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Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Dec. 31, 2019	Mar. 20, 2020	Jun. 30, 2019
Cover [Abstract]
Entity Registrant Name	Medicine Man Technologies, Inc.
Entity Central Index Key	0001622879
Document Type	10-K
Document Period End Date	Dec. 31, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	true
Entity Small Business	true
Entity Shell Company	false
Entity Ex Transition Period	false
Entity Public Float			$ 71,600,000
Entity Common Stock, Shares Outstanding		39,952,628
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2019
Entity Interactive Data Current	Yes
Entity Incorporation State Country Code	NV
Entity File Number	000-55450

Consolidated Balance Sheets - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Current assets
Cash and cash equivalents	$ 11,853,627	$ 321,788
Accounts receivable, net of allowance for doubtful accounts	313,317	1,180,757
Accounts receivable - related party	72,658	125,112
Inventory	684,940	489,239
Note receivable - related party	767,695	0
Other assets	529,416	50,824
Prepaid acquisition costs (Note 12)	1,347,462	0
Total current assets	15,569,115	2,167,720
Non-current assets
Fixed assets, net os accumulated depreciation of $159,354 and $149,015, respectively	239,078	94,640
Goodwill	12,304,306	12,304,306
Intangible assets, net of accumulated amortization of $19,811 and $13,903, respectively	75,289	81,197
Investment	406,774	2,199,344
Accounts receivable - litigation	3,063,968	1,281,511
Deferred tax assets, net	268,423	0
Notes receivable - noncurrent, net	241,711	92,888
Operating lease right of use assets	59,943	0
Total non-current assets	16,659,492	16,053,886
Total assets	32,228,607	18,221,606
Current liabilities
Accounts payable	699,961	202,515
Accounts payable - related party	15,372	71,312
Accrued expenses	1,091,204	291,084
Derivative liabilities	3,773,382	0
Income taxes payable	1,940	582,931
Total current liabilities	5,581,859	1,147,842
Long-term liabilities
Lease liabilities	66,803	0
Total long-term liabilities	66,803	0
Total liabilities	5,648,662	1,147,842
Commitments and Contingencies (Note 12)	0	0
Shareholders' equity
Preferred stock $0.001 par value. 10,000,000 authorized, zero shares issued and outstanding December 31, 2019 and December 31, 2018, respectively.	0	0
Common stock $0.001 par value. 250,000,000 authorized, 39,952,626 and 27,753,310 shares issued and outstanding December 31, 2019 and December 31, 2018, respectively.	39,953	27,875
Additional paid-in capital	50,356,469	22,886,624
Accumulated deficit	(22,816,477)	(5,840,735)
Common stock held in treasury, at cost, 257,732 shares and zero shares held at December 31, 2019 and 2018, respectively	(1,000,000)	0
Total Shareholders' equity	26,579,945	17,073,764
Total liabilities and stockholders' equity	$ 32,228,607	$ 18,221,606

Consolidated Balance Sheets (Parenthetical) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Accumulated depreciation	$ 159,354	$ 149,015
Accumulated amortization	$ 19,811	$ 13,903
Preferred stock authorized	10,000,000	10,000,000
Preferred stock par value	$ 0.001	$ 0.001
Preferred stock issued	0	0
Preferred stock outstanding	0	0
Common stock authorized	250,000,000	90,000,000
Common stock par value	$ 0.001	$ 0.001
Common stock issued	39,952,626	27,753,310
Common stock outstanding	39,952,626	27,753,310
Treasury Stock, Common, Shares	257,732	0

Consolidated Statement of Comprehensive (Loss) And Income - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Operating revenues
Total revenue	$ 12,400,955	$ 9,442,555
Cost of goods and services
Cost of goods and services	7,616,221	2,577,510
Total cost of goods and services	7,616,221	2,577,510
Gross profit	4,784,734	6,865,045
Operating expenses
Selling, general and administrative expenses	2,261,317	1,101,756
Professional services	3,357,877	885,149
Salaries, benefits and related expenses	3,567,535	1,250,549
Stock based compensation	7,279,363	1,457,250
Derivative expense - contingent compensation	5,400,559	0
Total operating expenses	21,866,651	4,694,704
(Loss) Income from operations	(17,081,917)	2,170,341
Other income (expense)
Bad debt expense	(151,169)	(196,112)
Loss on sale of assets	0	(8,998)
Unrealized gain on derivative liabilities	1,627,176	0
Unrealized loss on marketable securities	(1,792,569)	(463,386)
Interest (expense) income, net	(160,195)	30,001
Total other (expense)	(476,756)	(638,495)
(Loss) income before income taxes	(17,558,673)	1,531,846
Provision for income tax (benefit) expense	(582,931)	582,931
Net (loss) income	$ (16,975,742)	$ 948,915
Basic (loss) earnings per common share	$ (0.50)	$ 0.04
Diluted (loss) earnings per common share	$ (0.50)	$ 0.03
Weighted-average number of common shares outstanding - Basic	33,740,557	25,121,896
Weighted-average number of common shares outstanding - Diluted	33,740,557	27,769,357
Comprehensive (loss) income	$ (16,975,742)	$ 948,915
Product sales, net [Member]
Operating revenues
Total revenue	6,468,230	1,476,169
Product sales - related party, net [Member]
Operating revenues
Total revenue	1,351,578	555,434
Litigation Revenue [Member]
Operating revenues
Total revenue	1,782,457	1,518,099
Licensing, consulting and Cultivation Max fees [Member]
Operating revenues
Total revenue	2,767,649	5,810,815
Other Operating Revenues [Member]
Operating revenues
Total revenue	$ 31,041	$ 82,038

Statement of Changes in Stockholders' Equity - USD ($)	Preferred Stock	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Common Stock Held In Treasury at Cost	Total
Beginning balance, shares at Dec. 31, 2017	0	22,991,137
Beginning balance, value at Dec. 31, 2017	$ 0	$ 22,113	$ 17,505,697	$ (6,789,650)		$ 10,739,160
Net income (loss)				948,915		948,915
Issuance of common stock in connection with sales made under private or public offerings, shares		937,647
Issuance of common stock in connection with sales made under private or public offerings, value		$ 938	999,062			1,000,000
Issuance of common stock in connection with the exercise of common stock purchase warrants, shares		1,091,197
Issuance of common stock in connection with the exercise of common stock purchase warrants, value		$ 1,091	(1,091)
Issuance of common stock as compensation to employees, officers and/or directors, shares		800,000
Issuance of common stock as compensation to employees, officers and/or directors, value		$ 800	1,456,450			1,457,250
Issuance of common stock in connection with the acquisition of a business, shares		1,933,329
Issuance of common stock in connection with the acquisition of a business, value		$ 1,933	2,998,067			3,000,000
Adjustment for acquisition payment			(71,561)			(71,561)
Ending balance, shares at Dec. 31, 2018	0	27,753,310
Ending balance, value at Dec. 31, 2018	$ 0	$ 27,875	22,886,624	(5,840,735)		17,073,764
Net income (loss)				(16,975,742)		(16,975,742)
Issuance of common stock in connection with sales made under private or public offerings, shares		9,800,000
Issuance of common stock in connection with sales made under private or public offerings, value		$ 9,800	19,590,200			19,600,000
Issuance of common stock in connection with the exercise of common stock purchase warrants, shares		485,543
Issuance of common stock in connection with the exercise of common stock purchase warrants, value		$ 365	602,195			602,560
Issuance of common stock as compensation to employees, officers and/or directors, shares		1,913,775
Issuance of common stock as compensation to employees, officers and/or directors, value		$ 1,913	3,220,488			3,222,401
Return of common stock in lieu of collection of certain accounts receivable					(1,000,000)	(1,000,000)
Stock based compensation expense related to common stock options			4,056,962			4,056,962
Ending balance, shares at Dec. 31, 2019	0	39,952,628
Ending balance, value at Dec. 31, 2019	$ 0	$ 39,953	$ 50,536,469	$ (22,816,477)	$ (1,000,000)	$ 26,579,945

Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
Consolidated Statements of Cash Flows - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Cash flows from operating activities of continuing operations:
Net (loss) income	$ (16,975,742)	$ 948,915
Adjustments to reconcile net (loss) income to cash used in operating activities:
Depreciation and amortization	61,708	81,960
Bad debt expense	151,169	196,112
Deferred taxes	(268,423)	0
Derivative expense	5,400,559	0
Unrealized loss on derivative liabilities	(1,627,176)	0
Equity securities received in lieu of cash for fees and services provided	0	(2,662,730)
Realized loss on disposal of fixed assets	0	8,998
Unrealized loss on marketable securities	1,792,569	463,386
Stock based compensation	7,184,363	1,457,250
Changes in operating assets and liabilities
Accounts receivable	(3,361,194)	(2,100,318)
Inventory	(195,701)	(92,148)
Prepaid expense and other current assets	(383,592)	0
Other assets	0	11,445
Operating lease right of use assets and liabilities	6,860	0
Accounts payable and other liabilities	1,241,626	(65,962)
Income taxes payable	(580,991)	582,931
Net cash used in operating activities	(7,553,965)	(1,170,160)
Cash flows from investing activities
Adjustment for acquisition payment	0	(71,561)
Issuance of notes receivable	(916,518)	(97,889)
Repayment of short-term debt	0	(58,280)
Proceeds from sale of fixed assets	0	14,000
Purchase of fixed assets	(200,238)	(43,037)
Net cash used in investing activities	(1,116,756)	(256,767)
Cash flows from financing activities
Proceeds from issuance of common stock, net of issuance costs	19,600,000	1,000,000
Proceeds for exercise of common stock purchase warrants, net of issuance costs	602,560	0
Net cash provided by financing activities	20,202,560	1,000,000
Net increase in cash and cash equivalents	11,531,839	(426,927)
Cash and cash equivalents at beginning of period	321,788	748,715
Cash and cash equivalents at end of period	11,853,627	321,788
Supplemental disclosure of cash flow information:
Cash paid for interest	192,107	0
Cash paid for income taxes	268,423	0
Supplemental disclosure of non-cash investing and financing activities:
Common stock issued in connection with long term service contracts	95,000	0
Return of common stock in lieu of collection of certain accounts receivable	$ 1,000,000	$ 0

Organization and Nature of Operations

12 Months Ended

Dec. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Business Description

Organization and Nature of Operations

Business Description – Business Activity

Medicine Man Technologies Inc. (the “Company”) incorporated in Nevada on March 20, 2014. On May 1, 2014, the Company entered into an exclusive Technology License Agreement with Medicine Man Denver, Inc., f/k/a Medicine Man Production Corporation, a Colorado corporation (“Medicine Man Denver”) whereby Medicine Man Denver granted it a license to use all of their proprietary processes they have developed, implemented and practiced at its cannabis facilities relating to the commercial growth, cultivation, marketing and distribution of medical marijuana and recreational marijuana pursuant to relevant state laws and the right to use and to license such information, including trade secrets, skills and experience (present and future) (the “Medicine Man Denver License Agreement”).

The Company commenced its business on May 1, 2014 and currently generates revenues from consulting activities for prospective clients interested in entering the cannabis industry as well as sponsoring seminars offered to the cannabis industry and other business endeavors related to our core competencies.

1. Liquidity and Capital Resources

12 Months Ended

Dec. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Liquidity and Capital Resources

1.	Liquidity and Capital Resources

During the fiscal year ended December 31, 2019 and 2018, the Company primarily used revenues from its operation supplemented by cash to fund its operations.

Cash and cash equivalents are carried at cost or amortized cost and represent cash on hand, deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date. The Company had $11,853,627 and $321,788 classified as cash and cash equivalents as of December 31, 2019, and December 31, 2018, respectively.

The Company maintains its cash balances with a high-credit-quality financial institution. At times, such cash may be more than the insured limit of $250,000. The Company has not experienced any losses in such accounts, and management believes the Company is not exposed to any significant credit risk on its cash and cash equivalents.

To mitigate credit risk, the Company may purchase highly liquid investments with an original maturity of three months or less. At December 31, 2019, the Company had one United States Treasury Bill with a maturity date of January 14, 2020 and bearing interest at a rate of approximately 1.4%.

The following table depicts the composition of the Company’s cash and cash equivalents as of December 31, 2019 and 2018:

	December 31, 2019		December 31, 2018

Deposits placed with banks	$	736,101	$	321,788
United States Treasury Bill		11,117,526		–
Total cash and cash equivalents	$	11,853,627	$	321,788

2. Critical Accounting Policies and Estimates

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Critical Accounting Policies and Estimates

2.	Critical Accounting Policies and Estimates

Basis of Presentation

These accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for annual financial statements.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported therein. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be based upon amounts that differ from these estimates.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications had no impact on the Company’s net (loss) earnings and financial position.

Fair Value Measurements

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability, in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, as follows:

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments include cash, accounts receivable, note receivable, accounts payables and tenant deposits. The carrying values of these financial instruments approximate their fair value due to their short maturities. The carrying amount of the Company’s debt approximates fair value because the interest rates on these instruments approximate the interest rate on debt with similar terms available to us. The Company’s derivative liability was adjusted to fair market value at the end of the year, using Level 3 inputs.

The following is the Company’s assets and liabilities measured at fair value on a recurring and nonrecurring basis at December 31, 2019 and 2018, using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3):

		December 31, 2019				December 31, 2018
Level 1 – Marketable Securities Available-for-Sale – Recurring		$	406,774			$	2,199,344

Marketable Securities at Fair Value on a Recurring Basis

Certain assets are measured at fair value on a recurring basis. The Level 1 position consists of an investment in equity securities held in Canada House Wellness Group, Inc. (CHV), a publicly-traded company whose securities are actively quoted on the Toronto Stock Exchange.

Fair Value of Financial Instruments

The carrying amounts of cash and current assets and liabilities approximate fair value because of the short-term maturity of these items. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. Available-for-sale securities are recorded at current market value as of the date of this report.

Accounts Receivable

The Company extends unsecured credit to its customers in the ordinary course of business. Accounts receivable related to consulting revenues are recorded when a milestone is reached at point in time resulting in funds being due for delivered services, and where payment is reasonably assured. Accounts receivable related to Cultivation Max revenues are recorded based on cultivation yields over time on harvested cannabis. Consulting and Cultivation Max revenues are generally collected from 30 to 60 days after the invoice is sent.

The following table depicts the composition of our accounts receivable as of December 31, 2019 and 2018:

	December 31, 2019			December 31, 2018

Accounts receivable – trade	$	384,202		$	1,180,757
Accounts receivable – related party		72,658			125,112
Accounts receivable – litigation, non-current		3,063,968			1,281,511
Allowance for doubtful accounts		(70,885	)		–
Total accounts receivable	$	3,449,943		$	2,587,380

The Company establishes an allowance for doubtful accounts based on management’s assessment of the collectability of trade receivables. A considerable amount of judgment is required in assessing the amount of the allowance. The Company makes judgments about the creditworthiness of each customer based on ongoing credit evaluations and monitors current economic trends that might impact the level of credit losses in the future. If the financial condition of the customers were to deteriorate, resulting in their inability to make payments, a specific allowance will be required. At December 31, 2019 and 2018, the Company recorded an allowance for doubtful accounts of $70,885 and $0, respectively.

