| Schedule of Allocation of the Purchase Price as of the Date of Acquisition |
The allocation of the purchase price as of the
date of acquisition is summarized as follows:
| Net assets deficit assumed (i) | |
$ | (60,092 | ) |
| Software acquired in business combination (ii) | |
| 1,000,406 | |
| Goodwill | |
| 5,767,504 | |
| Deferred tax liabilities | |
| (234,225 | ) |
| Non-controlling interest (iii) | |
| (2,585,087 | ) |
| Foreign currency adjustments | |
| 120,261 | |
| | |
$ | 4,008,767 | |
| Total purchase price is comprised of | |
| | |
| Cash consideration | |
$ | 3,055,432 | |
| Fair value of previously held equity interests (iv) | |
| 708,129 | |
| Fair value of 6.67% equity interest in Zhongxin (v) | |
| 393,816 | |
| Less: cash from transfer of fair value of 6.67% equity interest in Zhongxin (v) | |
| (148,610 | ) |
| | |
$ | 4,008,767 | |
| (i) | Net asset deficit assumed primarily included other current liabilities for operating expenses. |
| (ii) | Software acquired in the business combination had estimated useful life of 3 years. |
| (iii) | Fair value of the noncontrolling interests was estimated with reference to the market price per share as of the acquisition date. |
| (iv) | A gain of $850 in relation to the revaluation of the previously held equity interests was recorded in other income, net in the consolidated statements of operations and comprehensive loss for the year ended December 31, 2022. The fair value of the previously held equity interests approximated the cost of investments as Beijing Yisuizhen has not commenced operations since its setup. |
| (v) | In exchange for the equity interest in Beijing Yisuizhen and West Angel, the Company also granted 6.67% equity interest in Shanghai Zhongxin, with fair value of $393,816 (RMB 2,713,000), to four shareholders of West Angel at cash consideration of $148,610 (RMB 1,000,000). The Company engaged a third-party valuation team to estimate the fair value of equity interest of Shanghai Zhongxin. As of December 31, 2022, the four shareholders paid the cash consideration to Mr. Yang, the Chief Executive Officer of the Company. The Company recorded the outstanding balance in the account of due from related parties as of December 31, 2022. |
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