">56,759</span> of unamortized premium, the total outstanding balance of the Purchase Note was $<span id="xdx_908_eus-gaap--LongTermNotesPayable_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Notes Payable, Noncurrent">2,858,947</span>, which is presented on the consolidated balance sheet as a current portion of $<span id="xdx_90B_eus-gaap--LongTermDebtCurrent_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Long-Term Debt, Current Maturities">1,977,502</span> and a non-current portion of $<span id="xdx_906_eus-gaap--LongTermDebtNoncurrent_c20221231__us-gaap--LongtermDebtTypeAxis__custom--AniviaPurchaseNoteMember_pp0p0" title="Long-Term Debt, Excluding Current Maturities">881,445</span>.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> 3000000 0 0 39237 0 0 2024-11-12 796035 <table cellpadding="0" cellspacing="0" id="xdx_887_eus-gaap--InterestIncomeAndInterestExpenseDisclosureTableTextBlock_zSsI9ZC6i5fd" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Loans Payable (Details - Interest expense)"> <tr style="vertical-align: bottom"> <td style="text-align: left"><span id="xdx_8B9_zLGRLlqwe30l" style="display: none">Schedule of interest on loans payable</span></td><td> </td> <td style="text-align: left"> </td><td id="xdx_498_20221001__20221231_zferSF7GxWG4" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_49B_20211001__20211231_zylFG2ovciMa" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_49D_20220701__20221231_zclUBuu6saWj" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_49A_20210701__20211231_zCzJJ9LslBLd" style="text-align: center"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_401_ecustom--AccruedInterestExpense_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="width: 36%; text-align: left">Accrued interest</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">207,292</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">30,909</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">363,547</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 13%; text-align: right">30,909</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_406_ecustom--CreditUtilizationFees_i_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Credit utilization fees</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">6,824</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1082">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">13,586</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1084">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_40B_ecustom--AmortizationOfDebtDiscount_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 1pt">Amortization of debt discount</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">66,304</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">44,203</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">132,610</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">44,203</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--InterestExpense_i_pp0p0" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">280,420</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1092">–</span></td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">509,743</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1094">–</span></td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> 207292 30909 363547 30909 6824 13586 66304 44203 132610 44203 280420 509743 377133 9334819 12314627 182543 3500000 3600000 45938 12579 98438 25261 177188 56759 2858947 1977502 881445 <p id="xdx_80A_eus-gaap--RelatedPartyTransactionsDisclosureTextBlock_zm6eHpPD9Uia" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 13 - <span id="xdx_822_z8q2Z1RH9kO6">Related party transactions</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Starting March 1, 2022, the Company subleases upto 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 three and six months ended December 31, 2022, the Company recorded a sublease fee of $<span id="xdx_902_eus-gaap--OtherNonoperatingIncome_pp0p0_c20221001__20221231_z5DlQecDusEe" title="Non-operating income">140,000</span> and $<span id="xdx_900_eus-gaap--OtherNonoperatingIncome_c20220701__20221231_pp0p0" title="Non-operating income">387,750</span> as other non-operating income. As of December 31, 2022 and June 30, 2022, other receivables due from Box Harmony was $<span id="xdx_90E_eus-gaap--AccountsReceivableRelatedPartiesCurrent_c20221231_pp0p0" title="Other receivable - related party">39,853</span> and $<span id="xdx_908_eus-gaap--AccountsReceivableRelatedPartiesCurrent_c20220630_pp0p0" title="Other receivable - related party">51,762</span>, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 15, 2022, the Company assumed $<span id="xdx_903_ecustom--AdvanceFromShareholders_c20220215_pp0p0" title="Advance from shareholders">92,246</span> (RMB618,000) of advance from shareholders of DHS through the acquisition of Anivia. This amount was for capital injection pending capital inspection by the local government in accordance with the PRC rules. As of December 31, 2022 and June 30, 2022, the balance of advance from shareholders was $<span id="xdx_904_ecustom--AdvanceFromShareholders_c20221231_pp0p0" title="Advance from shareholders">89,592</span> and $<span id="xdx_902_ecustom--AdvanceFromShareholders_c20220630_pp0p0" title="Advance from shareholders">92,246</span>, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> 140000 387750 39853 51762 92246 89592 92246 <p id="xdx_801_eus-gaap--IncomeTaxDisclosureTextBlock_zCU40e4lh81j" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 14 – <span id="xdx_82A_zV2I47GgDOae">Income taxes</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the three and six months ended December 31, 2022, as a result of the Company’s inability to establish a reliable estimate for annual effective tax rate, the Company calculated income tax expense using the actual effective tax rate year to date, as opposed to the estimated annual effective tax rate, as provided in Accounting Standards Codification (ASC) 740-270-30-18.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The income tax provision for the three and six months ended December 31, 2022 and 2021 consisted of the following: </p> <table cellpadding="0" cellspacing="0" id="xdx_89C_eus-gaap--ScheduleOfComponentsOfIncomeTaxExpenseBenefitTableTextBlock_z0TBCEAkwfk1" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Income taxes (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B9_zKR54fPULZf1" style="display: none"> Schedule of provision for income tax expense</span></td><td> </td> <td colspan="2" id="xdx_49C_20221001__20221231_zTYgh34cQQQa" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_498_20211001__20211231_zNkmALL0I343" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_49A_20220701__20221231_zsTbcRrMSy9i" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_49E_20210701__20211231_zbgu8q3Mz4w9" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_403_eus-gaap--CurrentFederalStateAndLocalTaxExpenseBenefitAbstract_iB" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Current:</td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td></tr> <tr id="xdx_408_eus-gaap--CurrentFederalTaxExpenseBenefit_maCITEBzwYY_z73haeWEyCB6" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; width: 44%">Federal</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 11%; text-align: right">280,781</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 11%; text-align: right">222,339</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 11%; text-align: right">280,781</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 11%; text-align: right">456,968</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40C_eus-gaap--CurrentStateAndLocalTaxExpenseBenefit_maCITEBzwYY_zLeJgIvozzIe" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt">States</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(123</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">100,376</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">9,799</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">208,722</td><td style="text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--CurrentForeignTaxExpenseBenefit_maCITEBzwYY_zngtBlidWp0h" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; padding-bottom: 1pt">Foreign</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1165">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1166">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1167">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1168">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr id="xdx_408_eus-gaap--CurrentIncomeTaxExpenseBenefit_iT_pp0p0_mtCITEBzwYY_zmsonWwKAHx6" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt; text-align: left; padding-bottom: 1pt">Total current income tax provision</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">280,658</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">322,715</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">290,580</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">665,690</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--DeferredFederalStateAndLocalTaxExpenseBenefitAbstract_iB" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Deferred:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_401_eus-gaap--DeferredFederalIncomeTaxExpenseBenefit_iN_pp0p0_maDITEBzcAP_zemPKbT47FVa" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt">Federal</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(1,090,318</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1181">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(1,259,785</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1183">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--DeferredStateAndLocalIncomeTaxExpenseBenefit_iN_pp0p0_maDITEBzcAP_zvri6tXkgyh9" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt">States</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(203,562</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1186">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(306,707</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1188">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--DeferredForeignIncomeTaxExpenseBenefit_iN_pp0p0_maDITEBzcAP_zxaAz7V1wfo1" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; padding-bottom: 1pt">Foreign</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(34,527</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1191">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(219,633</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1193">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--DeferredIncomeTaxExpenseBenefit_iNT_pp0p0_mtDITEBzcAP_zO3SXFoBWWRi" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt; text-align: left; padding-bottom: 1pt">Total deferred taxes</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(1,328,407</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1196">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(1,786,125</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1198">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--OtherTaxExpenseBenefit_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 2.5pt">Total provision for income taxes</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(1,047,749</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">322,715</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(1,495,545</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">665,690</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p id="xdx_8A4_zpdRjDFQRov1" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company is subject to 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:</p> <table cellpadding="0" cellspacing="0" id="xdx_896_eus-gaap--ScheduleOfEffectiveIncomeTaxRateReconciliationTableTextBlock_zwKpOZjZPr8g" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Income taxes (Details - Reconcilation of effective income tax rate)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B5_zb8IPiHVNQP1" style="display: none"> Schedule of reconciliation of effective income tax rate</span></td><td> </td> <td colspan="2" id="xdx_498_20221001__20221231_zMZSQkXuyf72" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_499_20211001__20211231_zO3fzT6NqKQ2" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_49F_20220701__20221231_zqkc2kgrcxQk" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_494_20210701__20211231_zmY96A9SQ205" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Statutory tax rate</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--EffectiveIncomeTaxRateReconciliationAtFederalStatutoryIncomeTaxRate_i_pdd" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; width: 44%">Federal</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">21.00%</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">21.00%</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">21.00%</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">21.00%</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--EffectiveIncomeTaxRateReconciliationStateAndLocalIncomeTaxes_i_pdd" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt">State</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5.85%</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">8.84%</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5.85%</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">8.84%</td><td style="text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--EffectiveIncomeTaxRateReconciliationForeignIncomeTaxRateDifferential_i_pdd" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; text-align: left">Foreign tax rate difference</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(0.33%</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1218">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1.86%</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1220">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--EffectiveIncomeTaxRateReconciliationNondeductibleExpenseImpairmentLosses_i_pdd" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-indent: -10pt; padding-left: 20pt; text-align: left">Impairment loss on goodwill -permanent difference</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1222">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1223">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(9.32%</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1225">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--EffectiveIncomeTaxRateReconciliationOtherAdjustments_i_pdd" style="vertical-align: bottom; background-color: White"> <td style="text-indent: -10pt; padding-left: 20pt; text-align: left">Net effect of state income tax deduction and other permanent differences</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(2.38%</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(1.04%</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(2.72%</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(1.53%</td><td style="padding-bottom: 1pt; text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--EffectiveIncomeTaxRateContinuingOperations_i_pdd" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Effective tax