Intangible Assets and Digital Assets

3 Months Ended

Sep. 30, 2024

Intangible Assets and Digital Assets [Abstract]

INTANGIBLE ASSETS AND DIGITAL ASSETS

NOTE 6 – INTANGIBLE ASSETS AND DIGITAL ASSETS

Intangible assets

Intangible assets consisted of the following:

	September 30,		June 30,
	2024		2024
Land use rights, net	$	7,844,019	$	7,624,558
Trademarks		5,895,043		5,688,599
Total	$	13,739,062	$	13,313,157

LAND USE RIGHT

On September 25, 2009, Yuxing was granted a land use right for approximately 88 acres (353,000 square meters or 3.8 million square feet) by the People’s Government and Land & Resources Bureau of Hu County, Xi’an, Shaanxi Province. The fair value of the related intangible asset was determined to be the respective cost of RMB73,184,895 (or $10,428,116). The intangible asset is being amortized over the grant period of 50 years using the straight-line method.

On August 13, 2003, Tianjuyuan was granted a certificate of Land Use Right for a parcel of land of approximately 11 acres (42,726 square meters or 459,898 square feet) at Ping Gu District, Beijing. The purchase cost was recorded at RMB1,045,950 (or $149,037). The intangible asset is being amortized over the grant period of 50 years.

On August 16, 2001, Jinong received a land use right as a contribution from a shareholder, which was granted by the People’s Government and Land & Resources Bureau of Yangling District, Shaanxi Province. The fair value of the related intangible asset at the time of the contribution was determined to be RMB7,285,099 (or $1,038,054). The intangible asset is being amortized over the grant period of 50 years.

The land use rights consisted of the following:

	September 30,			June 30,
	2024			2024
Land use rights	$	11,466,169		$	11,064,624
Less: accumulated amortization		(3,622,150	)		(3,440,066	)
Total land use rights, net	$	7,844,019		$	7,624,558

TRADEMARKS

On July 2, 2010, the Company acquired Gufeng and its wholly-owned subsidiary Tianjuyuan. The preliminary fair value of the acquired trademarks was estimated to be RMB41,371,630 (or $5,895,044) and is subject to an annual impairment test.

AMORTIZATION EXPENSE

Estimated amortization expenses of intangible assets for the next twelve months periods ended September 30, are as follows:

Twelve Months Ended on September 30,	Expense ($)
2025		257,022
2026		237,985
2027		228,967
2028		228,967
2029		228,967

Digital assets

On March 13, 2023, the Company established Antaeus Tech Inc. (“Antaeus”) in the State of Delaware. In April 2023, Antaeus started to purchase digital assets mining machines and to mine Bitcoin in West Texas. As of September 30, 2024, and June 30, 2024, the Company held digital assets with amount of $11,225 and $53,693, respectively. The Company’s digital assets include Bitcoin only. Digital assets are classified on our balance sheet as current assets due to the Company’s ability to sell them in a highly liquid marketplace and its intent to liquidate its digital assets to support operations when needed.

The Company adopted ASU 2023-08, which requires entities to measure crypto assets at fair value with changes recognized in the Condensed Consolidated Statements of Operations each reporting period. The Company’s digital assets were within the scope of ASU 2023-08 and a cumulative-effect adjustment of $(262) as of the three months ended September 30, 2024 was recorded for the difference between the carrying amount of the Company’s digital assets and fair value.

The following table presents the Company’s significant digital asset Bitcoin holdings as of September 30, 2024:

	Quantity		Cost Basis		Fair Value
Bitcoin		0.18		63,330		11,225
Total Bitcoin held as of September 30, 2024		0.18	$	63,330	$	11,225

The following table presents a roll-forward of total digital assets (including digital assets, restricted) for the three months ended September 30, 2024, based on the fair value model under ASU 2023-08:

	Fair Value
Beginning Balance: Digital assets at June 30, 2024	$	53,693
Addition of digital assets, mining proceeds		162,973
Addition of digital assets, other		-
Disposition of digital assets		(213,910	)
Realized gain (loss) on digital assets		8,730
Unrealized gain (loss) on digital assets		(262	)
Digital assets at September 30, 2024	$	11,225

For the three months ended September 30, 2024, the Company acquired $162,973 of digital assets through mining activities and disposed of $213,910 digital assets through the sale of digital assets. For the three months ended September 30, 2024, the Company realized total gains on digital assets of $8,730.