Recovery of bad debt amounts previously written off is recorded as a reduction of bad debt expense in the period the payment is collected. If the Company’s actual collection experience changes, revisions to its allowance may be required. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. The Company wrote-off $80,284 of its accounts receivable during the year ended December 31, 2019. The Company did not write-off any of its accounts receivable in year ended December 31, 2018.

On March 22, 2019, the Company entered into an Agreement of Sale of Future Receipts (“Factoring Agreement”) with Libertas Funding, LLC (“Purchaser”). Under the terms of the Factoring Agreement, the Purchaser acquired $810,000 of certain future receivables from the Company for $582,000 in net proceeds. The Company is required to repay the Purchaser $24,107 weekly for an estimated term of eight months. On July 2, 2019, the Company repaid $436,607, which represented all remaining amounts owed under the Factoring Agreement. The Company recorded $192,107 in interest expense related to the Factoring Agreement during the year ended December 31, 2019.

In July 2018, the Company commenced legal action against a customer in Clark County, Nevada for breach of contract, adding a significant value to its receivables for fees that had been booked, due to forbearance grants by the Company that were subsequently violated, causing the Company to increase its receivables accordingly. The Company provided services to this customer for a period of thirteen months, agreeing conditionally to three modifications in December 2017, March 2018 and May 2018 to forego certain revenue sharing payments in accordance with the agreement with the customer, which were subsequently breached by the customer. As a result, the Company engaged legal counsel and filed a complaint in Clark County, Nevada, which alleged breach of contract and sought general, special and punitive damages in the amount of $3,876,850.

On August 2, 2019, a jury in the District Court of Clark County, Nevada found in favor of the Company and awarded the Company damages totaling $2,773,321 (See Part II, Item 1, Legal Proceedings for more information). The Company has classified the awarded amount receivable as a non-current asset since the customer has subsequently filed an appeal. Considering this customer’s appeal, the Company sought to compel the customer to obtain and produce a bond securing the award. On December 13, 2019, proof of the bond was posted through United States Fire Insurance Company, naming the Company as the obligee.

At December 31, 2019 and 2018, the accounts receivable for this matter totaled $2,773,321 and $990,864, and the related revenue recorded totaled $1,782,457 and $1,015,154 for the years ended December 31, 2019 and 2018, respectively.

The Company analyzed the contract, associated revenue and litigation process under Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers. As detailed above, the Company had a contract with the customer that identified distinct performance obligations to be satisfied over time. Additionally, it determined that the litigation process and subsequent award represented a contract modification.

Paragraph 606-10-25 states that an entity transfers control of a good or service over time and, therefore, satisfies a performance obligation and recognizes revenue over time if one of the following criteria is met:

The customer simultaneously receives and consumes the benefits provided by the entity’s performance as the entity performs.

The entity’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced.

The entity’s performance does not create an asset with an alternative use to the entity, and the entity has an enforceable right to payment for performance completed to date.

Paragraph 606-10-25 further states that the process for determining the proper treatment for a contract modification includes three steps:

Determine whether a change to a contract qualifies as a contract modification.

Determine whether the modification should be treated as a separate, standalone contract or as a modification of the original contract. If the contract is a separate contract, the entity follows the five-step model to determine how to recognize revenue. If the modification is not treated as a separate contract, the entity continues to Step 3.

Determine appropriate accounting treatment for contract modification not accounted for as a separate contract.

ASC 606 defines a contract modification as a change in scope and/or price to an original contract or any change to the enforceable rights and obligations of the parties to the original contract. Enforceable rights and obligations are those that are approved by both parties and legally required. A contract modification does not need to be written; enforceable changes can be the result of oral agreements or implied through customary business practices.

The effect that the modification has on the transaction price and on the entity’s measure of progress towards satisfaction of the performance obligation is recognized as an adjustment to revenue either as an increase in or a reduction of revenue at the date of the modification. The adjustment to revenue is made on a cumulative catch-up basis.

As management determined that the litigation process constituted a contract modification, and that the contract was upheld judicially, the Company recognized and recorded $1,782,457 on a cumulative catch-up basis as of August 2, 2019.

On June 7, 2019, the Company filed a complaint against a second customer in Clark County, Nevada, for, amongst other causes of action, breach of contract. On July 17, 2019, the parties stipulated to stay the case in favor of arbitration. Since that time, the parties have been in the process of mutually agreeing upon an arbitrator, which has now completed. The parties are now in the process of scheduling the arbitration. As of December 31, 2019 and 2018, the accounts receivable for this matter totaled $290,647.

Notes Receivable

In July 2016, the Company executed a non-binding Term Sheet to acquire Capital G Ltd, an Ohio limited liability company and its three wholly owned subsidiary companies, Funk Sac LLC, Commodogy LLC, and OdorNo LLC. The agreement was subject to the Company’s due diligence as well as execution of definitive agreements. In January 2017, the parties agreed not to proceed with this transaction. As part of the term sheet, the Company agreed to loan Capital G the principal balance of $250,000 pursuant to the terms of a convertible note which accrues interest at the rate of 12% per annum and which became due November 1, 2017. As of September 30, 2018, this note has not been repaid when it became due. As of December 31, 2018, the Company has written off 100%, or $250,000, of this balance plus accrued interest of $49,018. Due to this bad debt expense not being a part of the Company’s normal business this expense is categorized in other income and expense on the income statement.

On July 17, 2018, the Company entered into an intellectual property license agreement with Abba Medix Corp. (AMC), a wholly-owned subsidiary of publicly-traded Canada House Wellness Group, Inc. (CHV). The Company agreed to provide a lending facility to AMC in CAD$125,000 increments of up to CAD$500,000. The lending facility is for a term of 36 months and bears interest at a rate of 2%. As of December 31, 2019 and 2018, the Company had loaned to AMC a total of $241,711 and $92,888, respectively. The Company classified these loans as long-term notes receivable on its consolidated balance sheets as of December 31, 2019 and 2018.

Other Assets (Current and Non-Current)

Other assets at December 31, 2019 and 2018 were $529,416 and $50,824, respectively.

At December 31, 2019, other assets included $480,881 in prepaid expenses, $21,085 in interest receivable and $27,450 in security deposits. Prepaid expenses were primarily comprised of insurance premiums, membership dues, conferences and seminars and other general and administrative costs.

At December 31, 2018, other assets included $29,005 in prepaid expenses and $21,819 in security deposits.

Goodwill and Intangible Assets

Goodwill represents the future economic benefit arising from other assets acquired that could not be individually identified and separately recognized. The goodwill arising from the Company’s acquisitions is attributable to the value of the potential expanded market opportunity with new customers. Intangible assets have either an identifiable or indefinite useful life. Intangible assets with identifiable useful lives are amortized on a straight-line basis over their economic or legal life, whichever is shorter. The Company’s amortizable intangible assets consist of licensing agreements, product licenses and registrations, and intellectual property or trade secrets. Their estimated useful lives range from 10 to 15 years.

