| PREPAID EXPENSES AND OTHER CURRENT ASSETS |
NOTE 6 — PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid expenses and other current assets, consisted of the following:
| | |
January 31,
2026
(unaudited) | | |
April 30,
2025 | |
| Advance to vendors(i) | |
$ | 501,382 | | |
$ | 185,218 | |
| Security deposits(ii) | |
| 11,913 | | |
| 12,072 | |
| Prepaid service fee(iii) | |
| 416,385 | | |
| 2,615,385 | |
| Accrued interest receivable(iv) | |
| 7,500 | | |
| — | |
| Others | |
| 17,544 | | |
| — | |
| Total | |
$ | 954,724 | | |
$ | 2,812,675 | |
| (i) | Advance to vendors represents cash paid to various vendors for inventory purchase. Advances to vendors are reviewed periodically to determine whether their carrying value has become impaired. The Company considers the assets to be impaired if the realization of the advance becomes doubtful. The Company uses the aging method to estimate the allowance for credit loss for unrealizable balances. In addition, at each reporting date, the Company generally determines the adequacy of allowance for credit loss by evaluating all available information, and then records specific allowances for those advances based on the specific facts and circumstances. As of January 31, 2026 and April 30, 2025, there was no credit loss recorded as management believed that all of the advance to vendor balances were fully realizable. | | (ii) | Security deposits represent rental security payment to the landlords for its warehouse and office facilities, which will be refunded upon maturity of the lease. |
| (iii) | Prepaid service fee represents various service agreements that the Company entered during fiscal year ended April 2025 for supply chain management service, logistics management service, market expanding and financial consulting services. The balances as of January 31, 2026, represented the unamortized remaining balance based on the agreements. |
| (iv) | Accrued interest receivable represents interest earned but not yet
received on the Company’s $500,000 promissory notes with Valemi Inc and BEP. |
|