rate</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">24.14%</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">28.80%</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">16.67%</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">28.31%</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p id="xdx_8A0_zh7eW72NeKSa" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022, prepaid income taxes to US tax authorities and income tax payable to Chinese tax authorities was $<span id="xdx_90A_eus-gaap--PrepaidTaxes_iI_pp0p0_c20221231__us-gaap--IncomeTaxAuthorityAxis__custom--USTaxAuthoritiesMember_zVl73NrEXUB6" title="Prepaid taxes">151,506</span> and $<span id="xdx_900_eus-gaap--PrepaidTaxes_iI_pp0p0_c20221231__us-gaap--IncomeTaxAuthorityAxis__custom--ChineseTaxAuthoritiesMember_zI2TPsgoS0Mc" title="Prepaid taxes">290,946</span>, respectively. As of June 30, 2022, prepaid income taxes to US tax authorities and income tax payable to Chinese tax authorities was $<span id="xdx_90E_eus-gaap--AccruedIncomeTaxes_iI_pp0p0_c20220630__us-gaap--IncomeTaxAuthorityAxis__custom--USTaxAuthoritiesMember_zkm4prp4DA88" title="Accrued income taxes">375,087</span> and $<span id="xdx_909_eus-gaap--AccruedIncomeTaxes_iI_pp0p0_c20220630__us-gaap--IncomeTaxAuthorityAxis__custom--ChineseTaxAuthoritiesMember_z7LbaoZCAYIa" title="Accrued income taxes">299,563</span>, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">The tax effects of temporary differences which give rise to significant portions of the deferred taxes are summarized as follows: </p> <table cellpadding="0" cellspacing="0" id="xdx_899_eus-gaap--ScheduleOfDeferredTaxAssetsAndLiabilitiesTableTextBlock_zbDvdyhmCGh6" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Income Taxes (Details - Deferred taxes)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8BA_zndmcw4LRLxa" style="display: none"> Schedule of deferred taxes</span></td> <td> </td> <td colspan="2" id="xdx_49C_20221231_zs4Cp0uQDci8" style="text-align: center"> </td> <td> </td> <td> </td> <td colspan="2" id="xdx_49D_20220630_z6iU3Y9OSgu" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">December 31,<br/> 2022</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">June 30, <br/> 2022</span></td> <td> </td></tr> <tr id="xdx_40C_eus-gaap--DeferredTaxAssetsNetAbstract_iB" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt"><b>Deferred tax assets</b></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_40A_eus-gaap--DeferredTaxAssetsTaxDeferredExpenseOther_i01I_pp0p0_maDTAOzrBt_zlzQ7eLm3Lpg" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt; width: 68%"><span style="font-size: 10pt">263A calculation</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">165,368</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">123,884</span></td> <td style="width: 1%"> </td></tr> <tr id="xdx_404_eus-gaap--DeferredTaxAssetsInventory_i01I_pp0p0_maDTAOzrBt_zxprGcJwmMhi" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Inventory reserve</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">106,071</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">71,026</span></td> <td> </td></tr> <tr id="xdx_404_eus-gaap--DeferredTaxAssetsStateTaxes_i01I_pp0p0_maDTAOzrBt_zyrbO8PrA0Ia" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">State taxes</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,058</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">45,234</span></td> <td> </td></tr> <tr id="xdx_400_eus-gaap--DeferredTaxAssetsTaxDeferredExpenseReservesAndAccrualsReserves_i01I_pp0p0_maDTAOzrBt_z19zC3TE2jD4" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Accrued expenses</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">133,823</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">69,172</span></td> <td> </td></tr> <tr id="xdx_405_ecustom--DeferredTaxAssetsLeaseAssetsLiabilities_i01I_pp0p0_maDTAOzrBt_zzP7FcKU1Zy6" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">ROU assets / liabilities</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">114,045</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">83,738</span></td> <td> </td></tr> <tr id="xdx_40D_eus-gaap--DeferredTaxAssetsTaxDeferredExpenseCompensationAndBenefitsShareBasedCompensationCost_i01I_pp0p0_maDTAOzrBt_znIKPiaS6W5" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Stock-based compensation</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">142,810</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">70,266</span></td> <td> </td></tr> <tr id="xdx_406_eus-gaap--DeferredTaxAssetsOperatingLossCarryforwardsDomestic_i01I_pp0p0_d0_maDTAOzrBt_zNfot3Y6YJy6" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Net operating loss</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">1,530,336</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">–</span></td> <td> </td></tr> <tr id="xdx_407_eus-gaap--DeferredTaxAssetsOther_i01I_pp0p0_maDTAOzrBt_zqHflaGbfi05" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Others</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">18,797</span></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">7,539</span></td> <td> </td></tr> <tr id="xdx_407_eus-gaap--DeferredTaxAssetsGross_i01TI_pp0p0_mtDTAOzrBt_maDTALNzBPn_ztRNDBVER0ga" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 20pt"><span style="font-size: 10pt"><b>Total deferred tax assets</b></span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">2,213,308</span></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">470,859</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_40F_eus-gaap--DeferredTaxLiabilitiesAbstract_iB" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt"><b>Deferred tax liabilities</b></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_408_eus-gaap--DeferredTaxLiabilitiesPropertyPlantAndEquipment_i01NI_pp0p0_di_maDITLzvmh_zjiliO8nzxE9" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Depreciation</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">(127,196</span></td> <td><span style="font-size: 10pt">)</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">(86,254</span></td> <td><span style="font-size: 10pt">) </span></td></tr> <tr id="xdx_406_eus-gaap--DeferredTaxLiabilitiesOtherFiniteLivedAssets_i01NI_pp0p0_di_maDITLzvmh_zqEAp8Lhfr25" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Intangible assets acquired</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,236,533</span></td> <td><span style="font-size: 10pt">)</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,323,720</span></td> <td><span style="font-size: 10pt">) </span></td></tr> <tr id="xdx_402_eus-gaap--DeferredIncomeTaxLiabilities_i01NTI_pp0p0_di_mtDITLzvmh_msDTALNzBPn_z2Pu8ZM0lAOh" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 20pt"><span style="font-size: 10pt"><b>Total deferred tax liabilities</b></span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,363,729</span></td> <td><span style="font-size: 10pt">)</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,409,974</span></td> <td><span style="font-size: 10pt">) </span></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_40D_ecustom--NetDeferredTaxLiabilities_iTI_pp0p0_mtDTALNzBPn_z4MIujC2f32g" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-bottom: 2.5pt; padding-left: 10pt"><span style="font-size: 10pt"><b>Net deferred tax assets (liabilities)</b></span></td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: Black 2.5pt double; text-align: right"><span style="font-size: 10pt">849,579</span></td> <td style="padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: Black 2.5pt double; text-align: right"><span style="font-size: 10pt">(939,115</span></td> <td style="padding-bottom: 2.5pt"><span style="font-size: 10pt">) </span></td></tr> </table> <p id="xdx_8A8_zFW86XbXpOrk" style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> <table cellpadding="0" cellspacing="0" id="xdx_89C_eus-gaap--ScheduleOfComponentsOfIncomeTaxExpenseBenefitTableTextBlock_z0TBCEAkwfk1" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Income taxes (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B9_zKR54fPULZf1" style="display: none"> Schedule of provision for income tax expense</span></td><td> </td> <td colspan="2" id="xdx_49C_20221001__20221231_zTYgh34cQQQa" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_498_20211001__20211231_zNkmALL0I343" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_49A_20220701__20221231_zsTbcRrMSy9i" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_49E_20210701__20211231_zbgu8q3Mz4w9" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr id="xdx_403_eus-gaap--CurrentFederalStateAndLocalTaxExpenseBenefitAbstract_iB" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Current:</td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td></tr> <tr id="xdx_408_eus-gaap--CurrentFederalTaxExpenseBenefit_maCITEBzwYY_z73haeWEyCB6" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; width: 44%">Federal</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 11%; text-align: right">280,781</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 11%; text-align: right">222,339</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 11%; text-align: right">280,781</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 11%; text-align: right">456,968</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40C_eus-gaap--CurrentStateAndLocalTaxExpenseBenefit_maCITEBzwYY_zLeJgIvozzIe" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt">States</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(123</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">100,376</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">9,799</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">208,722</td><td style="text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--CurrentForeignTaxExpenseBenefit_maCITEBzwYY_zngtBlidWp0h" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; padding-bottom: 1pt">Foreign</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1165">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1166">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1167">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1168">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr id="xdx_408_eus-gaap--CurrentIncomeTaxExpenseBenefit_iT_pp0p0_mtCITEBzwYY_zmsonWwKAHx6" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt; text-align: left; padding-bottom: 1pt">Total current income tax provision</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">280,658</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">322,715</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">290,580</td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">665,690</td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--DeferredFederalStateAndLocalTaxExpenseBenefitAbstract_iB" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Deferred:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_401_eus-gaap--DeferredFederalIncomeTaxExpenseBenefit_iN_pp0p0_maDITEBzcAP_zemPKbT47FVa" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt">Federal</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(1,090,318</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1181">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(1,259,785</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1183">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--DeferredStateAndLocalIncomeTaxExpenseBenefit_iN_pp0p0_maDITEBzcAP_zvri6tXkgyh9" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt">States</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(203,562</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1186">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(306,707</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1188">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--DeferredForeignIncomeTaxExpenseBenefit_iN_pp0p0_maDITEBzcAP_zxaAz7V1wfo1" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; padding-bottom: 1pt">Foreign</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(34,527</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1191">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(219,633</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1193">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--DeferredIncomeTaxExpenseBenefit_iNT_pp0p0_mtDITEBzcAP_zO3SXFoBWWRi" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt; text-align: left; padding-bottom: 1pt">Total deferred taxes</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(1,328,407</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1196">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(1,786,125</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1198">–</span></td><td style="padding-bottom: 1pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--OtherTaxExpenseBenefit_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left; padding-bottom: 2.5pt">Total provision for income taxes</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(1,047,749</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">322,715</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(1,495,545</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">665,690</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> 280781 222339 280781 456968 -123 100376 9799 208722 280658 322715 290580 665690 -1090318 -1259785 -203562 -306707 -34527 -219633 -1328407 -1786125 -1047749 322715 -1495545 665690 <table cellpadding="0" cellspacing="0" id="xdx_896_eus-gaap--ScheduleOfEffectiveIncomeTaxRateReconciliationTableTextBlock_zwKpOZjZPr8g" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - Income taxes (Details - Reconcilation of effective income tax rate)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B5_zb8IPiHVNQP1" style="display: none"> Schedule of reconciliation of effective income tax rate</span></td><td> </td> <td colspan="2" id="xdx_498_20221001__20221231_zMZSQkXuyf72" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_499_20211001__20211231_zO3fzT6NqKQ2" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_49F_20220701__20221231_zqkc2kgrcxQk" style="text-align: center"> </td><td> </td><td> </td> <td colspan="2" id="xdx_494_20210701__20211231_zmY96A9SQ205" style="text-align: center"> </td><td> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-align: left">Statutory tax rate</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--EffectiveIncomeTaxRateReconciliationAtFederalStatutoryIncomeTaxRate_i_pdd" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; width: 44%">Federal</td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">21.00%</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">21.00%</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">21.00%</td><td style="width: 1%; text-align: left"> </td><td style="width: 1%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">21.00%</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--EffectiveIncomeTaxRateReconciliationStateAndLocalIncomeTaxes_i_pdd" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt">State</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5.85%</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">8.84%</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5.85%</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">8.84%</td><td