NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 1 – Organization
Reviv3 Procare Company (the “Company”)
was incorporated in the State of Delaware on May 21, 2015 as a reorganization of Reviv3 Procare, LLC which was organized on July
31, 2013. The Company is engaged in the manufacturing, marketing, sale and distribution of professional quality hair and skin care
products throughout the United States, Canada, Europe and Asia.
Note 2 – Basis of Presentation
and Summary of Significant Accounting Policies
Basis of Presentation
The unaudited financial statements for
the three months ended August 31, 2019 and 2018 have been prepared by us pursuant to the rules and regulations of the Securities
and Exchange Commission. In the opinion of the management, all adjustments necessary to present fairly our financial position,
results of operations, and cash flows as of August 31, 2019 and 2018, and for the periods then ended, have been made. Those adjustments
consist of normal and recurring adjustments. Certain information and note disclosures normally included in our annual financial
statements prepared in accordance with generally accepted accounting principles have been omitted. The unaudited financial statements
should be read in conjunction with the financial statements and notes thereto included in the Company’s annual report on
Form 10-K for the year ended May 31, 2019. The results of operations for the three months ended August 31, 2019 are not necessarily
indicative of the results to be expected for the full year.
Going Concern
As reflected in the accompanying financial
statements, the Company has a net loss and net cash used in operations of $100,609 and $6,130, respectively, for the three months
ended August 31, 2019. Additionally, the Company has an accumulated deficit of $4,738,751 at August 31, 2019. These
factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of 12 months from
the issuance date of this report. The ability of the Company to continue as a going concern is dependent on the Company’s
ability to continue its business plan, raise capital, and generate sufficient revenue; however, the Company’s cash position
may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to further implement
its business plan and generate sufficient revenue and in its ability to raise additional funds, there can be no assurances to that
effect. The financial statements do not include any adjustments related to the recoverability and classification of recorded asset
amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a
going concern.
Use of estimates
The preparation of the financial statements
in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that
affect the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures at the date of the financial
statements and during the reporting period. Actual results could materially differ from these estimates. Significant estimates
made by management include, but are not limited to, the allowance for doubtful accounts, inventory valuations, the useful
life of property and equipment, the valuation of intangible assets, the valuation of deferred tax assets, the value of stock-based
compensation, and the fair value of non-cash common stock issuances.
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 2 – Basis of Presentation
and Summary of Significant Accounting Policies (continued)
Cash and cash equivalents
The Company considers all highly liquid
debt instruments and other short-term investments with maturities of three months or less, when purchased, to be cash equivalents. The
Company maintains cash and cash equivalent balances at one financial institution that is insured by the Federal Deposit Insurance
Corporation.
Accounts receivable and allowance
for doubtful accounts
The Company has a policy of providing
on allowance for doubtful accounts based on its best estimate of the amount of probable credit losses in its existing accounts
receivable. The Company periodically reviews its accounts receivable to determine whether an allowance is necessary
based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account
balances deemed to be uncollectible are charged to bad debt expense and included in the allowance after all means of collection
have been exhausted and the potential for recovery is considered remote.
Prepaid expenses and other current assets
Prepaid expenses and other current assets
of $10,540 and $2,993 at August 31, 2019 and May 31, 2019, respectively, consist primarily of costs paid for future services which
will occur within a year and cash prepayment to vendors. Prepaid expenses at August 31, 2019 primarily include rent paid in advance
while prepayments at May 31, 2019 primarily included cash prepayment to vendors.
Inventory
The Company values inventory, consisting
of finished goods and raw materials, at the lower of cost and net realizable value. Cost is determined using an average cost method.
The Company reduces inventory for the diminution of value, resulting from product obsolescence, damage or other issues affecting
marketability, equal to the difference between the cost of the inventory and its net realizable value. The Company evaluates its
current level of inventory considering historical sales and other factors and, based on this evaluation, classifies inventory markdowns
in the statement of operations as a component of cost of goods sold. These markdowns are estimates, which could vary significantly
from actual requirements if future economic conditions, customer demand or competition differ from expectations.
