NOTE 2 - DISCONTINUED OPERATIONS

12 Months Ended

Apr. 30, 2020

Notes

NOTE 2 - DISCONTINUED OPERATIONS

NOTE 2 - DISCONTINUED OPERATIONS

On July 30, 2019, Qufu Natural Green entered into an Asset Transfer Agreement with Na Li, an unaffiliated individual (the "Buyer") for the sale of 100% equity ownership of Qufu Shengwang. Pursuant to the Asset Transfer Agreement, the Buyer shall pay to Qufu Natural Green a total cash consideration of RMB8,000,000 (approximately $1,163,000) based on the estimated net book value as of July 30, 2019, payable in two installments of RMB5,000,000 (approximately $727,000) on July 30, 2019 and RMB3,000,000 (approximately $436,000) on September 30, 2019. The Buyer assumed all assets and liabilities of Qufu Shengwang including the amount of Qufu Shengwang's due to Qufu Natural Green of approximately RMB26,000,000 (approximately $3,779,000), and Qufu Natural Green shall assist in completing all documents required for the equity transfer after confirming the receipt of the first payment. The Company received the first installment of RMB5,000,000 on July 30, 2019, and received the second installment of RMB3,000,000 on August 20, 2019. The Buyer settled all liabilities of Qufu Shengwang due to Natural Green by assuming the liabilities on behalf of Qufu Shengren in the amount of approximately RMB 26,000,000 (approximately $3,779,000) due to another third party.

Prior to July 30, 2019, Qufu Shangwang engaged in our Chinese medicine segment. In our Chinese medicine segment, we manufactured and sold traditional Chinese medicine formula extracts which are used in products made for use by both humans and animals. As a result of the sale of Qufu Shengwang, our Chinese medicine segment is treated as a discontinued operation.

  Pursuant to ASC Topic 205-20, Presentation of Financial Statements - Discontinued Operations, the results of operations from the Chinese medicine segment for the years ended April 30, 2020 and 2019 have been classified as discontinued operations and included in the line caption of the loss from discontinued operations line in the accompanying consolidated statements of operations and comprehensive loss presented herein. The assets and liabilities also have been classified as discontinued operations under the line captions of current assets held for sale, non-current assets held for sale, current liabilities held for sale and non-current liabilities held for sale in the Company's consolidated balance sheets as of April 30, 2020 and 2019.

The assets and liabilities classified as discontinued operations in the Company's consolidated financial statements as of April 30, 2020 and 2019 were set forth below. 

	April 30, 2020	April 30, 2019
Assets:
Current assets:
Cash	$0	$426,766
Accounts receivable, net	0	322,902
Inventories, net	0	949,705
Due from related parties	0	2,308,159
Prepaid expenses and other	0	135,527
Total current assets	0	4,143,059
Property and equipment, net	0	985,630
Land use rights, net	0	1,795,362
Other long-term asset	0	144,714
Total assets	$0	$7,068,765
Liabilities:
Current liabilities:
Accounts payable	$0	$389,521
Accrued expenses and other liabilities	0	599,227
Total current liabilities	0	988,748
Long-term loans	0	947,445
Total liabilities *	$0	$1,936,193

*  Not including intercompany loan of Qufu Shengwang payable to Qufu Natural Green in the amount of RMB27,354,608 (approximately $3,976,000) which was not reflected on the consolidated financial statements as of April 30, 2019 due to consolidation.

The following table presented the results of discontinued operations in the fiscal years ended April 30, 2020 and 2019:

	Fiscal Years Ended April 30,
	2020	2019
Revenues	$733,441	$2,730,140
Cost of revenues	572,357	2,269,216
Loss before income taxes	(20,016)	(244,402)
Income tax expense	0	0
Loss from discontinued operations	(20,016)	(244,402)
Gain from disposal, net of taxes	61,050	0
Loss from sales of subsidiary	(294,465)	0
Total loss from discontinued operations	$(253,431)	$(244,402)

For the years ended April 30, 2020 and 2019, loss from discontinued operations amounted to $253,431 and $244,402. The Company realized a loss of $294,465 from the disposal of 100% of the equity of Qufu Shengwang, which was reflected as loss from sale of discontinued operations on the consolidated statement of operations and comprehensive loss for the year ended April 30, 2020.