NOTE 3 - INVENTORY

Inventories primarily consist of bulk and bottled liquor and raw materials and are stated at the lower of cost or market. Cost is determined using an average costing methodology, which approximates cost under the first-in, first-out (“FIFO”) method. A portion of the Company’s finished goods inventory is held in warehouses located in several states that maintain control over the alcohol beverage distribution process until it is sold into the retail distribution channel within those states. The Company regularly monitors inventory quantities on hand and records write-downs for excess and obsolete inventories based primarily on the Company’s estimated forecast of product demand and production requirements. Such write-downs establish a new cost basis of accounting for the related inventory.

Inventories consisted of the following as of December 31:

 SCHEDULE OF INVENTORY

On January 27, 2025, the Company’s wholly owned subsidiary, Two Trees Beverage Company and Brown Water Bourbon Xchange, LLC, a Kentucky Limited Liability Company entered into an Asset Purchase Agreement. According to the terms of the Agreement, Brown Water Bourbon Xchange, LLC sold to the Company 680 barrels of whiskey in exchange for 5,000,000 restricted shares of Common Stock of the Company, with a fair value of $850,000 based on the closing price of the Company’s common stock at the agreement date.

During the year ended December 31, 2025, the Company recognized an impairment of $140,067 related to barrel inventory with a market price below the Company’s carrying value.