10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from              to             

Commission File No. 333-108715

Joway Health Industries Group Inc.

(Exact Name of Registrant as Specified in Its Charter)

Nevada	98-0221494
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
No. 2, Baowang Road, Baodi Economic Development Zone, Tianjin, PRC 301800	86-22-22533666
(Address of Principal Executive Offices)	(Issuer’s Telephone Number)

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act: None

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock par value $0.001 per share	GTVI	OTCPink marketplace of OTC Markets Inc.

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

(Note: The registrant is a voluntary filer of reports under Section 13 or 15(d) of the Securities Exchange Act of 1934 and has filed during the preceding 12 months all reports it would have been required to file by Section 13 or 15(d) of the Securities Exchange Act of 1934 if the registrant had been subject to one of such Sections.)

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: The number of shares outstanding of the Issuer’s Common Stock as of August 14, 2020 was 20,054,000 shares.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION	1
Item 1. Financial Statements	1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3. Quantitative and Qualitative Disclosures About Market Risk	28
Item 4. Controls and Procedures	29
PART II - OTHER INFORMATION	30
Item 1. Legal Proceedings	30
Item 1A. Risk Factors	30
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3. Defaults Upon Senior Securities	30
Item 4. Mine Safety Disclosures	30
Item 5. Other Information	30
Item 6. Exhibits	30
SIGNATURES	31

i

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements included in this Form 10-Q reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the results of operations for the periods presented. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.

INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

	Page
Condensed Consolidated Balance Sheets as of June 30, 2020 (Unaudited) and December 31, 2019	2
Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the Three and the Six Months Ended June 30, 2020 and 2019 (Unaudited)	3
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2020 and 2019 (Unaudited)	4
Notes to Unaudited Condensed Consolidated Financial Statements	5-18

1

JOWAY HEALTH INDUSTRIES GROUP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

	June 30,			December 31,
	2020			2019
	(Unaudited)			(Audited)
ASSETS
CURRENT ASSETS:
Cash	$	48,631		$	99,979
Other receivables		32,883			28,740
Inventories		481,476			500,269
Advances to suppliers		80,981			56,418
Prepaid taxes		97,595			97,381
Total current assets		741,566			782,787
PROPERTY, PLANT AND EQUIPMENT, net		3,135,040			3,377,361
OTHER ASSETS:
Intangible assets, net		434,409			448,033
Total other assets		434,409			448,033
Total assets	$	4,311,015		$	4,608,181
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	88,802		$	92,071
Advances from customers		11,718			21,734
Other payables		94,695			55,792
Due to related parties		1,734,948			1,480,515
Total current liabilities		1,930,163			1,650,112
COMMITMENTS		-			-
STOCKHOLDERS’ EQUITY:
Preferred stock - par value $0.001; 1,000,000 shares authorized; no shares issued and outstanding		-			-
Common stock - par value $0.001; 200,000,000 shares authorized; 20,054,000 shares issued and outstanding at June 30, 2020 and December 31, 2019		20,054			20,054
Additional paid-in-capital		7,361,665			7,361,665
Statutory reserves		354,052			354,052
Accumulated deficit		(5,798,566	)		(5,264,040	)
Accumulated other comprehensive income		443,647			486,338
Total stockholders’ equity		2,380,852			2,958,069
Total liabilities and stockholders’ equity	$	4,311,015		$	4,608,181

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

2

JOWAY HEALTH INDUSTRIES GROUP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(UNAUDITED)

	Three months ended June 30,						Six months ended June 30,
	2020			2019			2020			2019
REVENUES	$	67,902		$	171,379		$	82,118		$	310,250
COST OF REVENUES		37,729			82,759			45,751			152,163
GROSS PROFIT		30,173			88,620			36,367			158,087
Selling expenses		23,893			84,605			45,866			168,933
General and administrative expenses		203,092			276,482			523,919			632,010
OPERATING EXPENSES		226,985			361,087			569,785			800,943
LOSS FROM OPERATIONS		(196,812	)		(272,467	)		(533,418	)		(642,856	)
Interest income		24			44			44			88
Other income		-			-			1			11
Other expenses		(309	)		(127	)		(1,153	)		(1,290	)
OTHER EXPENSES, NET		(285	)		(83	)		(1,108	)		(1,191	)
LOSS BEFORE INCOME TAXES		(197,097	)		(272,550	)		(534,526	)		(644,047	)
INCOME TAX		-			-			-			-
NET LOSS		(197,097	)		(272,550	)		(534,526	)		(644,047	)
OTHER COMPREHENSIVE INCOME (LOSS):
Foreign currency translation adjustment		1,436			(90,110	)		(42,691	)		13,670
COMPREHENSIVE LOSS	$	(195,661	)	$	(362,660	)	$	(577,217	)	$	(630,377	)
NET LOSS PER COMMON SHARE, BASIC AND DILUTED	$	(0.01	)	$	(0.02	)	$	(0.03	)	$	(0.03	)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING, BASIC AND DILUTED		20,054,000			20,054,000			20,054,000			20,054,000

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

3

JOWAY HEALTH INDUSTRIES GROUP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Six months ended June 30,
	2020			2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(534,526	)	$	(644,047	)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation		196,237			208,149
Amortization		7,134			9,672
Changes in operating assets and liabilities:
Other receivables		(5,129	)		20,499
Inventories		20,355			(28,197	)
Advances to suppliers		(24,563	)		79,204
Prepaid expense		-			872
Accounts payable		(3,269	)		(3,317	)
Advances from customers		(10,016	)		(93,174	)
Other payable		21,027			370
Salary and welfare payable		17,876			(8,308	)
Taxes payable		(214	)		(10,231	)
Net cash used in operating activities		(315,088	)		(468,508	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment		-			(89,235	)
Net cash used in investing activities		-			(89,235	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds of due to related parties		254,433			544,898
Net cash provided by financing activities		254,433			544,898
EFFECT OF EXCHANGE RATE CHANGES ON CASH		9,307			5,583
NET DECREASE IN CASH		(51,348	)		(7,262	)
CASH, beginning of period		99,979			118,996
CASH, end of period	$	48,631		$	111,734
SUPPLEMENTAL DISCLOSURES:
Income taxes paid	$	-		$	-
Interest paid	$	-		$	-

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

4

JOWAY HEALTH INDUSTRIES GROUP INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – ORGANIZATION

The unaudited condensed consolidated financial statements include the financial statements of Joway Health Industries Group Inc. (referred to herein as “Joway Health”), its subsidiaries, and variable interest entities (“VIEs”) where Joway Health is deemed the primary beneficiary. Joway Health, its subsidiaries and VIEs are collectively referred to herein as the “Company”, “we” and “us”.

Joway Health (formerly G2 Ventures, Inc.) was originally incorporated under the laws of the State of Texas on March 21, 2003. On September 21, 2010, Joway Health entered into a Share Exchange Agreement (the “Share Exchange”) with the sole stockholder of Dynamic Elite International Limited. As a result of the Share Exchange, Dynamic Elite became a wholly-owned subsidiary of Joway Health and the stockholders of Dynamic Elite acquired approximately 76.08% of the issued and outstanding stock of Joway Health. The share exchange transaction resulted in the shareholders of Dynamic Elite acquiring a majority voting interest in Joway Health. Generally accepted accounting principles in the United States of America require that the company whose shareholders retain the majority interest in the combined business be treated as the acquirer for accounting purposes. The reverse acquisition process utilizes the capital structure of Joway Health and the assets and liabilities of Dynamic Elite recorded at historical cost. On December 22, 2010, Joway Health changed its jurisdiction of incorporation from the State of Texas to the State of Nevada.

Dynamic Elite International Limited (referred to herein as “Dynamic Elite”) was incorporated under the laws of the British Virgin Islands on June 2, 2010 as a limited liability company (a BVI company). Dynamic Elite engages in manufacturing and distributing tourmaline products in China. Its wholly owned subsidiary, Tianjin Junhe Management Consulting Co., Ltd. was incorporated on September 15, 2010 in Tianjin, People’s Republic of China (“PRC”). Other than the equity interest in Junhe Consulting, Dynamic Elite does not own any assets or conduct any operations.

Tianjin Junhe Management Consulting Co., Ltd. (referred to herein as “Junhe Consulting”) conducts its business through Tianjin Joway Shengshi Group Co., Ltd. that is consolidated as a variable interest entity.

Tianjin Joway Shengshi Group Co., Ltd. (referred to herein as “Joway Shengshi”) was incorporated in PRC on May 17, 2007. Joway Shengshi is currently owned 99% by Jinghe Zhang, the Company’s current CEO and President and 1% by Song Baogang. Joway Shengshi engages in manufacturing and distributing tourmaline products in China. Shenyang Joway Electronic Technology Co., Ltd., Tianjin Joway Decoration Engineering Co., Ltd. and Tianjin Oriental Shengtang Trading Import & Export Trading Co., Ltd are subsidiaries of Joway Shengshi.

Shenyang Joway Electronic Technology Co., Ltd. (referred to herein as “Joway Technology”) was originally named Liaoning Joway Technology Engineering Co., Ltd. which was incorporated on March 28, 2007 in PRC. The name was changed on June 22, 2011. It engages in the distribution of Tourmaline Activated Water Machines and Tourmaline Wellness Houses. Prior to July 25, 2010, Joway Shengshi owned 90.91% of Joway Technology. Joway Shengshi entered into a share acquisition agreement with Jingyun Chen, another stockholder of Joway Technology on July 25, 2010 to acquire the remaining 9.09% of the share of Joway Technology. As a result of the share acquisition, Joway Technology became a wholly-owned subsidiary of Joway Shengshi.

Tianjin Joway Decoration Engineering Co., Ltd. (referred to herein as “Joway Decoration”) was incorporated on April 22, 2009 in PRC. It engages in the distribution of Tourmaline Activated Water Machines, Tourmaline Wellness House for family use and Tourmaline Wellness House materials. Prior to July 9, 2010, Joway Shengshi owned 90% of Joway Decoration. Joway Shengshi entered into a share acquisition agreement with Jingyun Chen, another stockholder of Joway Decoration on July 9, 2010 to acquire the remaining 10% of the shares of Joway Decoration. As a result of the share acquisition, Joway Decoration became a wholly-owned subsidiary of Joway Shengshi. Jingyun Chen is currently the General Manager of Joway Decoration.

5

Tianjin Oriental Shengtang Import & Export Trading Co., Ltd (referred to herein as “Shengtang Trading”) was incorporated on September 18, 2009 in the PRC. It engages in purchasing raw materials which it sells to other companies of the group. Prior to July 28, 2010, Joway Shengshi owned 95% of Shengtang Trading. Joway Shengshi entered into a share acquisition agreement with Wang Aiying, another stockholder of Shengtang Trading on July 28, 2010 to acquire the remaining 5% of the shares of Shengtang Trading. As a result of the share acquisition, Shengtang Trading became a wholly-owned subsidiary of Joway Shengshi.

The following table lists the Company and its subsidiaries:

Name	Domicile and Date of Incorporation	Paid in Capital	Percentage of Effective Ownership	Principal Activities
Joway Health Industries Group Inc.	March 21, 2003, Nevada	USD 20,054	86.8% owned by Crystal Globe Limited 13.2%owned by other institutional and individual investors	Investment Holding
Dynamic Elite International Limited	June 2, 2010, British Virgin Islands	USD 10,000	100% owned by Joway Health Industries Group Inc.	Investment Holding
Tianjin Junhe Management Consulting Co., Ltd.	September 15, 2010, PRC	USD 20,000	100% owned by Dynamic Elite International Limited	Advisory
Tianjin Joway Shengshi Group Co., Ltd.	May 17, 2007, PRC	USD 7,216,140.72	99% owned by Jinghe Zhang,  and 1% owned  by Baogang Song	Production and distribution of Healthcare Knit Goods and Daily Healthcare and Personal Care products
Shenyang Joway Electronic Technology Co., Ltd.	March 28, 2007, PRC	USD 142,072.97	100% owned by Tianjin Joway Shengshi Group Co., Ltd	Distribution of Tourmaline Activated Water Machine and construction of Tourmaline Wellness House
Tianjin Joway Decoration Engineering Co., Ltd.	April 22, 2009, PRC	USD 292,367.74	100% owned by Tianjin Joway Shengshi Group Co., Ltd	Distribution of Wellness House for family use and Activated Water Machine and construction of Tourmaline Wellness House
Tianjin Oriental Shengtang Import & Export Trading Co., Ltd.	September 18, 2009, PRC	USD 292,463.75	100% owned by Tianjin Joway Shengshi Group Co., Ltd	Distribution of tourmaline products

6

On September 16, 2010, prior to the share exchange, Junhe Consulting entered into a series of contractual agreements (the “Contractual Agreements”) with Joway Shengshi and Joway Shengshi’s owners. The following is a brief description of the Contractual Agreements entered into between Junhe Consulting and Joway Shengshi or Joway Shengshi’s owners:

1. Consulting Services Agreement. Pursuant to the consulting services agreement between Junhe Consulting and Joway Shengshi, Junhe Consulting has the right to advise, consult, manage and operate Joway Shengshi, and collect and own all of the net profits of the Operating Entities.

2. Operating Agreement. Under the operating agreement between Junhe Consulting and Joway Shengshi, Junhe Consulting has the right to recommend director candidates and appoint the senior executives of Joway Shengshi, approve any transactions that may materially affect the assets, liabilities, rights or operations of Joway Shengshi, and guarantee the contractual performance by Joway Shengshi of any agreements with third parties, in exchange for a pledge by Joway Shengshi of its accounts receivable and assets.

3. Voting Rights Proxy Agreement. Under the voting rights proxy agreement between Joway Shengshi’s owners and Junhe Consulting, the owners of Joway Shengshi have vested their collective voting control over Joway Shengshi to Junhe Consulting and will only transfer their respective equity interests in Joway Shengshi to Junhe Consulting or its designee.

4. Option Agreement. Under the option agreement between Joway Shengshi’s owners and Junhe Consulting, the owners of Joway Shengshi have granted Junhe Consulting the irrevocable right and option to acquire all of their equity interests in Joway Shengshi.

5. Equity Pledge Agreement. Under the equity pledge agreement between Joway Shengshi’s owners and Junhe Consulting, the owners of Joway Shengshi have pledged all of their rights, titles and interests in Joway Shengshi to Junhe Consulting to guarantee Joway Shengshi’s performance of its obligations under the Consulting Services Agreement.

As a result of the Contractual Agreements, Joway Shengshi is effectively a variable interest entity of Junhe Consulting. Accordingly, the Company through its wholly-owned subsidiary Junhe Consulting, consolidates Joway Shengshi’s results of operation, assets and liabilities in its financial statements.

In connection with the Share Exchange and as consideration for entering into the VIE Agreements, Jinghe Zhang and Baogang Song, the shareholders of Joway Shengshi (the “Grantees”), entered into a Call Option Agreement, dated July 20, 2010 with Lionel Evan Liu (the “Grantor”), the sole shareholder of Crystal Globe (the controlling shareholder of Dynamic Elite), a British Virgin Islands company (the “Call Option Agreement”), pursuant to which the Grantees had the right to purchase up to 100% of the shares of Crystal Globe (the “Call Option”) at an exercise price of $2.00 per share (the “Exercise Price”) for a period of five years. The Call Option vested as to 34% of the shares of Crystal Globe on April 2, 2011 and as to 33% on each of April 2, 2012 and 2013 (the respective “Call Option Effective Date”). On March 28, 2015, the Grantor and Grantees amended the Call Option Agreement, to (i) reduce the Exercise Price to $0.00 per share and (ii) extend the Grantees’ rights to exercise their call option within ten years from the respective Option Effective Date.

On November 13, 2016, Jinghe Zhang exercised the Call Option as to 99% of the shares of Crystal Globe and Baogang Song exercised his Call Option as to 1% of the shares of Crystal Globe. As a result of exercising the Call Option, Jinghe Zhang became the controlling shareholder of Crystal Globe and in turn, the controlling shareholder of the Company. On November 20, 2016, Baogang Song transferred 1% of the shares of Crystal Globe to Jinghe Zhang. Consequently, Jinghe Zhang controls 17,408,000 shares, or 86.8%, of the issued and outstanding shares of the Company’s common stock.

On May 15, 2019, Joway Shengshi’s 100% owned subsidiary, Joway Decoration, declared and distributed a one-time dividends of RMB 6.29 million or $927,192.54. The dividend was used to offset a loan between Joway Shengshi and Joway Decoration.

7

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). Accordingly, they do not include all of the information and the footnotes required by generally accepted accounting principles for complete financial statements. The Company’s functional currency is the Chinese Renminbi (“RMB”); however, the accompanying unaudited condensed consolidated financial statements have been translated and presented in United States Dollars (“USD”). All significant inter-company transactions and balances have been eliminated. The consolidated financial statements include all adjustments that, in the opinion of management, are necessary to make the financial statements not misleading.

Operating results for the six month period ended June 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s form 10-K for the fiscal year ended December 31, 2019 which was filed on March 31, 2020.

Use of Estimates

The preparation of the consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made. Actual results could differ from those estimates.

Basis of Consolidation

The accompanying consolidated financial statements include the Company and its wholly owned subsidiaries and controlled VIEs. All significant inter-company accounts and transactions have been eliminated in the consolidation.

Pursuant to Accounting Standards Codification Topic 810 “Consolidation” (“ASC 810”), the Company is required to include in its consolidated financial statements the financial statements of its variable interest entities (“VIEs”). ASC 810 requires a VIE to be consolidated by a company if that company is subject to a majority of the risk of loss for the VIE or is entitled to receive a majority of the VIE’s residual returns. VIEs are those entities in which a company, through contractual arrangements, bears the risk of, and enjoys the rewards normally associated with ownership of the entity, and therefore the company is the primary beneficiary of the entity.