style="text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--EffectiveIncomeTaxRateReconciliationForeignIncomeTaxRateDifferential_i_pdd" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; text-align: left">Foreign tax rate difference</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(0.33%</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1218">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1.86%</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1220">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--EffectiveIncomeTaxRateReconciliationNondeductibleExpenseImpairmentLosses_i_pdd" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="text-indent: -10pt; padding-left: 20pt; text-align: left">Impairment loss on goodwill -permanent difference</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1222">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1223">–</span></td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(9.32%</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span style="-sec-ix-hidden: xdx2ixbrl1225">–</span></td><td style="text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--EffectiveIncomeTaxRateReconciliationOtherAdjustments_i_pdd" style="vertical-align: bottom; background-color: White"> <td style="text-indent: -10pt; padding-left: 20pt; text-align: left">Net effect of state income tax deduction and other permanent differences</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(2.38%</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(1.04%</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(2.72%</td><td style="padding-bottom: 1pt; text-align: left">)</td><td style="padding-bottom: 1pt"> </td> <td style="border-bottom: Black 1pt solid; text-align: left"> </td><td style="border-bottom: Black 1pt solid; text-align: right">(1.53%</td><td style="padding-bottom: 1pt; text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--EffectiveIncomeTaxRateContinuingOperations_i_pdd" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Effective tax rate</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">24.14%</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">28.80%</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">16.67%</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">28.31%</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> 0.2100 0.2100 0.2100 0.2100 0.0585 0.0884 0.0585 0.0884 -0.0033 0.0186 -0.0932 -0.0238 -0.0104 -0.0272 -0.0153 0.2414 0.2880 0.1667 0.2831 151506 290946 375087 299563 <table cellpadding="0" cellspacing="0" id="xdx_899_eus-gaap--ScheduleOfDeferredTaxAssetsAndLiabilitiesTableTextBlock_zbDvdyhmCGh6" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Income Taxes (Details - Deferred taxes)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8BA_zndmcw4LRLxa" style="display: none"> Schedule of deferred taxes</span></td> <td> </td> <td colspan="2" id="xdx_49C_20221231_zs4Cp0uQDci8" style="text-align: center"> </td> <td> </td> <td> </td> <td colspan="2" id="xdx_49D_20220630_z6iU3Y9OSgu" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">December 31,<br/> 2022</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">June 30, <br/> 2022</span></td> <td> </td></tr> <tr id="xdx_40C_eus-gaap--DeferredTaxAssetsNetAbstract_iB" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt"><b>Deferred tax assets</b></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_40A_eus-gaap--DeferredTaxAssetsTaxDeferredExpenseOther_i01I_pp0p0_maDTAOzrBt_zlzQ7eLm3Lpg" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt; width: 68%"><span style="font-size: 10pt">263A calculation</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">165,368</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">123,884</span></td> <td style="width: 1%"> </td></tr> <tr id="xdx_404_eus-gaap--DeferredTaxAssetsInventory_i01I_pp0p0_maDTAOzrBt_zxprGcJwmMhi" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Inventory reserve</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">106,071</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">71,026</span></td> <td> </td></tr> <tr id="xdx_404_eus-gaap--DeferredTaxAssetsStateTaxes_i01I_pp0p0_maDTAOzrBt_zyrbO8PrA0Ia" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">State taxes</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,058</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">45,234</span></td> <td> </td></tr> <tr id="xdx_400_eus-gaap--DeferredTaxAssetsTaxDeferredExpenseReservesAndAccrualsReserves_i01I_pp0p0_maDTAOzrBt_z19zC3TE2jD4" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Accrued expenses</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">133,823</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">69,172</span></td> <td> </td></tr> <tr id="xdx_405_ecustom--DeferredTaxAssetsLeaseAssetsLiabilities_i01I_pp0p0_maDTAOzrBt_zzP7FcKU1Zy6" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">ROU assets / liabilities</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">114,045</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">83,738</span></td> <td> </td></tr> <tr id="xdx_40D_eus-gaap--DeferredTaxAssetsTaxDeferredExpenseCompensationAndBenefitsShareBasedCompensationCost_i01I_pp0p0_maDTAOzrBt_znIKPiaS6W5" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Stock-based compensation</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">142,810</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">70,266</span></td> <td> </td></tr> <tr id="xdx_406_eus-gaap--DeferredTaxAssetsOperatingLossCarryforwardsDomestic_i01I_pp0p0_d0_maDTAOzrBt_zNfot3Y6YJy6" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Net operating loss</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">1,530,336</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">–</span></td> <td> </td></tr> <tr id="xdx_407_eus-gaap--DeferredTaxAssetsOther_i01I_pp0p0_maDTAOzrBt_zqHflaGbfi05" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Others</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">18,797</span></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">7,539</span></td> <td> </td></tr> <tr id="xdx_407_eus-gaap--DeferredTaxAssetsGross_i01TI_pp0p0_mtDTAOzrBt_maDTALNzBPn_ztRNDBVER0ga" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 20pt"><span style="font-size: 10pt"><b>Total deferred tax assets</b></span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">2,213,308</span></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">470,859</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_40F_eus-gaap--DeferredTaxLiabilitiesAbstract_iB" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt"><b>Deferred tax liabilities</b></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_408_eus-gaap--DeferredTaxLiabilitiesPropertyPlantAndEquipment_i01NI_pp0p0_di_maDITLzvmh_zjiliO8nzxE9" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Depreciation</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">(127,196</span></td> <td><span style="font-size: 10pt">)</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">(86,254</span></td> <td><span style="font-size: 10pt">) </span></td></tr> <tr id="xdx_406_eus-gaap--DeferredTaxLiabilitiesOtherFiniteLivedAssets_i01NI_pp0p0_di_maDITLzvmh_zqEAp8Lhfr25" style="vertical-align: bottom; background-color: white"> <td style="padding-left: 10pt"><span style="font-size: 10pt">Intangible assets acquired</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,236,533</span></td> <td><span style="font-size: 10pt">)</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,323,720</span></td> <td><span style="font-size: 10pt">) </span></td></tr> <tr id="xdx_402_eus-gaap--DeferredIncomeTaxLiabilities_i01NTI_pp0p0_di_mtDITLzvmh_msDTALNzBPn_z2Pu8ZM0lAOh" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-left: 20pt"><span style="font-size: 10pt"><b>Total deferred tax liabilities</b></span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,363,729</span></td> <td><span style="font-size: 10pt">)</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,409,974</span></td> <td><span style="font-size: 10pt">) </span></td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_40D_ecustom--NetDeferredTaxLiabilities_iTI_pp0p0_mtDTALNzBPn_z4MIujC2f32g" style="vertical-align: bottom; background-color: #EEEEEE"> <td style="padding-bottom: 2.5pt; padding-left: 10pt"><span style="font-size: 10pt"><b>Net deferred tax assets (liabilities)</b></span></td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: Black 2.5pt double; text-align: right"><span style="font-size: 10pt">849,579</span></td> <td style="padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: Black 2.5pt double; text-align: right"><span style="font-size: 10pt">(939,115</span></td> <td style="padding-bottom: 2.5pt"><span style="font-size: 10pt">) </span></td></tr> </table> 165368 123884 106071 71026 2058 45234 133823 69172 114045 83738 142810 70266 1530336 0 18797 7539 2213308 470859 127196 86254 1236533 1323720 1363729 1409974 849579 -939115 <p id="xdx_80D_eus-gaap--EarningsPerShareTextBlock_zSwlfdyfoTC6" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 15 – <span id="xdx_82C_z66S0RSR1bwb">(Losses) Earnings per share</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">The following table sets forth the computation of basic and diluted (losses) earnings per share for the periods presented:  </p> <table cellpadding="0" cellspacing="0" id="xdx_88A_eus-gaap--ScheduleOfEarningsPerShareBasicAndDilutedTableTextBlock_zJTo7zk1LPm8" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - (Losses) Earnings per share (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B0_z6nhAprqbLN2" style="display: none"> Schedule of computation of earnings per share</span></td><td> </td> <td style="text-align: left"> </td><td id="xdx_49C_20221001__20221231_zmzoTux7mgG9" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_493_20211001__20211231_zweKARpGXmIk" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_493_20220701__20221231_zSoBKjWUUuI6" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_499_20210701__20211231_z1Wflq9nJ4ll" style="text-align: center"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td>Numerator:</td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td></tr> <tr id="xdx_409_eus-gaap--NetIncomeLossAvailableToCommonStockholdersDiluted_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt; width: 44%; text-align: left; padding-bottom: 2.5pt">Net (Loss) Income</td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 11%; text-align: right">(3,290,439</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left">)</td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 11%; text-align: right">797,861</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 11%; text-align: right">(7,472,815</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left">)</td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 11%; text-align: right">1,685,389</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Denominator:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_40A_ecustom--WeightedaverageSharesUsedInComputingBasicAndDilutedEarningsPerShareAbstract_iB" style="vertical-align: bottom; background-color: White"> <td style="text-indent: -10pt; padding-left: 20pt; text-align: left">Weighted-average shares used in computing basic and diluted earnings per share*</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--WeightedAverageNumberOfSharesOutstandingBasic_i01_pdd" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Basic</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">29,742,620</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">26,491,103</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">29,687,878</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">26,487,816</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--WeightedAverageNumberDilutedSharesOutstandingAdjustment_i01_pdd" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Diluted</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">29,742,620</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">26,491,103</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">29,687,878</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">26,487,816</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_400_ecustom--LossesEarningsPerShareAbstract_iB_zBaVEQDFABU3" style="vertical-align: bottom; background-color: White"> <td>(Losses) Earnings per share:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_401_eus-gaap--EarningsPerShareBasic_i01_pdd" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Basic</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.11</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.03</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.25</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.06</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--EarningsPerShareDiluted_i01_pdd" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Diluted</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.11</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.03</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.25</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.06</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="text-align: justify">*</td> <td style="text-align: justify">Due to the ani-dilutive effect, the computation of basic and diluted EPS did not include the shares underlying the exercise of warrants as the Company had a net loss for the three and six months ended December 31, 2022.</td></tr> <tr style="vertical-align: top"> <td style="text-align: justify"> </td> <td style="text-align: justify"> </td></tr> <tr style="vertical-align: top"> <td style="width: 2%; text-align: justify"><span style="font-size: 10pt">*</span></td> <td style="width: 98%; text-align: justify"><span style="font-size: 10pt">The computation of diluted EPS did not include the underlying shares of warrants calculated using treasury method for the three and six months ended December 31, 2021 as the exercise price was greater than the market price of the shares. </span></td></tr> <tr style="vertical-align: top"> <td style="text-align: justify"> </td> <td style="text-align: justify"> </td></tr> <tr style="vertical-align: top"> <td style="text-align: justify">*</td> <td style="text-align: justify">For the three and six months ended December 31, 2022, <span id="xdx_906_ecustom--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedUnissuedNumberOfShares_c20221001__20221231_z4vXN6cCQ001" title="Vested shares"><span id="xdx_90D_ecustom--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedUnissuedNumberOfShares_c20220701__20221231_zWAX16i0UPpa" title="Vested shares">154,261</span></span> vested but unissued shares of restricted stock units under the 2020 Equity Incentive Plan (as discussed in Note 16) are considered issued shares and therefore are included in the computation of basic earnings (losses) per share when the shares are fully vested.