2022 Q3 Form 10-Q Financial Statement

#000149315222023045 Filed on August 15, 2022

View on sec.gov

Income Statement

Concept 2022 Q3 2022 Q2 2021 Q3
Revenue $179.3K $214.2K $2.962M
YoY Change -93.95% 42.16%
Cost Of Revenue $43.35K $105.6K $480.3K
YoY Change -90.97% -48.64%
Gross Profit $135.9K $537.0K $2.482M
YoY Change -94.52% 117.91%
Gross Profit Margin 75.82% 250.7% 83.78%
Selling, General & Admin $1.143M $1.228M $1.984M
YoY Change -42.4% -34.5%
% of Gross Profit 840.54% 228.59% 79.94%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $55.93K $8.069K $8.630K
YoY Change 548.09% 95.71%
% of Gross Profit 41.14% 1.5% 0.35%
Operating Expenses $1.143M $1.228M $1.984M
YoY Change -42.4% -34.5%
Operating Profit -$1.007M -$690.5K $497.8K
YoY Change -302.22% -57.57%
Interest Expense $1.840K $470.00
YoY Change 291.49%
% of Operating Profit 0.09%
Other Income/Expense, Net -$1.160K $532.00 -$760.00
YoY Change 52.63% 19.82%
Pretax Income -$1.006M -$690.0K $497.5K
YoY Change -302.2% -57.6%
Income Tax $0.00 $0.00
% Of Pretax Income 0.0%
Net Earnings -$930.4K -$639.7K $448.5K
YoY Change -307.43% -57.71%
Net Earnings / Revenue -518.94% -298.64% 15.14%
Basic Earnings Per Share -$0.02
Diluted Earnings Per Share $0.00 -$15.99K $14.27K
COMMON SHARES
Basic Shares Outstanding 40.00M shares 40.00M shares
Diluted Shares Outstanding

Balance Sheet

Concept 2022 Q3 2022 Q2 2021 Q3
SHORT-TERM ASSETS
Cash & Short-Term Investments $267.1K $263.7K $2.060M
YoY Change -87.03% 35.6%
Cash & Equivalents $267.1K $263.7K $2.060M
Short-Term Investments
Other Short-Term Assets $629.8K $614.1K $687.7K
YoY Change -8.42% 47.31%
Inventory
Prepaid Expenses $268.3K $230.2K $338.6K
Receivables
Other Receivables $65.85K $141.7K $123.8K
Total Short-Term Assets $917.5K $971.5K $2.871M
YoY Change -68.04% 35.12%
LONG-TERM ASSETS
Property, Plant & Equipment $134.0K $111.1K $68.73K
YoY Change 95.01% -68.68%
Goodwill
YoY Change
Intangibles $2.082K $2.276K $2.568K
YoY Change -18.93% 65.29%
Long-Term Investments
YoY Change
Other Assets $8.317K $51.24K
YoY Change 1448.04%
Total Long-Term Assets $863.1K $773.7K $353.8K
YoY Change 143.99% 114.6%
TOTAL ASSETS
Total Short-Term Assets $917.5K $971.5K $2.871M
Total Long-Term Assets $863.1K $773.7K $353.8K
Total Assets $1.781M $1.745M $3.225M
YoY Change -44.79% 61.66%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $799.6K $744.6K $1.431M
YoY Change -44.11% -45.56%
Accrued Expenses $358.6K $304.4K $335.3K
YoY Change 6.97% -14.38%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $5.172M $4.298M $5.190M
YoY Change -0.34% 20.1%
LONG-TERM LIABILITIES
Long-Term Debt $0.00 $0.00 $0.00
YoY Change
Other Long-Term Liabilities $264.1K $320.9K $53.13K
YoY Change 397.12% 1370.44%
Total Long-Term Liabilities $264.1K $320.8K $53.13K
YoY Change 397.14% 1370.42%
TOTAL LIABILITIES
Total Short-Term Liabilities $5.172M $4.298M $5.190M
Total Long-Term Liabilities $264.1K $320.8K $53.13K
Total Liabilities $5.436M $4.619M $5.243M
YoY Change 3.68% 3.81%
SHAREHOLDERS EQUITY
Retained Earnings -$3.654M -$2.724M -$1.821M
YoY Change 100.65%
Common Stock $40.00K $4.000K $4.000K
YoY Change 900.0% 0.0% 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity -$3.375M -$2.651M -$1.853M
YoY Change
Total Liabilities & Shareholders Equity $1.781M $1.745M $3.225M
YoY Change -44.79% 61.66%

Cashflow Statement

Concept 2022 Q3 2022 Q2 2021 Q3
OPERATING ACTIVITIES
Net Income -$930.4K -$639.7K $448.5K
YoY Change -307.43% -57.71%
Depreciation, Depletion And Amortization $55.93K $8.069K $8.630K
YoY Change 548.09% 95.71%
Cash From Operating Activities -$1.592M -$768.0K $1.859M
YoY Change -185.65% -739.62%
INVESTING ACTIVITIES
Capital Expenditures $139.2K $6.630K -$11.87K
YoY Change -1272.37% -165.58%
Acquisitions
YoY Change
Other Investing Activities -$95.13K
YoY Change
Cash From Investing Activities -$139.2K -$88.49K -$11.87K
YoY Change 1072.37% 816.99%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities
YoY Change
NET CHANGE
Cash From Operating Activities -1.592M -768.0K 1.859M
Cash From Investing Activities -139.2K -88.49K -11.87K
