Company: SISI
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010889
Chunk: 37

Company: SHINECO, INC.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 1
Chunk 37
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 2024 were translated at 1 RMB to 0.1378 USD and at 1 RMB to 0.1376 USD, respectively. The average translation
rates applied to the income and cash flow statement amounts for the nine months ended March 31, 2025 and 2024 were 1 RMB to 0.1387 USD
and 1 RMB to 0.1389 USD, respectively. The average translation rates applied to the income and cash flow statement amounts for the three
months ended March 31, 2025 and 2024 were 1 RMB to 0.1375 USD and 1 RMB to 0.1397 USD, respectively.

Convertible Notes Payable

In accordance with ASC 470 Debt with conversion
and other option, an embedded beneficial conversion feature present in a convertible instrument shall be recognized separately at
issuance by allocating a portion of the proceeds equal to the intrinsic value of that feature to additional paid-in capital. Issuance
costs should be allocated proportionally to the debt host and conversion feature. Deferred financing costs will be discounted and amortized
subsequently, and the convertible notes are subsequently carried at amortized cost.

Research and Development Expenses

Research and development costs relating to the development
of new processes and significant improvements and refinements to existing processes are expensed when incurred in accordance with the
FASB ASC 730, “Research and Development.” The research and development costs primarily comprise employee costs, consultant
fees, materials and testing costs, and depreciation to property and equipment used in the research and development activities and other
miscellaneous expenses. For the nine months ended March 31, 2025 and 2024, total research and development expense from continuing operations
were US$54,602 and US$77,811, respectively. For the three months ended March 31, 2025 and 2024, total research and development expense
from continuing operations were US$15,487 and US$31,895, respectively. No research and development expense were from discontinued operations
for the nine and three months ended March 31, 2025 and 2024.

    17

Comprehensive Loss

Comprehensive loss consists of two components, net
loss and other comprehensive income (loss). The foreign currency translation gain resulting from translation of the financial statements
expressed in RMB to USD is reported in other comprehensive income (loss) in the unaudited condensed consolidated