Based on the various Contractual Agreements, the Company is able to exercise control over the VIEs, and to obtain the full economic benefits. The terms of the exclusive option agreement are currently exercisable and legally enforceable under PRC laws and regulations. The minimum amount of consideration permitted by the applicable PRC law to exercise the option does not represent a financial barrier or disincentive for the Company to exercise its rights under the exclusive option agreement. A simple majority vote of the Company’s board of directors is required to pass a resolution to exercise its rights under the exclusive option agreement, for which consent of the shareholder of VIEs is not required. Therefore, this gives the Company the power to direct the activities that most significantly impact VIEs’ economic performance. The Company’s ability to exercise effective control, together with the consulting service agreements and the equity pledge agreements, give the Company the rights to receive substantially all of the economic benefits from VIEs in consideration for the services provided by its wholly owned subsidiaries in China. Accordingly, as the primary beneficiary of VIEs and in accordance with U.S. GAAP, Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading, as VIEs of Junhe Consulting, has been consolidated in the Company’s financial statements. Sales from Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading are included in the Company’s total sales, their incomes or losses from operations are consolidated with the Company’s, and the Company’s net income or loss includes net income or loss from Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading.

8

Foreign Currency Translation

The accompanying consolidated financial statements are presented in USD. The functional currency of the Company is RMB. The consolidated financial statements are translated into United States dollars from RMB at period-end exchange rates as to assets and liabilities and average exchange rates as to revenues and expenses. Equity accounts are translated at their historical exchange rates when the equity transactions occurred. The resulting transaction adjustments are recorded as a component of stockholders’ equity. Gains and losses from foreign currency transactions are included in net income.

	For the six months ended June 30,				For the year ended December 31,
	2020		2019		2019
Period ended RMB: USD Exchange rate		7.0795		6.86557		6.9762
Average RMB: USD Exchange rate		7.0319		6.78392		6.8985

The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into USD at the rates used in translation.

Foreign currency translation adjustments have been reported as comprehensive income (loss) in the consolidated financial statements and totaled $1,436 and $(90,110) for the three months ended June 30, 2020 and 2019, respectively, and $(42,691) and $13,670 for the six months ended June 30, 2020 and 2019, respectively.

Other Comprehensive Income

Other comprehensive income is defined as the change in equity during the period from transactions and other events, excluding the changes resulting from investments by owners and distributions to owners, and is not included in the computation of income tax expense or benefit. Accumulated other comprehensive income represents the accumulated balance of foreign currency translation adjustments.

Concentrations of Credit Risk

The Company’s operations are carried out in the PRC. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC’s economy. The Company’s operations in the PRC are subject to specific considerations and significant risks not typically associated with companies in North America. The Company’s results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash. Substantially all of the Company’s cash is maintained with state-owned banks within the PRC, and no deposits are covered by insurance. The Company has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts.

Fair Value of Financial Instruments

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

● Level 1—defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

● Level 2—defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and

● Level 3—defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying amounts reported in the balance sheets for cash, accounts receivable, other receivable, accounts payable, other payable, and amounts due from related parties generally approximate their fair market values based on the short-term maturity of these instruments. ASC 825-10 “Financial Instruments” allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding instruments.

9

Cash

For financial reporting purposes, the Company considers all highly liquid financial instruments with an original maturity of three months or less to be cash equivalents. The Company had no cash equivalents at any point during the period of the financial statements presented. Balances at financial institutions or state-owned banks within the PRC are not covered by insurance. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risks on its cash in bank accounts.

Accounts Receivable

Accounts receivable are presented net of an allowance for doubtful accounts. The Company maintains allowances for doubtful accounts for estimated losses. On a periodic basis, the Company reviews the composition of the accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these allowances. Accounts are written off after exhaustive efforts at collection. As of June 30, 2020 and December 31, 2019, based on a review of its outstanding balances, the Company allowance $2,553 and $2,591 for doubtful accounts, respectively.

Inventories

Inventories are stated at the lower of cost, as determined by the specific identification method on contract level (for each individual contract, inventories cost flow are determined by weighted-average method), or the net realizable value, which is determined on selling prices less any further costs expected to be incurred for completion and disposal. The Company regularly evaluates the composition of its inventories to identify slow-moving and obsolete inventories to determine whether a valuation allowance is required. As of June 30, 2020 and December 31, 2019, the Company recorded $105,435 and $106,997 for inventory valuation allowance, respectively.

Advances to Suppliers

Advances to suppliers represent the cash paid in advance for inventory items or construction in progress. The advance payments are meant to ensure preferential pricing and delivery. The amounts advanced under such arrangements totaled $87,146 and $62,674 as of June 30, 2020 and December 31, 2019, respectively.

Property, Plant, and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation, and include expenditures that substantially increase the useful lives of existing assets.

Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Estimated useful lives are as follows:

Building	20 years
Operating Equipment	10 years
Office furniture and equipment	3 or 5 years
Vehicles	10 years

10

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts, and any gain or loss is included in the consolidated statements of operations. Maintenance, repairs and minor renewals are charged directly to expenses as incurred. Significant renewals and betterment to buildings and equipment are capitalized. Leasehold improvements are depreciated over the lesser of the useful life or the life of the lease.

Intangible Assets

Intangible assets mainly consist of land use rights. All land located in the PRC is owned by the government and cannot be sold to any individual or company. The land use rights granted to the Company are being amortized using the straight-line method over the lease term of 50 years. Other intangible assets are software programs that are amortized over their estimated useful life of 10 years.

Impairment of Long-lived Assets

Long-lived assets of the Company are reviewed annually as to whether their carrying value has become impaired, pursuant to the guidelines established in FASB ASC 360. The Company considers assets to be impaired if the carrying value exceeds the future projected cash flows from the related operations. The Company also re-evaluates the periods of depreciation and amortization to determine whether subsequent events and circumstances warrant revised estimates of useful lives. The Company did not record any impairment loss for the six months ended June 30, 2020 and 2019.

Revenue Recognition

The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the purchase price is fixed or determinable and collectability is reasonably assured.

With respect to sales of product to both franchisee and non-franchisee customers, the Company prepares product shipments upon the receipt of a customer’s purchase order. Sales prices are based on fixed price lists that are different depending on whether the price list is for a franchisee customer or for non-franchisee customers. The Company recognizes revenue when the product is shipped. The Company does not sell product to any customers with a right of return as defined in ASC 605-15-25-4. Sales are presented net of value added tax (“VAT”).

For Tourmaline Wellness House sales, the Company recognizes revenue under the completed contract method. Customers contact the Company with requests to construct a Wellness House. The Company and the customer enter into a contract, at which time the customer pays a deposit of at least one-half of the sales price. A contract is considered completed when all significant costs have been incurred and the project has been accepted by the customer. The contracts have a place for the customer to sign indicating their acceptance of the completed Wellness House. At this time the customer will also pay any remaining balance on the contract. The Company recognizes the full contract revenue at this point. Contract costs consist primarily of materials and labor costs. The construction period of a Wellness House generally does not exceed five days.

Shipping Costs

Shipping costs are included in selling expenses and totaled $11,189 and $11,575 for the three months ended June 30, 2020 and 2019, respectively, and $15,078 and $28,971 for the six months ended June 30, 2020 and 2019, respectively.

Income Taxes

The Company is governed by the Income Tax Law and associated legislations of the PRC. The Company accounts for income taxes in accordance with FASB ASC 740 “Income Taxes”, which is an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s financial statements or tax returns. ASC 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets is dependent upon future earnings, if any, of which the timing and amount are uncertain.

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According to ASC 740, the evaluation of a tax position is a two-step process. The first step is to determine whether it is more likely than not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigation based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50% likelihood of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. ASC 740 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures, and transition.

Basic and Diluted Earnings per Share

The Company reports earnings per share in accordance with FASB ASC 260 “Earnings per share”. The Company’s basic earnings per share are computed using the weighted average number of shares outstanding for the periods presented. Diluted earnings per share are computed based on the assumption that any dilutive options or warrants were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, the Company’s outstanding stock warrants are assumed to be exercised, and funds thus obtained were assumed to be used to purchase common stock at the average market price during the period. There were no dilutive instruments outstanding during the six months periods ended June 30, 2020 and 2019.

Segment Information

The Company follows FASB ASC 280-Segment Reporting, which requires that companies disclose segment data based on how management makes decision about allocating resources to segments and evaluating their performance.

For the six months ended June 30, 2020 and the year ended December 31, 2019, management has determined that the Company is operating in three reportable business segments, (1) Healthcare Knit Goods Series, (2) Daily Healthcare and Personal Care Series, and (3) Wellness House and Activated Water Machine Series. The Company’s reportable segments are strategic business units that offer different products. They are managed separately based on the fundamental differences in their operations.

Recently Issued Accounting Pronouncements

In December 2019, the FASB issued a new standard to simplify the accounting for income taxes. The guidance eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences related to changes in ownership of equity method investments and foreign subsidiaries. The guidance also simplifies aspects of accounting for franchise taxes and enacted changes in tax laws or rates, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. We believe that adoption of this new standard will not have material impact in our consolidated financial statements, including accounting policies, processes, and systems.

In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The guidance should be adopted on a prospective basis for the annual or any interim goodwill impairment tests beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company adopted the standard in 2019. Adoption of the standard did not have a significant impact on the Company’s consolidated statement of earnings in 2019.

In June 2018, the FASB issued ASU 2018-07, “Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting,” which simplifies the accounting for share-based payments granted to nonemployees for goods and services and aligns most of the guidance on such payments to nonemployees with the requirements for share-based payments granted to employees. ASU 2018-07 becomes effective for the Company on January 1, 2019. Early adoption is permitted. The Company adopted the standard in 2019. Adoption of the standard did not have a significant impact on the Company’s consolidated statement of earnings in 2019.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The standard outlined a comprehensive lease accounting model that superseded the previous lease guidance and required lessees to recognize lease liabilities and corresponding right-of-use assets for all leases with lease terms greater than 12 months. The guidance also changed the definition of a lease and expanded the disclosure requirements of lease arrangements. The Company adopted the standard on December 15, 2019. Adoption of the standard did not have a significant impact on the Company’s consolidated statement of earnings in 2019.

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In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326), which requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application will be permitted for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company adopted the standard in 2019. Adoption of the standard did not have a significant impact on the Company’s consolidated statement of earnings in 2019.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the SEC did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statements.

NOTE 3 – GOING CONCERN

The accompanying unaudited condensed financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As reflected in the accompanying unaudited condensed financial statements, the Company has an accumulated deficit of approximately $5,800,000 and a working capital deficit of approximately $1,189,000 at June 30, 2020. In addition, the Company continues to generate operating losses and negative cash flows from operations. This raises substantial doubt about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company’s ability to raise additional capital. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Management intends to provide the Company with additional loans as needed. Management feels these actions provide the opportunity for the Company to continue as a going concern.

NOTE 4 – ACCOUNTS RECEIVABLE

Accounts receivable consisted of the following:

	June 30,			December 31,
	2020			2019
Accounts receivable	$	2,553		$	2,591
Less: allowance for bad debt		(2,553	)		(2,591	)
Accounts receivable, net	$	-		$	-

As of June 30, 2020 and December 31, 2019, the Company allowance $2,553 and $2,591 for doubtful accounts, respectively.

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NOTE 5 – INVENTORIES

Inventories consisted of the following:

	June 30,			December 31,
	2020			2019
Raw materials	$	119,027		$	126,563
Finished goods		431,889			444,175
Low value consumables		35,995			36,528
Total		586,911			607,266
Less: impairment loss		(105,435	)		(106,997	)
Inventory, net	$	481,476		$	500,269

Low value consumables represent low priced and easily worn articles and are amortized on equal-split amortization method. Pursuant to this method, half value of the low value consumable should be amortized once used and the remaining half value should be amortized when disposed of.

As of June 30, 2020 and December 31, 2019, the Company recognized $105,435 and $106,997, respectively, as a reserve for impairment loss from inventory.

NOTE 6 – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consisted of the following:

	June 30,			December 31,
	2020			2019
Building	$	5,624,223		$	5,707,503
Operating Equipment		412,929			419,044
Office furniture and equipment		334,198			339,147
Vehicles		966,144			980,450
Total		7,337,494			7,446,144
Less: accumulated depreciation		(4,202,454	)		(4,068,783	)
Property, plant and equipment, net	$	3,135,040		$	3,377,361

Depreciation expense for the three months ended June 30, 2020 and 2019 amounted to $97,107 and $102,432, respectively, and for the six months ended June 30, 2020 and 2019 amounted to $196,237 and $208,149, respectively.

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NOTE 7 – INTANGIBLE ASSETS

Intangible assets consisted of the following:

	June 30,			December 31,
	2020			2019
Land use rights	$	583,100		$	591,734
Other intangible assets		74,605			75,710
Total		657,705			667,444
Less: accumulated amortization		(223,296	)		(219,411	)
Intangible assets, net	$	434,409		$	448,033

Amortization expense of intangible assets for the three months ended June 30, 2020 and 2019 was $2,963 and $4,804, respectively, and for the six months ended June 30, 2020 and 2019 amounted to $7,134 and $9,672, respectively.

The estimated amortization expense for the next five years is as follows:

Estimated amortization expense for
the year ending December 31,	Amount
2020	$	19,000
2021	$	19,000
2022	$	19,000
2023	$	19,000
2024	$	19,000
Thereafter	$	353,033

NOTE 8 – RELATED PARTY TRANSACTIONS

Payables due to related parties consist of the following:

	June 30,		December 31,
	2020		2019
Jinghe Zhang	$	1,734,948	$	1,480,515
Total	$	1,734,948	$	1,480,515

Transactions with Shenyang Joway

● Shenyang Joway Industrial Development Co., Ltd. (“Shenyang Joway”) was formed in 2005 in Shenyang, China by Mr. Jinghe Zhang and three other individuals. Mr. Zhang holds more than 50% of the equity in Shenyang Joway. Shenyang Joway was in the business of marketing and distributing clothing and related products to other companies. Through 2009 Shenyang Joway had ceased operations, although it still existed as a legal entity. Shenyang Joway was cancelled in 2019.

● On May 7, 2007, the Company’s subsidiary Joway Shengshi entered into an agreement with Shenyang Joway pursuant to which Joway Shengshi and Shenyang Joway agreed to provide each other with interest-free, unsecured advances for working capital. On May 10, 2007, the Company’s subsidiary Joway Technology and Shenyang Joway entered into an agreement pursuant to which Joway Technology and Shenyang Joway agreed to provide each other with interest-free, unsecured advances for working capital.

● Through December 31, 2008, Joway Technology advanced $58,568 to Shenyang Joway, which was paid off by Shenyang Joway to Joway Technology in 2009.

● Through December 31, 2018, Shenyang Joway advanced an aggregate of $912,645 to Joway Shengshi and Joway Technology, which was paid off by 2019. For the six months ended June 30, 2020 and 2019, the Company repaid $0 and $118,458 of these advances, respectively. As of June 30, 2020, the total unpaid principal balance due Shenyang Joway for advances was $0.

15

Transactions with Jinghe Zhang

● On December 1, 2009, the Company, through its subsidiary Joway Shengshi, entered into a royalty-free license agreement with Jinghe Zhang, our President, Chief Executive Officer and director. Pursuant to the license agreement, we are authorized to use the trademark “Joway” for a term of nine years and five patents from December 1, 2009 till the expiration dates of the patents.

● On May 10, 2007, Joway Shengshi entered into a cash advance agreement with Jinghe Zhang, the Company’s President, Chief Executive Officer and director. Pursuant to the agreement, Jinghe Zhang agreed to advance operating capital to Joway Shengshi. The advances are interest free, unsecured, and have no specified repayment terms. The agreement is valid throughout Joway Shengshi’s term of operation. During the period beginning May 17, 2007 (inception of Joway Shengshi) through June 30, 2020, Joway Shengshi received cash advances in the aggregate principal amount of $6,367,759 from Jinghe Zhang of which $4,632,811 has been repaid. For the six months ended June 30, 2020 and 2019, the Company received $254,433 and $663,356 of these advances, respectively. As of June 30, 2020, the total unpaid principal balance due Jinghe Zhang for advances was $1,734,948.

The amounts owed to related parties are non-interest bearing and have no specified repayment terms.

NOTE 9 – INCOME TAXES

The Company operations in the People’s Republic of China are subject to the Income Tax Law of the People’s Republic of China. Pursuant to the PRC Income Tax Laws, the Company is subject to the Enterprise Income Tax (“EIT”) which is generally a statutory rate of 25% beginning January 2008, on income as reported in its statutory financial statements after appropriate tax adjustments.

The table below summarizes the differences between the PRC statutory federal rate and the Company’s effective tax rate:

	For the six months ended June 30,
	2020			2019
Tax computed at China statutory rates		25	%		25	%
Effect of losses		(25	)%		(25	)%
Effective rate		0	%		0	%

NOTE 10 – STATUTORY RESERVES

Pursuant to the laws and regulations of the PRC, annual income of the Company’s subsidiaries is required to be partly allocated to the statutory reserves funds after the payment of the PRC income taxes. The allocation to the statutory reserves funds should be at least 10% of income after tax until the reserves reaches 50% of the entities’ registered capital or members’ equity. The reserve funds are not transferable to the Company in the form of cash dividends, loans or advances. Thus the reserve funds are not available for distribution except in liquidation. As of June 30, 2020, the Company had allocated $354,052 to statutory reserves.