Goodwill and indefinite-lived assets are not amortized but are subject to annual impairment testing unless circumstances dictate more frequent assessments. The Company performs an annual impairment assessment for goodwill at the end of each calendar year and more frequently whenever events or changes in circumstances indicate that the fair value of the asset may be less than the carrying amount. Goodwill impairment testing is a two-step process performed at the reporting unit level. Step one compares the fair value of the reporting unit to its carrying amount. The fair value of the reporting unit is determined by considering both the income approach and market approaches. The fair values calculated under the income approach and market approaches are weighted based on circumstances surrounding the reporting unit. Under the income approach, the Company determines fair value based on estimated future cash flows of the reporting unit, which are discounted to the present value using discount factors that consider the timing and risk of cash flows. For the discount rate, the Company relies on the capital asset pricing model approach, which includes an assessment of the risk-free interest rate, the rate of return from publicly traded stocks, the Company’s risk relative to the overall market, the Company’s size and industry and other Company-specific risks. Other significant assumptions used in the income approach include the terminal value, growth rates, future capital expenditures and changes in future working capital requirements. The market approaches use key multiples from guideline businesses that are comparable and are traded on a public market. If the fair value of the reporting unit is greater than its carrying amount, there is no impairment. If the reporting unit’s carrying amount exceeds its fair value, then the second step must be completed to measure the amount of impairment, if any. Step two calculates the implied fair value of goodwill by deducting the fair value of all tangible and intangible net assets of the reporting unit from the fair value of the reporting unit as calculated in step one. In this step, the fair value of the reporting unit is allocated to all of the reporting unit’s assets and liabilities in a hypothetical purchase price allocation as if the reporting unit had been acquired on that date. If the carrying amount of goodwill exceeds the implied fair value of goodwill, an impairment loss is recognized in an amount equal to the excess.

Determining the fair value of a reporting unit is judgmental in nature and requires the use of significant estimates and assumptions, including revenue growth rates, strategic plans and future market conditions, among others. There can be no assurance that the Company’s estimates and assumptions made for purposes of the goodwill impairment testing will prove to be accurate predictions of the future. Changes in assumptions and estimates could cause the Company to perform an impairment test prior to scheduled annual impairment tests.

The Company performed its annual fair value assessment at December 31, 2019 on its reporting units and subsidiary with material goodwill and intangible asset amounts on their respective balance sheets and determined that no impairment exists.

Long-Lived Assets

The Company evaluates the recoverability of its long-lived assets whenever events or changes in circumstances have indicated that an asset may not be recoverable. Long-lived asset are grouped with other assets at the lowest level for which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities. If the sum of the projected undiscounted cash flows is less than the carrying value of the assets, the assets are written down to the estimated fair value.

The Company evaluated the recoverability of its long-lived assets at December 31, 2019 on its reporting units and subsidiary with material amounts on their respective balance sheets and determined that no impairment exists.

Accounts Payable

Accounts payable at December 31, 2019 and 2018 were $699,961 and $202,515, respectively, and were comprised of trade payables for various purchases and services rendered during the ordinary course of business.

Accrued Expenses and Other Liabilities

Accrued expenses and other liabilities at December 31, 2019 and 2018 were $1,091,204 and $291,084, respectively.

At December 31, 2019, accrued expenses and other liabilities was comprised of customer deposits of $148,109, accrued payroll of $714,220, and operating expenses of $228,875.

At December 31, 2018, accrued expenses and other liabilities was comprised of $163,568 in customer deposits, $21,330 in deferred rent expense and $106,185 in accrued payroll.

Revenue Recognition and Related Allowances

The Company’s revenue recognition policy is significant because the amount and timing of revenue is a key component of its results of operations. Certain criteria are required to be met in order to recognize revenue. If these criteria are not met, then the associated revenue is deferred until the criteria are met. When consideration is received in advance of the delivery of goods or services, a contract liability is recorded. Revenue contracts are identified when accepted from customers and represent a single performance obligation to sell the Company’s products to a customer.

The Company has three main revenue streams: (i) product sales; (ii) licensing, consulting and Cultivation Max fees; and (iii) other operating revenues from seminars, reimbursements and other miscellaneous sources.

Product sales are recorded at the time that control of the products is transferred to customers. In evaluating the timing of the transfer of control of products to customers, the Company considers several indicators, including significant risks and rewards of products, its right to payment, and the legal title of the products. Based on the assessment of control indicators, sales are generally recognized when products are delivered to customers.

Revenue from licensing, consulting and Cultivation Max fees are recognized when the obligations to the client are fulfilled which is determined when milestones in the contract are achieved and target harvest yields are exceeded.

Revenue from seminar fees is related to one-day seminars and is recognized as earned upon the completion of the seminar. The Company also recognizes expense reimbursement from clients as revenue for expenses incurred during certain jobs.

Intellectual Property Licensing Agreement with ABBA Medix Corp.

On July 17, 2018, the Company entered into an intellectual property license agreement with Abba Medix Corp. (“AMC”), a wholly-owned subsidiary of publicly-traded CHV.

The license agreement granted AMC the right to use products and processes related to high-efficiency cultivation of cannabis, as well as various inventions, ideas, discoveries, algorithms, designs, hardware, prototypes, copyrights, processes, mask works, trade secrets, know-how, calculations, testing results, technical data, documentation, potential customer contracts, marketing ideas and other technology in the cannabis cultivation industry, in addition to all related trademarks, from the Company. The license was granted as of the effective date of the agreement for an 18-month period and shall automatically renew for successive 18-month periods until the agreement is otherwise terminated.

As consideration for granting the license to AMC, the Company received the following:

$1,150,000 in cash;

$3,500,000 in shares of CHV common stock; and

Ongoing licensing fees calculated as a percentage of AMC’s sales revenue directly related to the Company’s intellectual property.

ASC 606 provides guidance in determining the proper accounting treatment for the license of the intellectual property requiring the Company had to complete a sequence of analyses. These analyses include the following: (i) sale versus licensing transactions; (ii) distinct performance obligations; (iii) the nature of the license; and (iv) the timing of recognition based on the nature of the license. Based on an analysis of ASC 606, the Company determined the following:

The license agreement establishes AMC’s right to use the intellectual property; it does not transfer any of the Company’s ownership in the assets. Therefore, the agreement is clearly identified as a licensing transaction.

The license agreement grants AMC the right to use the intellectual property immediately and does provide for the transfer of any other goods or services to AMC. The property is capable of being distinct, and the promise to transfer the property is distinct within the context of the contract. The Company recognized its license as distinct and a separate performance obligation.

The intellectual property is functional intellectual property as it has significant standalone functionality. The license agreement with AMC grants them with the exclusive right to use the Company’s intellectual property immediately upon the date of the agreement. This date clearly represents a transfer of control to the customer. Further, upon its effectiveness, the Company established the right to payment and the customer accepted the asset. As control has been transferred to the customer, the Company has satisfied its performance obligation and, as such, is entitled to immediately recognize the $4,650,000 in revenue associated with the granting of the licensing rights.

Additionally, under the terms of the agreement, the Company agreed to provide a loan facility to AMC under the following terms:

The Licensor (the Company) shall provide a lending facility to the Licensee (AMC) in $125,000 increments of up to $500,000; noting that any increment over the initial $250,000 advanced shall only be funded upon the Licensee’s funding of the second $575,000 amount to the Licensor. Such lending facilities shall bear a nominal interest rate and carry terms as agreed to by both parties. Both parties agree that each of the Licensor’s advances shall be first money in and first money to be repaid in accordance with the terms mutually agreed to.

The purpose of this lending facility was to provide financing support to AMC, the licensee of the Company’s intellectual property, for investing in capital expenses that would allow them to generate revenue that would result in a royalty being paid to Medicine Man Technologies, Inc. The Company is entitled to receive 4% of the gross revenues associated with the sale of Success Nutrients by AMC over the term of the agreement. The Company considered the guidance under ASC 606 in determining whether the facility had any impact on the Company’s ability to recognize revenue from the licensing agreement. Based upon the Company’s analysis, the Company determined the business purpose of the financing facility that it provided to AMCwas a separate agreement with distinct responsibilities from the Company’s performance obligations under the intellectual property license agreement. The Company considered the scope exceptions highlighted in 606-10-15-2(c) and determined that ASC 825, Financial Instruments more appropriately applied. The amount of revenue of $4,650,000 that the Company recognized was not reduced by the amount of the $500,000 facility, which the Company determined is a standalone contract with commercial substance and collectability. As of December 31, 2018, the Company recorded a trade accounts receivable on its balance sheet due from AMC of $250,000.