Cash From Financing Activities
Net Change In Cash -1.731M -856.5K 1.847M
YoY Change -193.74% -875.66%
FREE CASH FLOW
Cash From Operating Activities -$1.592M -$768.0K $1.859M
Capital Expenditures $139.2K $6.630K -$11.87K
Free Cash Flow -$1.731M -$774.6K $1.871M
YoY Change -192.55% -695.04%

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<p id="xdx_80E_eus-gaap--NatureOfOperations_z9piAKsJRlEk" style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b>NOTE 1. <span id="xdx_822_zMe3uMIxEBk7">DESCRIPTION OF THE BUSINESS AND ORGANIZATION</span></b></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Kun Peng International Limited (“the Company”, “KPIL”, “CXKJ”, “we”, “us”, “our”), a Nevada corporation (formerly known as CX Network Group, Inc.), through its subsidiaries and VIE, currently engages in the sale of health care and health related household products through its online platform, King Eagle Mall.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><i>Reverse Merger</i></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">On May 17, 2021, the Company entered into a share exchange agreement (“Share Exchange Agreement”) with (i) Kun Peng International Holding Limited (“KP International”), a limited liability company incorporated in British Virgin Islands on April 20, 2021, and (ii) the five members of KP International to acquire all the issued and outstanding capital stock of KP International in exchange for the issuance to those members of an aggregate of <span id="xdx_904_eus-gaap--StockIssuedDuringPeriodSharesNewIssues_c20210516__20210517__dei--LegalEntityAxis__custom--KPInternationalMember_zlhWhE7wmvVc" title="Stock issuance in reverse merger">34,158,391</span> shares of our common stock (“Reverse Acquisition”). Pursuant to the terms of the Exchange Agreement, and as a condition to the completion of the transactions contemplated by the Share Exchange Agreement, the Company also agreed to enter into an agreement with Wenhai Xia (“the Stockholder”), to cancel an aggregate of <span id="xdx_908_eus-gaap--StockRepurchasedAndRetiredDuringPeriodShares_c20210516__20210517__srt--TitleOfIndividualAxis__custom--WenhaiXiaMember_zvNLuFw4GsF3" title="Number of shares cancelled">15,535,309</span> shares of the Company’s Common Stock owned by the Stockholder. The Reverse Acquisition was closed on May 17, 2021.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">For accounting purpose, the transaction with KP International was treated as a reverse acquisition and KP International is deemed to be the acquirer and the Company as the acquired party. Consequently, the assets and liabilities and the historical operations that will be reflected in the accompanying consolidated financial statements prior to the Reverse Acquisition will be those of KP International and its consolidated subsidiaries and will be recorded at the historical cost basis of KP International, and the accompanying consolidated financial statements after consummation of the reverse acquisition will include the assets and liabilities of KP International and its subsidiaries and VIE, historical operations of KP International and its subsidiaries and VIE, and operations of the Company from the Closing Date of the Reverse Acquisition. The accompanying consolidated financial statements share and per share information has been retroactively adjusted to reflect the exchanged shares in the Acquisition. The equity structure of the Company was retrospectively adjusted under ASC Topic 805-40. As of September 30, 2021, there were <span id="xdx_901_eus-gaap--CommonStockSharesIssued_iI_c20210930_z4iHT8fcc9Mj" title="Common stock, shares issued"><span id="xdx_904_eus-gaap--CommonStockSharesOutstanding_iI_c20210930_zYkYkwQCYTf6" title="Common stock, shares outstanding">40,000,000</span></span> shares issued and outstanding.