Discontinued Operations

3 Months Ended

Mar. 31, 2020

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

Note 3 - Discontinued Operations

On January 7, 2020, the Company transferred its entire interest in Bright Swallow to Y-Tone (Worldwide) Limited, an unrelated third party, for cash consideration of $2.50 million, pursuant to a formal agreement entered into on January 7, 2020. The Company received the payment on May 11, 2020.

As of March 31, 2019, operations of Bright Swallow were reported as discontinued operations in the accompanying unaudited condensed consolidated financial statements for all periods presented. Accordingly, assets, liabilities, revenues, expenses and cash flows related to Bright Swallow have been reclassified in the condensed consolidated financial statements as discontinued operations for all periods presented.

The following table summarizes the net assets of Bright Swallow at the date of disposal (January 7, 2020):

Cash and cash equivalents	$	1,462,200
Accounts receivable, net		969,841
Advance to suppliers		609,935
Accounts payable		(948	)
Advance from customers		(126,916	)
Accrued liabilities and other payables		(2,553	)
Income tax payable		(85,028	)
Net assets of Bright Swallow upon disposal		2,826,531
Consideration receivable as of March 31, 2020		(2,500,000	)
Loss on disposal of subsidiary	$	(326,531	)

The following table presents the components of discontinued operations in relation to Bright Swallow reported in the condensed consolidated statements of operations:

	For the three months ended
	March 31, 2020			March 31, 2019
Sales		-		$	1,866,066
Cost of sales		-			(1,666,735	)
Operating expenses		-			(103,446	)
Other expense, net		-			(676	)
Loss on disposal of subsidiary		(326,531	)		-
(Loss) Income before income taxes		(326,531	)		95,209
Income tax expense		-			22,860
(Loss) income from discontinued operations		(326,531	)		72,349