On July 31, 2018, the license agreement was amended solely to eliminate the equal $1,000,000 million-dollar stock swap element. Based upon the Company’s analysis of ASC 606-10-25-13, the Company determined the modification represented the elimination of a stock swap between the Company and its customer’s parent company, CHV. While the consideration had a defined value, the result of the modification does not beneficially or negatively impact either the Company or its customer. The Company determined that the remaining goods or services as of the time of the modification are not distinct and, form part of a single performance obligation that was partially, if not fully, satisfied. As the consideration represented an exchange of equal value between the two parties, the Company did not record any revenue adjustments (either as an increase or a reduction) due to the elimination of the stock swap.

Cultivation Max fees

On August 6, 2018, the Company entered into an agreement with a client that was comprised of two basic elements:

Element One: The Company was hired to act as project management due to the Company’s industry knowledge to help a client prepare to cultivate their crop. The Company completed all of its work to get them growing by December 31, 2018. This element of the Company’s contract called for simply charging an agreed upon fee for services performed. All fees were considered fully earned and were billed and collected in 2018.

Element Two: The second part of the agreement called for the Company to receive a bonus equal to “25% of the value of the product grown over 2 pounds per light” for the next 5 years. “2 pounds per light” is a marijuana industry standard meaning that if the crop yield was above that standard, it would indicate that due to the Company’s expertise that the client crop was “above standard”. Under that clause, the Company would be sharing in the extra profit if it was achieved, because the expert advice provided by the Company would enable the client to generate a significant level of profit above industry standard. On December 14, 2018, the Company entered into an amendment to amend the terms of the August 6, 2018 license agreement:

The term for receiving 25% of the value grown over 2 pounds per light, was reduced from five years to three years

The 25% level was reduced to 5%

In return, the Company received a $1,000,000 fee which it billed in 2018 and collected in full in January 2019. Specifically, the wording in the addendum stated, “The aforementioned fee of $1,000,000 shall be deemed earned by the Licensor (Medicine Man) upon the execution of this Addendum and shall be payable before January 15, 2019”. The Company met all contractual terms prior to December 31, 2018 and has no ongoing contractual responsibility to provide consulting services in order to earn this fee. The client limited their exposure for potentially higher future payments by agreeing to a one-time payment of $1,000,000.

The amendment also provided that the client will reimburse the Company up to $11,000 a month for the cost of its employees if they are needed at the client’s locations. The Company considered this a pass-thru item where no profit was recognized. Under the guidelines of ASC 606-10-25-27, an entity transfers control of a good or service over time and, therefore, satisfies a performance obligation and recognizes revenue over time, if one of the following criteria is met:

The customer simultaneously receives and consumes the benefits provided by the entity’s performance as the entity performs (see paragraphs 606-10-55-5 through 55-6).

The entity’s performance creates or enhances an asset (for example, work in process) that the customer controls as the asset is created or enhanced (see paragraph 606-10-55-7).

The entity’s performance does not create an asset with an alternative use to the entity (see paragraph 606-10-25-28), and the entity has an enforceable right to payment for performance completed to date (see paragraph 606-10-25-29).

As a result of the contractual consulting services the Company provided for Element One, control of the services has been transferred to the customer. These services enhanced the client’s crop output capabilities and clearly meet criteria (a) and (b) above, and, therefore were recorded as revenue in 2018.

With respect to Element Two in terms of considering the revenue method of recognition under ASC 606, the following characteristics of the transaction were considered:

The Company had no further performance obligations

The customer contractually deemed this fee as earned

The future potential value of the reduction from 25% over five years, to 5% over three years, is an asset that legally passed to the client.

The customer paid the fee

Based on the analysis performed, the Company determined “control” at a point in time, transferred immediately to the client upon the signing of the amendment. As a result, the Company recorded a trade receivable of $1,000,000 on its balance sheet as of December 31, 2018 and $1,000,000 of revenue in its statement of operations for the year ended December 31, 2018. This $1,000,000 receivable was fully received in January of 2019.

The Company notes no change in the pattern of revenue recognition due to the adoption of Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers. The Company believes that the revenue recognition related to our licensing, consulting and product sales are consistent with our current practice.

Costs of Goods and Services Sold

Costs of goods and services sold are comprised of related expenses incurred while supporting the implementation and sales of Company’s products and services.

General and Administrative Expenses

General and administrative expense are comprised of all expenses not linked to the production or advertising of the Company’s products or services.

Advertising and Marketing Costs

Advertising and marketing costs are expensed as incurred and totaled $455,047 and $291,711 for years ended December 31, 2019 and 2018, respectively.

Stock-Based Compensation

The Company accounts for share-based payments pursuant to ASC 718, Stock Compensation and, accordingly, the Company records compensation expense for share-based awards based upon an assessment of the grant date fair value for stock and restricted stock awards using the Black-Scholes option pricing model.

Stock compensation expense for stock options is recognized over the vesting period of the award or expensed immediately under ASC 718 and Emerging Issues Task Force (“EITF”) 96-18 when stock or options are awarded for previous or current service without further recourse.

Share-based expense paid to through direct stock grants is expensed as occurred. Since the Company’s stock is publicly traded, the value is determined based on the number of shares issued and the over-the-counter quoted value of the stock on the date of the transaction.

On June 20, 2018, the FASB issued ASU 2018-07 which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under the ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. Previously, share-based payment arrangements to nonemployees were accounted for under ASC 718, while nonemployee share-based payments issued for goods and services were accounted for under ASC 505-50. Before the amendment, the major difference for the Company (but not limited to) was the determination of measurement date, which generally is the date on which the measurement of equity classified share-based payments becomes fixed. Equity classified share-based payments for employees was fixed at the time of grant. Equity-classified nonemployee share-based payment awards are no longer measured at the earlier of the date which a commitment for performance by the counterparty is reached or the date at which the counterparty’s performance is complete. They are now measured at the grant date of the award, which is the same as share-based payments for employees. The Company adopted the requirements of the new rule as of January 1, 2019, the effective date of the new guidance.

The Company recognized $7,279,363 and $1,457,250 in expense for stock-based compensation to directors, employees and consultants during the years ended December 31, 2019 and 2018, respectively.

Income Taxes

ASC 740, Income Taxes requires the use of the asset and liability method of accounting for income taxes. Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

Right of Use Assets and Lease Liabilities

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The standard requires lessees to recognize almost all leases on the balance sheet as a Right-of-Use (“ROU”) asset and a lease liability and requires leases to be classified as either an operating or a finance type lease. The standard excludes leases of intangible assets or inventory. The standard became effective for the Company beginning January 1, 2019. The Company adopted ASC 842 using the modified retrospective approach, by applying the new standard to all leases existing at the date of initial application. Results and disclosure requirements for reporting periods beginning after January 1, 2019 are presented under ASC 842, while prior period amounts have not been adjusted and continue to be reported in accordance with our historical accounting under ASC 840. The Company elected the package of practical expedients permitted under the standard, which also allowed the Company to carry forward historical lease classifications. The Company also elected the practical expedient related to treating lease and non-lease components as a single lease component for all equipment leases as well as electing a policy exclusion permitting leases with an original lease term of less than one year to be excluded from the ROU assets and lease liabilities.