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><i>Authorized Shares and Name Change </i></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Effective as of September 9, 2021, the Company’s Articles of Incorporation were amended to change the name of the Company from CX Network Group, Inc. to Kun Peng International Ltd. (“KPIL”) and to increase the Company’s authorized capital to <span id="xdx_90E_eus-gaap--CapitalUnitsAuthorized_iI_pid_c20210909__us-gaap--StatementEquityComponentsAxis__us-gaap--CapitalUnitsMember_zvKSo4Qp99Ba" title="Capital stock, shares authorized">210,000,000</span> authorized shares of Capital Stock with <span id="xdx_908_eus-gaap--CommonStockSharesAuthorized_iI_pid_c20210909__us-gaap--StatementEquityComponentsAxis__us-gaap--CommonStockMember_zUSTxYgGPwO3" title="Common stock, shares authorized">200,000,000</span> designated as $<span id="xdx_908_eus-gaap--CommonStockParOrStatedValuePerShare_iI_pid_c20210909__us-gaap--StatementEquityComponentsAxis__us-gaap--CommonStockMember_zJkIygJ1uAo1" title="Common stock par value">0.0001</span> par value Common Stock, and <span id="xdx_90A_eus-gaap--PreferredStockSharesAuthorized_iI_pid_c20210909__us-gaap--StatementEquityComponentsAxis__us-gaap--PreferredStockMember_zuAZ0LFIf7Gf" title="Preferred stock, shares authorized">10,000,000</span> designated as $<span id="xdx_909_eus-gaap--PreferredStockParOrStatedValuePerShare_iI_pid_c20210909__us-gaap--StatementEquityComponentsAxis__us-gaap--PreferredStockMember_zb9UX8zQZyw3" title="Preferred stock par value">0.0001</span> par value Preferred Stock.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><i>Kun Peng International Holding Limited</i></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Kun Peng International Holding Limited (“KP International”) was incorporated in the British Virgin Islands on April 20, 2021. KP International is a holding company and entered into a Bought and Sold Note with Kunpeng (China) Industrial Development Company Limited (“KP Industrial”), incorporated in Hong Kong on August 11, 2017, at a <span id="xdx_90B_ecustom--ForeignCurrencyTranslationCashConsiderationDescription_c20210502__20210503__dei--LegalEntityAxis__custom--KunPengInternationalHoldingLimitedMember_zPanm2PFRzc1" title="Foreign currency translation, cash consideration, description">cash consideration of $0.129 (HK$1) on May 3, 2021</span>. After the ownership transfer, it became a sole shareholder of KP Industrial.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><i>Kunpeng (China) Industrial Development Company Limited</i></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Kunpeng (China) Industrial Development Company Limited (“KP Industrial”) was incorporated as a limited liability company in Hong Kong under the name of Jing Jin Ji Investment Group Co., Limited (“Jing Jin Ji”) on August 11, 2017. <span id="xdx_901_ecustom--ShareCapitalDescription_c20211001__20220630__dei--LegalEntityAxis__custom--KunpengChinaIndustrialDevelopmentCompanyLimitedMember_zk268Yj08w1f" title="Share capital, description">The share capital of KP Industrial is 10,000 ordinary shares at $1,292 (HKD10,000) and was wholly owned by an individual</span>. On November 9, 2018, Jing Jin Ji changed its name to “Kunpeng (China) Industrial Development Company Limited” and filed a Certificate of Change of Name with the Hong Kong Company Registry on the same day. Although it was incorporated in 2017, it did not commence operations until July 2020 as it focused on exploring business opportunities in its initial phrase and developing our online mobile application, King Eagle Mall, through its subsidiary, King Eagle (China) Co., Ltd. It became a wholly owned subsidiary of KP International on May 3, 2021.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><i>Kun Peng (Hong Kong) Industrial Development Limited</i></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 29.15pt"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Kun Peng (Hong Kong) Industrial Development Limited (“KP (Hong Kong)”) was incorporated as a limited liability company in Hong Kong on June 21, 2021. It is a holding company and is wholly owned by Kun Peng International Holding Limited. <span id="xdx_906_ecustom--ShareCapitalDescription_c20210620__20210621__dei--LegalEntityAxis__custom--KunPengHongKongIndustrialDevelopmentLimitedMember_zws4eZRe1z29" title="Share capital, description">The share capital of this entity upon formation is $0.13 (HK$1)</span>.