Termination of Vie Agreements with Shareholders of 39PU

12 Months Ended

Jun. 30, 2023

Termination of Vie Agreements with Shareholders of 39PU [Abstract]

TERMINATION OF VIE AGREEMENTS WITH SHAREHOLDERS OF 39PU

4. TERMINATION OF VIE AGREEMENTS WITH SHAREHOLDERS OF 39PU

On August 3, 2022, the Company and Guangzhou Baogu Trading Co., Ltd. (the “Gaogu”) entered into certain share purchase agreement (the “Disposition SPA”). Pursuant to the Disposition SPA, Baogu agreed to purchase 51% of the issued and outstanding shares of 39Pu, which is controlled by the Company through VIE Agreements, in exchange for cash consideration of RMB 8 million. Upon the closing of the transaction contemplated by the Disposition SPA, Baogu will become the majority shareholder of 39 Pu and as a result, assume all assets and liabilities of 39 Pu. The disposition was closed on August 4, 2022.

In accordance with ASC 205-20-45, 39Pu met the criteria as a discontinued operation as June 30, 2022. As of June 30, 2022 and 2021, the assets and liabilities relevant to the sale of 39Pu were classified as assets of discontinued group and the liabilities of discontinued group, respectively. The net income or loss of 39Pu were recognized as the “net (loss) income from discontinued operations” in the consolidated statements of operations and comprehensive loss for the years ended June 30, 2022, 2021 and 2020.

The following is a reconciliation of the carrying amounts of major classes of assets and liabilities held for sale in the consolidated balance sheet as of June 30, 2023 and 2022:

	June 30, 2023		June 30, 2022
ASSETS
Cash	$	-	$	44,078
Short-term investments		-		647,819
Trade receivables		-		374,697
Inventories		-		723,199
Other current assets		-		108,301
Goodwill		-		-
Property and equipment, net		-		938,408
Intangible assets		-		1,672
Right of use assets		-		234,047
Total Assets	$	-	$	3,072,221
LIABILITIES
Other current liabilities	$	-	$	51,818
Income tax payable		-		142,447
Lease liabilities		-		124,263
Total Liabilities	$	-	$	318,528

The following is a reconciliation of the amounts of major classes of income from operations classified as discontinued operations in the consolidated statements of operations and comprehensive loss for the years ended June 30, 2023, 2022 and 2021: 

	For the Years Ended June 30,
	2023			2022			2021
Revenue	$	102,580		$	1,672,504		$	5,353,166
Cost of revenues		(12,510	)		(1,326,413	)		(3,571,175	)
General and administrative expenses		(50,810	)		(2,790,108	)		(1,619,508	)
Impairment of goodwill		-			(9,573,081	)		-
Other income (expenses)		629			(459,473	)		166,269
Income tax expenses		-			-			(145,542	)
Net (loss) income from discontinued operations	$	39,889		$	(12,476,571	)	$	183,210