Under ASC 842, the Company determines if an arrangement is a lease at inception. ROU assets and liabilities are recognized at commencement date based on the present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. As most of the Company's leases do not provide an implicit rate, the Company estimated the incremental borrowing rate in determining the present value of lease payments. The ROU asset also includes any lease payments made prior to commencement and is recorded net of any lease incentives received. The Company’ lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options.

Operating leases are included in operating lease Right-of-Use assets and operating lease liabilities, current and non-current, on the Company's consolidated balance sheets.

3. Recent Accounting Pronouncements

12 Months Ended

Dec. 31, 2019

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Recent Accounting Pronouncements

3.	Recent Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position or results of operations except as noted below:

FASB ASU 2017-01, Clarifying the Definition of a Business (Topic 805) – In January 2017, the FASB issued 2017-01. The new guidance that changes the definition of a business to assist entities with evaluating when a set of transferred assets and activities is a business. The guidance requires an entity to evaluate if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the set of transferred assets and activities is not a business. The guidance also requires a business to include at least one substantive process and narrows the definition of outputs by more closely aligning it with how outputs are described in ASC 606. The ASU is effective for annual reporting periods beginning after December 15, 2017, and for interim periods within those years. Adoption of this ASU did not have a significant impact on the Company’s consolidated results of operations, cash flows and financial position.

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), which enhances and simplifies various aspects of the income tax accounting guidance, including requirements such as tax basis step-up in goodwill obtained in a transaction that is not a business combination, ownership changes in investments, and interim-period accounting for enacted changes in tax law. The amendment will be effective for public companies with fiscal years beginning after December 15, 2020; early adoption is permitted. The Company is evaluating the impact of this amendment on its consolidated financial statements.

In February 2020, the FASB issued ASU 2020-02, Financial Instruments-Credit Losses (Topic 326) and Leases (Topic 842) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842), which amends the effective date of the original pronouncement for smaller reporting companies. ASU 2016-13 and its amendments will be effective for the Company for interim and annual periods in fiscal years beginning after December 15, 2022. The Company believes the adoption will modify the way the Company analyzes financial instruments, but it does not anticipate a material impact on results of operations. The Company is in the process of determining the effects adoption will have on its consolidated financial statements.

4. Fixed Assets

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Fixed Assets

4.	Fixed Assets

Fixed assets are recorded at cost, net of accumulated depreciation and are comprised of the following:

	December 31, 2019			December 31, 2018
Furniture and fixtures	$	98,903		$	98,395
Leasehold improvements		40,953			36,900
Vehicles		34,000			34,000
Office equipment		33,833			74,360
Work in process		190,743			–
		398,432			243,655
Less: accumulated depreciation		(159,354	)		(149,015	)
Total property and equipment, net of depreciation	$	239,078		$	94,640

Depreciation on fixed assets is recorded on a straight-line basis over the following expected useful:

Furniture and fixtures			3 years
Marketing display			3 years
Vehicles			3 years
Office equipment			3 years

Depreciation expense for the years ended December 31, 2019 and 2018 was $55,800 and $75,446, respectively.

5. Intangible Asset

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Asset

5.	Intangible Asset

Intangible assets at December 31, 2019 and 2018 were comprised of the following:

	December 31, 2019			December 31, 2018

License agreement	$	5,300		$	5,300
Product license and registration		57,300			57,300
Trade secret – intellectual property		32,500			32,500
		95,100			95,100
Less: accumulated amortization		(19,811	)		(13,903	)
Total intangible assets, net of amortization	$	75,289		$	81,197

Amortization expense for years ended December 31, 2019 and 2018 was $5,908 and $6,515, respectively.

6. Derivative Liability

12 Months Ended

Dec. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Liability

6.	Derivative Liabilities

During the year ended December 31, 2019, the Company entered into employment agreements with certain key officers that contained contingent consideration provisions based upon the achievement of certain market condition milestones. The Company determined that each of these vesting conditions represented derivative instruments.

On January 8, 2019, the Company granted the right to receive 500,000 shares of restricted common stock to an officer, which will vest at such time that that the Company’s stock price appreciates to $8.00 per share with defined minimum average daily trading volume thresholds.

On April 23, 2019, the Company granted the right to receive 1,000,000 shares of restricted common stock to an officer, which will vest at such time that that the Company’s stock price appreciates to $8.00 per share with defined minimum average daily trading volume thresholds. Similarly, on June 11, 2019, the Company granted the right to receive 1,000,000 shares of restricted common stock to an officer, which will vest at such time that that the Company’s stock price appreciates to $8.00 per share with defined minimum average daily trading volume thresholds.

The Company accounts for derivative instruments in accordance with the U.S. GAAP accounting guidance under ASC 815 Derivatives and Hedging Activities. The Company estimated the fair value of these derivatives at the respective balance sheet dates using the Black-Scholes option pricing model based upon the following inputs: (i) stock price on the date of grant ranging between $1.32 - $3.75, (ii) the contractual term of the derivative instrument ranging between 2.25 - 3 years, (iii) a risk-free interest rate ranging between 1.56% - 2.57% and (iv) an expected volatility of the price of the underlying common stock ranging between 136% - 158%.

As of December 31, 2019, the fair value of these derivative liabilities is $3,773,382. The change in the fair value of derivative liabilities for the year ended December 31, 2019 was $1,627,177, resulting in an aggregate unrealized gain on derivative liabilities.

7. Related Party Transactions

12 Months Ended

Dec. 31, 2019

Related Party Transactions

7.	Related Party Transactions

For the year ended December 31, 2019

During the year ended December 31, 2019, the Company had sales from Super Farm LLC (“Super Farm”) totaling $578,655 and sales from De Best Inc. (“De Best”) totaling $191,915. The Company gives a larger discount on nutrient sales to related parties than non-related parties. During the year ended December 31, 2019, the Company had sales discounts associated with Super Farm totaling $291,823 and sales discounts associated with De Best totaling $95,957. As of December 31, 2019, the Company had an accounts receivable balance from Super Farm totaling $33,127 and an accounts receivable balance from De Best totaling $2,180. The Company’s Chief Cultivation Officer, Joshua Haupt, currently owns 20% of both Super Farm and De Best.

During the year ended December 31, 2019, the Company recorded sales from Medicine Man Denver totaling $402,839 and sales discounts totaling $143,473. As of December 31, 2019, the Company had an accounts receivable balance with Medicine Man Denver totaling $34,748. Also, during the year ended December 31, 2019, the Company incurred expenses from Medicine Man Denver totaling $125,897 for contract labor and other related administrative costs. The Company’s former Chief Executive Officer, Andy Williams, currently owns 38% of Medicine Man Denver.

During the year ended December 31, 2019, the Company recorded sales from MedPharm Holdings LLC (“MedPharm Holdings”) totaling $64,378 and sales discounts totaling $7,498. As of December 31, 2019, the Company had an accounts receivable balance with MedPharm Holdings totaling $2,604. Also, during the year ended December 31, 2019, the Company issued various notes receivable to MedPharm Holdings totaling $767,695 with original maturity dates ranging from September 21, 2019 through January 19, 2020 and all bearing interest at 8% per annum. Certain notes extended to 2020 by mutual agreement between the Company and noteholder. The Company’s former Chief Executive Officer, Andy Williams, currently owns 29% of MedPharm Holdings.

During the year ended December 31, 2019, the Company recorded sales from Baseball 18, LLC (“Baseball”) totaling $165,617. The revenue is included under product sales - related party, net, in the Company’s consolidated financial statements. As of December 31, 2019, the Company had an accounts receivable balance with Baseball totaling $169,960. During the year ended December 31, 2019, the Company recorded sales from Farm Boy, LLC (“Farm Boy”) totaling $321,307. The revenue is included under product sales - related party, net, in the Company’s consolidated financial statements. As of December 31, 2019, the Company had an accounts receivable balance with Farm Boy totaling $330,911.