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><i>King Eagle (China) Co., Ltd.</i></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">King Eagle (China) Co., Ltd. (“King Eagle (China)”) was incorporated as a limited liability company in Beijing Economic Technological Development Zone in the People’s Republic of China (“the PRC”) on March 20, 2019 with a registered capital of approximately $<span id="xdx_906_ecustom--RegisteredCapital_pn6n6_c20190319__20190320__dei--LegalEntityAxis__custom--KingEagleChinaMember_zWP0CuGBnT8b" title="Registered capital">15</span> million (RMB<span id="xdx_901_ecustom--RegisteredCapital_pn6n6_uRMB_c20190319__20190320__dei--LegalEntityAxis__custom--KingEagleChinaMember_zrsVMyly3br" title="Registered capital">100</span> million). King Eagle (China) was a wholly owned subsidiary of KP Industrial at the time of establishment. KP Industrial transferred its approximately $<span id="xdx_90F_ecustom--TransferredAmount_pn5n6_c20201101__20201102__dei--LegalEntityAxis__custom--GuoxinRuilianGroupCoLtdMember_zOWQsaWwnPkf" title="Transferred amount">2.2</span> million (RMB <span id="xdx_90E_ecustom--TransferredAmount_pn6n6_uRMB_c20201101__20201102__dei--LegalEntityAxis__custom--GuoxinRuilianGroupCoLtdMember_zGKMnY1vvzi3" title="Transferred amount">15</span> million) or <span id="xdx_90B_ecustom--TransferredPercentage_pid_dp_uPure_c20201101__20201102__dei--LegalEntityAxis__custom--GuoxinRuilianGroupCoLtdMember_z3TwZCplffta" title="Transferred percentage">15</span>% to Guoxin Ruilian Group Co., Ltd., a limited liability company incorporated in Beijing, the PRC, on November 2, 2020.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 96.3pt 0pt 6.9pt; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">On March 26, 2021, Guoxin Ruilian Group Co., Ltd entered into equity transfer agreements with KP Industrial and Guoxin Zhengye. Both Guoxin Ruilian Group Co., Ltd and Guoxin Zhengye are wholly owned by a common shareholder, Guoxin United Holdings Group Co., Ltd. Under the agreements, Guoxin Ruilian Group Co., Ltd agreed to transfer its <span id="xdx_902_ecustom--TransferredPercentage_dp_uPure_c20210419__20210420__dei--LegalEntityAxis__custom--KingEagleChinaMember__srt--TitleOfIndividualAxis__custom--GuoxinZhengyeMember_zrbGaWnBGUQ1" title="Transferred percentage">8</span>% of its ownership in King Eagle (China) to Guoxin Zhengye and the remaining <span id="xdx_908_ecustom--TransferredPercentage_dp_uPure_c20210419__20210420__dei--LegalEntityAxis__custom--KingEagleChinaMember__srt--OwnershipAxis__custom--KunPengInternationalHoldingLimitedMember_zSHNTScKiFC5" title="Transferred percentage">7</span>% ownership in King Eagle (China) to KP Industrial on April 20, 2021. After the transfer, KP Industrial and Guoxin Zhengye became the <span id="xdx_902_eus-gaap--EquityMethodInvestmentOwnershipPercentage_iI_dp_uPure_c20220630__srt--ScheduleOfEquityMethodInvestmentEquityMethodInvesteeNameAxis__custom--KunPengInternationalHoldingLimitedMember_zdvlfrptkryg" title="Ownership percentage">92</span>% and <span id="xdx_909_eus-gaap--EquityMethodInvestmentOwnershipPercentage_iI_dp_uPure_c20220630__srt--ScheduleOfEquityMethodInvestmentEquityMethodInvesteeNameAxis__custom--GuoxinZhengyeMember_zx8RuKSC5KPh" title="Ownership percentage">8</span>% shareholders of King Eagle (China), respectively.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">On July 18, 2022, King Eagle (China) and KP Industrial entered into an equity transfer agreement with both Guoxin Ruilian Group Co., Ltd and Guoxin Zhengye pursuant to which Guoxin Zhengye transferred its <span id="xdx_905_eus-gaap--EquityMethodInvestmentOwnershipPercentage_iI_dp_uPure_c20220718__srt--ScheduleOfEquityMethodInvestmentEquityMethodInvesteeNameAxis__custom--GuoxinZhengyeMember_zyvrcDts6DMa" title="Ownership percentage">8</span>% ownership in King Eagle (China) to KP Industrial (Guoxin Zhengye became a wholly-owned subsidiary of Guoxin Ruilian Group Co., Ltd on November 5, 2021). After the transfer, King Eagle (China) became a wholly owned subsidiary of KP Industrial. Such transfer was approved and effective on August 5, 2022.