Property and Equipment
Property and equipment are carried at
cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful
lives of the assets. The cost of repairs and maintenance is expensed as incurred; major replacements and improvements are capitalized. When
assets are retired or disposed of, the cost and accumulated depreciation are removed, and any resulting gains or losses are included
in the statement of operations.
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 2 – Basis of Presentation
and Summary of Significant Accounting Policies (continued)
Revenue recognition
Effective June 1, 2018, the Company adopted
Accounting Standards Codification (“ASC”) 606, Revenue From Contracts With Customers, which is effective for public
business entities with annual reporting periods beginning after December 15, 2017. This new revenue recognition standard
(new guidance) has a five-step process: a) Determine whether a contract exists; b) Identify the performance obligations; c) Determine
the transaction price; d) Allocate the transaction price; and e) Recognize revenue when (or as) performance obligations are satisfied.
The impact of the Company’s initial application of ASC 606 did not have a material impact on its financial statements and
disclosures and there was no cumulative effect of the adoption of ASC 606.
The Company sells a variety of hair and skin
care products. The Company recognizes revenue for the agreed upon sales price when a purchase order is received from the customer
and subsequently the product is shipped to the customer, which satisfies the performance obligation. Consideration paid to the
customer to promote and sell the Company’s products is typically recorded as a reduction in revenues. See Note 11 for revenue
disaggregation disclosures.
Cost of Sales
The primary components of cost of sales
include the cost of the product and shipping fees.
Shipping and Handling Costs
The Company accounts for shipping and
handling fees in accordance with ASC 606. While amounts charged to customers for shipping products are included in revenues, the
related costs of shipping products to customers are classified in marketing and selling expenses as incurred. Shipping costs included
in marketing and selling expense were $10,292 and $9,203 for the three months ended August 31, 2019 and 2018, respectively.
Marketing, selling and advertising
Marketing, selling and advertising costs
are expensed as incurred.
Customer Deposits
Customer deposits consisted of prepayments
from customers to the Company. The Company will recognize the prepayments as revenue upon delivery of products in compliance with
its revenue recognition policy.
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 2 – Basis of Presentation
and Summary of Significant Accounting Policies (continued)
Fair value measurements and fair value of financial
instruments
The Company adopted Accounting Standards
Codification (“ASC”) 820, “Fair Value Measurements and Disclosures” (“ASC 820”), for assets
and liabilities measured at fair value on a recurring basis. ASC 820 establishes a common definition for fair value to be applied
to existing generally accepted accounting principles that requires the use of fair value measurements, establishes a framework
for measuring fair value and expands disclosure about such fair value measurements. The adoption of ASC 820 did not have an
impact on the Company’s financial position or operating results, but did expand certain disclosures. ASC 820 defines
fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. Additionally, ASC 820 requires the use of valuation techniques that maximize
the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized below:
Level 1:
|
Observable inputs such as quoted market prices in active markets for identical assets or liabilities
|
Level 2:
|
Observable market-based inputs or unobservable inputs that are corroborated by market data
|
Level 3:
|
Unobservable inputs for which there is little or no market data, which require the use of the reporting entity’s own assumptions.
|
The Company analyzes all financial instruments
with features of both liabilities and equity under the Financial Accounting Standard Board’s (“FASB”) accounting
standard for such instruments. Under this standard, financial assets and liabilities are classified in their entirety based on
the lowest level of input that is significant to the fair value measurement.
The estimated fair value of certain
financial instruments, including prepaid expenses, deposits, accounts payable and accrued expenses are carried at historical cost
basis, which approximates their fair values because of the short-term nature of these instruments.
Income Taxes
The Company accounts for income taxes
pursuant to the provision of ASC 740-10, “Accounting for Income Taxes” (“ASC 740-10”), which requires,
among other things, an asset and liability approach to calculating deferred income taxes. The asset and liability approach requires
the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between
the carrying amounts and the tax bases of assets and liabilities. A valuation allowance is provided to offset any net deferred
tax assets for which management believes it is more likely than not that the net deferred asset will not be realized.