NOTE 11 – SEGMENTS

In 2020 and 2019, the Company operated in three reportable business segments: (1) Healthcare Knit Goods Series, (2) Daily Healthcare and Personal Care Series and (3) Wellness House and Activated Water Machine Series. The Company's reportable segments are strategic business units that offer different products. They are managed separately based on the fundamental differences in their operations. Information with respect to these reportable business segments is as follows:

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For the three months ended June 30, 2020

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	4,346	$	2,091	$	2,255	$	(12,273	)	$	6,405	$	119,329
Daily Healthcare and Personal Care Series		25,685		13,151		12,534		(73,327	)		37,853		192,597
Wellness House and Activated Water Machine Series		37,871		22,487		15,384		(111,212	)		55,812		198,240
Segment Totals	$	67,902	$	37,729	$	30,173		(196,812	)	$	100,070		510,166
Other Loss, net								(285	)
Income tax benefits								-
Unallocated Assets													3,800,849
Net Loss							$	(197,097	)
Total Assets												$	4,311,015

For the three months ended June 30, 2019

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	15,841	$	4,523	$	11,318	$	(11,214	)	$	9,912	$	142,532
Daily Healthcare and Personal Care Series		51,577		23,556		28,021		(87,371	)		32,273		230,516
Wellness House and Activated Water Machine Series		103,961		54,680		49,281		(173,882	)		65,051		190,719
Segment Totals	$	171,379	$	82,759	$	88,620		(272,467	)	$	107,236		563,767
Other Loss, net								(83	)
Income tax benefits								-
Unallocated Assets													4,390,832
Net Loss							$	(272,550	)
Total Assets												$	4,954,599

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For the six months ended June 30, 2020

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	6,553	$	3,113	$	3,440	$	(64,308	)	$	16,229	$	119,329
Daily Healthcare and Personal Care Series		30,662		15,464		15,198		(190,675	)		75,937		192,597
Wellness House and Activated Water Machine Series		44,903		27,174		17,729		(278,435	)		111,205		198,240
Segment Totals	$	82,118	$	45,751	$	36,367		(533,418	)	$	203,371		510,166
Other Loss, net								(1,108	)
Income tax benefits								-
Unallocated Assets													3,800,849
Net Loss							$	(534,526	)
Total Assets												$	4,311,015

For the six months ended June 30, 2019

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	47,187	$	23,507	$	23,680	$	(98,139	)	$	33,129	$	142,532
Daily Healthcare and Personal Care Series		81,895		38,405		43,490		(167,931	)		57,497		230,516
Wellness House and Activated Water Machine Series		181,168		90,251		90,917		(376,786	)		127,195		190,719
Segment Totals	$	310,250	$	152,163	$	158,087		(642,856	)	$	217,821		563,767
Other Loss, net								(1,191	)
Income tax benefits								-
Unallocated Assets													4,390,832
Net Loss							$	(644,047	)
Total Assets												$	4,954,599

NOTE 12 - FRANCHISE REVENUES

The Company enters into franchising agreements to develop retail outlets for the Company's products. The agreements provide that franchisees will sell Company products exclusively at a predetermined retail price. In exchange the Company provides them with geographic exclusivity, discounted products, training and support. The agreements also require franchisees to adhere to certain standards of product merchandising, promotion and presentment. The agreements also prohibit franchisees from selling competitor’s products. The agreements do not require any initial franchise fees from the franchisees, nor do they require the franchisees to pay continuing royalties. The agreements do not require the franchisees to purchase any minimum levels of product, but do require that they make at least one purchase during each year. The Company does not act to manage the franchisees’ levels of product. Franchisees hold periodic conferences, assisted by the Company’s marketing department, to promote product awareness and the introduction of new products. The franchising agreements are generally for terms of three years and are renewable at the mutual agreement of both parties. The franchising agreements are cancelable at the Company’s discretion if franchisees violate the terms of the agreements.

The following is a breakdown of revenue between franchise and non-franchise customers:

	For the three months ended June 30,				For the six months ended June 30,
	2020		2019		2020		2019
Sales to franchise customers	$	56,473	$	120,369	$	70,385	$	225,476
Sales to non-franchise customers		11,429		51,010		11,733		84,774
Total sales	$	67,902	$	171,379	$	82,118	$	310,250

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation.

The following discussion and analysis should be read in conjunction with the consolidated financial statements and notes thereto included in Item 1 of this Quarterly Report on Form 10-Q and with Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 31, 2020.

FORWARD-LOOKING STATEMENTS:

Certain statements made in this report may constitute “forward-looking statements on our current expectations and projections about future events.” These forward-looking statements involve known or unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. In some cases you can identify forward-looking statements by some words such as “may,” “should,” “potential,” “continue,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates,” and similar expressions. These statements are based on our current beliefs, expectations, and assumptions, and are subject to a number of risks and uncertainties. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. These forward-looking statements are made as of the date of this report, and we assume no obligation to update these forward-looking statements whether as a result of new information, future events, or otherwise, other than as required by law. In light of these assumptions, risks, and uncertainties, the forward-looking events discussed in this report might not occur and actual results and events may vary significantly from those discussed in the forward-looking statements.

Overview

General

We develop, manufacture, market, distribute, and sell products, including knit goods, daily healthcare and personal care products, and wellness house and activated water machine products, that are coated, embedded or filled with tourmaline. Most of our products, such as clothing, bedding, and mattresses are purchased as finished products which we then coat and/or infuse with liquid or granular tourmaline using one or more of our manufacturing techniques. We conduct all of our operations in Tianjin City, China and distribute most of our products to more than 200 franchisees in China. Our franchisees, in turn, sell the products to their customers. All of our revenues to date have been generated by sales to customers located in the PRC.

Beginning in 2009, we began to develop a franchise network to distribute our healthcare knit goods, daily healthcare products and personal care products. Through these franchisees, we were able to significantly increase sales of our healthcare knit goods segment and daily healthcare and personal care segment. In 2010, we began distributing our wellness house and activated water machine products through our franchise network.

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We are a holding company with no material operations of our own. All of our operations are conducted through Joway Shengshi and its three subsidiaries, Joway Technology, Joway Decoration and Shengtang Trading. Joway Shengshi engages in the manufacture and distribution of tourmaline health-related products such as knit goods, and daily healthcare and personal care products. Joway Technology and Joway Decoration engage in the manufacture and distribution of activated water machines and wellness houses. We utilize our Shengtang Trading subsidiary to purchase raw materials, which are then sold to Joway Shengshi and Joway Decoration.

As a holding company, our ability to pay dividends and other cash distributions to our shareholders depends in part upon dividends and other distributions paid to us by our PRC subsidiaries. The amount of dividends paid by our PRC subsidiaries to us primarily depends on the service fees paid to our PRC subsidiaries from Joway Shengshi and its subsidiaries, and, to a lesser degree, our PRC subsidiaries’ retained earnings. Conducting our operations through contractual arrangements with Joway Shengshi and its subsidiaries has a risk that we may lose the power to direct the activities that most significantly affect the economic performance of Joway Shengshi and its subsidiaries, which may result in our being unable to consolidate their financial results with our results and may impair our access to their cash flow from operations and thereby reduce our liquidity.

Description of Selected Income Statement Items

Revenues. We generate revenue from sales of our Healthcare Knit goods Series, Daily Healthcare and Personal Care Series and Wellness House and Activated Water Machine Series.

Cost of goods sold.  Cost of goods sold consists of costs directly attributable to production, including the cost of raw materials, salaries for staff engaged in production activity, electricity, depreciation, packing materials, and related expenses.

Operating expenses.  Our total operating expenses consist of sales and marketing expenses and general and administrative expenses. Sales and marketing expenses consist primarily of salaries and traveling expenses of our marketing department employees, transportation expenses, and advertising expenses. General and administrative expenses consist primarily of salaries of our administrative department employees, payroll taxes and benefits, general office expenses and depreciation.

Other (expense) income. Our other (expense) income consists primarily of interest income, investment income and bank service fee.

Income taxes. According to the revised Enterprise Income Tax Law effective as of January 1, 2008, the income tax rate of our PRC subsidiaries is generally 25%. Joway Health Industries Group Inc. was established under the laws of the State of Nevada and is subject to U.S. federal income tax and Nevada annual reporting requirements.

Results of Operations

The following table sets forth certain information regarding our results of operations.

	For the three months ended June 30,						For the six months ended June 30,
	2020			2019			2020			2019
REVENUES	$	67,902		$	171,379		$	82,118		$	310,250
COST OF REVENUES		37,729			82,759			45,751			152,163
GROSS PROFIT		30,173			88,620			36,367			158,087
OPERATING EXPENSES		226,985			361,087			569,785			800,943
LOSS FROM OPERATIONS		(196,812	)		(272,467	)		(533,418	)		(642,856	)
OTHER EXPENSE, NET		(285	)		(83	)		(1,108	)		(1,191	)
LOSS BEFORE INCOME TAXES		(197,097	)		(272,550	)		(534,526	)		(644,047	)
INCOME TAX BENEFITS		-			-			-			-
NET LOSS	$	(197,097	)	$	(272,550	)	$	(534,526	)	$	(644,047	)

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Business Segments

In 2020 and 2019, we operated in three reportable business segments: (1) Healthcare Knit Goods, (2) Daily Healthcare and Personal Care Products and (3) Wellness House and Activated Water Machine Products. The following table sets forth the contributions of each reportable business segment in dollars and as a percent of revenue:

For the three months ended June 30, 2020

	Healthcare Knitgoods Series			% of Total			Daily Healthcare and Personal Care Series			% of Total			Wellness House and Activated Water Machine Series			% of Total			Total
REVENUES	$	4,346			6.4	%	$	25,685			37.8	%	$	37,871			55.8	%	$	67,902
COST OF REVENUES		2,091			5.5	%		13,151			34.9	%		22,487			59.6	%		37,729
GROSS PROFIT		2,255			7.5	%		12,534			41.5	%		15,384			51.0	%		30,173
GROSS MARGIN		51.9	%					48.8	%					40.6	%					44.4	%
OPERATING EXPENSES		14,528			6.4	%		85,861			37.8	%		126,596			55.8	%		226,985
LOSS FROM OPERATIONS	$	(12,273	)		6.2	%	$	(73,327	)		37.3	%	$	(111,212	)		56.5	%	$	(196,812	)

For the three months ended June 30, 2019

	Healthcare Knitgoods Series			% of Total			Daily Healthcare and Personal Care Series			% of Total			Wellness House and Activated Water Machine Series			% of Total			Total
REVENUES	$	15,841			9.2	%	$	51,577			30.1	%	$	103,961			60.7	%	$	171,379
COST OF REVENUES		4,523			5.5	%		23,556			28.5	%		54,680			66.1	%		82,759
GROSS PROFIT		11,318			12.8	%		28,021			31.6	%		49,281			55.6	%		88,620
GROSS MARGIN		71.4	%					54.3	%					47.4	%					51.7	%
OPERATING EXPENSES		22,532			6.2	%		115,392			32.0	%		223,163			61.8	%		361,087
LOSS FROM OPERATIONS	$	(11,214	)		4.1	%	$	(87,371	)		32.1	%	$	(173,882	)		63.8	%	$	(272,467	)

For the six months ended June 30, 2020

	Healthcare Knitgoods Series			% of Total			Daily Healthcare and Personal Care Series			% of Total			Wellness House and Activated Water Machine Series			% of Total			Total
REVENUES	$	6,553			8.0	%	$	30,662			37.3	%	$	44,903			54.7	%	$	82,118
COST OF REVENUES		3,113			6.8	%		15,464			33.8	%		27,174			59.4	%		45,751
GROSS PROFIT		3,440			9.5	%		15,198			41.8	%		17,729			48.8	%		36,367
GROSS MARGIN		52.5	%					49.6	%					39.5	%					44.3	%
OPERATING EXPENSES		67,748			11.9	%		205,873			36.1	%		296,164			52.0	%		569,785
LOSS FROM OPERATIONS	$	(64,308	)		12.1	%	$	(190,675	)		35.7	%	$	(278,435	)		52.2	%	$	(533,418	)

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For the six months ended June 30, 2019

	Healthcare Knitgoods Series			% of Total			Daily Healthcare and Personal Care Series			% of Total			Wellness House and Activated Water Machine Series			% of Total			Total
REVENUES	$	47,187			15.2	%	$	81,895			26.4	%	$	181,168			58.4	%	$	310,250
COST OF REVENUES		23,507			15.4	%		38,405			25.2	%		90,251			59.3	%		152,163
GROSS PROFIT		23,680			15.0	%		43,490			27.5	%		90,917			57.5	%		158,087
GROSS MARGIN		50.2	%					53.1	%					50.2	%					51.0	%
OPERATING EXPENSES		121,819			15.2	%		211,421			26.4	%		467,703			58.4	%		800,943
LOSS FROM OPERATIONS	$	(98,139	)		15.3	%	$	(167,931	)		26.1	%	$	(376,786	)		58.6	%	$	(642,856	)

For The Three Months Ended June 30, 2020 Compared to June 30, 2019

Revenue. For the three months ended June 30, 2020, revenue was $67,902 compared to $171,379 for the three months ended June 30, 2019, a decrease of $103,477 or 60.4%. In 2020, the impact of COVID-19 on the Chinese economy seriously affected our business with implementation of restrictions at business operations and city lockdowns.

Revenue from healthcare knit goods segment decreased by $11,495 or 72.6% to $4,346 for the three months ended June 30, 2020 from $15,841 for the three months ended June 30, 2019. This decrease was mainly due to the decrease in sales of our mattress products. Our mattress products are our best-selling products and were most affected by market fluctuations and stop working orders implemented by cities under the lockdown period as COVID-19 swept China.

Revenue from daily healthcare and personal care products decreased by $25,892 or 50.2% to $25,685 for the three months ended June 30, 2020 from $51,577 for the three months ended June 30, 2019. This was primarily due to the decrease in sales of most of our daily healthcare and personal care products affected by industry downturn and almost of all cities under lockdown as COVID-19 swept China.

Revenue from wellness houses and activated water machines decreased by $66,090 or 63.6% to $37,871 for the three months ended June 30, 2020 from $103,961 for the three months ended June 30, 2019. This decrease was mainly due to the decrease in the construction of our wellness house.

Cost of Goods Sold. For the three months ended June 30, 2020, cost of goods sold was $37,729 compared to $82,759 for the three months ended June 30, 2019, a decrease of $45,030 or 54.4%. This decrease was mainly due to the decrease in sales.

Cost of goods sold for healthcare knit goods segment decreased to $2,091 for the three months ended June 30, 2020 from $4,523 for the three months ended June 30, 2019, a decrease of $2,432 or 53.8%. This decrease was mainly due to the decrease in sales.

Cost of goods sold for the daily healthcare and personal care segment decreased to $13,151 for the three months ended June 30, 2020 from $23,556 for the three months ended June 30, 2019, a decrease of $10,405 or 44.2%. This decrease was mainly due to the decrease in sales.

Cost of goods sold for our wellness house and activated water machine segment decreased to $22,487 for the three months ended June 30, 2020 from $54,680 for the three months ended June 30, 2019, a decrease of $32,193 or 58.9%. This decrease was mainly due to the decrease in sales.

Gross profit. Our gross profit decreased by $58,447 or 66% to $30,173 for the three months ended June 30, 2020, compared to $88,620 for the three months ended June 30, 2019. This decrease was mainly due to the decrease in sales. Our gross margin decreased from 51.7% for the three months ended June 30, 2019 to 44.4% for the three months ended June 30, 2020. This decrease was mainly due to our healthcare knit goods segment.

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Gross profit for the healthcare knit goods segment decreased by $9,063 or 80.1% to $2,255 for the three months ended June 30, 2020 compared to $11,318 for the three months ended June 30, 2019. This decrease was mainly due to the decrease in sales. The gross margins of healthcare knit goods segment decreased from 71.4% for the three months ended June 30, 2019 to 51.9% for the three months ended June 30, 2020. It was mainly due to the increased proportion of products with higher gross margin.

Gross profit of daily healthcare and personal care segment decreased by $15,487 or 55.3% to $12,534 for the three months ended June 30, 2020, compared to $28,021 for the three months ended June 30, 2019. This decrease was mainly due to the decrease in sales. The gross margin of daily healthcare and personal care segment decreased from 54.3% for the three months ended June 30, 2019 to 48.8% for the three months ended June 30, 2020.

Gross profit of the wellness house and activated water machine segments decreased by $33,897 or 68.8% to $15,384 for the three months ended June 30, 2020, compared to $49,281 for the three months ended June 30, 2019. This decrease was mainly due to the decrease in sales. The gross margin of our wellness house and activated water machine segments decreased from 47.4% for the three months ended June 30, 2019 to 40.6% for the three months ended June 30, 2020.

Operating expenses. Our total operating expenses consist of sales and marketing expenses and general and administrative expenses. Our total operating expenses decreased by $134,102 or 37.1%, from $361,087 for the three months ended June 30, 2019 to $226,985 for the three months ended June 30, 2020. This decrease was mainly due to the decrease in travel expense and salary. Operating expenses for healthcare knit goods segment decreased by $8,004 or 35.5% to $14,528 for the three months ended June 30, 2020 from $22,532 for the three months ended June 30, 2019. Operating expenses for daily healthcare and personal care segment decreased by $29,531 or 25.6% to $85,861 for the three months ended June 30, 2020 from $115,392 for the three months ended June 30, 2019. Operating expenses for our wellness house and activated water machine segment decreased by $96,567 or 43.3% to $126,596 for the three months ended June 30, 2020 from $223,163 for the three months ended June 30, 2019.

Loss from operations. As a result of the foregoing, our loss from operations was $196,812 for the three months ended June 30, 2020, compared to $272,467 for the three months ended June 30, 2019. This was mainly due to the decrease in operating expenses.

Income taxes. Our income taxes were $0 for the three months ended June 30, 2020 and 2019, separately.

Net loss. For the three months ended June 30, 2020, our net loss was $197,097 compared to $272,550 for the three months ended June 30, 2019. This was mainly due to the decrease in operating expenses.

For the six months Ended June 30, 2020 Compared to June 30, 2019

Revenue. For the six months ended June 30, 2020, revenue was $82,118 compared to $310,250 for the six months ended June 30, 2019, a decrease of $228,132 or 73.5%. This decrease was mainly due to the downturn of the health care industry in China affected by COVID-19.

Revenue from healthcare knit goods segment decreased by $40,634, or 86.1% to $6,553 for the six months ended June 30, 2020 from $47,187 for the six months ended June 30, 2019. This decrease was mainly due to the decrease in sales of our mattress products. Our mattress products are our best-selling products and were most affected by market fluctuations.

Revenue from daily healthcare and personal care products decreased by $51,233 or 62.6% to $30,662 for the six months ended June 30, 2020 from $81,895 for the six months ended June 30, 2019. This was primarily due to the decrease in sales of most of our daily healthcare and personal care products affected by industry downturn.