For the year ended December 31, 2018

As of December 31, 2018, the Company had six related parties, Brett Roper, Medicine Man Denver, MedPharm Holdings, MedPharm Iowa, Super Farm LLC and De Best Inc. The Company’s Chief Cultivation Officer, Joshua Haupt, currently owns 20% of both Super Farm and De Best. Additionally, the Company’s former Chief Executive Officer, Andy Williams, currently owns 38% of Medicine Man Denver. Andy Williams also owns 10% of MedPharm Holdings and 3% of MedPharm Iowa. Brett Roper was the Chief Executive Officer of the Company before Andy Williams.

During the year ended December 31, 2018, the Company had net sales from Super Farm totaling $264,103 and $88,063 in net sales from De Best. The Company gives a larger discount on nutrient sales to related parties than non-related parties. As of December 31, 2018, the Company had accounts receivable balance with Super Farm totaling $61,110 and $20,503 accounts receivable from De Best. As of December 31, 2018, the company had an accounts payable balance to Brett Roper in the amount of $69,714.

As of and for the year ended December 31, 2018, the Company had sales from Medicine Man Denver totaling $158,805 and an accounts receivable balance of $28,893. As of December 31, 2018, the Company had an accounts receivable balance owed from Medicine Man Denver totaling $2,986. During the year ended December 31, 2018, the Company had sales from MedPharm Iowa totaling $10,026 and $34,438 in sales from MedPharm Holdings. As of December 31, 2018, the Company had an accounts receivable balance owed from MedPharm Iowa totaling $1,195 and $10,425 owed from MedPharm Holdings.

8. Goodwill and Acquisition Accounting

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Acquisition Accounting

8.	Goodwill and Acquisition Accounting

On September 17, 2018, of the Company acquired Two JS LLC, d/b/a The Big Tomato, a Colorado limited liability company (“Big T” or “The Big Tomato”). The Company issued an aggregate of 1,933,329 shares of its common stock in exchange for a 100% ownership of Big T. The Company utilized purchase price accounting stating that net book value approximates the fair market value of the assets acquired. The purchase price accounting resulted in the Company valuing the investment as $3,000,000 of Goodwill. At September 17, 2018, the Company’s per share value of Common Stock was $1.55. There was no requirement for The Big Tomato to have independent audited financial statement for the prior two fiscal years and any interim periods because the aggregate value of the acquisition is less than 20% of the Company’s current assets.

The Big Tomato Balance Sheet

	Book/Fair Value					Book/Fair Value
Assets:				Liabilities:
Inventory	$	291,000		Accounts payable		$	272,266
Other assets		4,950		Customer Deposits			23,684
	$	295,950				$	295,950

Purchase Price (1,933,329*1.5517)
			$	3,000,000
Less: BV of Assets				(295,950	)
Add: BV of Liabilities				295,950
Goodwill			$	3,000,000

As of December 31, 2019, the Company’s Goodwill has a balance of $12,304,306. This amount consisted of $3,003,226 from the DCG (Denver Consulting Group) acquisition, $6,301,080 from the Success Nutrients and Pono Productions acquisitions and $3,000,000 from the acquisition of The Big Tomato. As of December 31, 2019, the Company had an independent third-party valuation group perform an impairment analysis on our consolidated goodwill balance. It was noted that as of December 31, 2019, no impairment was needed.

9. Inventory

12 Months Ended

Dec. 31, 2019

Inventory Disclosure [Abstract]

Inventory

9.	Inventory

As of December 31, 2019, and December 31, 2018, the Company had $684,940 and $489,239 of finished goods inventory, respectively. The Company only has finished goods within inventory because it does not produce any of its products. All inventory is produced by a third party. The inventory valuation method that the Company uses is the FIFO method. During the years ended December 31, 2019 and 2018, the Company did not recognize any impairment for obsolescence within its inventory.

10. Note Payable

12 Months Ended

Dec. 31, 2019

Debt Disclosure [Abstract]

Note Payable

10.	Note Payable

The Company had a note payable to its Chief Cultivation Officer, Joshua Haupt. The note was repaid in full during the quarter ended March 31, 2018.

11. Leases

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Leases

11.	Leases

Leases with an initial term of one year or less are not recorded on the balance sheet; we recognize lease expense for these leases on a straight-line basis over the lease term. Leases with a term greater than one year are recognized on the balance sheet at the time of lease commencement or modification by recording an ROU operating lease asset and a lease liability, initially measured at the present value of the lease payments. Lease costs are recognized in the income statement over the lease term on a straight-line basis. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.

The Company's leases consist of real estate leases for office, retail and warehouse spaces. The Company elected to combine the lease and related non-lease components for its operating leases.

The Company’s operating leases may include options to extend or terminate the leases, which are not included in the determination of the ROU asset or lease liability unless it is reasonably certain to be exercised. The Company's operating leases have remaining lease terms of less than one year. The Company’s lease agreements do not contain any material residual value guarantees or materially restrictive covenants.

As the Company's leases do not provide an implicit rate, the Company used an incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The discount rate used in the computations was 6%.

Balance Sheet Classification of Operating Lease Assets and Liabilities

	Balance Sheet Line	December 31, 2019
Asset
Operating lease asset	Non-Current Assets	$	59,943
Liabilities
Operating lease liability	Non-Current Liabilities	$	66,803

Lease Costs

The table below summarizes the components of lease costs for the year ended December 31, 2019.

Year Ended

December 31, 2019

Operating lease costs

227,115

Maturities of Lease Liabilities

Maturities of lease liabilities as of December 31, 2019 are as follows:

2020 fiscal year	$	67,904
Total lease payments		67,904
Less: Interest		(1,101	)
Present value of lease liabilities	$	66,803

The following table presents the Company’s future minimum lease obligation under ASC 840 as of December 31, 2019:

2020 fiscal year

67,904

12. Commitments and Contingencies

12 Months Ended

Dec. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

12.	Commitments and Contingencies

Over the past three years, the Company has supported legislation in Colorado to allow licensed cannabis companies in Colorado to trade their securities, provided they are reporting companies under the Exchange Act, as amended. HB19-1090 titled, “Publicly Licensed Marijuana Companies” was signed into Colorado legislature on May 29, 2019 and went into effect on November 1, 2019. The bill repeals the provision that prohibits publicly traded corporations from holding a marijuana license in Colorado.

Effective January 10, 2019, the Company entered into binding term sheets to acquire three cannabis and cannabis related companies, including the following:

FutureVision 2020, LLC and FutureVision Ltd., Inc. dba Medicine Man Denver (in the aggregate, “Medicine Man Denver”), owners of several licensed dispensaries and a cultivation facility in the Denver, Colorado metro area. It is also a leading cultivator, retailer and one of the best-known brands in the cannabis sector, winning over a dozen industry awards. Medicine Man Denver operates out of a 35,000 square foot cultivation operation and has four popular retail locations across the Denver metropolitan area;

MedPharm Holdings, a company that develops and manages intellectual property related to the manufacture and formulation of products containing cannabinoid extracts. Management believes that this acquisition will bring world-class processing and pharmaceutical-grade products to the company; and

MX LLC, the holder of the license that allow it to be a manufacturer of marijuana infused products in the Denver metro area. It also has a research license that has been issued by the state of Colorado and the local jurisdiction approval is in process.

The term sheets provide for the issuance of shares of common stock to the targets at an initial price per share of $1.32, with the final price to be determined based on the fair market valuation, which is subject to an independent valuation assessment. The Company’s former Chief Executive Officer, Andrew Williams, serves as an officer/manager and has an ownership interest in each of the targets above.