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Some of the business engaged in by King Eagle (Tianjin) is restricted or prohibited for foreign investment under PRC regulations. As such, King Eagle (China) has entered into the VIE Agreements with King Eagle (Tianjin) and their shareholders. We do not own any equity interests in King Eagle (Tianjin), but control and receive the economic benefits of their respective business operations through the VIE Agreements. The VIE Agreements enable us to provide King Eagle (Tianjin) with consulting services on an exclusive basis, in exchange for all of its annual profits, if any. In addition, we are able to appoint its senior executives and approve all matters requiring approval of its shareholders. The VIE Agreements are comprised of a Consulting Service Agreement, Business Operation Agreement, Proxy Agreement, Equity Disposal Agreement, and Equity Pledge Agreement.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Under current Chinese laws and regulations, the Company believes that the VIE Agreements are not subject to any government approval. The shareholders of King Eagle (Tianjin) were required to register with SAFE when they established offshore vehicles to hold KP International, and such SAFE registration was effected on May 14, 2021. These shareholders of King Eagle (Tianjin) will have to register their equity pledge arrangement as required under the Equity Pledge Agreement with King Eagle (China). The Company faces uncertainty with respect to future actions by the PRC government that could significantly affect King Eagle (Tianjin)’s financial performance and the enforceability of the VIE Agreements.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 96.3pt 0pt 6.9pt; text-align: justify"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><i>King Eagle (Tianjin) Technology Co., Ltd.</i></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 96.3pt 0pt 6.9pt; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">King Eagle (Tianjin) Technology Co., Ltd. (“King Eagle (Tianjin)”) was incorporated as a limited liability company in Tianjin Pilot Free Trade Zone in the People’s Republic of China on September 2, 2020, with a registered capital of approximately $<span id="xdx_900_ecustom--RegisteredCapital_pn5n6_c20200901__20200902__dei--LegalEntityAxis__custom--KingEagleTianjinMember_zkxyl0DdJaL" title="Registered capital">1.5</span> million (RMB <span id="xdx_902_ecustom--RegisteredCapital_pn6n6_uRMB_c20200901__20200902__dei--LegalEntityAxis__custom--KingEagleTianjinMember_zfWYNkyAKq4h" title="Registered capital">10</span> million).</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">On March 23, 2022, <span id="xdx_906_eus-gaap--EquityMethodInvestmentDescriptionOfPrincipalActivities_c20220322__20220323__srt--ScheduleOfEquityMethodInvestmentEquityMethodInvesteeNameAxis__custom--KingEagleTianjinMember_zjYflmYZlK3a" title="Equity method ownership description">the board of directors of King Eagle (Tianjin) approved the transfer by Xiangyi Mao of her entire ownership (5%) in King Eagle (Tianjin) to Yuanyuan Zhang. After the transfer, Yuanyuan Zhang became a 10% shareholder of King Eagle (Tianjin). The ownership percentage of other King Eagle (Tianjin)’s shareholders remained identical. The ownership transfer was completed on March 29, 2022</span>.