The Company follows the provision of
ASC 740-10 related to Accounting for Uncertain Income Tax Positions. When tax returns are filed, there may be uncertainty about
the merits of positions taken or the amount of the position that would be ultimately sustained. In accordance with the guidance
of ASC 740-10, the benefit of a tax position is recognized in the financial statements in the period during which, based on all
available evidence, management believes it is more likely than not that the position will be sustained upon examination, including
the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions.
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 2 – Basis of Presentation
and Summary of Significant Accounting Policies (continued)
Tax positions that meet the more likely
than not recognition threshold are measured at the largest amount of tax benefit that is more than 50 percent likely of being realized
upon settlement with the applicable taxing authority. The portion of the benefit associated with tax positions taken that exceed
the amount measured as described above should be reflected as a liability for uncertain tax benefits in the accompanying balance
sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. The Company
believes its tax positions are all more likely than not to be upheld upon examination. As such, the Company has not recorded a
liability for uncertain tax benefits.
The Company has adopted ASC 740-10-25,
“Definition of Settlement”, which provides guidance on how an entity should determine whether a tax position is effectively
settled for the purpose of recognizing previously unrecognized tax benefits and provides that a tax position can be effectively
settled upon the completion and examination by a taxing authority without being legally extinguished. For tax positions considered
effectively settled, an entity would recognize the full amount of tax benefit, even if the tax position is not considered more
likely than not to be sustained based solely on the basis of its technical merits and the statute of limitations remains open. The
federal and state income tax returns of the Company are subject to examination by the IRS and state taxing authorities, generally
for three years after they are filed.
Impairment of long-lived assets
The Company reviews long-lived assets
for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable,
or at least annually. The Company recognizes an impairment loss when the sum of expected undiscounted future cash flows is less
than the carrying amount of the asset. The amount of impairment is measured as the difference between the asset’s estimated
fair value and its book value. The Company recorded impairment losses of $474 during the three months ended August 31, 2019.
Stock-based compensation
Stock-based compensation is accounted
for based on the requirements of the Share-Based Payment Topic of ASC 718, “Compensation — Stock Compensation”
(“ASC 718”), which requires recognition in the financial statements of the cost of employee and director services received
in exchange for an award of equity instruments over the period the employee or director is required to perform the services in
exchange for the award (presumptively, the vesting period). ASC 718 also requires measurement of the cost of employee and director
services received in exchange for an award based on the grant-date fair value of the award.
Pursuant to ASC Topic 505-50, “Equity
Based Payments to Non-employees”, for share-based payments to consultants and other third-parties, compensation expense is
determined at the measurement date. The expense is recognized over the vesting period of the award. Until the measurement date
is reached, the total amount of compensation expense remains uncertain. The Company initially records compensation expense based
on the fair value of the award at the reporting date.
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 2 – Basis of Presentation
and Summary of Significant Accounting Policies (continued)
Net loss per share of common stock
Basic net loss per share is computed
by dividing the net loss by the weighted average number of common shares during the period. Diluted net loss per share is computed
using the weighted average number of common shares and potentially dilutive securities outstanding during the period. At August
31, 2019 and 2018, the Company had no potentially dilutive securities outstanding.
Accounting Changes
In February 2016, the FASB issued ASU No. 2016-02,
Leases, which require lessees to report on their balance sheets a right-of-use asset and a lease liability in connection
with most lease agreements classified as operating leases under the prior guidance. Under the new guidance, codified as ASC Topic
842, Leases, the lease liability must be measured initially based on the present value of future lease payments, subject
to certain conditions. The right-of-use asset must be measured initially based on the amount of the liability, plus certain initial
direct costs. As permitted, the Company adopted ASC Topic 842 effective May 1, 2019 using the optional cumulative-effect transition
method. The Company, currently, does not have any lease with a term greater than 1 year, hence, the adoption did not have any impact
on the financial statements and there was no cumulative effect adjustment. The Company shall record a lease liability and a related
right-of-use assets upon entering into any lease agreements of term greater than 1 year.
