Inventories

9 Months Ended

Dec. 31, 2019

Inventory Disclosure [Abstract]

INVENTORIES

NOTE 5. INVENTORIES

Inventories are generally kept for a short period of time. Inventories are comprised of growing costs, harvesting costs, raw materials, and finished goods (including harvesting agricultural produce paddy and processed rice and other agricultural products).

Growing costs, also referred to as agricultural costs, consist of seeds, cultivation, fertilization, labor costs and soil improvement, pest control and irrigation.

Harvest costs are comprised of labor and equipment expenses incurred to harvest and deliver crops to the packinghouses.

Raw materials include all costs of materials purchased to be used in production of the Company's products.

Agricultural produce paddy is grown in Lvxin's planting base. This crop has distinct growing, harvest, and selling periods, each of which lasts approximately four to six months. During the growing period (usually April to September), agricultural costs are capitalized, as they are associated with benefiting and preparing the crops for the harvest and selling period. During the harvest and selling period, harvest costs and agricultural costs are capitalized as inventories, then amortized as a cost of sales in accordance with FIFO recognition of historical costs when the inventory is sold.

Most agricultural costs, including amortization of capitalized agricultural costs and certain other costs, such as indirect labor including farm supervision and management and irrigation that benefit multiple crops, are allocated to crops on a per-kilogram basis.

The cost of harvesting agricultural produce paddy includes all relevant expenditures incurred before and during the entire cultivation period and after harvesting, mainly including seed, fertilizer and other production materials, land rent, labor, and other related costs, subject to impairment if the cost of inventory exceeds net realizable value.

Manufactured goods, rice and other products includes all expenditures incurred in bringing the goods to the point of sale and putting them in a saleable condition.

The Company values inventory on its balance sheet at the lower of cost or net realizable value. Based on recent sales experience, the Company determined that the net realizable value of its inventory was less than the costs incurred in producing the inventory. Therefore, an impairment charge was made as of March 31, 2019. At December 31, 2019 and March 31, 2019, inventories consisted of the following:

	December 31,		March 31,
	2019		2019
	(Unaudited)
Growing cost	$	-	$	70,211
Selenium enriched paddy		568,459		396,800
Rice and other products		50,698		68,662
Packing and other materials		11,876		10,170
Total inventories at cost		631,033		545,843
Inventory-impairment		-		(29,439	)
Inventories, net	$	631,033	$	516,404

For the nine months ended December 31, 2019, inventory-impairment of $28,354 has been reflected in cost of sales since the corresponding inventories have been sold.