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Related Party Transactions

12 Months Ended

Dec. 31, 2019

NOTE 11 – RELATED PARTY TRANSACTIONS

Ms. Hui Song was the Company's former sales director. In 2013, Ms. Hui Song resigned from the Company and no longer had any significant control or influence over the Company; therefore, she was no longer considered a related party. Jilin Jiliang Zongbao Biological Technology Co., Ltd., an entity controlled by Ms. Hui Song, and Yantai Zongbao Tele-Agriculture Service Co., Ltd., a related company of Ms. Hui Song, were also no longer considered as related parties of the Company.

*Accounts receivable from and sales to Ms. Hui Song and her associated company

For the year ended December 31, 2019, the Company did not sell any products to Ms. Hui Song and her associated company.

For the year ended December 31, 2018, the Company sold fertilizer manufacturing equipment to Jilin Jiliang Zongbao Biological Technology Co., Ltd., in the amount of $164,968, with related cost of $103,371. This transaction was reflected in the revenue and cost of goods sold.

As of December 31, 2019 and December 31, 2018, the Company has account receivable balance of $234,062 and $185,665 from Jilin Jiliang Zongbao Biological Technology Co., Ltd., respectively.

As of December 31, 2019 and December 31, 2018, the Company has account receivable balance of $0 and $61,082 from Yantai Zongbao Tele-Agriculture Service Co., Ltd., respectively.

*Accounts payable to and purchase from Ms. Hui Song and her associated company

For the year ended December 31, 2019, the Company purchased fertilizer of $3,054,791 from Jilin Jiliang Zongbao Biological Technology Co., Ltd., an entity controlled by Ms. Hui Song. As of December 31, 2019, accounts payable to Jilin Jiliang Zongbao Biological Technology Co., Ltd. was $505,331.

For the year ended December 31, 2018, the Company purchased fertilizer of $3,651,430 from Jilin Jiliang Zongbao Biological Technology Co., Ltd., an entity controlled by Ms. Hui Song. As of December 31, 2018, accounts payable to Jilin Jiliang Zongbao Biological Technology Co., Ltd. was $72,712.

*Loan from Ms. Hui Song and her associated company

As of December 31, 2019, long-term loan payable balances for Jilin Jiliang Zongbao Biological Technology Co., Ltd. and Ms. Hui Song were of $799,237 and $264,033, respectively.

As of December 31, 2018, long-term loan payable balances for Jilin Jiliang Zongbao Biological Technology Co., Ltd. and Ms. Hui Song were of $807,780 and $266,855, respectively.

*Accounts payable to and purchase from related parties

The Company did not make any purchase from related parties for the year ended December 31, 2019.

For the year ended December 31, 2018, the Company purchased fertilizer manufacturing equipment of $120,945 from Shanghai Aoke Chemicals Co., Ltd, an entity controlled by Mr. Lirong Wang, CEO and majority shareholder of the Company. As of December 31, 2018, account payable to Shanghai Aoke Chemicals Co., Ltd. were $116,340.

As of December 31, 2019 and December 31, 2018, account payable to Shanghai Aoke Chemicals Co., Ltd. were $115,110 and $116,340, respectively.

*Due to related parties

Outstanding balance due to Mr. Lirong Wang, Ms. Xueying Sheng and Mr. Guohua Lin below are advances to the Company as working capital. These advances are due on demand, non-interest bearing, and unsecured, unless further disclosed.

	December 31,		December 31,
	2019		2018		Relationship
Mr. Lirong Wang		861,702		1,442,751	The CEO and Chairman/Actual controlling person
Ms. Xueying Sheng		73,474		169,743	Controller/Accounting manager of the Company
Mr. Guohua Lin		74,149		3,054	Senior management and a shareholder
Total		1,009,325		1,615,547

For the year ended December 31, 2019, the Company borrowed $3,950,414 from Mr. Lirong Wang, and repaid $4,272,035.

For the year ended December 31, 2019, the Company borrowed $237,041 from Mr. Guohua Lin, and repaid $165,455.

For the year ended December 31, 2019, the Company borrowed $49,070 from Ms. Xueying Sheng and repaid $115,316.