Revenue from wellness houses and activated water machines decreased by $136,265 or 75.2% to $44,903 for the six months ended June 30, 2020 from $181,168 for the six months ended June 30, 2019. This decrease was mainly due to the decrease in the construction of our wellness house.

Cost of Goods Sold. For the six months ended June 30, 2020, cost of goods sold was $45,751 compared to $152,163 for the six months ended June 30, 2019, a decrease of $106,412, or 69.9%. This decrease was mainly due to the decrease in sales.

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Cost of goods sold for healthcare knit goods segment decreased to $3,113 for the six months ended June 30, 2020 from $23,507 for the six months ended June 30, 2019, a decrease of $20,394 or 86.8%. This decrease was mainly due to the decrease in sales.

Cost of goods sold for the daily healthcare and personal care segment decreased to $15,464 for the six months ended June 30, 2020 from $38,405 for the six months ended June 30, 2019, a decrease of $22,941 or 59.7%. This decrease was mainly due to the decrease in sales.

Cost of goods sold for our wellness house and activated water machine segment decreased to $27,174 for the six months ended June 30, 2020 from $90,251 for the six months ended June 30, 2019, a decrease of $63,077 or 69.9%. This decrease was due to the decrease in the cost of our wellness house as a result of the decrease in sales.

Gross profit. Our gross profit decreased by $121,720 or 77% to $36,367 for the six months ended June 30, 2020, compared to $158,087 for the six months ended June 30, 2019. This decrease was due to the decrease in sales. In addition, our gross margin decreased from 51% for the six months ended June 30, 2019 to 44.3% for the six months ended June 30, 2020. This decrease was mainly due to our wellness house and activated water machine segment.

Gross profit for the healthcare knit goods segment decreased by $20,240 or 85.5% to $3,440 for the six months ended June 30, 2020 compared to $23,680 for the six months ended June 30, 2019. This decrease was mainly due to the decrease in sales. The gross margins of healthcare knit goods segment increased slightly from 50.2% for the six months ended June 30, 2019 to 52.5% for the six months ended June 30, 2020.

Gross profit of daily healthcare and personal care segment decreased by $28,292 or 65.1% to $15,198 for the six months ended June 30, 2020, compared to $43,490 for the six months ended June 30, 2019. This decrease was primarily due to the decrease in sales. Our gross margin of daily healthcare and personal care segment decreased from 53.1% for the six months ended June 30, 2019 to 49.6% for the six months ended June 30, 2020.

Gross profit of the wellness house and activated water machine segment decreased by $73,188 or 80.5% to $17,729 for the six months ended June 30, 2020, compared to $90,917 for the six months ended June 30, 2019. This decrease was mainly due to the decrease in gross profit of construction of wellness house. The gross margin of our wellness house and activated water machine segments decreased from 50.2% for the six months ended June 30, 2019 to 39.5% for the six months ended June 30, 2020. It was mainly due to that there was no gross profit from the wellness house construction, which has higher gross margin, for the first quarter of 2020.

Operating expenses. Our total operating expenses consist of sales and marketing expenses and general and administrative expenses. Our total operating expenses decreased by $231,158, or 28.9%, from $800,943 for the six months ended June 30, 2019 to $569,785 for the six months ended June 30, 2020. This decrease was mainly due to the decreased travel expenses and salary. Operating expenses for healthcare knit goods segment decreased by $54,071 or 44.4% to $67,748 for the six months ended June 30, 2020 from $121,819 for the six months ended June 30, 2019. Operating expenses for daily healthcare and personal care segment decreased by $5,548 or 2.6% to $205,873 for the six months ended June 30, 2020 from $211,421 for the six months ended June 30, 2019. Operating expenses for our wellness house and activated water machine segment decreased by $171,539 or 36.7% to $296,164 for the six months ended June 30, 2020 from $467,703 for the six months ended June 30, 2019.

Loss from operations. As a result of the foregoing, our loss from operations was $533,418 for the six months ended June 30, 2020, compared to a loss from operations of $642,856 for the six months ended June 30, 2019, a decrease of $109,438. This decrease of loss was mainly due to the decrease in operating expenses.

Income taxes. Our income taxes were $0 for the six months ended June 30, 2020 and 2019, separately.

Net loss. Our net loss was $534,526 for the six months ended June 30, 2020, compared to a net loss of $644,047 for the six months ended June 30, 2019. This decrease of net loss was mainly due to the decrease in operating expenses.

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Franchising

We enter into franchise agreements to develop retail outlets for our products. These agreements provide that franchisees will sell our products exclusively. In exchange, we provide them with geographic exclusivity, discounted products, training, and support. The agreements also require franchisees to adhere to certain standards of product merchandising, promotion, and presentment. The agreements do not require the franchisees to purchase any minimum levels of product, but do require that they make at least one purchase during each year. The agreements are generally for terms of three years and are renewable at the mutual agreement of both parties. The Agreements are cancelable at our discretion if franchisees violate the terms of the agreements.

The following is a breakdown of revenue between franchise and non-franchise customers:

	For the three months ended June 30,				For the six months ended June 30,
	2020		2019		2020		2019
Sales to franchise customers	$	56,473	$	120,369	$	70,385	$	225,476
Sales to non-franchise customers		11,429		51,010		11,733		84,774
Total sales	$	67,902	$	171,379	$	82,118	$	310,250

Liquidity and Capital Resources

Our cash at the beginning of the six months ended June 30, 2020 was $48,631 and decreased to $99,979 by the end of June 30, 2020, a decrease of $51,348. This decrease was mainly due to our deteriorated operating results. On June 30, 2020, we had net working capital of $(1,188,597), a decrease of $321,272 from $(867,325) on December 31, 2019.

Our cash flow information summary is as follows:

	For the six months ended June 30,
	2020			2019
Net cash provided by (used in):
Operating activities	$	(315,088	)	$	(468,508	)
Investing activities	$	-		$	(89,235	)
Financing activities	$	254,433		$	544,898

Net Cash Used in Operating Activities

Net cash used in operating activities was $315,088 for the six months ended June 30, 2020, compared to $468,508 for the six months ended June 30, 2019.

For the six months ended June 30, 2020, cash was mainly used to cover our loss of $534,526, which was primarily offset by an add-back of $196,237 of depreciation for non-cash expense.

For the six months ended June 30, 2019, cash was mainly used to cover our loss of $644,047, which was primarily offset by an add-back of $208,149 of depreciation for non-cash expense.

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Net Cash Used In Investing Activities

Net cash used in investing activities was $0 for the six months ended June 30, 2020, compared to $89,235 for the six months ended June 30, 2019. For the six months ended June 30, 2020 and 2019, respectively, we expended $0 and $89,235 on purchase of advanced production equipment and office equipment.

Net Cash Provided By Financing Activities

For the six months ended June 30, 2020, $254,433 of cash was provided by financing activities, compared to $544,898 for the six months ended June 30, 2019.

On May 10, 2007, Joway Shengshi entered into a cash advance agreement with Jinghe Zhang, the Company’s President, Chief Executive Officer and director. Pursuant to the agreement, Jinghe Zhang agreed to advance operating capital to Joway Shengshi. The advances are interest free, unsecured, and have no specified repayment terms. The agreement is valid throughout Joway Shengshi’s term of operation. During the period beginning May 17, 2007 (inception of Joway Shengshi) through June 30, 2020, Joway Shengshi received cash advances in the aggregate principal amount of $6,367,759 from Jinghe Zhang of which $4,632,811 has been repaid. For the six months ended June 30, 2020 and 2019, the Company received $254,433 and $663,356 of these advances, respectively.

STATUTORY RESERVES

Pursuant to the laws and regulations of the PRC, our PRC subsidiaries are required to allocate a portion of their after-tax income to statutory reserves funds. The minimum statutory reserves allocation is 10% of after-tax income until the reserves reach 50% of the entities’ registered capital or members’ equity. The reserve funds are not transferable to us in the form of cash dividends, loans or advances. Thus, the reserve funds are not available for distribution except in liquidation. As of June 30, 2020, we had allocated $354,052 to statutory reserves.

Off Balance Sheet Items

Under SEC regulations, we are required to disclose off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, such as changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. An off-balance sheet arrangement means a transaction, agreement or contractual arrangement to which any entity that is not consolidated with us is a party, under which we have:

● any obligation under certain guarantee contracts,

● any retained or contingent interest in assets transferred to an unconsolidated entity or similar arrangement that serves as credit, liquidity or market risk support to that entity for such assets,

● any obligation under a contract that would be accounted for as a derivative instrument, except that it is both indexed to our stock and classified in shareholder equity in our statement of financial position, and

● any obligation arising out of a material variable interest held by us in an unconsolidated entity that provides financing, liquidity, market risk or credit risk support to us, or engages in leasing, hedging or research and development services with us.

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We do not have any off-balance sheet arrangements that we are required to disclose pursuant to these regulations. In the ordinary course of business, we enter into operating lease commitments, purchase commitments and other contractual obligations. These transactions are recognized in our financial statements in accordance with generally accepted accounting principles in the United States.

Critical Accounting Policies

Management’s discussion and analysis of its financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. Our financial statements reflect the selection and application of accounting policies which require management to make significant estimates and judgments. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. We believe that the following reflect the more critical accounting policies that currently affect our financial condition and results of operations.

Basis of Consolidation

The accompanying consolidated financial statements include Joway Health and its wholly owned subsidiaries and controlled VIEs. All significant inter-company accounts and transactions have been eliminated in the consolidation.

Pursuant to Accounting Standards Codification Topic 810 “Consolidation” (“ASC 810”), the Company is required to include in its consolidated financial statements the financial statements of its variable interest entities (“VIEs”). ASC 810 requires a VIE to be consolidated by a company if that company is subject to a majority of the risk of loss for the VIE or is entitled to receive a majority of the VIE’s residual returns. VIEs are those entities in which a company, through contractual arrangements, bears the risk of, and enjoys the rewards normally associated with ownership of the entity, and therefore the company is the primary beneficiary of the entity.

Based on the various Contractual Agreements, we believe we are able to exercise control over the VIEs, and to obtain the full economic benefits. We believe that the terms of the exclusive option agreement are currently exercisable and legally enforceable under PRC laws and regulations. We also believe that the minimum amount of consideration permitted by the applicable PRC law to exercise the option does not represent a financial barrier or disincentive for us to exercise our rights under the exclusive option agreement. A simple majority vote of our board of directors is required to pass a resolution to exercise our rights under the exclusive option agreement, for which consent of the shareholder of VIEs is not required. Therefore, we believe this gives us the power to direct the activities that most significantly impact VIEs’ economic performance. T We believe that our ability to exercise effective control, together with the consulting service agreements and the equity pledge agreements, give us the rights to receive substantially all of the economic benefits from VIEs in consideration for the services provided by its wholly owned subsidiaries in China. Accordingly, as the primary beneficiary of VIEs and in accordance with U.S. GAAP, Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading, as VIEs of Junhe Consulting, has been consolidated in the Company’s financial statements. Sales from Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading are included in our total sales, their incomes or losses from operations are consolidated with ours, and our net income or loss includes net income or loss from Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading.

Revenue Recognition

We recognize revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the purchase price is fixed or determinable and collectability is reasonably assured.

With respect to sales of product to both franchisee and non-franchisee customers, we prepare product shipment upon the receipt of a customer’s purchase order. Sales prices are based on fixed price lists that are different depending on whether the price list is for franchisee customers or for non-franchisee customers. We recognize revenue when the product is shipped. We do not sell product to any customers with a right of return as defined in ASC 605-15-25-4. Sales are presented net of value added tax (VAT).

27

We recognize revenue on the sale of our wellness houses under the completed contract method. At the time when we enter into a contract with a customer to build a wellness house, the customer pays a deposit of at least one-half of the sales price. We consider the contract to be completed when all significant costs have been incurred and the customer accepts the project in writing by signing in the appropriate place on the contract. At this time the customer will also pay any remaining balance on the contract. We recognize the full contract revenue at this point. Contract costs consist primarily of materials and labor costs. The construction period of a wellness house generally does not exceed five days.

Accounts Receivable

Accounts receivable are carried at net realizable value. We provide reserves for potential credit losses on accounts receivable. Management reviews the composition of the accounts receivable and analyzes historical bad debts, customer concentrations, customers’ credit worthiness, current economic trends, and changes in customer’s payment patterns to evaluate the adequacy of these reserves.

Inventories

Inventories are stated at the lower of cost, as determined by the specific identification method on contract level (for each individual contract, inventories cost flow is determined by weighted-average method), or the net realizable value, which is determined on selling prices less any further costs expected to be incurred for completion and disposal. Management regularly evaluates the composition of its inventories to identify slow-moving and obsolete inventories to determine whether a valuation allowance is required.

Property, Plant, and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation, and include expenditures that substantially increase the useful lives of existing assets.

Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Estimated useful lives are as follows:

Building	20 years
Operating Equipment	10 years
Office furniture and equipment	3 or 5 years
Vehicles	10 years

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts, and any gain or loss is included in the consolidated statements of income and other comprehensive income. Maintenance, repairs and minor renewals are charged directly to expenses as incurred. Significant renewals and betterment to buildings and equipment are capitalized. Leasehold improvements are depreciated over the lesser of the useful life or the life of the lease.

Recent Accounting Pronouncements

We do not anticipate that the adoption of recently issued accounting pronouncements to have a material effect on our condensed consolidated financial statements.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Not applicable.

28

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, under the supervision and with the participation of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), has evaluated the effectiveness of our disclosure controls and procedures as defined in SEC Rules 13a-15(e) and 15d-15(e) as of the end of the period covered by this quarterly report. The purpose of this evaluation is to determine if, as of Evaluation Date, our disclosure controls and procedures were operating effectively such that the information, required to be disclosed in our Securities and Exchange Commission (“SEC”) reports (i) was recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) was accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Based on their evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of June 30, 2020, our disclosure controls and procedures were not effective, based on the material weakness described below:

We did not have sufficient skilled accounting personnel that are either qualified as Certified Public Accountants in the U.S. or that have received education from U.S. institutions or other educational programs that would provide enough relevant education relating to U.S. GAAP. The Company’s CFO and Financial Manager have worked for U.S. listed companies but have limited experience with U.S. GAAP and are not U.S. Certified Public Accountants. Further, our operating subsidiaries are based in China, and in accordance with PRC laws and regulations, are required to comply with PRC GAAP, rather than U.S. GAAP. Thus, the accounting skills and understanding necessary to fulfill the requirements of U.S. GAAP-based reporting, including the preparation of financial statements and consolidation, are inadequate, and determined to be a material weakness.

Remediation Initiative

● We have started a training program in the principles and rules of U.S. GAAP, SEC reporting requirements and the application thereof. The program is provided by an independent training institution, for our finance and accounting personnel, including our Chief Financial Officer, Financial Manager and others.

● We are in the process of designing a program to provide ongoing company-wide training regarding the Company’s internal controls, with particular emphasis on our finance and accounting staff.

● In 2011 we established the position of internal audit manager. From September 2011 to July 2012, we hired an internal audit manager who implemented an internal review process over financial reporting to review all recent accounting pronouncements and to verify that the accounting treatments identified in such report have been fully implemented and confirmed by our internal control department. Currently, we are still in the process of seeking for a proper candidate to perform as our internal audit manager.

We believe that the foregoing steps will remediate the significant deficiencies identified above, and we will continue to monitor the effectiveness of these steps and make any changes that our management deems appropriate.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting for the six months ended June 30, 2020 that materially affected, or were reasonably likely to materially affect our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

As of the date of this filing, there have been no material changes from the risk factors disclosed in Part I, Item 1A (Risk Factors) contained in our Annual Report on Form 10-K for the year ended December 31, 2019. We operate in a changing environment that involves numerous known and unknown risks and uncertainties that could materially affect our operations. The risks, uncertainties and other factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2019 may cause our actual results, performances and achievements to be materially different from those expressed or implied by our forward-looking statements. If any of these risks or events occurs, our business, financial condition or results of operations may be adversely affected.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.

EXHIBIT INDEX

Exhibit No.	Description
31.1	Certification of Chief Executive Officer of Periodic Report pursuant to Rule 13a-14a and Rule 14d-14(a). *
31.2	Certification of Chief Financial Officer of Periodic Report pursuant to Rule 13a-14a and Rule 15d-14(a). *
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350. *
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350. *
101.INS	XBRL Instance Document*
101.SCH	XBRL Schema Document*
101.CAL	XBRL Calculation Linkbase Document*
101.LAB	XBRL Label Linkbase Document*
101.PRE	XBRL Presentation Linkbase Document*
101.DEF	XBRL Definition Linkbase Document*

* Filed herewith

30

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

DATE: August 14, 2020

Joway Health Industries Group Inc.
By:	/s/ Jinghe Zhang
	Jinghe Zhang
	President and Chief Executive Officer
By:	/s/ Yuan Huang
	Yuan Huang
	Chief Financial Officer

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EX-31.1

Exhibit 31.1

CERTIFICATION

I, Jinghe Zhang, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the six months ended June 30, 2020 of Joway Health Industries Group Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 14, 2020

/S/ Jinghe Zhang

Jinghe Zhang

Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Yuan Huang, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the six months ended June 30, 2020 of Joway Health Industries Group Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 14, 2020

/S/ Yuan Huang

Yuan Huang

Chief Financial Officer

(Principal Financial and Accounting Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Jinghe Zhang, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of Joway Health Industries Group Inc. for the six months ended June 30, 2020 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Joway Health Industries Group Inc.

Date: August 14, 2020

By:	/S/ Jinghe Zhang
	Jinghe Zhang
	Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Yuan Huang, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of Joway Health Industries Group Inc. for the six months ended June 30, 2020 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Joway Health Industries Group Inc.