</td></tr> <tr style="vertical-align: top"> <td style="text-align: justify"> </td> <td style="text-align: justify"> </td></tr> <tr style="vertical-align: top"> <td style="text-align: justify"><span style="font-size: 10pt">*</span></td> <td style="text-align: justify"><span style="font-size: 10pt">For the three and six months ended December 31, 2021,  <span id="xdx_902_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedNumberOfShares_c20211001__20211231_zEc2vdbD6le3" title="Vested shares"><span id="xdx_909_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedNumberOfShares_c20210701__20211231_pdd" title="Vested shares">10,886</span></span> vested but unissued shares of restricted stock units under the Amended and Restated 2020 Equity Incentive Plan are considered issued shares and therefore are included in the computation of basic earnings (losses) per share as of grant date when the shares are fully vested. Impact of nonvested RSU is immaterial to the EPS.</span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <table cellpadding="0" cellspacing="0" id="xdx_88A_eus-gaap--ScheduleOfEarningsPerShareBasicAndDilutedTableTextBlock_zJTo7zk1LPm8" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%" summary="xdx: Disclosure - (Losses) Earnings per share (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B0_z6nhAprqbLN2" style="display: none"> Schedule of computation of earnings per share</span></td><td> </td> <td style="text-align: left"> </td><td id="xdx_49C_20221001__20221231_zmzoTux7mgG9" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_493_20211001__20211231_zweKARpGXmIk" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_493_20220701__20221231_zSoBKjWUUuI6" style="text-align: center"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_499_20210701__20211231_z1Wflq9nJ4ll" style="text-align: center"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Three Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="6" style="border-bottom: Black 1pt solid; text-align: center">Six Months Ended December 31,</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2022</td><td style="padding-bottom: 1pt"> </td><td style="padding-bottom: 1pt"> </td> <td colspan="2" style="border-bottom: Black 1pt solid; text-align: center">2021</td><td style="padding-bottom: 1pt"> </td></tr> <tr style="vertical-align: bottom"> <td>Numerator:</td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td><td> </td> <td colspan="2" style="text-align: right"> </td><td> </td></tr> <tr id="xdx_409_eus-gaap--NetIncomeLossAvailableToCommonStockholdersDiluted_i_pp0p0" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 10pt; width: 44%; text-align: left; padding-bottom: 2.5pt">Net (Loss) Income</td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 11%; text-align: right">(3,290,439</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left">)</td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 11%; text-align: right">797,861</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 11%; text-align: right">(7,472,815</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left">)</td><td style="width: 1%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 11%; text-align: right">1,685,389</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td>Denominator:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_40A_ecustom--WeightedaverageSharesUsedInComputingBasicAndDilutedEarningsPerShareAbstract_iB" style="vertical-align: bottom; background-color: White"> <td style="text-indent: -10pt; padding-left: 20pt; text-align: left">Weighted-average shares used in computing basic and diluted earnings per share*</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--WeightedAverageNumberOfSharesOutstandingBasic_i01_pdd" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Basic</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">29,742,620</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">26,491,103</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">29,687,878</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">26,487,816</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--WeightedAverageNumberDilutedSharesOutstandingAdjustment_i01_pdd" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Diluted</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">29,742,620</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">26,491,103</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">29,687,878</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">26,487,816</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_400_ecustom--LossesEarningsPerShareAbstract_iB_zBaVEQDFABU3" style="vertical-align: bottom; background-color: White"> <td>(Losses) Earnings per share:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_401_eus-gaap--EarningsPerShareBasic_i01_pdd" style="vertical-align: bottom; background-color: rgb(238,238,238)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Basic</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.11</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.03</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.25</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.06</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--EarningsPerShareDiluted_i01_pdd" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Diluted</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.11</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.03</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.25</td><td style="padding-bottom: 2.5pt; text-align: left">)</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.06</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> -3290439 797861 -7472815 1685389 29742620 26491103 29687878 26487816 29742620 26491103 29687878 26487816 -0.11 0.03 -0.25 0.06 -0.11 0.03 -0.25 0.06 154261 154261 10886 10886 <p id="xdx_802_eus-gaap--StockholdersEquityNoteDisclosureTextBlock_zotcYETkm4sa" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 16 – <span id="xdx_822_zTQ0X5CvWQyd">Equity</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><span style="text-decoration: underline">Common Stock</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>  </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">During the year ended June 30, 2022, the Company issued <span id="xdx_90A_eus-gaap--StockIssuedDuringPeriodSharesRestrictedStockAwardGross_c20220701__20221231__us-gaap--AwardTypeAxis__custom--StockIssuedForVestedRsusMember_pdd" title="Stock Issued During Period, Value, Conversion of Convertible Securities">40,019</span> shares of restricted common stock for RSUs vested in the quarter ended September 30, 2021.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 15, 2022, as part of the consideration for the acquisition of Anivia and subsidiaries, the Company issued <span id="xdx_907_eus-gaap--StockIssuedDuringPeriodSharesAcquisitions_c20220214__20220215__us-gaap--BusinessAcquisitionAxis__custom--AniviaMember__us-gaap--StatementClassOfStockAxis__us-gaap--RestrictedStockMember_zPeBpMoT3sM6" title="Number of shares issued for acquisition">3,083,700</span> restricted shares of the Company’s common stock, valued at $<span id="xdx_903_eus-gaap--SaleOfStockPricePerShare_c20220215_pdd" title="Sale of Stock, Price Per Share">2.27</span> 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 $<span id="xdx_90B_eus-gaap--BusinessCombinationConsiderationTransferredEquityInterestsIssuedAndIssuable_c20220214__20220215_pp0p0" title="Business Combination, Consideration Transferred, Equity Interests Issued and Issuable">5,528,373</span>, calculated with a discount of lack of marketability of 21%, which is determined using the Black Scholes Model.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022 and June 30, 2022, there were <span id="xdx_902_eus-gaap--CommonStockSharesIssued_iI_c20221231_z3CW6zIDyPKe" title="Common stock, shares issued"><span id="xdx_907_eus-gaap--CommonStockSharesOutstanding_iI_c20221231_zNyXGy8wOLq6" title="Common stock, shares outstanding">29,572,382</span></span> and <span id="xdx_900_eus-gaap--CommonStockSharesIssued_iI_c20220630_zOtA0OHrVqrf" title="Common stock, shares issued"><span id="xdx_909_eus-gaap--CommonStockSharesOutstanding_iI_c20220630_zZyhpvEIZVe6" title="Common stock, shares outstanding">29,572,382</span></span> shares of Common Stock issued and outstanding, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Preferred Stock</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s 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 December 31, 2022 and June 30, 2022, respectively, there were no shares of Preferred Stock issued and outstanding.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Equity Incentive Plan</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 <span id="xdx_90B_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNumberOfSharesAuthorized_iI_c20221231__us-gaap--PlanNameAxis__custom--EquityIncentivePlanMember_zX8HS9wPbzDa" title="Number of shares authorized">5,000,000</span> 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. On November 16, 2021, the Company filed a registration statement on Form S-8 registering all shares issuable under the Plan.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Restricted Stock Unit</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Following completion of the IPO on May 11, 2021, pursuant to their letter agreements, the Company awarded a total of <span id="xdx_905_eus-gaap--StockIssuedDuringPeriodSharesRestrictedStockAwardGross_c20200701__20210514__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember__us-gaap--RelatedPartyTransactionAxis__custom--LetterAgreementsMember_zLOkk9vDk7dh" title="Number of restricted shares">46,546</span> 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. On November 16, 2021, we filed a registration statement on Form S-8 registering all shares issuable under the Plan. 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. The fair value of RSUs issued subsequent to IPO date was based on the stock price on each grant date. During the six months ended December 31, 2022, the Company granted an additional <span id="xdx_900_eus-gaap--StockIssuedDuringPeriodSharesRestrictedStockAwardGross_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zWEFoQiURZGh">79,406</span> shares of RSUs. For the three and six months ended December 31, 2022, the Company recorded $<span id="xdx_907_eus-gaap--ShareBasedCompensation_pp0p0_c20221001__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zu2Mqfbbrsph" title="Share based compensation">21,884</span> and $<span id="xdx_905_eus-gaap--ShareBasedCompensation_pp0p0_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_z8n2noE2dDK9" title="Share based compensation">49,384</span> of stock-based compensation expense. For the three and six months ended December 31, 2021, the Company recorded $<span id="xdx_905_eus-gaap--ShareBasedCompensation_pp0p0_c20211001__20211231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zV2MsYstXXz6" title="Share based compensation">54,435</span> and $<span id="xdx_909_eus-gaap--ShareBasedCompensation_pp0p0_c20210701__20211231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zGUBlD48vv07" title="Share based compensation">157,489</span> of stock-based compensation expense. As of December 31, 2022 and June 30, 2022, the unvested number of RSUs was <span id="xdx_902_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingNumber_c20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_pdd" title="Options vested">24,800</span> and <span id="xdx_904_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingNumber_c20220630__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_pdd" title="Options vested">6,608</span> and the unamortized expense was $<span id="xdx_907_eus-gaap--EmployeeServiceShareBasedCompensationNonvestedAwardsTotalCompensationCostNotYetRecognizedShareBasedAwardsOtherThanOptions_iI_pp0p0_c20221231_z7JfeCIEDo31">14,384</span> and $<span id="xdx_905_eus-gaap--EmployeeServiceShareBasedCompensationNonvestedAwardsTotalCompensationCostNotYetRecognizedShareBasedAwardsOtherThanOptions_iI_pp0p0_c20220630_zbLmSZTgSdTc">15,000</span>, respectively.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Information relating to RSU grants is summarized as follows:  </p> <table cellpadding="0" cellspacing="0" id="xdx_89D_eus-gaap--ScheduleOfShareBasedCompensationRestrictedStockUnitsAwardActivityTableTextBlock_z5WJYOcOWaI6" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Equity (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B4_zzi1JJECLnF8" style="display: none"> Schedule of RSU activity</span></td> <td> </td> <td colspan="2" style="text-align: right"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total RSUs Issued</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total Fair Market Value of RSUs Issued as Compensation (1)</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 68%"><span style="font-size: 10pt">RSUs granted, but not vested, at June 30, 2022</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td id="xdx_989_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iS_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zpg1F4J6t0c" style="width: 13%; text-align: right" title="RSU's outstanding at beginning"><span style="font-size: 10pt">6,608</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 13%; text-align: right"> </td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">RSUs granted</span></td> <td> </td> <td> </td> <td id="xdx_988_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodGross_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_pdd" style="text-align: right" title="RSUs granted"><span style="font-size: 10pt">79,406</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_983_eus-gaap--StockIssued1_pp0p0_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_fKDEp_z1huByzLuYik" style="text-align: right" title="Total Fair Market Value of RSUs Issued as Compensation RSUs granted"><span style="font-size: 10pt">48,768</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">RSUs forfeited</span></td> <td> </td> <td> </td> <td id="xdx_986_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresInPeriod_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_pdd" style="text-align: right" title="RSUs forfeited"><span style="font-size: 10pt"><span style="-sec-ix-hidden: xdx2ixbrl1396">–</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">RSUs vested</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td id="xdx_98E_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedNumberOfShares_iN_di_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zvm9YEGAJRU1" style="border-bottom: black 1pt solid; text-align: right" title="RSUs vested"><span style="font-size: 10pt">(61,214</span></td> <td><span style="font-size: 10pt">)</span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">RSUs granted, but not vested, at December 31, 2022</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"> </td> <td id="xdx_988_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iE_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zKgw3qUzsD32" style="border-bottom: black 2.25pt double; text-align: right" title="RSU's outstanding at ending"><span style="font-size: 10pt">24,800</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> _____________________</p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td><span id="xdx_F09_z59xoqxufsc5" style="font-size: 10pt">(1)</span></td> <td><span id="xdx_F14_zRe8TMs6pgl3" style="font-size: 10pt">The total fair value was based on the current stock price on the grant date.