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"> </p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">On June 6, 2022, <span id="xdx_902_ecustom--OwnershipTransfersPercentageDescription_c20220605__20220606__dei--LegalEntityAxis__custom--KingEagleTianjinMember_zRtRHW2fzAFe" title="Ownership transfers percentage, description">the board of directors of King Eagle (Tianjin) approved the transfer of the 5% ownership by Yanlu Li to Chengyuan Li. The ownership transfer was completed on June 9, 2022. As a result of the equity transfer, the ownership percentage of Chengyuan Li changed from 40.5% to 45.5%.</span> The ownership percentage of other King Eagle (Tianjin)’s shareholders remained identical.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><span id="xdx_905_ecustom--OwnershipPercentageDescription_c20211001__20220630__dei--LegalEntityAxis__custom--KingEagleTianjinMember_z7QWuSa8pdZ3" title="Ownership percentage, description">After the ownership transfers, King Eagle (Tianjin) is owned by multiple individuals: (i) Chengyuan Li, 45.5%, (ii) Xiujin Wang, 10.5%, (iii) Jinjing Zhang, 6%, (iv) Wanfeng Hu, 6%, (v) Cuilian Liu, 6%. (vi) Zhizhong Wang, 6%. (vii) Zhandong Fan, 5%, (viii) Yuanyuan Zhang, 10%, and (ix) Hui Teng, 5%</span>.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"/> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><span id="xdx_901_ecustom--OwnershipTransfersPercentageDescription_c20220605__20220606__dei--LegalEntityAxis__custom--BritishVirrginIslandsEntityMember_zGHvHvPFscy8">Those shareholders also indirectly own the Company through two British Virgin Islands entities: Kunpeng Tech Limited and Kunpeng TJ Limited. Currently, Cuilian Liu, Zhizhong Wang, Jinjing Zhang and Hui Teng owned 26%, 26%, 26% and 22%, respectively, equity interest in Kunpeng Tech Limited. Zhizhong Wang is a sole director of Kunpeng Tech Limited. Chengyuan Li, Wanfeng Hu, Yuanyuan Zhang and Zhandong Fan owned 66.2%, 7.8%, 6.5% and 6.5%, respectively, equity interest in Kunpeng TJ Limited. Chengyuan Li is a sole director of Kunpeng TJ Limited. Yuanyuan Zhang is the Chief Financial Officer of the Company.</span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"/></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.45in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><i>Kun Peng Tian Yu Health Technology (Tianjin) Co., Ltd. </i></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 96.3pt 0pt 6.9pt; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 22.25pt"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Kun Peng Tian Yu Health Technology Co., Ltd. (“KP Tian Yu”) was incorporated as a limited liability company in Tianjin Pilot Free Trade Zone in the People’s Republic of China on August 10, 2021 with a registered capital of $<span id="xdx_90D_ecustom--RegisteredCapital_pn6n6_c20210808__20210810__dei--LegalEntityAxis__custom--KunPengTianYuHealthTechnologyMember_zeQRWyXAhnti" title="Registered capital">5</span> million. It’s wholly owned by KP (Hong Kong).</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p>
CY2021Q3 us-gaap Common Stock Shares Issued
CommonStockSharesIssued
40000000 shares
CY2021Q3 us-gaap Common Stock Shares Outstanding
CommonStockSharesOutstanding
40000000 shares
us-gaap Use Of Estimates
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<p id="xdx_844_eus-gaap--UseOfEstimates_z458j422bEC2" style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><b><i><span style="text-decoration: underline"><span id="xdx_863_zTiSwQcXAWXg">Use of Estimates and Assumptions</span></span></i></b></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 29.15pt"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The preparation of the condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimate and assumptions that impact the presented amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the presented amounts of revenues and expenses during the period. Actual results may differ from those estimates. Significant estimates during the nine months ended June 30, 2022 and 2021 include the collectability of receivables, the useful lives of long-lived assets and intangibles, assumptions used in assessing impairment of long-lived assets, valuation of accruals for expenses and tax due.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"/>