Date: August 14, 2020

By:	/S/ Yuan Huang
	Yuan Huang
	Chief Financial Officer

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2020	Aug. 14, 2020
Document and Entity Information [Abstract]
Entity Registrant Name	Joway Health Industries Group Inc
Entity Central Index Key	0001263364
Amendment Flag	false
Document Type	10-Q
Document Period End Date	Jun. 30, 2020
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2020
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Common Stock Shares Outstanding		20,054,000
Entity File Number	333-108715
Entity Interactive Data Current	Yes
Entity Incorporation State Country Code	NV

XML

Condensed Consolidated Balance Sheets - USD ($)	Jun. 30, 2020	Dec. 31, 2019
CURRENT ASSETS:
Cash	$ 48,631	$ 99,979
Other receivables	32,883	28,740
Inventories	481,476	500,269
Advances to suppliers	80,981	56,418
Prepaid taxes	97,595	97,381
Total current assets	741,566	782,787
PROPERTY, PLANT AND EQUIPMENT, net	3,135,040	3,377,361
OTHER ASSETS:
Intangible assets, net	434,409	448,033
Total other assets	434,409	448,033
Total assets	4,311,015	4,608,181
CURRENT LIABILITIES:
Accounts payable	88,802	92,071
Advances from customers	11,718	21,734
Other payables	94,695	55,792
Due to related parties	1,734,948	1,480,515
Total current liabilities	1,930,163	1,650,112
COMMITMENTS
STOCKHOLDERS' EQUITY:
Preferred stock - par value $0.001; 1,000,000 shares authorized; no shares issued and outstanding
Common stock - par value $0.001; 200,000,000 shares authorized; 20,054,000 shares issued and outstanding at June 30, 2020 and December 31, 2019	20,054	20,054
Additional paid-in-capital	7,361,665	7,361,665
Statutory reserves	354,052	354,052
Accumulated deficit	(5,798,566)	(5,264,040)
Accumulated other comprehensive income	443,647	486,338
Total stockholders' equity	2,380,852	2,958,069
Total liabilities and stockholders' equity	$ 4,311,015	$ 4,608,181

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	20,054,000	20,054,000
Common stock, shares outstanding	20,054,000	20,054,000

XML

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Income Statement [Abstract]
REVENUES	$ 67,902	$ 171,379	$ 82,118	$ 310,250
COST OF REVENUES	37,729	82,759	45,751	152,163
GROSS PROFIT	30,173	88,620	36,367	158,087
Selling expenses	23,893	84,605	45,866	168,933
General and administrative expenses	203,092	276,482	523,919	632,010
OPERATING EXPENSES	226,985	361,087	569,785	800,943
LOSS FROM OPERATIONS	(196,812)	(272,467)	(533,418)	(642,856)
Interest income	24	44	44	88
Other income			1	11
Other expenses	(309)	(127)	(1,153)	(1,290)
OTHER EXPENSES, NET	(285)	(83)	(1,108)	(1,191)
LOSS BEFORE INCOME TAXES	(197,097)	(272,550)	(534,526)	(644,047)
INCOME TAX
NET LOSS	(197,097)	(272,550)	(534,526)	(644,047)
OTHER COMPREHENSIVE INCOME (LOSS):
Foreign currency translation adjustment	1,436	(90,110)	(42,691)	13,670
COMPREHENSIVE LOSS	$ (195,661)	$ (362,660)	$ (577,217)	$ (630,377)
NET LOSS PER COMMON SHARE, BASIC AND DILUTED	$ (0.01)	$ (0.02)	$ (0.03)	$ (0.03)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING, BASIC AND DILUTED	20,054,000	20,054,000	20,054,000	20,054,000

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (534,526)	$ (644,047)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation	196,237	208,149
Amortization	7,134	9,672
Changes in operating assets and liabilities:
Other receivables	(5,129)	20,499
Inventories	20,355	(28,197)
Advances to suppliers	(24,563)	79,204
Prepaid expense		872
Accounts payable	(3,269)	(3,317)
Advances from customers	(10,016)	(93,174)
Other payable	21,027	370
Salary and welfare payable	17,876	(8,308)
Taxes payable	(214)	(10,231)
Net cash used in operating activities	(315,088)	(468,508)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment		(89,235)
Net cash used in investing activities		(89,235)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds of due to related parties	254,433	544,898
Net cash provided by financing activities	254,433	544,898
EFFECT OF EXCHANGE RATE CHANGES ON CASH	9,307	5,583
NET DECREASE IN CASH	(51,348)	(7,262)
CASH, beginning of period	99,979	118,996
CASH, end of period	48,631	111,734
SUPPLEMENTAL DISCLOSURES:
Income taxes paid
Interest paid

XML

Organization

6 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

ORGANIZATION

NOTE 1 – ORGANIZATION

The unaudited condensed consolidated financial statements include the financial statements of Joway Health Industries Group Inc. (referred to herein as "Joway Health"), its subsidiaries, and variable interest entities ("VIEs") where Joway Health is deemed the primary beneficiary. Joway Health, its subsidiaries and VIEs are collectively referred to herein as the "Company", "we" and "us".

Joway Health (formerly G2 Ventures, Inc.) was originally incorporated under the laws of the State of Texas on March 21, 2003. On September 21, 2010, Joway Health entered into a Share Exchange Agreement (the "Share Exchange") with the sole stockholder of Dynamic Elite International Limited. As a result of the Share Exchange, Dynamic Elite became a wholly-owned subsidiary of Joway Health and the stockholders of Dynamic Elite acquired approximately 76.08% of the issued and outstanding stock of Joway Health. The share exchange transaction resulted in the shareholders of Dynamic Elite acquiring a majority voting interest in Joway Health. Generally accepted accounting principles in the United States of America require that the company whose shareholders retain the majority interest in the combined business be treated as the acquirer for accounting purposes. The reverse acquisition process utilizes the capital structure of Joway Health and the assets and liabilities of Dynamic Elite recorded at historical cost. On December 22, 2010, Joway Health changed its jurisdiction of incorporation from the State of Texas to the State of Nevada.

Dynamic Elite International Limited (referred to herein as "Dynamic Elite") was incorporated under the laws of the British Virgin Islands on June 2, 2010 as a limited liability company (a BVI company). Dynamic Elite engages in manufacturing and distributing tourmaline products in China. Its wholly owned subsidiary, Tianjin Junhe Management Consulting Co., Ltd. was incorporated on September 15, 2010 in Tianjin, People's Republic of China ("PRC"). Other than the equity interest in Junhe Consulting, Dynamic Elite does not own any assets or conduct any operations.

Tianjin Junhe Management Consulting Co., Ltd. (referred to herein as "Junhe Consulting") conducts its business through Tianjin Joway Shengshi Group Co., Ltd. that is consolidated as a variable interest entity.

Tianjin Joway Shengshi Group Co., Ltd. (referred to herein as "Joway Shengshi") was incorporated in PRC on May 17, 2007. Joway Shengshi is currently owned 99% by Jinghe Zhang, the Company's current CEO and President and 1% by Song Baogang. Joway Shengshi engages in manufacturing and distributing tourmaline products in China. Shenyang Joway Electronic Technology Co., Ltd., Tianjin Joway Decoration Engineering Co., Ltd. and Tianjin Oriental Shengtang Trading Import & Export Trading Co., Ltd are subsidiaries of Joway Shengshi.

Shenyang Joway Electronic Technology Co., Ltd. (referred to herein as "Joway Technology") was originally named Liaoning Joway Technology Engineering Co., Ltd. which was incorporated on March 28, 2007 in PRC. The name was changed on June 22, 2011. It engages in the distribution of Tourmaline Activated Water Machines and Tourmaline Wellness Houses. Prior to July 25, 2010, Joway Shengshi owned 90.91% of Joway Technology. Joway Shengshi entered into a share acquisition agreement with Jingyun Chen, another stockholder of Joway Technology on July 25, 2010 to acquire the remaining 9.09% of the share of Joway Technology. As a result of the share acquisition, Joway Technology became a wholly-owned subsidiary of Joway Shengshi.

Tianjin Joway Decoration Engineering Co., Ltd. (referred to herein as "Joway Decoration") was incorporated on April 22, 2009 in PRC. It engages in the distribution of Tourmaline Activated Water Machines, Tourmaline Wellness House for family use and Tourmaline Wellness House materials. Prior to July 9, 2010, Joway Shengshi owned 90% of Joway Decoration. Joway Shengshi entered into a share acquisition agreement with Jingyun Chen, another stockholder of Joway Decoration on July 9, 2010 to acquire the remaining 10% of the shares of Joway Decoration. As a result of the share acquisition, Joway Decoration became a wholly-owned subsidiary of Joway Shengshi. Jingyun Chen is currently the General Manager of Joway Decoration.

Tianjin Oriental Shengtang Import & Export Trading Co., Ltd (referred to herein as "Shengtang Trading") was incorporated on September 18, 2009 in the PRC. It engages in purchasing raw materials which it sells to other companies of the group. Prior to July 28, 2010, Joway Shengshi owned 95% of Shengtang Trading. Joway Shengshi entered into a share acquisition agreement with Wang Aiying, another stockholder of Shengtang Trading on July 28, 2010 to acquire the remaining 5% of the shares of Shengtang Trading. As a result of the share acquisition, Shengtang Trading became a wholly-owned subsidiary of Joway Shengshi.

The following table lists the Company and its subsidiaries:

Name	Domicile and Date of Incorporation	Paid in Capital	Percentage of Effective Ownership	Principal Activities
Joway Health Industries Group Inc.	March 21, 2003, Nevada	USD 20,054	86.8% owned by Crystal Globe Limited 13.2%owned by other institutional and individual investors	Investment Holding
Dynamic Elite International Limited	June 2, 2010, British Virgin Islands	USD 10,000	100% owned by Joway Health Industries Group Inc.	Investment Holding
Tianjin Junhe Management Consulting Co., Ltd.	September 15, 2010, PRC	USD 20,000	100% owned by Dynamic Elite International Limited	Advisory
Tianjin Joway Shengshi Group Co., Ltd.	May 17, 2007, PRC	USD 7,216,140.72	99% owned by Jinghe Zhang,  and 1% owned  by Baogang Song	Production and distribution of Healthcare Knit Goods and Daily Healthcare and Personal Care products
Shenyang Joway Electronic Technology Co., Ltd.	March 28, 2007, PRC	USD 142,072.97	100% owned by Tianjin Joway Shengshi Group Co., Ltd	Distribution of Tourmaline Activated Water Machine and construction of Tourmaline Wellness House
Tianjin Joway Decoration Engineering Co., Ltd.	April 22, 2009, PRC	USD 292,367.74	100% owned by Tianjin Joway Shengshi Group Co., Ltd	Distribution of Wellness House for family use and Activated Water Machine and construction of Tourmaline Wellness House
Tianjin Oriental Shengtang Import & Export Trading Co., Ltd.	September 18, 2009, PRC	USD 292,463.75	100% owned by Tianjin Joway Shengshi Group Co., Ltd	Distribution of tourmaline products

On September 16, 2010, prior to the share exchange, Junhe Consulting entered into a series of contractual agreements (the "Contractual Agreements") with Joway Shengshi and Joway Shengshi's owners. The following is a brief description of the Contractual Agreements entered into between Junhe Consulting and Joway Shengshi or Joway Shengshi's owners:

1. Consulting Services Agreement. Pursuant to the consulting services agreement between Junhe Consulting and Joway Shengshi, Junhe Consulting has the right to advise, consult, manage and operate Joway Shengshi, and collect and own all of the net profits of the Operating Entities.

2. Operating Agreement. Under the operating agreement between Junhe Consulting and Joway Shengshi, Junhe Consulting has the right to recommend director candidates and appoint the senior executives of Joway Shengshi, approve any transactions that may materially affect the assets, liabilities, rights or operations of Joway Shengshi, and guarantee the contractual performance by Joway Shengshi of any agreements with third parties, in exchange for a pledge by Joway Shengshi of its accounts receivable and assets.

3. Voting Rights Proxy Agreement. Under the voting rights proxy agreement between Joway Shengshi's owners and Junhe Consulting, the owners of Joway Shengshi have vested their collective voting control over Joway Shengshi to Junhe Consulting and will only transfer their respective equity interests in Joway Shengshi to Junhe Consulting or its designee.

4. Option Agreement. Under the option agreement between Joway Shengshi's owners and Junhe Consulting, the owners of Joway Shengshi have granted Junhe Consulting the irrevocable right and option to acquire all of their equity interests in Joway Shengshi.

5. Equity Pledge Agreement. Under the equity pledge agreement between Joway Shengshi's owners and Junhe Consulting, the owners of Joway Shengshi have pledged all of their rights, titles and interests in Joway Shengshi to Junhe Consulting to guarantee Joway Shengshi's performance of its obligations under the Consulting Services Agreement.

As a result of the Contractual Agreements, Joway Shengshi is effectively a variable interest entity of Junhe Consulting. Accordingly, the Company through its wholly-owned subsidiary Junhe Consulting, consolidates Joway Shengshi's results of operation, assets and liabilities in its financial statements.

In connection with the Share Exchange and as consideration for entering into the VIE Agreements, Jinghe Zhang and Baogang Song, the shareholders of Joway Shengshi (the "Grantees"), entered into a Call Option Agreement, dated July 20, 2010 with Lionel Evan Liu (the "Grantor"), the sole shareholder of Crystal Globe (the controlling shareholder of Dynamic Elite), a British Virgin Islands company (the "Call Option Agreement"), pursuant to which the Grantees had the right to purchase up to 100% of the shares of Crystal Globe (the "Call Option") at an exercise price of $2.00 per share (the "Exercise Price") for a period of five years. The Call Option vested as to 34% of the shares of Crystal Globe on April 2, 2011 and as to 33% on each of April 2, 2012 and 2013 (the respective "Call Option Effective Date"). On March 28, 2015, the Grantor and Grantees amended the Call Option Agreement, to (i) reduce the Exercise Price to $0.00 per share and (ii) extend the Grantees' rights to exercise their call option within ten years from the respective Option Effective Date.

On November 13, 2016, Jinghe Zhang exercised the Call Option as to 99% of the shares of Crystal Globe and Baogang Song exercised his Call Option as to 1% of the shares of Crystal Globe. As a result of exercising the Call Option, Jinghe Zhang became the controlling shareholder of Crystal Globe and in turn, the controlling shareholder of the Company. On November 20, 2016, Baogang Song transferred 1% of the shares of Crystal Globe to Jinghe Zhang. Consequently, Jinghe Zhang controls 17,408,000 shares, or 86.8%, of the issued and outstanding shares of the Company's common stock.

On May 15, 2019, Joway Shengshi's 100% owned subsidiary, Joway Decoration, declared and distributed a one-time dividends of RMB 6.29 million or $927,192.54. The dividend was used to offset a loan between Joway Shengshi and Joway Decoration.

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("US GAAP"). Accordingly, they do not include all of the information and the footnotes required by generally accepted accounting principles for complete financial statements. The Company's functional currency is the Chinese Renminbi ("RMB"); however, the accompanying unaudited condensed consolidated financial statements have been translated and presented in United States Dollars ("USD"). All significant inter-company transactions and balances have been eliminated. The consolidated financial statements include all adjustments that, in the opinion of management, are necessary to make the financial statements not misleading.

Operating results for the six month period ended June 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company's form 10-K for the fiscal year ended December 31, 2019 which was filed on March 31, 2020.

Use of Estimates

The preparation of the consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made. Actual results could differ from those estimates.

Basis of Consolidation

The accompanying consolidated financial statements include the Company and its wholly owned subsidiaries and controlled VIEs. All significant inter-company accounts and transactions have been eliminated in the consolidation.

Pursuant to Accounting Standards Codification Topic 810 "Consolidation" ("ASC 810"), the Company is required to include in its consolidated financial statements the financial statements of its variable interest entities ("VIEs"). ASC 810 requires a VIE to be consolidated by a company if that company is subject to a majority of the risk of loss for the VIE or is entitled to receive a majority of the VIE's residual returns. VIEs are those entities in which a company, through contractual arrangements, bears the risk of, and enjoys the rewards normally associated with ownership of the entity, and therefore the company is the primary beneficiary of the entity.

Based on the various Contractual Agreements, the Company is able to exercise control over the VIEs, and to obtain the full economic benefits. The terms of the exclusive option agreement are currently exercisable and legally enforceable under PRC laws and regulations. The minimum amount of consideration permitted by the applicable PRC law to exercise the option does not represent a financial barrier or disincentive for the Company to exercise its rights under the exclusive option agreement. A simple majority vote of the Company's board of directors is required to pass a resolution to exercise its rights under the exclusive option agreement, for which consent of the shareholder of VIEs is not required. Therefore, this gives the Company the power to direct the activities that most significantly impact VIEs' economic performance. The Company's ability to exercise effective control, together with the consulting service agreements and the equity pledge agreements, give the Company the rights to receive substantially all of the economic benefits from VIEs in consideration for the services provided by its wholly owned subsidiaries in China. Accordingly, as the primary beneficiary of VIEs and in accordance with U.S. GAAP, Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading, as VIEs of Junhe Consulting, has been consolidated in the Company's financial statements. Sales from Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading are included in the Company's total sales, their incomes or losses from operations are consolidated with the Company's, and the Company's net income or loss includes net income or loss from Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading.

Foreign Currency Translation

The accompanying consolidated financial statements are presented in USD. The functional currency of the Company is RMB. The consolidated financial statements are translated into United States dollars from RMB at period-end exchange rates as to assets and liabilities and average exchange rates as to revenues and expenses. Equity accounts are translated at their historical exchange rates when the equity transactions occurred. The resulting transaction adjustments are recorded as a component of stockholders' equity. Gains and losses from foreign currency transactions are included in net income.

	For the six months ended June 30,				For the year ended December 31,
	2020		2019		2019
Period ended RMB: USD Exchange rate		7.0795		6.86557		6.9762
Average RMB: USD Exchange rate		7.0319		6.78392		6.8985

The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into USD at the rates used in translation.

Foreign currency translation adjustments have been reported as comprehensive income (loss) in the consolidated financial statements and totaled $1,436 and $(90,110) for the three months ended June 30, 2020 and 2019, respectively, and $(42,691) and $13,670 for the six months ended June 30, 2020 and 2019, respectively.

