Leases

9 Months Ended

Mar. 31, 2024

Leases [Abstract]

LEASES

NOTE 7. LEASES

In April 2021, Qingguo entered into an operating cooperation agreement with Hohhot Aihua Traditional Chinese Medicine Hospital. Under the terms Qingguo was able to use office space (approximately 700 square meters) free of charge during the period between April 1, 2021 to March 31, 2026. On May 27, 2022, the agreement was amended to provide for the lease of this office space under a non-cancellable operating lease agreement. Under terms of the lease agreement, from May 27, 2022, Qingguo was committed to make lease payments of approximately $9,295 per year for 1 year. On August 31, 2023, the lease agreement was terminated.

On July 2, 2022 the Company leased a staff dormitory under a non-cancellable operating lease agreement with a third party, Xi Ling. Under the terms of the agreement, the Company was committed to make total lease payments of $20,561, or RMB 150,000, with lease payments of $6,854 per year for the lease period from July 2, 2022 to July 2, 2025. On June 30, 2023, the agreement was terminated.

On April 4, 2023, Chengheng leased office space (approximately 957 square meters) under an operating lease agreement with Jinrong Holding (Hainan) Group Co., LTD. Inner Mongolia branch. Under the terms of the agreement as supplemented October 3, 2023, Chengheng was committed to make lease payments of approximately $7,062, or RMB 50,000, from January 1, 2024 to March 31, 2024. On April 1, 2024, Chengheng entered into a lease agreement with Ding Jun. Under the terms of the new lease, Chengheng is able to use office space (approximately 451 square meters) free of charge during the period from April 1, 2024 to May 31, 2024. After lessor completes the decoration of the office space, the parties are to sign a new lease agreement.

On August 31, 2023, Qingguo leased office space (approximately 482 square meters) under an operating lease agreement with Inner Mongolia Chuangfuhui Enterprise Management Co., Ltd. Under the terms of the agreement, Qingguo is committed to make lease payments of approximately $30,157 (RMB 220,000) for the period between September 10, 2023 and September 10, 2024.

Leases with an initial term of 12 months or less are not recorded on the balance sheet. Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in selling, general and administrative expenses. For lease agreements entered into or reassessed after the adoption of Topic 842, the Company did not combine lease and non-lease components.

Most leases do not include options to renew. The exercise of lease renewal options has to be agreed to by the lessors. The depreciable life of assets and leasehold improvements are limited by the term of the respective leases, unless there is a transfer of title or a purchase option reasonably certain of exercise. Lease expense is recognized on a straight-line basis over the term of the lease. Lease expense related to noncancelable operating leases was $0 and $57,687 for the nine months ended March 31, 2024 and 2023, respectively.

Balance sheet information related to the Company’s leases is presented below:

	March 31, 2024		June 30, 2023
Assets
Operating lease right of use assets	$	-	$	13,470
Liabilities
Operating lease liabilities – current	$	-	$	6,579
Operating lease liabilities – non-current		-		6,891
Total Operating lease liabilities	$	-	$	13,470