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us-gaap Profit Loss
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CXKJ Working Capital Deficit
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us-gaap Proceeds From Related Party Debt
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CXKJ Revenue Percentage
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1.792 pure
us-gaap Revenues
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us-gaap Revenues
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CY2021Q2 CXKJ Revenue Percentage
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0.422 pure
CY2021Q2 us-gaap Revenues
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CY2022Q2 us-gaap Revenues
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us-gaap Marketing Expense
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CXKJ Secretarial Service
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CY2021Q3 us-gaap Prepaid Expense Current And Noncurrent
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CY2022Q2 CXKJ Prepaid Rent And Building Management And Utilities
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CY2021Q3 CXKJ Prepaid Rent And Building Management And Utilities
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CY2022Q2 us-gaap Supplies
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CY2021Q3 us-gaap Supplies
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CY2021Q3 CXKJ Prepaid System Maintenance Services
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CY2022Q2 us-gaap Prepaid Taxes
PrepaidTaxes
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CY2021Q3 us-gaap Prepaid Taxes
PrepaidTaxes
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CY2022Q2 CXKJ Prepaid Professional Services
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CY2021Q3 CXKJ Prepaid Professional Services
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CY2022Q2 us-gaap Other Prepaid Expense Current
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CY2021Q3 us-gaap Other Prepaid Expense Current
OtherPrepaidExpenseCurrent
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CY2022Q2 us-gaap Prepaid Expense And Other Assets Current
PrepaidExpenseAndOtherAssetsCurrent
230192 usd
CY2021Q3 us-gaap Prepaid Expense And Other Assets Current
PrepaidExpenseAndOtherAssetsCurrent
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CY2022Q2 CXKJ Prepaid Supplies
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CY2021Q3 CXKJ Prepaid Supplies
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78248 usd
CY2022Q2 us-gaap Prepaid Expense Current And Noncurrent
PrepaidExpenseCurrentAndNoncurrent
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CY2022Q2 us-gaap Prepaid Rent
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CY2021Q3 us-gaap Prepaid Rent
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CY2022Q2 CXKJ Advance To Employees
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CY2021Q3 CXKJ Advance To Employees
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CY2022Q2 us-gaap Other Receivables Gross Current
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4313 usd
CY2022Q2 us-gaap Other Receivables Net Current
OtherReceivablesNetCurrent
141741 usd
CY2021Q3 us-gaap Other Receivables Net Current
OtherReceivablesNetCurrent
123824 usd
CY2022Q2 us-gaap Property Plant And Equipment Gross
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137045 usd
CY2021Q3 us-gaap Property Plant And Equipment Gross
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CY2022Q2 us-gaap Accumulated Depreciation Depletion And Amortization Property Plant And Equipment
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CY2021Q3 us-gaap Accumulated Depreciation Depletion And Amortization Property Plant And Equipment
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27751 usd
CY2022Q2 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
111052 usd
CY2021Q3 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
