Operating Lease

12 Months Ended

Jun. 30, 2022

Leases Of Lessee Disclosures Abstract

OPERATING LEASE

10. OPERATING LEASE

As of June 30, 2022, the Company leases offices space and tea shop stores under certain non-cancelable operating leases, with terms matured through December 2023.

The Company considers those renewal or termination options that are reasonably certain to be exercised in the determination of the lease term and initial measurement of right of use assets and lease liabilities. Lease expense for lease payment is recognized on a straight-line basis over the lease term.

The Company determines whether a contract is or contains a lease at inception of the contract and whether that lease meets the classification criteria of a finance or operating lease. When available, the Company uses the rate implicit in the lease to discount lease payments to present value; however, most of the Company’s leases do not provide a readily determinable implicit rate. Therefore, the Company discount lease payments based on an estimate of its incremental borrowing rate.

The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The table below presents the operating lease related assets and liabilities recorded on the balance sheets.

	June 30,  2022		June 30,  2021
Rights of use lease assets	$	120,043	$	183,908
Operating lease liabilities, current		86,547		147,205
Operating lease liabilities, noncurrent		17,820		17,990
Total operating lease liabilities	$	104,367	$	165,015

The weighted average remaining lease terms and discount rates for all of operating leases were as follows as of June 30, 2022 and 2021:

	June 30,  2022			June 30,  2021
Remaining lease term and discount rate
Weighted average remaining lease term (years)		1.13			2.10
Weighted average discount rate		4.75	%		4.75	%

Rent expense for the years ended June 30, 2022, 2021, and 2020 was $164,454, $226,055, and $377,261, respectively.

The following is a schedule, by years, of maturities of lease liabilities as of June 30, 2022:

Twelve months ended June 30,	Lease payment
2023	$	86,977
2024		20,113
Total lease payments		107,090
Less: imputed interest		(2,723	)
Present value of lease liabilities	$	104,367