Other Comprehensive Income

Other comprehensive income is defined as the change in equity during the period from transactions and other events, excluding the changes resulting from investments by owners and distributions to owners, and is not included in the computation of income tax expense or benefit. Accumulated other comprehensive income represents the accumulated balance of foreign currency translation adjustments.

Concentrations of Credit Risk

The Company's operations are carried out in the PRC. Accordingly, the Company's business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC's economy. The Company's operations in the PRC are subject to specific considerations and significant risks not typically associated with companies in North America. The Company's results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash. Substantially all of the Company's cash is maintained with state-owned banks within the PRC, and no deposits are covered by insurance. The Company has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts.

Fair Value of Financial Instruments

Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 820 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

● Level 1—defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

● Level 2—defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and

● Level 3—defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying amounts reported in the balance sheets for cash, accounts receivable, other receivable, accounts payable, other payable, and amounts due from related parties generally approximate their fair market values based on the short-term maturity of these instruments. ASC 825-10 "Financial Instruments" allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding instruments.

Cash

For financial reporting purposes, the Company considers all highly liquid financial instruments with an original maturity of three months or less to be cash equivalents. The Company had no cash equivalents at any point during the period of the financial statements presented. Balances at financial institutions or state-owned banks within the PRC are not covered by insurance. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risks on its cash in bank accounts.

Accounts Receivable

Accounts receivable are presented net of an allowance for doubtful accounts. The Company maintains allowances for doubtful accounts for estimated losses. On a periodic basis, the Company reviews the composition of the accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these allowances. Accounts are written off after exhaustive efforts at collection. As of June 30, 2020 and December 31, 2019, based on a review of its outstanding balances, the Company allowance $2,553 and $2,591 for doubtful accounts, respectively.

Inventories

Inventories are stated at the lower of cost, as determined by the specific identification method on contract level (for each individual contract, inventories cost flow are determined by weighted-average method), or the net realizable value, which is determined on selling prices less any further costs expected to be incurred for completion and disposal. The Company regularly evaluates the composition of its inventories to identify slow-moving and obsolete inventories to determine whether a valuation allowance is required. As of June 30, 2020 and December 31, 2019, the Company recorded $105,435 and $106,997 for inventory valuation allowance, respectively.

Advances to Suppliers

Advances to suppliers represent the cash paid in advance for inventory items or construction in progress. The advance payments are meant to ensure preferential pricing and delivery. The amounts advanced under such arrangements totaled $87,146 and $62,674 as of June 30, 2020 and December 31, 2019, respectively.

Property, Plant, and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation, and include expenditures that substantially increase the useful lives of existing assets.

Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Estimated useful lives are as follows:

Building	20 years
Operating Equipment	10 years
Office furniture and equipment	3 or 5 years
Vehicles	10 years

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts, and any gain or loss is included in the consolidated statements of operations. Maintenance, repairs and minor renewals are charged directly to expenses as incurred. Significant renewals and betterment to buildings and equipment are capitalized. Leasehold improvements are depreciated over the lesser of the useful life or the life of the lease.

Intangible Assets

Intangible assets mainly consist of land use rights. All land located in the PRC is owned by the government and cannot be sold to any individual or company. The land use rights granted to the Company are being amortized using the straight-line method over the lease term of 50 years. Other intangible assets are software programs that are amortized over their estimated useful life of 10 years.

Impairment of Long-lived Assets

Long-lived assets of the Company are reviewed annually as to whether their carrying value has become impaired, pursuant to the guidelines established in FASB ASC 360. The Company considers assets to be impaired if the carrying value exceeds the future projected cash flows from the related operations. The Company also re-evaluates the periods of depreciation and amortization to determine whether subsequent events and circumstances warrant revised estimates of useful lives. The Company did not record any impairment loss for the six months ended June 30, 2020 and 2019.

Revenue Recognition

The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the purchase price is fixed or determinable and collectability is reasonably assured.

With respect to sales of product to both franchisee and non-franchisee customers, the Company prepares product shipments upon the receipt of a customer's purchase order. Sales prices are based on fixed price lists that are different depending on whether the price list is for a franchisee customer or for non-franchisee customers. The Company recognizes revenue when the product is shipped. The Company does not sell product to any customers with a right of return as defined in ASC 605-15-25-4. Sales are presented net of value added tax ("VAT").

For Tourmaline Wellness House sales, the Company recognizes revenue under the completed contract method. Customers contact the Company with requests to construct a Wellness House. The Company and the customer enter into a contract, at which time the customer pays a deposit of at least one-half of the sales price. A contract is considered completed when all significant costs have been incurred and the project has been accepted by the customer. The contracts have a place for the customer to sign indicating their acceptance of the completed Wellness House. At this time the customer will also pay any remaining balance on the contract. The Company recognizes the full contract revenue at this point. Contract costs consist primarily of materials and labor costs. The construction period of a Wellness House generally does not exceed five days.

Shipping Costs

Shipping costs are included in selling expenses and totaled $11,189 and $11,575 for the three months ended June 30, 2020 and 2019, respectively, and $15,078 and $28,971 for the six months ended June 30, 2020 and 2019, respectively.

Income Taxes

The Company is governed by the Income Tax Law and associated legislations of the PRC. The Company accounts for income taxes in accordance with FASB ASC 740 "Income Taxes", which is an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company's financial statements or tax returns. ASC 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets is dependent upon future earnings, if any, of which the timing and amount are uncertain.

According to ASC 740, the evaluation of a tax position is a two-step process. The first step is to determine whether it is more likely than not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigation based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50% likelihood of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. ASC 740 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures, and transition.

Basic and Diluted Earnings per Share

The Company reports earnings per share in accordance with FASB ASC 260 "Earnings per share". The Company's basic earnings per share are computed using the weighted average number of shares outstanding for the periods presented. Diluted earnings per share are computed based on the assumption that any dilutive options or warrants were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, the Company's outstanding stock warrants are assumed to be exercised, and funds thus obtained were assumed to be used to purchase common stock at the average market price during the period. There were no dilutive instruments outstanding during the six months periods ended June 30, 2020 and 2019.

Segment Information

The Company follows FASB ASC 280-Segment Reporting, which requires that companies disclose segment data based on how management makes decision about allocating resources to segments and evaluating their performance.

For the six months ended June 30, 2020 and the year ended December 31, 2019, management has determined that the Company is operating in three reportable business segments, (1) Healthcare Knit Goods Series, (2) Daily Healthcare and Personal Care Series, and (3) Wellness House and Activated Water Machine Series. The Company's reportable segments are strategic business units that offer different products. They are managed separately based on the fundamental differences in their operations.

Recently Issued Accounting Pronouncements

In December 2019, the FASB issued a new standard to simplify the accounting for income taxes. The guidance eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences related to changes in ownership of equity method investments and foreign subsidiaries. The guidance also simplifies aspects of accounting for franchise taxes and enacted changes in tax laws or rates, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. We believe that adoption of this new standard will not have material impact in our consolidated financial statements, including accounting policies, processes, and systems.

In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The guidance should be adopted on a prospective basis for the annual or any interim goodwill impairment tests beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company adopted the standard in 2019. Adoption of the standard did not have a significant impact on the Company's consolidated statement of earnings in 2019.

In June 2018, the FASB issued ASU 2018-07, "Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting," which simplifies the accounting for share-based payments granted to nonemployees for goods and services and aligns most of the guidance on such payments to nonemployees with the requirements for share-based payments granted to employees. ASU 2018-07 becomes effective for the Company on January 1, 2019. Early adoption is permitted. The Company adopted the standard in 2019. Adoption of the standard did not have a significant impact on the Company's consolidated statement of earnings in 2019.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The standard outlined a comprehensive lease accounting model that superseded the previous lease guidance and required lessees to recognize lease liabilities and corresponding right-of-use assets for all leases with lease terms greater than 12 months. The guidance also changed the definition of a lease and expanded the disclosure requirements of lease arrangements. The Company adopted the standard on December 15, 2019. Adoption of the standard did not have a significant impact on the Company's consolidated statement of earnings in 2019.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326), which requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application will be permitted for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company adopted the standard in 2019. Adoption of the standard did not have a significant impact on the Company's consolidated statement of earnings in 2019.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the SEC did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements.

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Going Concern

6 Months Ended

Jun. 30, 2020

Going Concern [Abstract]

GOING CONCERN

NOTE 3 – GOING CONCERN

The accompanying unaudited condensed financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As reflected in the accompanying unaudited condensed financial statements, the Company has an accumulated deficit of approximately $5,800,000 and a working capital deficit of approximately $1,189,000 at June 30, 2020. In addition, the Company continues to generate operating losses and negative cash flows from operations. This raises substantial doubt about the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company's ability to raise additional capital. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Management intends to provide the Company with additional loans as needed. Management feels these actions provide the opportunity for the Company to continue as a going concern.

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Accounts Receivable

6 Months Ended

Jun. 30, 2020

Receivables [Abstract]

ACCOUNTS RECEIVABLE

NOTE 4 – ACCOUNTS RECEIVABLE

Accounts receivable consisted of the following:

	June 30,			December 31,
	2020			2019
Accounts receivable	$	2,553		$	2,591
Less: allowance for bad debt		(2,553	)		(2,591	)
Accounts receivable, net	$	-		$	-

As of June 30, 2020 and December 31, 2019, the Company allowance $2,553 and $2,591 for doubtful accounts, respectively.

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Inventories

6 Months Ended

Jun. 30, 2020

Inventory Disclosure [Abstract]

INVENTORIES

NOTE 5 – INVENTORIES

Inventories consisted of the following:

	June 30,			December 31,
	2020			2019
Raw materials	$	119,027		$	126,563
Finished goods		431,889			444,175
Low value consumables		35,995			36,528
Total		586,911			607,266
Less: impairment loss		(105,435	)		(106,997	)
Inventory, net	$	481,476		$	500,269

Low value consumables represent low priced and easily worn articles and are amortized on equal-split amortization method. Pursuant to this method, half value of the low value consumable should be amortized once used and the remaining half value should be amortized when disposed of.

As of June 30, 2020 and December 31, 2019, the Company recognized $105,435 and $106,997, respectively, as a reserve for impairment loss from inventory.

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Property, Plant and Equipment

6 Months Ended

Jun. 30, 2020

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENT

NOTE 6 – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consisted of the following:

	June 30,			December 31,
	2020			2019
Building	$	5,624,223		$	5,707,503
Operating Equipment		412,929			419,044
Office furniture and equipment		334,198			339,147
Vehicles		966,144			980,450
Total		7,337,494			7,446,144
Less: accumulated depreciation		(4,202,454	)		(4,068,783	)
Property, plant and equipment, net	$	3,135,040		$	3,377,361

Depreciation expense for the three months ended June 30, 2020 and 2019 amounted to $97,107 and $102,432, respectively, and for the six months ended June 30, 2020 and 2019 amounted to $196,237 and $208,149, respectively.

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Intangible Assets

6 Months Ended

Jun. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS

NOTE 7 – INTANGIBLE ASSETS

Intangible assets consisted of the following:

	June 30,			December 31,
	2020			2019
Land use rights	$	583,100		$	591,734
Other intangible assets		74,605			75,710
Total		657,705			667,444
Less: accumulated amortization		(223,296	)		(219,411	)
Intangible assets, net	$	434,409		$	448,033

Amortization expense of intangible assets for the three months ended June 30, 2020 and 2019 was $2,963 and $4,804, respectively, and for the six months ended June 30, 2020 and 2019 amounted to $7,134 and $9,672, respectively.

The estimated amortization expense for the next five years is as follows:

Estimated amortization expense for
the year ending December 31,	Amount
2020	$	19,000
2021	$	19,000
2022	$	19,000
2023	$	19,000
2024	$	19,000
Thereafter	$	353,033

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Related Party Transactions

6 Months Ended

Jun. 30, 2020

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 8 – RELATED PARTY TRANSACTIONS

Payables due to related parties consist of the following:

	June 30,		December 31,
	2020		2019
Jinghe Zhang	$	1,734,948	$	1,480,515
Total	$	1,734,948	$	1,480,515

Transactions with Shenyang Joway

● Shenyang Joway Industrial Development Co., Ltd. ("Shenyang Joway") was formed in 2005 in Shenyang, China by Mr. Jinghe Zhang and three other individuals. Mr. Zhang holds more than 50% of the equity in Shenyang Joway. Shenyang Joway was in the business of marketing and distributing clothing and related products to other companies. Through 2009 Shenyang Joway had ceased operations, although it still existed as a legal entity. Shenyang Joway was cancelled in 2019.

● On May 7, 2007, the Company's subsidiary Joway Shengshi entered into an agreement with Shenyang Joway pursuant to which Joway Shengshi and Shenyang Joway agreed to provide each other with interest-free, unsecured advances for working capital. On May 10, 2007, the Company's subsidiary Joway Technology and Shenyang Joway entered into an agreement pursuant to which Joway Technology and Shenyang Joway agreed to provide each other with interest-free, unsecured advances for working capital.

● Through December 31, 2008, Joway Technology advanced $58,568 to Shenyang Joway, which was paid off by Shenyang Joway to Joway Technology in 2009.

● Through December 31, 2018, Shenyang Joway advanced an aggregate of $912,645 to Joway Shengshi and Joway Technology, which was paid off by 2019. For the six months ended June 30, 2020 and 2019, the Company repaid $0 and $118,458 of these advances, respectively. As of June 30, 2020, the total unpaid principal balance due Shenyang Joway for advances was $0.

Transactions with Jinghe Zhang

● On December 1, 2009, the Company, through its subsidiary Joway Shengshi, entered into a royalty-free license agreement with Jinghe Zhang, our President, Chief Executive Officer and director. Pursuant to the license agreement, we are authorized to use the trademark "Joway" for a term of nine years and five patents from December 1, 2009 till the expiration dates of the patents.

● On May 10, 2007, Joway Shengshi entered into a cash advance agreement with Jinghe Zhang, the Company's President, Chief Executive Officer and director. Pursuant to the agreement, Jinghe Zhang agreed to advance operating capital to Joway Shengshi. The advances are interest free, unsecured, and have no specified repayment terms. The agreement is valid throughout Joway Shengshi's term of operation. During the period beginning May 17, 2007 (inception of Joway Shengshi) through June 30, 2020, Joway Shengshi received cash advances in the aggregate principal amount of $6,367,759 from Jinghe Zhang of which $4,632,811 has been repaid. For the six months ended June 30, 2020 and 2019, the Company received $254,433 and $663,356 of these advances, respectively. As of June 30, 2020, the total unpaid principal balance due Jinghe Zhang for advances was $1,734,948.

The amounts owed to related parties are non-interest bearing and have no specified repayment terms.

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Income Taxes

6 Months Ended

Jun. 30, 2020

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 9 – INCOME TAXES

The Company operations in the People's Republic of China are subject to the Income Tax Law of the People's Republic of China. Pursuant to the PRC Income Tax Laws, the Company is subject to the Enterprise Income Tax ("EIT") which is generally a statutory rate of 25% beginning January 2008, on income as reported in its statutory financial statements after appropriate tax adjustments.

The table below summarizes the differences between the PRC statutory federal rate and the Company's effective tax rate:

	For the six months ended June 30,
	2020			2019
Tax computed at China statutory rates		25	%		25	%
Effect of losses		(25	)%		(25	)%
Effective rate		0	%		0	%

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Statutory Reserves

6 Months Ended

Jun. 30, 2020

Statutory Reserves [Abstract]

STATUTORY RESERVES

NOTE 10 – STATUTORY RESERVES

Pursuant to the laws and regulations of the PRC, annual income of the Company's subsidiaries is required to be partly allocated to the statutory reserves funds after the payment of the PRC income taxes. The allocation to the statutory reserves funds should be at least 10% of income after tax until the reserves reaches 50% of the entities' registered capital or members' equity. The reserve funds are not transferable to the Company in the form of cash dividends, loans or advances. Thus the reserve funds are not available for distribution except in liquidation. As of June 30, 2020, the Company had allocated $354,052 to statutory reserves.

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Segments

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

SEGMENTS

NOTE 11 – SEGMENTS

In 2020 and 2019, the Company operated in three reportable business segments: (1) Healthcare Knit Goods Series, (2) Daily Healthcare and Personal Care Series and (3) Wellness House and Activated Water Machine Series. The Company's reportable segments are strategic business units that offer different products. They are managed separately based on the fundamental differences in their operations. Information with respect to these reportable business segments is as follows:

For the three months ended June 30, 2020

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	4,346	$	2,091	$	2,255	$	(12,273	)	$	6,405	$	119,329
Daily Healthcare and Personal Care Series		25,685		13,151		12,534		(73,327	)		37,853		192,597
Wellness House and Activated Water Machine Series		37,871		22,487		15,384		(111,212	)		55,812		198,240
Segment Totals	$	67,902	$	37,729	$	30,173		(196,812	)	$	100,070		510,166
Other Loss, net								(285	)
Income tax benefits								-
Unallocated Assets													3,800,849
Net Loss							$	(197,097	)
Total Assets												$	4,311,015

For the three months ended June 30, 2019

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	15,841	$	4,523	$	11,318	$	(11,214	)	$	9,912	$	142,532
Daily Healthcare and Personal Care Series		51,577		23,556		28,021		(87,371	)		32,273		230,516
Wellness House and Activated Water Machine Series		103,961		54,680		49,281		(173,882	)		65,051		190,719
Segment Totals	$	171,379	$	82,759	$	88,620		(272,467	)	$	107,236		563,767
Other Loss, net								(83	)
Income tax benefits								-
Unallocated Assets													4,390,832
Net Loss							$	(272,550	)
Total Assets												$	4,954,599

For the six months ended June 30, 2020

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	6,553	$	3,113	$	3,440	$	(64,308	)	$	16,229	$	119,329
Daily Healthcare and Personal Care Series		30,662		15,464		15,198		(190,675	)		75,937		192,597
Wellness House and Activated Water Machine Series		44,903		27,174		17,729		(278,435	)		111,205		198,240
Segment Totals	$	82,118	$	45,751	$	36,367		(533,418	)	$	203,371		510,166
Other Loss, net								(1,108	)
Income tax benefits								-
Unallocated Assets													3,800,849
Net Loss							$	(534,526	)
Total Assets												$	4,311,015

For the six months ended June 30, 2019

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	47,187	$	23,507	$	23,680	$	(98,139	)	$	33,129	$	142,532
Daily Healthcare and Personal Care Series		81,895		38,405		43,490		(167,931	)		57,497		230,516
Wellness House and Activated Water Machine Series		181,168		90,251		90,917		(376,786	)		127,195		190,719
Segment Totals	$	310,250	$	152,163	$	158,087		(642,856	)	$	217,821		563,767
Other Loss, net								(1,191	)
Income tax benefits								-
Unallocated Assets													4,390,832
Net Loss							$	(644,047	)
Total Assets												$	4,954,599

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Franchise Revenues

6 Months Ended

Jun. 30, 2020

Franchise Revenues [Abstract]

FRANCHISE REVENUES

NOTE 12 - FRANCHISE REVENUES

The Company enters into franchising agreements to develop retail outlets for the Company's products. The agreements provide that franchisees will sell Company products exclusively at a predetermined retail price. In exchange the Company provides them with geographic exclusivity, discounted products, training and support. The agreements also require franchisees to adhere to certain standards of product merchandising, promotion and presentment. The agreements also prohibit franchisees from selling competitor's products. The agreements do not require any initial franchise fees from the franchisees, nor do they require the franchisees to pay continuing royalties. The agreements do not require the franchisees to purchase any minimum levels of product, but do require that they make at least one purchase during each year. The Company does not act to manage the franchisees' levels of product. Franchisees hold periodic conferences, assisted by the Company's marketing department, to promote product awareness and the introduction of new products. The franchising agreements are generally for terms of three years and are renewable at the mutual agreement of both parties. The franchising agreements are cancelable at the Company's discretion if franchisees violate the terms of the agreements.