Recently Issued Accounting Pronouncements
In
August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) which modifies the disclosure requirements on fair
value measurements under ASC Topic No. 820, Fair Value Measurement, as amended (“ASC 820”). For public companies, ASU
2018-13 removes (a) the prior requirement to disclose the amount and reason for transfers between Level 1 and Level 2 of the fair
value hierarchy (please see Note 3 below for discussion of the three-level hierarchy for measuring fair value), (b) the policy
for timing of transfers between levels, and (c) the valuation processes used for level 3 fair value measurements. For public companies,
ASU 2018-13 also adds, among other things, a requirement to disclose the range and weighted average of significant unobservable
inputs used in Level 3 fair value measurements. This amendment is effective for fiscal years, and interim periods within those
fiscal years, beginning after December 15, 2019. Early adoption was permitted upon issuance of ASU 2018-13. The Company has not
adopted ASU 2018-13 and, based on its preliminary assessment, does not believe the impact of adoption will be material on its financial
statements.
Other accounting standards that have
been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on
the financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an
impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.
Reclassification
Certain prior year amounts have been reclassified for consistency
with the current period presentation. These reclassifications had no effect on the reported results of operations or cash flow.
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 3 – Accounts Receivable
Accounts receivable, consisted of the
following:
|
|
August 31, 2019
|
|
May 31, 2019
|
|
|
(Unaudited)
|
|
|
Accounts Receivable
|
|
$
|
38,039
|
|
|
$
|
82,365
|
|
Less: Allowance for doubtful debts
|
|
|
(435
|
)
|
|
|
(2,777
|
)
|
|
|
$
|
37,604
|
|
|
$
|
79,588
|
|
The Company recorded bad debt recovery of $2,342 and $0 during the three months
ended August 31, 2019 and 2018, respectively.
Note 4 – Inventory
Inventory consisted of the following:
|
|
August 31, 2019
|
|
May 31, 2019
|
|
|
(Unaudited)
|
|
|
Finished Goods
|
|
$
|
74,180
|
|
|
$
|
69,256
|
|
Raw Materials
|
|
|
235,328
|
|
|
|
195,322
|
|
|
|
$
|
309,508
|
|
|
$
|
264,578
|
|
At August 31, 2019 and May 31, 2019,
inventory held at third party locations amounted to $556 and $13,176, respectively. At August 31, 2019 and May 31, 2019, inventory
in- transit amounted to $0 and $3,450, respectively.
During the three months ended August
31, 2019 the Company sold some of the slow- moving inventory and recovered $769 which is included in cost of sales. During the
three months ended August 31, 2018, the Company wrote down inventory for obsolescence of $636 which is included in cost of sales.
Note 5 – Property and Equipment
Property and equipment, stated at cost,
consisted of the following:
|
|
Estimated Life
|
|
August 31, 2019
|
|
May 31, 2019
|
|
|
|
|
(Unaudited)
|
|
|
Furniture and Fixtures
|
|
5 years
|
|
$
|
5,759
|
|
|
$
|
5,759
|
|
Computer Equipment
|
|
3 years
|
|
|
17,392
|
|
|
|
17,392
|
|
Plant Equipment
|
|
5-10 years
|
|
|
29,720
|
|
|
|
20,490
|
|
Less: Accumulated Depreciation
|
|
|
|
|
(13,608
|
)
|
|
|
(10,838
|
)
|
|
|
|
|
$
|
39,263
|
|
|
$
|
32,803
|
|
Depreciation expense amounted to $2,770
and $913 for the three months ended August 31, 2019 and 2018, respectively.