</span></td></tr> </table> <p id="xdx_8A5_zDIKio4B0sw9" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022, of the <span id="xdx_904_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedNumberOfShares_c20220701__20221231_zc5gB3HJPp02" title="Vested shares">194,280</span> vested RSUs, <span id="xdx_905_ecustom--StockIssuedForRsusVested_c20221231_pdd" title="Stock issued for RSU's vested">40,019</span> shares of Common Stock were issued, and <span id="xdx_90B_ecustom--StockToBeIssuedForRsuVested_c20221231_pdd" title="Stock to be issued for RSU's vested">154,261</span> shares were to be issued upon setup of the plan administration account.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Stock Option</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 $<span id="xdx_90E_ecustom--CashPerformanceBonus_c20220501__20220512_pp0p0" title="Cash performance bonus">60,000</span> to be awarded to Kevin Vassily, CFO of the Company, and stock option grants (the “Option Grants”) in the amount of (i) <span id="xdx_903_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriod_c20220501__20220512__srt--CounterpartyNameAxis__custom--ChenlongTanMember_pdd" title="Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Net of Forfeitures">3,000,000</span> shares to Chenlong Tan, CEO and (ii) <span id="xdx_90A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriod_c20220501__20220512__srt--CounterpartyNameAxis__custom--MrVassilyMember_pdd" title="Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Net of Forfeitures">330,000</span> shares to Mr. Vassily. The Option Grants, which were issued on May 13, 2022, have an exercise price of $<span id="xdx_906_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice_c20220513_pdd" title="Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Weighted Average Exercise Price">1.12 per share</span>, a contractual term of 10 years and consist of six vesting tranches with a vesting schedule based entirely on the attainment of both designated operational milestones (performance conditions) and market conditions (together, the “Designated Milestones”), assuming continued employment of the recipients through the date on which such Designated Milestones are achieved. Each of the six vesting tranches for the Option Grants will vest when both (i) the market capitalization milestone for such tranche, which begins at $150 million for the first tranche and increases by increments of $50 million through the fourth tranche and $100 million thereafter (based on achieving such market capitalization for five consecutive trading days), has been achieved, and (ii) any one of the following six operational milestones focused on revenue or any one of the six operational milestones focused on operating income have been achieved during a given fiscal year.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The achievement status of the operational milestones as of December 31, 2022 was as follows:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1pt solid; text-align: center"> </td> <td colspan="5" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Revenue in Fiscal Year</span></td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="border-bottom: black 1pt solid; text-align: center"> </td> <td colspan="5" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Operating Income in Fiscal Year</span></td> <td style="text-align: center"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td> <td style="text-align: center"><span style="font-size: 10pt">Milestone</span></td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="text-align: center"><span style="font-size: 10pt">Milestone</span></td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="text-align: center"> </td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1pt solid; text-align: center"> </td> <td style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">(in Millions)</span></td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="border-bottom: black 1pt solid; text-align: center"> </td> <td style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Achievement Status</span></td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="border-bottom: black 1pt solid; text-align: center"> </td> <td style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">(in Millions)</span></td> <td style="text-align: center"> </td> <td style="text-align: center"> </td> <td style="border-bottom: black 1pt solid; text-align: center"> </td> <td style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Achievement Status</span></td> <td style="text-align: center"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 25%; text-align: right"><span style="font-size: 10pt">90</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 22%; text-align: center"><span style="font-size: 10pt">Probable</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 21%; text-align: right"><span style="font-size: 10pt">6</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 21%; text-align: center"><span style="font-size: 10pt">Probable</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">100</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">Probable</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">8</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">Probable</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">125</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">Probable</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">10</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">Probable</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">150</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">Probable</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">12</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">–</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">200</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">Probable</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">16</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">–</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">250</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">–</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td style="text-align: right"><span style="font-size: 10pt">20</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: center"><span style="font-size: 10pt">–</span></td> <td> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company evaluated the performance condition and market condition under ASC 718-10-20. The Option Grants are considered an award containing a performance and a market condition and both conditions (in this case at least one of the performance conditions) must be satisfied for the award to vest. The market condition is incorporated into the fair value of the award, and that fair value is recognized over the longer of the implied service period or requisite service period if it is probable that one of the performance conditions will be met. In relation to the five awards deemed probable to vest, the recognition period ranges from 2.93 years to 9.64 years. If the performance condition is ultimately not met, compensation cost related to the award should not be recognized (or should be reversed to the extent any expense has been recognized related to such tranche) because the vesting condition in the award would not have been satisfied.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On the grant date, a Monte Carlo simulation was used to determine for each tranche (i) a fixed amount of expense for such tranche and (ii) the future time when the market capitalization milestone for such tranche was expected to be achieved. Separately, based on a subjective assessment of our future financial performance, each quarter we determine whether it is probable that we will achieve each operational milestone that has not previously been achieved or deemed probable of achievement and if so, the future time when we expect to achieve that operational milestone. The Monte Carlo simulation utilized the following inputs:</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td style="width: 24px"> </td> <td style="width: 24px"><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td style="text-align: justify"><span style="font-size: 10pt">Stock Price - $<span id="xdx_90E_eus-gaap--SharePrice_iI_c20220512_z2bV7uRQgDE1" title="Share price">1.12</span> </span></td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td style="text-align: justify"><span style="font-size: 10pt">Volatility – <span id="xdx_907_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardFairValueAssumptionsExpectedVolatilityRate_dp_c20220511__20220512_ziZg6cVWdhyk" title="Volatility">95.65</span>% </span></td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td style="text-align: justify"><span style="font-size: 10pt">Term –<span id="xdx_909_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardFairValueAssumptionsExpectedTerm1_dtY_c20220511__20220512_zG90OzEhQMij" title="Term">10</span> years</span></td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td style="text-align: justify"><span style="font-size: 10pt">Risk Free Rate of Return – <span id="xdx_904_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardFairValueAssumptionsRiskFreeInterestRate_dp_c20220511__20220512_zsnsCVvTQJba" title="Risk Free Rate of Return">2.93</span>% </span></td></tr> <tr style="vertical-align: top"> <td> </td> <td><span style="font-family: Symbol; font-size: 10pt">·</span></td> <td style="text-align: justify"><span style="font-size: 10pt">Dividend Yield – <span id="xdx_90F_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardFairValueAssumptionsExpectedDividendRate_dp_c20220511__20220512_z9Jdb7nFCOGf" title="Dividend Yield">0</span>%</span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The total fair value of the Option Grants was $3.2 million of which, at June 30, 2022, $2.3 million is deemed probable of vesting. As of December 31, 2022, <span id="xdx_908_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingNumber_iI_dn_c20221231_zj55dRjnJJz8" title="Options vested">none</span> of the options had vested. For the three and six months ended December 31, 2022, the Company recorded $<span id="xdx_90B_eus-gaap--ShareBasedCompensation_pp0p0_c20221001__20221231__us-gaap--AwardTypeAxis__custom--OptionsGrantedMember_zMYs0KQrWHLi" title="Share-Based Payment Arrangement, Noncash Expense">110,382</span> and $<span id="xdx_905_eus-gaap--ShareBasedCompensation_c20220701__20221231__us-gaap--AwardTypeAxis__custom--OptionsGrantedMember_pp0p0" title="Share-Based Payment Arrangement, Noncash Expense">220,764</span> of stock-based compensation expense related to the Option Grants. For the three and six months ended December 31, 2021, the Company did <span id="xdx_90B_eus-gaap--ShareBasedCompensation_pp0p0_do_c20210701__20211231__us-gaap--AwardTypeAxis__custom--OptionsGrantedMember_zJbzVCX5Spfe" title="Share-Based Payment Arrangement, Noncash Expense"><span id="xdx_90E_eus-gaap--ShareBasedCompensation_pp0p0_do_c20210701__20211231__us-gaap--AwardTypeAxis__custom--OptionsGrantedMember_zJAaP5SThgz8" title="Share-Based Payment Arrangement, Noncash Expense">no</span></span>t record any stock-based compensation expense related to the Option Grants. Unrecognized compensation cost related to tranches probable of vesting is approximately $2.0 million and will be recognized over 2.5 years to 9.5 years, depending on the tranche.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> 40019 3083700 2.27 5528373 29572382 29572382 29572382 29572382 5000000 46546 79406 21884 49384 54435 157489 24800 6608 14384 15000 <table cellpadding="0" cellspacing="0" id="xdx_89D_eus-gaap--ScheduleOfShareBasedCompensationRestrictedStockUnitsAwardActivityTableTextBlock_z5WJYOcOWaI6" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Equity (Details)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B4_zzi1JJECLnF8" style="display: none"> Schedule of RSU activity</span></td> <td> </td> <td colspan="2" style="text-align: right"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total RSUs Issued</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Total Fair Market Value of RSUs Issued as Compensation (1)</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 68%"><span style="font-size: 10pt">RSUs granted, but not vested, at June 30, 2022</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td id="xdx_989_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iS_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zpg1F4J6t0c" style="width: 13%; text-align: right" title="RSU's outstanding at beginning"><span style="font-size: 10pt">6,608</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 13%; text-align: right"> </td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">RSUs granted</span></td> <td> </td> <td> </td> <td id="xdx_988_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodGross_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_pdd" style="text-align: right" title="RSUs granted"><span style="font-size: 10pt">79,406</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_983_eus-gaap--StockIssued1_pp0p0_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_fKDEp_z1huByzLuYik" style="text-align: right" title="Total Fair Market Value of RSUs Issued as Compensation RSUs granted"><span style="font-size: 10pt">48,768</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">RSUs forfeited</span></td> <td> </td> <td> </td> <td id="xdx_986_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresInPeriod_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_pdd" style="text-align: right" title="RSUs forfeited"><span style="font-size: 10pt"><span style="-sec-ix-hidden: xdx2ixbrl1396">–</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">RSUs vested</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td id="xdx_98E_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedNumberOfShares_iN_di_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zvm9YEGAJRU1" style="border-bottom: black 1pt solid; text-align: right" title="RSUs vested"><span style="font-size: 10pt">(61,214</span></td> <td><span style="font-size: 10pt">)</span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">RSUs granted, but not vested, at December 31, 2022</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"> </td> <td id="xdx_988_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iE_c20220701__20221231__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zKgw3qUzsD32" style="border-bottom: black 2.25pt double; text-align: right" title="RSU's outstanding at ending"><span style="font-size: 10pt">24,800</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> _____________________</p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: top"> <td><span id="xdx_F09_z59xoqxufsc5" style="font-size: 10pt">(1)</span></td> <td><span id="xdx_F14_zRe8TMs6pgl3" style="font-size: 10pt">The total fair value was based on the current stock price on the grant date.