The following is a breakdown of revenue between franchise and non-franchise customers:

	For the three months ended June 30,				For the six months ended June 30,
	2020		2019		2020		2019
Sales to franchise customers	$	56,473	$	120,369	$	70,385	$	225,476
Sales to non-franchise customers		11,429		51,010		11,733		84,774
Total sales	$	67,902	$	171,379	$	82,118	$	310,250

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("US GAAP"). Accordingly, they do not include all of the information and the footnotes required by generally accepted accounting principles for complete financial statements. The Company's functional currency is the Chinese Renminbi ("RMB"); however, the accompanying unaudited condensed consolidated financial statements have been translated and presented in United States Dollars ("USD"). All significant inter-company transactions and balances have been eliminated. The consolidated financial statements include all adjustments that, in the opinion of management, are necessary to make the financial statements not misleading.

Operating results for the six month period ended June 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company's form 10-K for the fiscal year ended December 31, 2019 which was filed on March 31, 2020.

Use of Estimates

Use of Estimates

The preparation of the consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made. Actual results could differ from those estimates.

Basis of Consolidation

Basis of Consolidation

The accompanying consolidated financial statements include the Company and its wholly owned subsidiaries and controlled VIEs. All significant inter-company accounts and transactions have been eliminated in the consolidation.

Pursuant to Accounting Standards Codification Topic 810 "Consolidation" ("ASC 810"), the Company is required to include in its consolidated financial statements the financial statements of its variable interest entities ("VIEs"). ASC 810 requires a VIE to be consolidated by a company if that company is subject to a majority of the risk of loss for the VIE or is entitled to receive a majority of the VIE's residual returns. VIEs are those entities in which a company, through contractual arrangements, bears the risk of, and enjoys the rewards normally associated with ownership of the entity, and therefore the company is the primary beneficiary of the entity.

Based on the various Contractual Agreements, the Company is able to exercise control over the VIEs, and to obtain the full economic benefits. The terms of the exclusive option agreement are currently exercisable and legally enforceable under PRC laws and regulations. The minimum amount of consideration permitted by the applicable PRC law to exercise the option does not represent a financial barrier or disincentive for the Company to exercise its rights under the exclusive option agreement. A simple majority vote of the Company's board of directors is required to pass a resolution to exercise its rights under the exclusive option agreement, for which consent of the shareholder of VIEs is not required. Therefore, this gives the Company the power to direct the activities that most significantly impact VIEs' economic performance. The Company's ability to exercise effective control, together with the consulting service agreements and the equity pledge agreements, give the Company the rights to receive substantially all of the economic benefits from VIEs in consideration for the services provided by its wholly owned subsidiaries in China. Accordingly, as the primary beneficiary of VIEs and in accordance with U.S. GAAP, Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading, as VIEs of Junhe Consulting, has been consolidated in the Company's financial statements. Sales from Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading are included in the Company's total sales, their incomes or losses from operations are consolidated with the Company's, and the Company's net income or loss includes net income or loss from Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading.

Foreign Currency Translation

Foreign Currency Translation

The accompanying consolidated financial statements are presented in USD. The functional currency of the Company is RMB. The consolidated financial statements are translated into United States dollars from RMB at period-end exchange rates as to assets and liabilities and average exchange rates as to revenues and expenses. Equity accounts are translated at their historical exchange rates when the equity transactions occurred. The resulting transaction adjustments are recorded as a component of stockholders' equity. Gains and losses from foreign currency transactions are included in net income.

	For the six months ended June 30,				For the year ended December 31,
	2020		2019		2019
Period ended RMB: USD Exchange rate		7.0795		6.86557		6.9762
Average RMB: USD Exchange rate		7.0319		6.78392		6.8985

The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into USD at the rates used in translation.

Foreign currency translation adjustments have been reported as comprehensive income (loss) in the consolidated financial statements and totaled $1,436 and $(90,110) for the three months ended June 30, 2020 and 2019, respectively, and $(42,691) and $13,670 for the six months ended June 30, 2020 and 2019, respectively.

Other Comprehensive Income

Other Comprehensive Income

Other comprehensive income is defined as the change in equity during the period from transactions and other events, excluding the changes resulting from investments by owners and distributions to owners, and is not included in the computation of income tax expense or benefit. Accumulated other comprehensive income represents the accumulated balance of foreign currency translation adjustments.

Concentrations of Credit Risk

Concentrations of Credit Risk

The Company’s operations are carried out in the PRC. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC’s economy. The Company’s operations in the PRC are subject to specific considerations and significant risks not typically associated with companies in North America. The Company’s results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash. Substantially all of the Company’s cash is maintained with state-owned banks within the PRC, and no deposits are covered by insurance. The Company has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 820 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

● Level 1—defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

● Level 2—defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and

● Level 3—defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying amounts reported in the balance sheets for cash, accounts receivable, other receivable, accounts payable, other payable, and amounts due from related parties generally approximate their fair market values based on the short-term maturity of these instruments. ASC 825-10 "Financial Instruments" allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding instruments.

Cash

Cash

For financial reporting purposes, the Company considers all highly liquid financial instruments with an original maturity of three months or less to be cash equivalents. The Company had no cash equivalents at any point during the period of the financial statements presented. Balances at financial institutions or state-owned banks within the PRC are not covered by insurance. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risks on its cash in bank accounts.

Accounts Receivable

Accounts Receivable

Accounts receivable are presented net of an allowance for doubtful accounts. The Company maintains allowances for doubtful accounts for estimated losses. On a periodic basis, the Company reviews the composition of the accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these allowances. Accounts are written off after exhaustive efforts at collection. As of June 30, 2020 and December 31, 2019, based on a review of its outstanding balances, the Company allowance $2,553 and $2,591 for doubtful accounts, respectively.

Inventories

Inventories

Inventories are stated at the lower of cost, as determined by the specific identification method on contract level (for each individual contract, inventories cost flow are determined by weighted-average method), or the net realizable value, which is determined on selling prices less any further costs expected to be incurred for completion and disposal. The Company regularly evaluates the composition of its inventories to identify slow-moving and obsolete inventories to determine whether a valuation allowance is required. As of June 30, 2020 and December 31, 2019, the Company recorded $105,435 and $106,997 for inventory valuation allowance, respectively.

Advances to Suppliers

Advances to Suppliers

Advances to suppliers represent the cash paid in advance for inventory items or construction in progress. The advance payments are meant to ensure preferential pricing and delivery. The amounts advanced under such arrangements totaled $87,146 and $62,674 as of June 30, 2020 and December 31, 2019, respectively.

Property, Plant, and Equipment

Property, Plant, and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation, and include expenditures that substantially increase the useful lives of existing assets.

Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Estimated useful lives are as follows:

Building	20 years
Operating Equipment	10 years
Office furniture and equipment	3 or 5 years
Vehicles	10 years

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts, and any gain or loss is included in the consolidated statements of operations. Maintenance, repairs and minor renewals are charged directly to expenses as incurred. Significant renewals and betterment to buildings and equipment are capitalized. Leasehold improvements are depreciated over the lesser of the useful life or the life of the lease.

Intangible Assets

Intangible Assets

Intangible assets mainly consist of land use rights. All land located in the PRC is owned by the government and cannot be sold to any individual or company. The land use rights granted to the Company are being amortized using the straight-line method over the lease term of 50 years. Other intangible assets are software programs that are amortized over their estimated useful life of 10 years.

Impairment of Long-lived Assets

Impairment of Long-lived Assets

Long-lived assets of the Company are reviewed annually as to whether their carrying value has become impaired, pursuant to the guidelines established in FASB ASC 360. The Company considers assets to be impaired if the carrying value exceeds the future projected cash flows from the related operations. The Company also re-evaluates the periods of depreciation and amortization to determine whether subsequent events and circumstances warrant revised estimates of useful lives. The Company did not record any impairment loss for the six months ended June 30, 2020 and 2019.

Revenue Recognition

Revenue Recognition

The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the purchase price is fixed or determinable and collectability is reasonably assured.

With respect to sales of product to both franchisee and non-franchisee customers, the Company prepares product shipments upon the receipt of a customer's purchase order. Sales prices are based on fixed price lists that are different depending on whether the price list is for a franchisee customer or for non-franchisee customers. The Company recognizes revenue when the product is shipped. The Company does not sell product to any customers with a right of return as defined in ASC 605-15-25-4. Sales are presented net of value added tax ("VAT").

For Tourmaline Wellness House sales, the Company recognizes revenue under the completed contract method. Customers contact the Company with requests to construct a Wellness House. The Company and the customer enter into a contract, at which time the customer pays a deposit of at least one-half of the sales price. A contract is considered completed when all significant costs have been incurred and the project has been accepted by the customer. The contracts have a place for the customer to sign indicating their acceptance of the completed Wellness House. At this time the customer will also pay any remaining balance on the contract. The Company recognizes the full contract revenue at this point. Contract costs consist primarily of materials and labor costs. The construction period of a Wellness House generally does not exceed five days.

Shipping Costs

Shipping Costs

Shipping costs are included in selling expenses and totaled $11,189 and $11,575 for the three months ended June 30, 2020 and 2019, respectively, and $15,078 and $28,971 for the six months ended June 30, 2020 and 2019, respectively.

Income Taxes

Income Taxes

The Company is governed by the Income Tax Law and associated legislations of the PRC. The Company accounts for income taxes in accordance with FASB ASC 740 “Income Taxes”, which is an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s financial statements or tax returns. ASC 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets is dependent upon future earnings, if any, of which the timing and amount are uncertain.

According to ASC 740, the evaluation of a tax position is a two-step process. The first step is to determine whether it is more likely than not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigation based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50% likelihood of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. ASC 740 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures, and transition.

Basic and Diluted Earnings per Share

Basic and Diluted Earnings per Share

The Company reports earnings per share in accordance with FASB ASC 260 "Earnings per share". The Company's basic earnings per share are computed using the weighted average number of shares outstanding for the periods presented. Diluted earnings per share are computed based on the assumption that any dilutive options or warrants were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, the Company's outstanding stock warrants are assumed to be exercised, and funds thus obtained were assumed to be used to purchase common stock at the average market price during the period. There were no dilutive instruments outstanding during the six months periods ended June 30, 2020 and 2019.

Segment Information

Segment Information

The Company follows FASB ASC 280-Segment Reporting, which requires that companies disclose segment data based on how management makes decision about allocating resources to segments and evaluating their performance.

For the six months ended June 30, 2020 and the year ended December 31, 2019, management has determined that the Company is operating in three reportable business segments, (1) Healthcare Knit Goods Series, (2) Daily Healthcare and Personal Care Series, and (3) Wellness House and Activated Water Machine Series. The Company's reportable segments are strategic business units that offer different products. They are managed separately based on the fundamental differences in their operations.

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

In December 2019, the FASB issued a new standard to simplify the accounting for income taxes. The guidance eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences related to changes in ownership of equity method investments and foreign subsidiaries. The guidance also simplifies aspects of accounting for franchise taxes and enacted changes in tax laws or rates, and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. We believe that adoption of this new standard will not have material impact in our consolidated financial statements, including accounting policies, processes, and systems.

In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The guidance should be adopted on a prospective basis for the annual or any interim goodwill impairment tests beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company adopted the standard in 2019. Adoption of the standard did not have a significant impact on the Company's consolidated statement of earnings in 2019.

In June 2018, the FASB issued ASU 2018-07, "Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting," which simplifies the accounting for share-based payments granted to nonemployees for goods and services and aligns most of the guidance on such payments to nonemployees with the requirements for share-based payments granted to employees. ASU 2018-07 becomes effective for the Company on January 1, 2019. Early adoption is permitted. The Company adopted the standard in 2019. Adoption of the standard did not have a significant impact on the Company's consolidated statement of earnings in 2019.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The standard outlined a comprehensive lease accounting model that superseded the previous lease guidance and required lessees to recognize lease liabilities and corresponding right-of-use assets for all leases with lease terms greater than 12 months. The guidance also changed the definition of a lease and expanded the disclosure requirements of lease arrangements. The Company adopted the standard on December 15, 2019. Adoption of the standard did not have a significant impact on the Company's consolidated statement of earnings in 2019.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326), which requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application will be permitted for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company adopted the standard in 2019. Adoption of the standard did not have a significant impact on the Company's consolidated statement of earnings in 2019.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the SEC did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements.

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Organization (Tables)

6 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of following table lists the Company and its subsidiaries

Name	Domicile and Date of Incorporation	Paid in Capital	Percentage of Effective Ownership	Principal Activities
Joway Health Industries Group Inc.	March 21, 2003, Nevada	USD 20,054	86.8% owned by Crystal Globe Limited 13.2%owned by other institutional and individual investors	Investment Holding
Dynamic Elite International Limited	June 2, 2010, British Virgin Islands	USD 10,000	100% owned by Joway Health Industries Group Inc.	Investment Holding
Tianjin Junhe Management Consulting Co., Ltd.	September 15, 2010, PRC	USD 20,000	100% owned by Dynamic Elite International Limited	Advisory
Tianjin Joway Shengshi Group Co., Ltd.	May 17, 2007, PRC	USD 7,216,140.72	99% owned by Jinghe Zhang,  and 1% owned  by Baogang Song	Production and distribution of Healthcare Knit Goods and Daily Healthcare and Personal Care products
Shenyang Joway Electronic Technology Co., Ltd.	March 28, 2007, PRC	USD 142,072.97	100% owned by Tianjin Joway Shengshi Group Co., Ltd	Distribution of Tourmaline Activated Water Machine and construction of Tourmaline Wellness House
Tianjin Joway Decoration Engineering Co., Ltd.	April 22, 2009, PRC	USD 292,367.74	100% owned by Tianjin Joway Shengshi Group Co., Ltd	Distribution of Wellness House for family use and Activated Water Machine and construction of Tourmaline Wellness House
Tianjin Oriental Shengtang Import & Export Trading Co., Ltd.	September 18, 2009, PRC	USD 292,463.75	100% owned by Tianjin Joway Shengshi Group Co., Ltd	Distribution of tourmaline products

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Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Schedule of gains and losses from foreign currency transactions

	For the six months ended June 30,				For the year ended December 31,
	2020		2019		2019
Period ended RMB: USD Exchange rate		7.0795		6.86557		6.9762
Average RMB: USD Exchange rate		7.0319		6.78392		6.8985

Schedule of estimated useful lives of assets

Building	20 years
Operating Equipment	10 years
Office furniture and equipment	3 or 5 years
Vehicles	10 years

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Accounts Receivable (Tables)

6 Months Ended

Jun. 30, 2020

Receivables [Abstract]

Schedule of accounts receivable

	June 30,			December 31,
	2020			2019
Accounts receivable	$	2,553		$	2,591
Less: allowance for bad debt		(2,553	)		(2,591	)
Accounts receivable, net	$	-		$	-

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Inventories (Tables)

6 Months Ended

Jun. 30, 2020

Inventory Disclosure [Abstract]

Schedule of inventories

	June 30,			December 31,
	2020			2019
Raw materials	$	119,027		$	126,563
Finished goods		431,889			444,175
Low value consumables		35,995			36,528
Total		586,911			607,266
Less: impairment loss		(105,435	)		(106,997	)
Inventory, net	$	481,476		$	500,269

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Property, Plant and Equipment (Tables)

6 Months Ended

Jun. 30, 2020

Property, Plant and Equipment [Abstract]

Schedule of property, plant and equipment

	June 30,			December 31,
	2020			2019
Building	$	5,624,223		$	5,707,503
Operating Equipment		412,929			419,044
Office furniture and equipment		334,198			339,147
Vehicles		966,144			980,450
Total		7,337,494			7,446,144
Less: accumulated depreciation		(4,202,454	)		(4,068,783	)
Property, plant and equipment, net	$	3,135,040		$	3,377,361

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Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of intangible assets

	June 30,			December 31,
	2020			2019
Land use rights	$	583,100		$	591,734
Other intangible assets		74,605			75,710
Total		657,705			667,444
Less: accumulated amortization		(223,296	)		(219,411	)
Intangible assets, net	$	434,409		$	448,033

Schedule of estimated amortization expense

Estimated amortization expense for
the year ending December 31,	Amount
2020	$	19,000
2021	$	19,000
2022	$	19,000
2023	$	19,000
2024	$	19,000
Thereafter	$	353,033

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Related Party Transactions (Tables)