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
;Note 6 – Accounts Payable
and Accrued Expenses
Accounts payable and accrued expenses
comprised of the following:
|
|
August 31, 2019
|
|
May 31, 2019
|
|
|
(Unaudited)
|
|
|
Trade Payables
|
|
$
|
67,765
|
|
|
$
|
14,610
|
|
Credit Cards
|
|
|
13,132
|
|
|
|
14,407
|
|
Other
|
|
|
6,142
|
|
|
|
3,454
|
|
|
|
$
|
87,039
|
|
|
$
|
32,471
|
|
Note 7 – Equipment Financing Payable
During the year ended May 31, 2019,
the Company purchased a forklift under an installment purchase plan. The loan amount is $16,500 payable in 60 monthly installment
payments of $317 comprising of principal payment of $275 and interest payment of $42. As of August 31, 2019, and May 31, 2019,
the balance outstanding on the loan was $14,257 and $15,210, respectively. $3,300 of the loan is payable within one year and the
balance $10,957, is payable after one year from August 31, 2019. The Company recorded an interest expense of $117 on the loan in
the accompanying unaudited financial statements.
The
amounts of loan payments due in the next five years ended August 31, are as follows:
|
|
Amount
|
|
2020
|
|
|
$
|
3,300
|
|
|
2021
|
|
|
|
3,300
|
|
|
2022
|
|
|
|
3,300
|
|
|
2023
|
|
|
|
3,300
|
|
|
2024
|
|
|
|
1,057
|
|
|
|
|
|
$
|
14,257
|
|
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 8 – Stockholders’
Equity
Shares Authorized
The authorized capital of the Company
consists of 100,000,000 shares of common stock, par value $0.0001 per share and 20,000,000 shares of preferred stock, par value
$0.0001 per share.
Preferred Stock
The preferred stock may be issued from
time to time in one or more series. The Board of Directors of the Company is expressly authorized to provide for the issuance of
all or any of the shares of the preferred stock in one or more series, and to fix the number of shares and to determine or alter,
for each such series, such voting powers, full or limited, or no voting powers and such designations, preferences, and relative,
participating, optional, or other rights and such qualifications, limitations, or restrictions thereof, as shall be stated and
expressed until the resolution adopted by the Board of Directors providing the issuance of such shares. The Board of Directors
is also expressly authorized to increase or decrease the number of shares of any series subsequent to the issue of shares of that
series. In case the number of shares of any such series shall be so decreased, the decrease shall resume the status that they had
prior to the adoption of the resolution originally fixing the number of shares of such series.
Common Stock
As of August 31, 2019, 41,285,881 shares
of common stock were outstanding.
No common stock was issued during the
three months ended August 31, 2019 and 2018.
Note 9 – Commitments and Contingencies
As discussed in Note 2 above, the Company
adopted ASU No. 2016-02, Leases on May 1, 2019, which require lessees to report on their balance sheets a right-of-use asset
and a lease liability in connection with most lease agreements classified as operating leases under the prior guidance. The Company
has a lease agreement in connection with its office and warehouse facility in California under operating leases, with a remaining
lease term of less than 1 year, expiring in October 2019. Rent expense amounted to $23,666 and $25,066 for the three months ended
August 31, 2019 and 2018, respectively. Future minimum rental payments required under this operating lease are as follows:
|
|
Total
|
|
1 Year
|
|
2-3 Year
|
|
Thereafter
|
Operating Lease
|
|
$
|
14,635
|
|
|
$
|
14,635
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total
|
|
$
|
14,635
|
|
|
$
|
14,635
|
|
|
$
|
—
|
|
|
$
|
—
|
|
In November 2017, the Company had executed
an Agreement with a third party located in Hong Kong, China, whereby the third party shall promote, market, distribute and resell
the Company’s products to end-user consumers through direct online sales or third party e-commerce platforms in the following
territories: Hong Kong, Macau, and the People’s Republic of China. The term of the agreement was for 36 months from the effective
date. Parties shall have the right to terminate this agreement, with or without cause, upon 60 days prior written notice. For services
provided in connection with this agreement, the Company shall pay the third party 16.5% of the gross revenues generated from sales
channels initiated and subsequently maintained by the third party or $3,300 per month, whichever is greater. In February 2018,
the Company terminated this Agreement.
