| 9. |
Derivative Liability |
|
Due to the
variable conversion price associated with some of these convertible promissory notes disclosed in Note 8 above, the Company has determined
that the conversion feature is considered a derivative liability for instruments which are convertible and have not yet been settled.
The accounting treatment of derivative financial instruments requires that the Company record the fair value of the derivatives on the
date they are deemed to be derivative liabilities. |
| |
|
|
Below is a reconciliation of the derivative liability as presented on the Company’s balance sheet as of June 30, 2021 and March 31, 2022: |
| Derivative liability as of June 30, 2020 |
|
$ |
1,590,638 |
|
| Initial derivative liability accounted for convertible notes payable issued during the period ended June 30, 2021 |
|
|
512,993 |
|
| True-up adjustment in debt discount and derivative liability |
|
|
37,360 |
|
| Change in derivative liability during the period |
|
|
(853,329 |
) |
| Notes retired due to refinancing |
|
|
(1,287,662 |
) |
| Derivative liability as of June 30, 2021 |
|
$ |
- |
|
| Change |
|
|
- |
|
| Balance at March 31, 2022 |
|
$ |
- |
|
Change in derivative liability for the nine months
ended March 31, 2022 and 2021, totaled $0 and $777,202, respectively and change in derivative liability for the three months ended
March 31, 2022 and 2021, totaled $0 and $1,039,980, respectively.
As of March 31, 2022, and June 30, 2021, the derivative
liability related to convertible notes was $0 and $0, respectively.
|