</span></td></tr> </table> 6608 79406 48768 61214 24800 194280 40019 154261 60000 3000000 330000 1.12 1.12 0.9565 P10Y 0.0293 0 0 110382 220764 0 0 <p id="xdx_807_ecustom--WarrantLiabilitiesTextBlock_zjsQkq8goic9" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 17 – <span id="xdx_82B_zlRCbJ5QayCj">Warrant liabilities</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company’s warrant liabilities contained unobservable inputs that reflected the Company’s own assumptions in which there was little, if any, market activity as of the measurement date. Accordingly, the Company’s warrant liabilities were measured at fair value on a recurring basis using unobservable inputs and were classified as Level 3 measurements.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On December 30, 2020, the Company issued warrants to purchase <span id="xdx_906_ecustom--WarrantsIssuedShares_c20201230__srt--CounterpartyNameAxis__custom--PlacementAgentMember__us-gaap--StatementClassOfStockAxis__custom--SeriesAConvertiblePreferredStockMember__us-gaap--SubsidiarySaleOfStockAxis__us-gaap--PrivatePlacementMember_pdd" title="Warrants issued">2,415</span> shares of Series A Convertible Preferred Stock to Boustead Securities, LLC (the “Placement Agent”) as compensation, which was recorded as financing expense. The exercise price of the warrants is $<span id="xdx_909_eus-gaap--ClassOfWarrantOrRightExercisePriceOfWarrantsOrRights1_c20201230__us-gaap--StatementClassOfStockAxis__custom--SeriesAConvertiblePreferredStockMember__srt--CounterpartyNameAxis__custom--PlacementAgentMember_pdd" title="Warrant exercise price">10</span> per share and expires in five years from the issuance date. This Series A Preferred Stock warrant was valued using Black Scholes Option Pricing Model at issuance date and recorded $<span id="xdx_909_eus-gaap--FinancingInterestExpense_c20201201__20201230__srt--CounterpartyNameAxis__custom--PlacementAgentMember__us-gaap--StatementClassOfStockAxis__custom--SeriesAConvertiblePreferredStockMember__us-gaap--SubsidiarySaleOfStockAxis__us-gaap--PrivatePlacementMember_pp0p0" title="Financing expense"><span id="xdx_90A_ecustom--WarrantLiability_c20201201__20201230__srt--CounterpartyNameAxis__custom--PlacementAgentMember__us-gaap--StatementClassOfStockAxis__custom--SeriesAConvertiblePreferredStockMember__us-gaap--SubsidiarySaleOfStockAxis__us-gaap--PrivatePlacementMember_pp0p0" title="Warrant liability">8,047</span></span> as financing expense and warrant liability.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On January 27, 2021, the Company completed a private placement offering pursuant to which the Company sold to two accredited investors an aggregate of $<span id="xdx_901_eus-gaap--ProceedsFromIssuanceOrSaleOfEquity_c20210126__20210127__srt--CounterpartyNameAxis__custom--TwoAccreditedInvestorsMember__us-gaap--SubsidiarySaleOfStockAxis__us-gaap--PrivatePlacementMember_pp0p0" title="Proceeds from sale of equity">3,000,000</span> 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 shall be exercisable for a period of three years from the IPO completion date at a per share exercise price equal to the IPO. 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">  </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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:</p> <table cellpadding="0" cellspacing="0" id="xdx_899_eus-gaap--ScheduleOfShareBasedPaymentAwardStockOptionsValuationAssumptionsTableTextBlock_zb5O3zeptZNi" style="font: 10pt Times New Roman, Times, Serif; width: 55%; border-collapse: collapse" summary="xdx: Disclosure - Warrant liabilities (Details - Assumptions)"> <tr style="vertical-align: top"> <td><span id="xdx_8B9_z0gkpvVHbWsa" style="display: none"> Schedule of assumptions for warrant liabilities</span></td> <td style="text-align: center"> </td></tr> <tr style="vertical-align: top"> <td style="width: 50%"> </td> <td style="border-bottom: black 1pt solid; width: 50%; text-align: center"><span style="font-size: 10pt">As of May 14, 2021</span></td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Expected term</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_905_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedTermMember" title="Fair value measurement assumptions">1 day to 3 years</span></span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Expected volatility</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_909_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputPriceVolatilityMember" title="Fair value measurement assumptions">3.3% to 58%</span></span></td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Risk-free interest rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_905_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputRiskFreeInterestRateMember" title="Fair value measurement assumptions">0.35% to 0.92%</span> </span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Expected dividend rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_904_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedDividendRateMember" title="Fair value measurement assumptions">0%</span></span></td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Probability</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_905_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__custom--MeasurementInputProbablityMember" title="Fair value measurement assumptions">100%</span></span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p id="xdx_8A7_zFYBCYxUjv5b" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of May 14, 2021, the fair value of the warrant liabilities was $<span id="xdx_90C_eus-gaap--FinancialLiabilitiesFairValueDisclosure_c20210514_pp0p0" title="Fair value of warrant liabilities">1,361,347</span>, which includes $<span id="xdx_908_eus-gaap--FinancialLiabilitiesFairValueDisclosure_c20210514__us-gaap--FinancialInstrumentAxis__custom--PreferredStockWarrantsMember_pp0p0" title="Fair value of warrant liabilities">4,610</span> preferred stock warrant, $<span id="xdx_907_eus-gaap--FinancialLiabilitiesFairValueDisclosure_c20210514__us-gaap--FinancialInstrumentAxis__custom--ConvertibleNoteInvestorsMember_pp0p0" title="Fair value of warrant liabilities">1,324,668</span> warrants issued to the Convertible Note investors and $<span id="xdx_900_eus-gaap--FinancialLiabilitiesFairValueDisclosure_c20210514__us-gaap--FinancialInstrumentAxis__custom--PlacementAgentWarrantsMember_pp0p0" title="Fair value of warrant liabilities">32,069</span> warrants issued to the placement agent. The increase in fair value immediately before the IPO was $<span id="xdx_905_eus-gaap--FairValueAdjustmentOfWarrants_c20210101__20211231__us-gaap--StatementEquityComponentsAxis__us-gaap--WarrantMember_pp0p0" title="Fair Value Adjustment of Warrants">617,593</span>, which was reported in other non-operating expenses for the year ended June 30, 2021.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Upon closing the IPO on May 14, 2021, the Placement Agent exercised its warrants in full to purchase a total of <span id="xdx_909_ecustom--WarrantsExercised_c20210514__srt--CounterpartyNameAxis__custom--BousteadSecuritiesLLCMember_pdd" title="Warrants exercised">24,451</span> 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 reclassed to additional paid in capital as the terms became fixed upon closing of the IPO. Through December 31, 2022, none of the private placement investors exercised any of their warrants. As such, as of December 31, 2022 and June 30, 2022, the number of shares issuable under the outstanding warrants was <span id="xdx_903_eus-gaap--ClassOfWarrantOrRightNumberOfSecuritiesCalledByWarrantsOrRights_c20221231_pdd" title="Outstanding warrants">685,715</span>, with an average exercise price of $<span id="xdx_906_eus-gaap--ClassOfWarrantOrRightExercisePriceOfWarrantsOrRights1_c20221231_pdd" title="Warrant exercise price">5.00</span> per share.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> 2415 10 8047 8047 3000000 <table cellpadding="0" cellspacing="0" id="xdx_899_eus-gaap--ScheduleOfShareBasedPaymentAwardStockOptionsValuationAssumptionsTableTextBlock_zb5O3zeptZNi" style="font: 10pt Times New Roman, Times, Serif; width: 55%; border-collapse: collapse" summary="xdx: Disclosure - Warrant liabilities (Details - Assumptions)"> <tr style="vertical-align: top"> <td><span id="xdx_8B9_z0gkpvVHbWsa" style="display: none"> Schedule of assumptions for warrant liabilities</span></td> <td style="text-align: center"> </td></tr> <tr style="vertical-align: top"> <td style="width: 50%"> </td> <td style="border-bottom: black 1pt solid; width: 50%; text-align: center"><span style="font-size: 10pt">As of May 14, 2021</span></td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Expected term</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_905_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedTermMember" title="Fair value measurement assumptions">1 day to 3 years</span></span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Expected volatility</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_909_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputPriceVolatilityMember" title="Fair value measurement assumptions">3.3% to 58%</span></span></td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Risk-free interest rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_905_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputRiskFreeInterestRateMember" title="Fair value measurement assumptions">0.35% to 0.92%</span> </span></td></tr> <tr style="vertical-align: top; background-color: white"> <td><span style="font-size: 10pt">Expected dividend rate</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_904_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedDividendRateMember" title="Fair value measurement assumptions">0%</span></span></td></tr> <tr style="vertical-align: top; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Probability</span></td> <td style="text-align: center"><span style="font-size: 10pt"><span id="xdx_905_eus-gaap--DerivativesBasisAndUseOfDerivativesBasisDeterminationOfFairValue_c20200701__20210514__us-gaap--DerivativeInstrumentRiskAxis__custom--WarrantLiabilityMember__us-gaap--MeasurementInputTypeAxis__custom--MeasurementInputProbablityMember" title="Fair value measurement assumptions">100%</span></span></td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> 1 day to 3 years 3.3% to 58% 0.35% to 0.92% 0% 100% 24451 685715 5.00 <p id="xdx_802_eus-gaap--ConcentrationRiskDisclosureTextBlock_zEeeS5FhoCG5" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 18 - <span id="xdx_826_z8ngnIe7a1u5">Concentration of risk</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Credit risk</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of December 31, 2022 and June 30, 2022, $<span id="xdx_90A_eus-gaap--CashAndCashEquivalentsAtCarryingValue_c20221231_pp0p0" title="Cash and Cash Equivalents, at Carrying Value">3,997,125</span> and $<span id="xdx_904_eus-gaap--CashAndCashEquivalentsAtCarryingValue_c20220630_pp0p0" title="Cash and Cash Equivalents, at Carrying Value">1,821,947</span>, 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 $<span id="xdx_90C_eus-gaap--CashUninsuredAmount_iI_dm_c20221231_zl6IuqggRZ1d" title="Cash, Uninsured Amount">3.1 million</span> and $<span id="xdx_90E_eus-gaap--CashUninsuredAmount_iI_dm_c20220630_z6jrh9YG4haj" title="Cash, Uninsured Amount">0.5 million</span>, respectively, in excess of the FDIC insurance limit, as of December 31, 2022 and June 30, 2022.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The business of DHS, the Company’s VIE, may be impacted by Chinese economic conditions, changes in regulations and laws, and other uncertainties.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Customer and vendor concentration risk</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the six months ended December 31, 2022 and 2021, Amazon Vendor and Amazon Seller customers accounted for <span id="xdx_901_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__srt--MajorCustomersAxis__custom--AmazonVendorAndAmazonSellerMember__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember_zI0hkFWyzegl" title="Concentration Risk, Percentage">91</span>% and <span id="xdx_905_eus-gaap--ConcentrationRiskPercentage1_dp_c20210701__20211231__srt--MajorCustomersAxis__custom--AmazonVendorAndAmazonSellerMember__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember_zZkrG0Hsu7Dl" title="Concentration Risk, Percentage">89</span>% of the Company's total revenues, respectively. As of December 31, 2022 and June 30, 2022, accounts receivable from Amazon Vendor and Amazon Seller accounted for <span id="xdx_90F_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__srt--MajorCustomersAxis__custom--AmazonVendorAndAmazonSellerMember__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember_zLUQR1cumqv4" title="Concentration Risk, Percentage">89</span>% and <span id="xdx_90A_eus-gaap--ConcentrationRiskPercentage1_dp_c20210701__20220630__srt--MajorCustomersAxis__custom--AmazonVendorAndAmazonSellerMember__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember_zRfqQlFmB2N8" title="Concentration Risk, Percentage">94</span>% of the Company’s total accounts receivable.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For the six months ended December 31, 2022 and 2021, two suppliers accounted for <span id="xdx_903_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--CostOfSalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--TwoSuppliersMember_zC9ZlKfpnZX5" title="Concentration Risk, Percentage">41</span>% (<span id="xdx_902_eus-gaap--ConcentrationRiskPercentage1_dp_c20210701__20210930__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--CostOfSalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--OneSupplierMember_zncvPVjsmvqe" title="Concentration Risk, Percentage">31</span>% and <span id="xdx_90B_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--CostOfSalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--AnotherSupplierMember_zIN4AbzlQsbe" title="Concentration Risk, Percentage">10</span>%) and <span id="xdx_903_eus-gaap--ConcentrationRiskPercentage1_dp_c20210701__20211231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--CostOfSalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--TwoSuppliersMember_zHhhZxMCKv49" title="Concentration Risk, Percentage">29</span>% (<span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_dp_c20210701__20211231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--CostOfSalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--OneSupplierMember_zXTbwP71O5D6" title="Concentration Risk, Percentage">22</span>% and <span id="xdx_903_eus-gaap--ConcentrationRiskPercentage1_dp_c20210701__20211231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--CostOfSalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--AnotherSupplierMember_z2S56OtfRSO2" title="Concentration Risk, Percentage">7</span>%) of the Company's total purchases, respectively. As of December 31, 2022, accounts payable to two suppliers accounted for <span id="xdx_905_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--TwoSuppliersMember_zIYHPkDDrtNg" title="Concentration Risk, Percentage">65</span>% (<span id="xdx_902_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20220930__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--OneSupplierMember_za6BEcPNhAEi" title="Concentration Risk, Percentage">57</span>% and <span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_dp_c20220701__20220930__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--AnotherSupplierMember_zZOpi08NMUG9" title="Concentration Risk, Percentage">8</span>%) of the Company’s total accounts payable. As of June 30, 2022, accounts payable to two suppliers accounted for <span id="xdx_900_eus-gaap--ConcentrationRiskPercentage1_dp_c20210701__20220630__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--TwoSuppliersMember_zLVzfkohNRSi" title="Concentration Risk, Percentage">44</span>% (<span id="xdx_900_eus-gaap--ConcentrationRiskPercentage1_dp_c20210701__20220630__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--OneSupplierMember_z4EhjtjxhOS4" title="Concentration Risk, Percentage">34</span>% and <span id="xdx_904_eus-gaap--ConcentrationRiskPercentage1_dp_c20210701__20220630__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--ProductConcentrationRiskMember__us-gaap--SupplyCommitmentAxis__custom--AnotherSupplierMember_zVF7uNSCqFM7" title="Concentration Risk, Percentage">10</span>%) of the Company’s total accounts payable.