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 10 – Related Party Transactions
The Company’s Chief Executive
Officer, from time to time, provided advances to the Company for working capital purposes. At August 31, 2019 and May 31, 2019,
the Company had a payable to the officer of $7,859 and $210, respectively. These advances are due on demand and non-interest bearing.
During the three months ended August
31, 2018, the Company paid $280 to an affiliated company for advisory services rendered. The affiliated company is managed by the
Company’s Chief Executive Officer.
Note 11 – Concentrations
Concentration of Credit Risk
Financial instruments that potentially
subject the Company to concentration of credit risk consist primarily of trade accounts receivable and cash deposits, investments
and cash equivalents instruments. The Company maintains its cash in bank deposits accounts. The Company’s account at this
institution is insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000. At August 31, 2019 and
May 31, 2019, the Company held cash of approximately $87,273 and $102,454, respectively, in excess of federally insured limits.
The Company has not experienced any losses in such accounts through August 31, 2019.
Concentration of Revenue, Product
Line, and Supplier
During the three months ended August
31, 2019 sales to four customers, which each represented over 10% of our total sales, aggregated to approximately 54% of the Company’s
net sales at 15%, 15%, 13% and 11%. During the three months ended August 31, 2018 sales to three customers, which each represented
over 10% of our total sales, aggregated to approximately 59% of the Company’s net sales at 25%, 18% and 16%.
During the three months ended August
31, 2019 sales to customers outside the United States represented approximately 51% which consisted of 30% from Canada, 15% from
Italy and 6% from UK and during the three months ended August 31, 2018 sales to customers outside the United States represented
approximately 33% which consisted of 27% from Canada and 6% from Hong Kong.
During
the three months ended August 31, 2019, sales by product lines which each represented over 10% of sales consisted of approximately
29% from sales of prep cleanser and shampoo, 16% from sale of moisturizer and conditioner and 30% from sale of introductory kit
(shampoo, conditioner and treatment spray). During the three month period ended August 31, 2018, sales by product line which each
represented over 10% of sales consisted of approximately 23% from sales of hair shampoo, 16% from sales of hair shampoo and conditioner,
20% from sale of hair treatment spray and repair products and 22% from sale of introductory kit (shampoo, conditioner and treatment
spray).
REVIV3 PROCARE COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
AUGUST 31, 2019 AND 2018
(UNAUDITED)
Note 11 – Concentrations (continued)
During
the three months ended August 31, 2019 and 2018, sales by product line comprised of the following:
Product
|
|
2019
|
|
2018
|
Prep Cleanser & Shampoo
|
|
$
|
36,712
|
|
|
$
|
30,590
|
|
Moisturizer & Conditioner
|
|
|
19,665
|
|
|
|
23,181
|
|
Treatment Spray
|
|
|
8,243
|
|
|
|
12,999
|
|
Cellular Complex
|
|
|
8,320
|
|
|
|
8,371
|
|
Hair masque
|
|
|
1,740
|
|
|
|
2,698
|
|
Thickening spray
|
|
|
2,553
|
|
|
|
2,345
|
|
Introductory kit
|
|
|
37,836
|
|
|
|
31,095
|
|
Fragrance shampoo and conditioner
|
|
|
—
|
|
|
|
25,000
|
|
Thermal protect
|
|
|
2,578
|
|
|
|
1,367
|
|
Bundle
|
|
|
5,745
|
|
|
|
—
|
|
Others
|
|
|
2,290
|
|
|
|
3,534
|
|
Total
|
|
$
|
125,682
|
|
|
$
|
141,180
|
|
As of August 31, 2019, accounts receivable
from four customers which each represented over 10% of total sales represented approximately 89% at 29%, 26%, 23%, and 11% and
at May 31, 2019, accounts receivable from five customers represented approximately 94% at 30%, 13%, 23%, 14% and 14%, respectively.
The Company purchased inventories and
products from two vendors totaling approximately $116,698 (85% of the purchases at 70% and 15%) and four vendors totaling approximately
$86,500 (87% of the purchases) during the three months ended August 31, 2019 and 2018, respectively.