6 Months Ended

Jun. 30, 2020

Related Party Transactions [Abstract]

Schedule of payables due to related parties

	June 30,		December 31,
	2020		2019
Jinghe Zhang	$	1,734,948	$	1,480,515
Total	$	1,734,948	$	1,480,515

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Income Taxes (Tables)

6 Months Ended

Jun. 30, 2020

Income Tax Disclosure [Abstract]

Schedule of differences between the PRC statutory federal rate and effective tax rate

	For the six months ended June 30,
	2020			2019
Tax computed at China statutory rates		25	%		25	%
Effect of losses		(25	)%		(25	)%
Effective rate		0	%		0	%

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Segments (Tables)

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Schedule of segment reporting

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	4,346	$	2,091	$	2,255	$	(12,273	)	$	6,405	$	119,329
Daily Healthcare and Personal Care Series		25,685		13,151		12,534		(73,327	)		37,853		192,597
Wellness House and Activated Water Machine Series		37,871		22,487		15,384		(111,212	)		55,812		198,240
Segment Totals	$	67,902	$	37,729	$	30,173		(196,812	)	$	100,070		510,166
Other Loss, net								(285	)
Income tax benefits								-
Unallocated Assets													3,800,849
Net Loss							$	(197,097	)
Total Assets												$	4,311,015

For the three months ended June 30, 2019

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	15,841	$	4,523	$	11,318	$	(11,214	)	$	9,912	$	142,532
Daily Healthcare and Personal Care Series		51,577		23,556		28,021		(87,371	)		32,273		230,516
Wellness House and Activated Water Machine Series		103,961		54,680		49,281		(173,882	)		65,051		190,719
Segment Totals	$	171,379	$	82,759	$	88,620		(272,467	)	$	107,236		563,767
Other Loss, net								(83	)
Income tax benefits								-
Unallocated Assets													4,390,832
Net Loss							$	(272,550	)
Total Assets												$	4,954,599

For the six months ended June 30, 2020

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	6,553	$	3,113	$	3,440	$	(64,308	)	$	16,229	$	119,329
Daily Healthcare and Personal Care Series		30,662		15,464		15,198		(190,675	)		75,937		192,597
Wellness House and Activated Water Machine Series		44,903		27,174		17,729		(278,435	)		111,205		198,240
Segment Totals	$	82,118	$	45,751	$	36,367		(533,418	)	$	203,371		510,166
Other Loss, net								(1,108	)
Income tax benefits								-
Unallocated Assets													3,800,849
Net Loss							$	(534,526	)
Total Assets												$	4,311,015

For the six months ended June 30, 2019

	Sales		COGS		Gross profit		Loss from operations			Depreciation and amortization		Assets
Healthcare Knit Goods Series	$	47,187	$	23,507	$	23,680	$	(98,139	)	$	33,129	$	142,532
Daily Healthcare and Personal Care Series		81,895		38,405		43,490		(167,931	)		57,497		230,516
Wellness House and Activated Water Machine Series		181,168		90,251		90,917		(376,786	)		127,195		190,719
Segment Totals	$	310,250	$	152,163	$	158,087		(642,856	)	$	217,821		563,767
Other Loss, net								(1,191	)
Income tax benefits								-
Unallocated Assets													4,390,832
Net Loss							$	(644,047	)
Total Assets												$	4,954,599

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Franchise Revenues (Tables)

6 Months Ended

Jun. 30, 2020

Franchise Revenues [Abstract]

Schedule of revenue between franchise and non-franchise customers

	For the three months ended June 30,				For the six months ended June 30,
	2020		2019		2020		2019
Sales to franchise customers	$	56,473	$	120,369	$	70,385	$	225,476
Sales to non-franchise customers		11,429		51,010		11,733		84,774
Total sales	$	67,902	$	171,379	$	82,118	$	310,250

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Organization (Details) - USD ($)	6 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
List of Company and its subsidiaries
Paid in Capital	$ 7,361,665	$ 7,361,665
Joway Health Industries Group Inc. [Member]
List of Company and its subsidiaries
Domicile and Date of Incorporation	March 21, 2003, Nevada
Paid in Capital	$ 20,054
Percentage of Effective Ownership	86.8% owned by Crystal Globe Limited 13.2% owned by other institutional and individual investors
Principal Activities	Investment Holding
Dynamic Elite International Limited [Member]
List of Company and its subsidiaries
Domicile and Date of Incorporation	June 2, 2010, British Virgin Islands
Paid in Capital	$ 10,000
Percentage of Effective Ownership	100% owned by Joway Health Industries Group Inc.
Principal Activities	Investment Holding
Tianjin Junhe Management Consulting Co., Ltd. [Member]
List of Company and its subsidiaries
Domicile and Date of Incorporation	September 15, 2010, PRC
Paid in Capital	$ 20,000
Percentage of Effective Ownership	100% owned by Dynamic Elite International Limited
Principal Activities	Advisory
Tianjin Joway Shengshi Group Co., Ltd. [Member]
List of Company and its subsidiaries
Domicile and Date of Incorporation	May 17, 2007, PRC
Paid in Capital	$ 7,216,141
Percentage of Effective Ownership	99% owned by Jinghe Zhang, and 1% owned by Baogang Song
Principal Activities	Production and distribution of Healthcare Knit Goods and Daily Healthcare and Personal Care products
Shenyang Joway Electronic Technology Co., Ltd. [Member]
List of Company and its subsidiaries
Domicile and Date of Incorporation	March 28, 2007, PRC
Paid in Capital	$ 142,073
Percentage of Effective Ownership	100% owned by Tianjin Joway Shengshi Group Co., Ltd.
Principal Activities	Distribution of Tourmaline Activated Water Machine and construction of Tourmaline Wellness House
Tianjin Joway Decoration Engineering Co., Ltd. [Member]
List of Company and its subsidiaries
Domicile and Date of Incorporation	April 22, 2009, PRC
Paid in Capital	$ 292,368
Percentage of Effective Ownership	100% owned by Tianjin Joway Shengshi Group Co., Ltd.
Principal Activities	Distribution of Wellness House for family use and Activated Water Machine and construction of Tourmaline Wellness House
Tianjin Oriental Shengtang Import & Export Trading Co., Ltd. [Member]
List of Company and its subsidiaries
Domicile and Date of Incorporation	September 18, 2009, PRC
Paid in Capital	$ 292,464
Percentage of Effective Ownership	100% owned by Tianjin Joway Shengshi Group Co., Ltd.
Principal Activities	Distribution of tourmaline products

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Organization (Details Textual)				1 Months Ended		6 Months Ended
	May 15, 2019 USD ($)	May 15, 2019 CNY (¥)	Nov. 13, 2016	Nov. 20, 2016 shares	Jul. 20, 2010 $ / shares	Jun. 30, 2020	Sep. 21, 2010	Jul. 28, 2010	Jul. 25, 2010	Jul. 09, 2010	May 17, 2007
Organization (Textual)
Percentage of shares acquired by Dynamic Elite International Limited from Joway Health							76.08%
Percentage of shares transferred				1.00%
Jinghe Zhang [Member]
Organization (Textual)
Ownership percentage				86.80%
Common stock shares | shares				17,408,000
Tianjin Joway Shengshi Group Co., Ltd. [Member]
Organization (Textual)
Ownership percentage											99.00%
Business acquisition percentage of remaining voting interests acquired											1.00%
Joway Shengshi owned of Joway Technology [Member]
Organization (Textual)
Ownership percentage	100.00%	100.00%							90.91%
Business acquisition percentage of remaining voting interests acquired									9.09%
Dividends | $	$ 927,192.54
Joway Shengshi owned of Joway Technology [Member] | RMB [Member]
Organization (Textual)
Dividends | ¥		¥ 6,290,000
Joway Shengshi owned of Joway Decoration [Member]
Organization (Textual)
Ownership percentage										90.00%
Business acquisition percentage of remaining voting interests acquired										10.00%
Joway Shengshi To Shengtang Trading [Member]
Organization (Textual)
Ownership percentage								95.00%
Business acquisition percentage of remaining voting interests acquired								5.00%
Joway Shengshi To CGL [Member]
Organization (Textual)
Percentage of right to purchase of shares					100.00%
Call Option expiration term under VIE Agreements					5 years
Options exercise price per share | $ / shares					$ 2.00
CGL [Member]
Organization (Textual)
Call option, description						The Call Option vested as to 34% of the shares of Crystal Globe on April 2, 2011 and as to 33% on each of April 2, 2012 and 2013 (the respective "Call Option Effective Date"). On March 28, 2015, the Grantor and Grantees amended the Call Option Agreement, to (i) reduce the Exercise Price to $0.00 per share and (ii) extend the Grantees' rights to exercise their call option within ten years from the respective Option Effective Date.
CGL [Member] | Jinghe Zhang [Member]
Organization (Textual)
Percentage of right to purchase of shares			99.00%
Percentage of shares transferred			1.00%

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Summary of Significant Accounting Policies (Details)	Jun. 30, 2020	Dec. 31, 2019	Jun. 30, 2019
Period ended RMB: USD Exchange rate
Summary of gains and losses from foreign currency transactions
Gains and losses from foreign currency transactions	7.0795	6.9762	6.86557
Average RMB: USD Exchange rate
Summary of gains and losses from foreign currency transactions
Gains and losses from foreign currency transactions	7.0319	6.8985	6.78392

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Summary of Significant Accounting Policies (Details 1)	6 Months Ended
	Jun. 30, 2020
Building [Member]
Summary of estimated useful lives of fixed assets
Estimated useful lives	20 years
Operating Equipment [Member]
Summary of estimated useful lives of fixed assets
Estimated useful lives	10 years
Office furniture and equipment [Member] | Minimum [Member]
Summary of estimated useful lives of fixed assets
Estimated useful lives	3 years
Office furniture and equipment [Member] | Maximum [Member]
Summary of estimated useful lives of fixed assets
Estimated useful lives	5 years
Vehicles [Member]
Summary of estimated useful lives of fixed assets
Estimated useful lives	10 years

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Summary of Significant Accounting Policies (Details Textual)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2020 USD ($)	Jun. 30, 2019 USD ($)	Jun. 30, 2020 USD ($) Segment	Jun. 30, 2019 USD ($)	Dec. 31, 2019 USD ($) Segment
Summary of Significant Accounting Policies (Textual)
Foreign currency translation adjustments	$ 1,436	$ (90,110)	$ (42,691)	$ 13,670
Valuation allowance for inventories	105,435		105,435		$ 106,997
Allowance for doubtful accounts	2,553		2,553		2,591
Advances to suppliers	80,981		$ 80,981		$ 56,418
Land use rights granted to amortized using the straight-line method over			50 years
Other intangible assets are software programs that are amortized over estimated useful life			10 years
Wellness House construction period			5 days
Shipping costs included in selling expenses	$ 11,189	$ 11,575	$ 15,078	$ 28,971
Income tax examination, likelihood upon ultimate settlement, description			The largest amount of benefit that is greater than 50% likelihood of being realized upon ultimate settlement.
Number of reportable business segments | Segment			3		3

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Going Concern (Details) - USD ($)	6 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Going Concern (Textual)
Accumulated deficit	$ (5,798,566)	$ (5,264,040)
Working capital deficit	$ 1,189,000

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Accounts Receivable (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Receivables [Abstract]
Accounts receivable	$ 2,553	$ 2,591
Less: allowance for bad debt	(2,553)	(2,591)
Accounts receivable, net

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Accounts Receivable (Details Textual) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Accounts Receivable (Textual)
Allowance for doubtful accounts	$ 2,553	$ 2,591

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Inventories (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Summary of inventories
Raw materials	$ 119,027	$ 126,563
Finished goods	431,889	444,175
Low value consumables	35,995	36,528
Total	586,911	607,266
Less: impairment loss	(105,435)	(106,997)
Inventory, net	$ 481,476	$ 500,269

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Inventories (Details Textual) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Inventories (Textual)
Impairment loss from inventory	$ 105,435	$ 106,997

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Property, Plant and Equipment (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Summary of property, plant and equipment
Total	$ 7,337,494	$ 7,446,144
Less: accumulated depreciation	(4,202,454)	(4,068,783)
Property, plant and equipment, net	3,135,040	3,377,361
Building [Member]
Summary of property, plant and equipment
Total	5,624,223	5,707,503
Operating Equipment [Member]
Summary of property, plant and equipment
Total	412,929	419,044
Office furniture and equipment [Member]
Summary of property, plant and equipment
Total	334,198	339,147
Vehicles [Member]
Summary of property, plant and equipment
Total	$ 966,144	$ 980,450

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Property, Plant and Equipment (Details Textual) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Property, Plant and Equipment (Textual)
Depreciation expense	$ 97,107	$ 102,432	$ 196,237	$ 208,149

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Intangible Assets (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Summary of intangible assets
Land use rights	$ 583,100	$ 591,734
Other intangible assets	74,605	75,710
Total	657,705	667,444
Less: accumulated amortization	(223,296)	(219,411)
Intangible assets, net	$ 434,409	$ 448,033

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Intangible Assets (Details 1)	Dec. 31, 2019 USD ($)
Estimated amortization expense for the year ending December 31,
2020	$ 19,000
2021	19,000
2022	19,000
2023	19,000
2024	19,000
Thereafter	$ 353,033

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Intangible Assets (Details Textual) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Intangible Assets (Textual)
Amortization expense of intangible assets	$ 2,963	$ 4,804	$ 7,134	$ 9,672

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Related Party Transactions (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Summary of payables due to related parties
Total	$ 1,734,948	$ 1,480,515
Jinghe Zhang [Member]
Summary of payables due to related parties
Total	$ 1,734,948	$ 1,480,515

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Related Party Transactions (Details Textual) - USD ($)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2018	Dec. 31, 2008
Related Party Transactions (Textual)
Repaid advances	$ 0	$ 118,458
Joway Shengshi [Member]
Related Party Transactions (Textual)
Received cash advances in the aggregate principal amount	6,367,759
Jinghe Zhang [Member]
Related Party Transactions (Textual)
Received amount of related parties	254,433	$ 663,356
Total unpaid principal balance	1,734,948
Received cash advances in the aggregate principal amount	$ 4,632,811
Shenyang Joway [Member]
Related Party Transactions (Textual)
Ownership percentage, description	More than 50% of the equity.
Interest-free, unsecured advances for working capital			$ 912,645
Unpaid advances	$ 0
Shenyang Joway Industrial Development Co., Ltd. [Member]
Related Party Transactions (Textual)
Interest-free, unsecured advances for working capital				$ 58,568

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Income Taxes (Details)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Summary of differences between the PRC statutory federal rate and effective tax rate
Tax computed at China statutory rates	25.00%	25.00%
Effect of losses	(25.00%)	(25.00%)
Effective rate	0.00%	0.00%

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Income Taxes (Details Textual)	Jan. 31, 2008
Enterprise Income Tax [Member]
Income Taxes (Textual)
Statutory rate	25.00%

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Statutory Reserves (Details)	6 Months Ended
	Jun. 30, 2020 USD ($)
Statutory Reserves (Textual)
Minimum statutory reserves allocation, percentage	10.00%
Income after tax until the reserves reaches, percentage	50.00%
Statutory reserves	$ 354,052

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Segments (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Reportable business segments
Sales	$ 67,902	$ 171,379	$ 82,118	$ 310,250
COGS	37,729	82,759	45,751	152,163
Gross profit	30,173	88,620	36,367	158,087
Loss from operations	(196,812)	(272,467)	(533,418)	(642,856)
Depreciation and amortization	100,070	107,236	203,371	217,821
Assets	510,166	563,767	510,166	563,767
Other Loss, net	(285)	(83)	(1,108)	(1,191)
Income tax benefits
Unallocated Assets	3,800,849	4,390,832	3,800,849	4,390,832
Net Loss	(197,097)	(272,550)	(534,526)	(644,047)
Total Assets	4,311,015	4,954,599	4,311,015	4,954,599	$ 4,608,181
Wellness House and Activated Water Machine Series [Member]
Reportable business segments
Sales	37,871	103,961	44,903	181,168
COGS	22,487	54,680	27,174	90,251
Gross profit	15,384	49,281	17,729	90,917
Loss from operations	(111,212)	(173,882)	(278,435)	(376,786)
Depreciation and amortization	55,812	65,051	111,205	127,195
Assets	198,240	190,719	198,240	190,719
Daily Healthcare and Personal Care Series [Member]
Reportable business segments
Sales	25,685	51,577	30,662	81,895
COGS	13,151	23,556	15,464	38,405
Gross profit	12,534	28,021	15,198	43,490
Loss from operations	(73,327)	(87,371)	(190,675)	(167,931)
Depreciation and amortization	37,853	32,273	75,937	57,497
Assets	192,597	230,516	192,597	230,516
Healthcare Knit Goods Series [Member]
Reportable business segments
Sales	4,346	15,841	6,553	47,187
COGS	2,091	4,523	3,113	23,507
Gross profit	2,255	11,318	3,440	23,680
Loss from operations	(12,273)	(11,214)	(64,308)	(98,139)
Depreciation and amortization	6,405	9,912	16,229	33,129
Assets	$ 119,329	$ 142,532	$ 119,329	$ 142,532

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Segments (Details Textual) - Segment	6 Months Ended	12 Months Ended
	Jun. 30, 2020	Dec. 31, 2019
Segments (Textual)
Number of reportable business segments	3	3

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Franchise Revenues (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Schedule of franchise and non-franchise customers
Total sales	$ 67,902	$ 171,379	$ 82,118	$ 310,250
Franchise Customers [Member]
Schedule of franchise and non-franchise customers
Total sales	56,473	120,369	70,385	225,476
Non-Franchise Customers [Member]
Schedule of franchise and non-franchise customers
Total sales	$ 11,429	$ 51,010	$ 11,733	$ 84,774

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Franchise Revenues (Details Textual)	6 Months Ended
	Jun. 30, 2020
Franchise Revenues (Textual)
Franchising agreements, description	The franchising agreements are generally for terms of three years and are renewable at the mutual agreement of both parties.
Term of franchising renewable agreements	3 years