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">  </p> 3997125 1821947 3100000 500000 0.91 0.89 0.89 0.94 0.41 0.31 0.10 0.29 0.22 0.07 0.65 0.57 0.08 0.44 0.34 0.10 <p id="xdx_808_eus-gaap--CommitmentsAndContingenciesDisclosureTextBlock_zSFI1xHOMSh6" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><b>Note 19 - <span id="xdx_820_zcCY2tDN9lC7">Commitments and contingencies</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"><b> </b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Lease commitments</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The Company has adopted ASC842 since its inception date, April 11, 2018. The Company has entered into a lease agreement to rent 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 through December 21, 2023 at the rate of approximately $42,000 per month.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 ranges from $27,921 to $29,910 per month through October 31, 2023.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On February 15, 2022, upon completion of the acquisition of Anivia Limited, the Company assumed an operating lease for offices located in the People’s Republic of China.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On July 28, 2021, the Company entered into a Lease agreement (the “Lease Agreement”) with 9th &amp; 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; background-color: white">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 were to be abated.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The lease was not started under the original Lease Agreement as completion of the construction was not timely completed. On February 23, 2022, as a result of the delay in completion of the construction, the Company entered into an amended agreement to extend the lease term to 74 months. The lease commencement date is February 10, 2022, with rent payments commencing May 11, 2022 and the lease expiring on May 31, 2028. The base rental fee ranges from $114,249 to $140,079 per month through the expiration date of May 31, 2028.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">On May 1, 2022, the Company leased another fulfillment center in Duarte, California. The base rental fee ranges from $56,000 to $59,410 per month through April 30, 2025.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Total commitment for the full term of these leases is $<span id="xdx_90A_eus-gaap--ContractualObligation_c20221231_pp0p0" title="Contractual obligation">12,440,869</span>. The financial statements reflected $9,161,840 and $<span id="xdx_90D_eus-gaap--OperatingLeaseRightOfUseAsset_c20220630_pp0p0" title="Right of use asset - non-current">10,453,282</span>, respectively, of operating lease right-of-use assets, and $<span id="xdx_907_eus-gaap--OperatingLeaseLiability_c20221231_pp0p0" title="Operating lease liabilities">9,586,788</span> and $<span id="xdx_901_eus-gaap--OperatingLeaseLiability_c20220630_pp0p0" title="Operating lease liabilities">10,848,544</span>, respectively, of operating lease liabilities as of December 31, 2022 and June 30, 2022.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Three Months Ended December 31, 2022 and 2021: </p> <table cellpadding="0" cellspacing="0" id="xdx_899_eus-gaap--LeaseCostTableTextBlock_zn8ktzHUGeRc" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Commitments and contingencies (Details - Lease cost)c"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B5_zVndAaKXQso3" style="display: none"> Schedule of lease cost and other information</span></td> <td> </td> <td colspan="2" style="text-align: center"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Lease cost</span></span></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2022</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2021</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 68%"><span style="font-size: 10pt">Operating lease cost (included in selling and fulfillment in the Company's statement of operations)</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_980_eus-gaap--OperatingLeaseCost_pp0p0_c20221001__20221231_zcRWe9CNfpxh" style="width: 13%; text-align: right" title="Operating lease cost"><span style="font-size: 10pt">775,494</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_98F_eus-gaap--OperatingLeaseCost_pp0p0_c20211001__20211231_zBuAsBpg9G0c" style="width: 13%; text-align: right" title="Operating lease cost"><span style="font-size: 10pt">205,517</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Other information</span></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Cash paid for amounts included in the measurement of lease liabilities</span></td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_983_eus-gaap--OperatingLeasePayments_pp0p0_c20221001__20221231_zAe3PEMDdNq9" style="text-align: right" title="Cash paid for amounts included in the measurement of lease liabilities"><span style="font-size: 10pt">755,643</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_98B_eus-gaap--OperatingLeasePayments_pp0p0_c20211001__20211231_zBctZCmyRv08" style="text-align: right" title="Cash paid for amounts included in the measurement of lease liabilities"><span style="font-size: 10pt">212,694</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Remaining term in years</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_908_ecustom--OperatingLeaseWeightedAverageRemainingLeaseTerm2_c20221001__20221231_z25lGSOVrZS5" title="Remaining lease term in years">0.58 – 5.42</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_90D_eus-gaap--OperatingLeaseWeightedAverageRemainingLeaseTerm1_iI_dtY_c20211231_zxQi8HfpfH6j" title="Lease remaining term">1.75</span></span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Average discount rate - operating leases</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_905_ecustom--OperatingLeaseWeightedAverageDiscountRatePercent1_c20221001__20221231_zSu1daj0ZHwc" title="Average discount rate - operating leases">5 - 8%</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_906_eus-gaap--OperatingLeaseWeightedAverageDiscountRatePercent_iI_dp_c20211231_z305SrBWese7" title="Average discount rate - operating leases">8</span>%</span></td> <td> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Six Months Ended December 31, 2022 and 2021: </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Commitments and contingencies (Details - Lease cost)"> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="text-align: center"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Lease cost</span></span></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2022</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2021</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 68%"><span style="font-size: 10pt">Operating lease cost (included in selling and fulfillment in the Company's statement of operations)</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_985_eus-gaap--OperatingLeaseCost_c20220701__20221231_pp0p0" style="width: 13%; text-align: right" title="Operating lease cost"><span style="font-size: 10pt">1,554,727</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_988_eus-gaap--OperatingLeaseCost_pp0p0_c20210701__20211231_zjEVrOoLXrCh" style="width: 13%; text-align: right" title="Operating lease cost"><span style="font-size: 10pt">411,034</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Other information</span></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Cash paid for amounts included in the measurement of lease liabilities</span></td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_987_eus-gaap--OperatingLeasePayments_c20220701__20221231_pp0p0" style="text-align: right" title="Cash paid for amounts included in the measurement of lease liabilities"><span style="font-size: 10pt">1,524,704</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_981_eus-gaap--OperatingLeasePayments_c20210701__20211231_pp0p0" style="text-align: right" title="Cash paid for amounts included in the measurement of lease liabilities"><span style="font-size: 10pt">422,457</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Remaining term in years</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_90C_ecustom--OperatingLeaseWeightedAverageRemainingLeaseTerm2_c20220701__20221231" title="Remaining lease term in years">0.58 – 5.42</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_90C_eus-gaap--OperatingLeaseWeightedAverageRemainingLeaseTerm1_iI_dtY_c20220630_z1fZJu6Jzr74" title="Lease remaining term">1.75</span></span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Average discount rate - operating leases</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_90F_ecustom--OperatingLeaseWeightedAverageDiscountRatePercent1_c20220701__20221231" title="Average discount rate - operating leases">5 - 8%</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_908_eus-gaap--OperatingLeaseWeightedAverageDiscountRatePercent_iI_dp_c20220630_zChPr8qb8nCj" title="Average discount rate - operating leases">8</span>%</span></td> <td> </td></tr> </table> <p id="xdx_8AB_z2vFiiO37Nij" style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0">The supplemental balance sheet information related to leases for the period is as follows: </p> <table cellpadding="0" cellspacing="0" id="xdx_898_eus-gaap--ScheduleOfCashFlowSupplementalDisclosuresTableTextBlock_zkC9hdL7SPya" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Commitments and contingencies (Details - Balance Sheet)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B0_zkIZlPoZKaLa" style="display: none"> Supplemental balance sheet information related to leases</span></td> <td> </td> <td> </td> <td id="xdx_49B_20221231_zKkmqfncp6Y7" style="text-align: center"> </td> <td> </td> <td> </td> <td> </td> <td id="xdx_494_20220630_zseTf9Ij7bf" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Operating leases</span></span></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2022</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">6/30/2022</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 68%"><span style="font-size: 10pt">Right of use asset - non-current</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">9,161,840</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_98C_eus-gaap--OperatingLeaseRightOfUseAsset_iI_c20220630_zD30p1ClBM1d" style="width: 13%; text-align: right" title="Right of use asset - non-current"><span style="font-size: 10pt">10,453,282</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_407_ecustom--OperatingLeaseLiabilityCurrents_iI_pp0p0_maOLLzH2i_zrIOpPNhyYm8" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Lease Liability - current</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,563,468</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,582,933</span></td> <td> </td></tr> <tr id="xdx_400_ecustom--OperatingLeaseLiabilityNoncurrents_iI_pp0p0_maOLLzH2i_zJoWK667yDj" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Lease Liability - non-current</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">7,023,320</span></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">8,265,611</span></td> <td> </td></tr> <tr id="xdx_405_eus-gaap--OperatingLeaseLiability_iTI_pp0p0_mtOLLzH2i_zZhkRPGAwil1" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Total operating lease liabilities</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">9,586,788</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">10,848,544</span></td> <td> </td></tr> </table> <p id="xdx_8A7_zK3jEnLoVDle" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Maturities of the Company’s lease liabilities are as follows: </p> <table cellpadding="0" cellspacing="0" id="xdx_89E_eus-gaap--LesseeOperatingLeaseLiabilityMaturityTableTextBlock_zLrFkDeJiSr2" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Commitments and contingencies (Details - Lease maturity)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B1_zKc5qhW3WPob" style="display: none"> Schedule of maturities of lease liabilities</span></td> <td> </td> <td colspan="2" id="xdx_49A_20221231_zfpEpx4loEc9" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="text-align: center"><span style="font-size: 10pt">Operating</span></td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Lease</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">For Year ending June 30:</span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_405_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueNextTwelveMonths_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td style="width: 84%"><span style="font-size: 10pt">2023</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">1,550,310</span></td> <td style="width: 1%"> </td></tr> <tr id="xdx_40A_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearTwo_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2024</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,510,815</span></td> <td> </td></tr> <tr id="xdx_40D_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearThree_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">2025</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,080,331</span></td> <td> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearFour_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2026</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">1,533,918</span></td> <td> </td></tr> <tr id="xdx_405_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearFive_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">2027</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">1,586,572</span></td> <td> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueAfterYearFive_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2028 and after</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">1,459,407</span></td> <td> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityUndiscountedExcessAmount_iNI_pp0p0_di_zymyz8uuUKLg" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Less: Imputed interest/present value discount</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,134,565</span></td> <td><span style="font-size: 10pt">)</span></td></tr> <tr id="xdx_40B_eus-gaap--OperatingLeaseLiability_iI_pp0p0_zA6uvIIaEIUg" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Present value of lease liabilities</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">9,586,788</span></td> <td> </td></tr> </table> <p id="xdx_8AD_zcx2mzrIr6k8" style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="text-decoration: underline">Contingencies</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Except as disclosed below, the Company is not currently a party to any material legal proceedings, investigation or claims. As the Company may, from time to time, be involved in legal matters arising in the ordinary course of its business, 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.