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CY2022Q2 us-gaap Depreciation
Depreciation
8069 usd
CY2021Q2 us-gaap Depreciation
Depreciation
4123 usd
us-gaap Depreciation
Depreciation
43689 usd
us-gaap Depreciation
Depreciation
15834 usd
CY2022Q2 us-gaap Leasehold Improvements Gross
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CY2022Q2 us-gaap Other Receivables
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3809 usd
CY2022Q2 us-gaap Buildings And Improvements Gross
BuildingsAndImprovementsGross
142251 usd
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91568 usd
CY2022Q2 us-gaap Property Plant And Equipment Other
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CY2022Q2 us-gaap Finite Lived Intangible Assets Accumulated Amortization
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325 usd
CY2021Q3 us-gaap Finite Lived Intangible Assets Accumulated Amortization
FiniteLivedIntangibleAssetsAccumulatedAmortization
135 usd
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IntangibleAssetsNetExcludingGoodwill
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IntangibleAssetsNetExcludingGoodwill
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us-gaap Amortization Of Intangible Assets
AmortizationOfIntangibleAssets
203 usd
us-gaap Amortization Of Intangible Assets
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CY2022Q2 us-gaap Amortization Of Intangible Assets
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0.036 pure
CY2022Q2 CXKJ Advance Payments From Customers
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AdvancePaymentsFromCustomers
3122705 usd
CY2022Q2 us-gaap Deferred Revenue Current
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CY2021Q3 us-gaap Deferred Revenue Current
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3122705 usd
CY2022Q2 us-gaap Deferred Revenue Current
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283904 usd
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39629 usd
us-gaap Effective Income Tax Rate Reconciliation At Federal Statutory Income Tax Rate
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0.210 pure
us-gaap Effective Income Tax Rate Reconciliation At Federal Statutory Income Tax Rate
EffectiveIncomeTaxRateReconciliationAtFederalStatutoryIncomeTaxRate
0.210 pure
CY2022Q2 us-gaap Effective Income Tax Rate Reconciliation Other Adjustments
EffectiveIncomeTaxRateReconciliationOtherAdjustments
0.035 pure
CY2021Q2 us-gaap Effective Income Tax Rate Reconciliation Other Adjustments
EffectiveIncomeTaxRateReconciliationOtherAdjustments
0.035 pure
us-gaap Effective Income Tax Rate Reconciliation Other Adjustments
EffectiveIncomeTaxRateReconciliationOtherAdjustments
0.032 pure
CY2022Q2 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
10000000 shares
CY2021Q3 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
10000000 shares
CY2022Q2 us-gaap Preferred Stock Par Or Stated Value Per Share
PreferredStockParOrStatedValuePerShare
0.0001
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PreferredStockParOrStatedValuePerShare
0.0001
CY2022Q2 us-gaap Preferred Stock Shares Issued
PreferredStockSharesIssued
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CY2022Q2 us-gaap Preferred Stock Shares Outstanding
PreferredStockSharesOutstanding
0 shares
CY2021Q3 us-gaap Preferred Stock Shares Issued
PreferredStockSharesIssued
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CY2021Q3 us-gaap Preferred Stock Shares Outstanding
PreferredStockSharesOutstanding
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CY2022Q2 us-gaap Common Stock Shares Authorized
CommonStockSharesAuthorized
200000000 shares
CY2021Q3 us-gaap Common Stock Shares Authorized
CommonStockSharesAuthorized
200000000 shares
CY2022Q2 us-gaap Common Stock Par Or Stated Value Per Share
CommonStockParOrStatedValuePerShare
0.0001
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CommonStockParOrStatedValuePerShare
0.0001
CY2022Q2 us-gaap Common Stock Shares Issued
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