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 &amp; Co. (who acted as underwriter in the Company’s IPO). Presently, the matter is scheduled to be heard before a FINRA arbitration appeal over six non-consecutive days during the months of April and May 2023. The Company has agreed to indemnify D.A. Davidson &amp; 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. The Company cannot reasonably estimate the amount of potential exposure as of the date of this report.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">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 may have on the Company’s business in the future.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><span style="background-color: white">In February 2022, the Russian Federation began conducting military operations against Ukraine, which have been ongoing ever since, resulting in global economic uncertainty and increased cost of various commodities. In response to these types of events, should they directly impact our supply chain or other operations, we may experience or be exposed to supply chain disruption which could cause us to 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 three and six months ended December 31, 2022.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> 12440869 10453282 9586788 10848544 <table cellpadding="0" cellspacing="0" id="xdx_899_eus-gaap--LeaseCostTableTextBlock_zn8ktzHUGeRc" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Commitments and contingencies (Details - Lease cost)c"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B5_zVndAaKXQso3" style="display: none"> Schedule of lease cost and other information</span></td> <td> </td> <td colspan="2" style="text-align: center"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Lease cost</span></span></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2022</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2021</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 68%"><span style="font-size: 10pt">Operating lease cost (included in selling and fulfillment in the Company's statement of operations)</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_980_eus-gaap--OperatingLeaseCost_pp0p0_c20221001__20221231_zcRWe9CNfpxh" style="width: 13%; text-align: right" title="Operating lease cost"><span style="font-size: 10pt">775,494</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_98F_eus-gaap--OperatingLeaseCost_pp0p0_c20211001__20211231_zBuAsBpg9G0c" style="width: 13%; text-align: right" title="Operating lease cost"><span style="font-size: 10pt">205,517</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Other information</span></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Cash paid for amounts included in the measurement of lease liabilities</span></td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_983_eus-gaap--OperatingLeasePayments_pp0p0_c20221001__20221231_zAe3PEMDdNq9" style="text-align: right" title="Cash paid for amounts included in the measurement of lease liabilities"><span style="font-size: 10pt">755,643</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_98B_eus-gaap--OperatingLeasePayments_pp0p0_c20211001__20211231_zBctZCmyRv08" style="text-align: right" title="Cash paid for amounts included in the measurement of lease liabilities"><span style="font-size: 10pt">212,694</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Remaining term in years</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_908_ecustom--OperatingLeaseWeightedAverageRemainingLeaseTerm2_c20221001__20221231_z25lGSOVrZS5" title="Remaining lease term in years">0.58 – 5.42</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_90D_eus-gaap--OperatingLeaseWeightedAverageRemainingLeaseTerm1_iI_dtY_c20211231_zxQi8HfpfH6j" title="Lease remaining term">1.75</span></span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Average discount rate - operating leases</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_905_ecustom--OperatingLeaseWeightedAverageDiscountRatePercent1_c20221001__20221231_zSu1daj0ZHwc" title="Average discount rate - operating leases">5 - 8%</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_906_eus-gaap--OperatingLeaseWeightedAverageDiscountRatePercent_iI_dp_c20211231_z305SrBWese7" title="Average discount rate - operating leases">8</span>%</span></td> <td> </td></tr> </table> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Six Months Ended December 31, 2022 and 2021: </p> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Commitments and contingencies (Details - Lease cost)"> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="text-align: center"> </td> <td> </td> <td> </td> <td colspan="2" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Lease cost</span></span></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2022</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2021</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 68%"><span style="font-size: 10pt">Operating lease cost (included in selling and fulfillment in the Company's statement of operations)</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_985_eus-gaap--OperatingLeaseCost_c20220701__20221231_pp0p0" style="width: 13%; text-align: right" title="Operating lease cost"><span style="font-size: 10pt">1,554,727</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_988_eus-gaap--OperatingLeaseCost_pp0p0_c20210701__20211231_zjEVrOoLXrCh" style="width: 13%; text-align: right" title="Operating lease cost"><span style="font-size: 10pt">411,034</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Other information</span></span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Cash paid for amounts included in the measurement of lease liabilities</span></td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_987_eus-gaap--OperatingLeasePayments_c20220701__20221231_pp0p0" style="text-align: right" title="Cash paid for amounts included in the measurement of lease liabilities"><span style="font-size: 10pt">1,524,704</span></td> <td> </td> <td> </td> <td><span style="font-size: 10pt">$</span></td> <td id="xdx_981_eus-gaap--OperatingLeasePayments_c20210701__20211231_pp0p0" style="text-align: right" title="Cash paid for amounts included in the measurement of lease liabilities"><span style="font-size: 10pt">422,457</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Remaining term in years</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_90C_ecustom--OperatingLeaseWeightedAverageRemainingLeaseTerm2_c20220701__20221231" title="Remaining lease term in years">0.58 – 5.42</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_90C_eus-gaap--OperatingLeaseWeightedAverageRemainingLeaseTerm1_iI_dtY_c20220630_z1fZJu6Jzr74" title="Lease remaining term">1.75</span></span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Average discount rate - operating leases</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_90F_ecustom--OperatingLeaseWeightedAverageDiscountRatePercent1_c20220701__20221231" title="Average discount rate - operating leases">5 - 8%</span></span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt"><span id="xdx_908_eus-gaap--OperatingLeaseWeightedAverageDiscountRatePercent_iI_dp_c20220630_zChPr8qb8nCj" title="Average discount rate - operating leases">8</span>%</span></td> <td> </td></tr> </table> 775494 205517 755643 212694 0.58 – 5.42 P1Y9M 5 - 8% 0.08 1554727 411034 1524704 422457 0.58 – 5.42 P1Y9M 5 - 8% 0.08 <table cellpadding="0" cellspacing="0" id="xdx_898_eus-gaap--ScheduleOfCashFlowSupplementalDisclosuresTableTextBlock_zkC9hdL7SPya" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Commitments and contingencies (Details - Balance Sheet)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B0_zkIZlPoZKaLa" style="display: none"> Supplemental balance sheet information related to leases</span></td> <td> </td> <td> </td> <td id="xdx_49B_20221231_zKkmqfncp6Y7" style="text-align: center"> </td> <td> </td> <td> </td> <td> </td> <td id="xdx_494_20220630_zseTf9Ij7bf" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td><span style="font-size: 10pt"><span style="text-decoration: underline">Operating leases</span></span></td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">12/31/2022</span></td> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">6/30/2022</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td style="width: 68%"><span style="font-size: 10pt">Right of use asset - non-current</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">9,161,840</span></td> <td style="width: 1%"> </td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td id="xdx_98C_eus-gaap--OperatingLeaseRightOfUseAsset_iI_c20220630_zD30p1ClBM1d" style="width: 13%; text-align: right" title="Right of use asset - non-current"><span style="font-size: 10pt">10,453,282</span></td> <td style="width: 1%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_407_ecustom--OperatingLeaseLiabilityCurrents_iI_pp0p0_maOLLzH2i_zrIOpPNhyYm8" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Lease Liability - current</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,563,468</span></td> <td> </td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,582,933</span></td> <td> </td></tr> <tr id="xdx_400_ecustom--OperatingLeaseLiabilityNoncurrents_iI_pp0p0_maOLLzH2i_zJoWK667yDj" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Lease Liability - non-current</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">7,023,320</span></td> <td> </td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">8,265,611</span></td> <td> </td></tr> <tr id="xdx_405_eus-gaap--OperatingLeaseLiability_iTI_pp0p0_mtOLLzH2i_zZhkRPGAwil1" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Total operating lease liabilities</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">9,586,788</span></td> <td> </td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">10,848,544</span></td> <td> </td></tr> </table> 10453282 2563468 2582933 7023320 8265611 9586788 10848544 <table cellpadding="0" cellspacing="0" id="xdx_89E_eus-gaap--LesseeOperatingLeaseLiabilityMaturityTableTextBlock_zLrFkDeJiSr2" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse" summary="xdx: Disclosure - Commitments and contingencies (Details - Lease maturity)"> <tr style="vertical-align: bottom"> <td><span id="xdx_8B1_zKc5qhW3WPob" style="display: none"> Schedule of maturities of lease liabilities</span></td> <td> </td> <td colspan="2" id="xdx_49A_20221231_zfpEpx4loEc9" style="text-align: center"> </td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="text-align: center"><span style="font-size: 10pt">Operating</span></td> <td> </td></tr> <tr style="vertical-align: bottom"> <td> </td> <td> </td> <td colspan="2" style="border-bottom: black 1pt solid; text-align: center"><span style="font-size: 10pt">Lease</span></td> <td> </td></tr> <tr style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">For Year ending June 30:</span></td> <td> </td> <td> </td> <td style="text-align: right"> </td> <td> </td></tr> <tr id="xdx_405_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueNextTwelveMonths_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td style="width: 84%"><span style="font-size: 10pt">2023</span></td> <td style="width: 1%"> </td> <td style="width: 1%"><span style="font-size: 10pt">$</span></td> <td style="width: 13%; text-align: right"><span style="font-size: 10pt">1,550,310</span></td> <td style="width: 1%"> </td></tr> <tr id="xdx_40A_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearTwo_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2024</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,510,815</span></td> <td> </td></tr> <tr id="xdx_40D_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearThree_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">2025</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">2,080,331</span></td> <td> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearFour_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2026</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">1,533,918</span></td> <td> </td></tr> <tr id="xdx_405_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearFive_iI_pp0p0" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">2027</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">1,586,572</span></td> <td> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueAfterYearFive_iI_pp0p0" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">2028 and after</span></td> <td> </td> <td> </td> <td style="text-align: right"><span style="font-size: 10pt">1,459,407</span></td> <td> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityUndiscountedExcessAmount_iNI_pp0p0_di_zymyz8uuUKLg" style="vertical-align: bottom; background-color: white"> <td><span style="font-size: 10pt">Less: Imputed interest/present value discount</span></td> <td> </td> <td style="border-bottom: black 1pt solid"> </td> <td style="border-bottom: black 1pt solid; text-align: right"><span style="font-size: 10pt">(1,134,565</span></td> <td><span style="font-size: 10pt">)</span></td></tr> <tr id="xdx_40B_eus-gaap--OperatingLeaseLiability_iI_pp0p0_zA6uvIIaEIUg" style="vertical-align: bottom; background-color: #EEEEEE"> <td><span style="font-size: 10pt">Present value of lease liabilities</span></td> <td> </td> <td style="border-bottom: black 2.25pt double"><span style="font-size: 10pt">$</span></td> <td style="border-bottom: black 2.25pt double; text-align: right"><span style="font-size: 10pt">9,586,788</span></td> <td> </td></tr> </table> 1550310 2510815 2080331 1533918 1586572 1459407 1134565 9586788 <p id="xdx_807_eus-gaap--SubsequentEventsTextBlock_zMNH2RxY6fyb" style="font: 10pt Times New Roman, Times, Serif; margin: 0"><b>Note 20 - <span id="xdx_82D_zZHGW2nKP829">Subsequent events</span></b></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">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. Other than as disclosed in Note 12 above, no material subsequent events that required recognition or additional disclosure in the consolidated financial statements presented herein.</p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"/> The total fair value was based on the current stock price on the grant date.