On May 24, 2019, the Company entered into a binding term sheet with Farm Boy and Baseball setting forth the terms of the acquisition by the Company of 100% of the capital stock and assets of Farm Boy and Baseball, respectively. As consideration, the Company shall pay a total purchase price of $5,937,500, subject to adjustment, consisting of $1,187,500 cash and 1,578,073 shares of its common stock, par value $0.001 per share. The 1,578,073 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to the execution date.

Also, on May 24, 2019, the Company entered into a binding term sheet with Los Suenos, LLC (“Los Suenos”) and Emerald setting forth the terms of the acquisition by the Company of 100% of the capital stock and assets of Los Suenos and Emerald, respectively. As consideration, the Company shall pay a total purchase price of $5,937,500, subject to adjustment, consisting of $1,187,500 cash and 1,578,073 shares of its common stock, par value $0.001 per share. The 1,578,073 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to the execution date.

On May 31, 2019, the Company entered into a binding term sheet with Mesa Organics Ltd., Mesa Organics II Ltd. and Mesa Organics III Ltd. (collectively referred to herein as “MesaPur”) setting forth the terms of the acquisition by the Company of 100% of the capital stock and assets of MesaPur. As consideration, the Company shall pay a total purchase price of $12,012,758, subject to adjustment, consisting of $2,402,552 cash and 2,801,809 shares of its common stock, par value $0.001 per share. The 2,801,809 shares were determined by averaging the closing price of Company’s common stock for the ten (10) days prior to the execution date.

On August 6, 2019, the Company entered into a binding term sheet with Cold Baked, LLC and Golden Works, LLC (d/b/a “Dabble”) setting forth the terms of the acquisition by the Company of 100% of the capital stock and assets of Dabble. As consideration, the Company shall pay a total purchase price of $3,750,000 consisting of $750,000 cash and 996,678 shares of its common stock, par value $0.001 per share. The 996,678 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to the execution date.

On August 15, 2019, the Company entered into a binding term sheet with Medically Correct, LLC (“Medically Correct”), an edible, extract and topical company, setting forth the terms of the acquisition by the Company of 100% of the capital stock and assets of Medically Correct. As consideration, the Company shall pay a total purchase price of $17,250,000 consisting of $3,450,000 cash and 4,677,967 shares of its common stock, par value $0.001 per share. The 4,677,967 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to August 8, 2019.

On August 28, 2019, the Company entered into a binding term sheet with Starbuds Pueblo LLC, Starbuds Louisville LLC, Starbuds Niwot LLC, Starbuds Longmont LLC and Starbuds Commerce City LLC (“Starbuds”) pursuant to which the Company will purchase the membership interests of Starbuds. As consideration, the Company shall pay a total purchase price of $31,005,089 consisting of $23,253,816 in cash and 2,601,098 shares of its common stock, par value $0.001 per share. The 2,601,098 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to August 28, 2019.

On August 29, 2019, the Company entered into a binding term sheet with High Country Supply d/b/a Colorado Harvest Company (“CHC”) pursuant to which the Company will purchase 100% of the capital stock or assets of CHC. As consideration, the Company shall pay a total purchase price of $12,500,000 consisting of $4,000,000 in cash and 2,881,356 shares of its common stock, par value $0.001 per share. The 2,881,356 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to July 8, 2019.

On August 30, 2019, the Company entered into a binding term sheet with Colorado Health Consultants, LLC, CitiMed, LLC, Lucky Ticket LLC and KEW LLC (collectively, the “Targets”) pursuant to which the Company will purchase the membership interests of the Targets. As consideration, the Company shall pay a total purchase price of $36,898,499 consisting of $27,673,874.25 in cash and 3,095,512 shares of its common stock, par value $0.001 per share. The 3,095,512 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to August 30, 2019.

On August 31, 2019, the Company entered into a binding term sheet with SB Aurora LLC, SB Arapahoe LLC, SB Alameda LLC, and SB 44th LLC (“SB”) pursuant to which the Company will purchase the membership interests of SB. As consideration, the Company shall pay a total purchase price of $50,096,413 consisting of $37,590,310 in cash and 4,202,720 shares of its common stock, par value $0.001 per share. The 4,202,720 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to August 31, 2019.

On September 5, 2019, the Company entered into a binding term sheet dated September 2, 2019 with RSFCG, LLC, RFSCA LLC, RFSCB, LLC, RFSCEV, LLC, RFSCED LLC, RFSCLV, LLC, RFSCG-1 LLC, and RFSCLVG LLC, which entities operate under the name Roots RX (“Roots RX”) pursuant to which the Company will purchase the membership interests of Roots RX. As consideration, the Company shall pay a total purchase price of $15,000,000 consisting of $9,750,000 in cash and 1,779,661 shares of its common stock, par value $0.001 per share. The 1,779,661 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to August 29, 2019.

On September 6, 2019, the Company entered into a binding term sheet with Ahab LLC, Garden Greens LLC, Syls LLC, Heartland Industries, LLC and Tri City Partners LLC, which entities operate under the name “Strawberry Fields” (“Strawberry Fields”) pursuant to which the Company will purchase 100% of the capital stock or assets of Strawberry Fields, except for certain assets as outlined in the term sheet. As consideration, the Company shall pay a total purchase price of $31,000,000 consisting of $14,000,000 in cash and 5,704,698 shares of its common stock, par value $0.001 per share. The 5,704,698 shares were determined by averaging the closing price of Company’s common stock for the five (5) days prior to August 22, 2019.

On September 9, 2019, the Company entered into a binding term sheet with Canyon, LLC (“Canyon”) and It Brand Enterprises, LLC (“It Brand”) pursuant to which the Company will purchase 100% of the capital stock or assets of Canyon and certain assets of It Brand. As consideration, the Company shall pay a total purchase price of $5,130,000 consisting of (i) a cash component which in no case will be greater than $2,565,000, and (ii) an equity component, which will consist of shares of the Company’s common stock, par value $0.001 per share, for the balance of the purchase price. The number of shares that make up the equity component will be determined by dividing the balance of the Purchase Price by the average closing price of Company’s common stock for the five (5) days prior to September 7, 2019.

Prepaid acquisition costs

During the year ended December 31, 2019, the Company entered into a number of sales transactions with companies above for which it has executed binding term sheets to acquire. The Company expects to settle each of these outstanding balances with the respective entity at the time of, or shortly following, their acquisition.

The contemplated acquisitions detailed above are conditioned upon the satisfaction or mutual waiver of certain closing conditions, including, but not limited to:

	·	regulatory approval relating to all applicable filings and expiration or early termination of any applicable waiting periods;
	·	regulatory approval of the Marijuana Enforcement Division and applicable local licensing authority approval;
	·	receipt of all material necessary, third party, consents and approvals;
	·	each party's compliance in all material respects with the respective obligations under the term sheet;
	·	a tax structure that is satisfactory to both the Company and the targets;
	·	the execution of leases and employment agreements that are mutually acceptable to each party; and
	·	the execution of definitive agreements between the respective parties.

There can be no assurance that we will be able to consummate any of the proposed acquisitions.

13. Stockholders' Equity

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Stockholders' Equity

13.	Stockholders’ Equity

On December 10, 2019, the shareholders approved an amendment to the Company’s articles of incorporation increasing the number of authorized shares of common stock from 90,000,000 shares to 250,000,000 shares.

The Company is authorized to issue two classes of shares, designated preferred stock and common stock.

Preferred Stock

The number of shares of preferred stock authorized is 10,000,000, par value $0.001 per share. The preferred stock may be divided into such number of series as the Company’s Board of Directors may determine. The Board is authorized to determine and alter the rights, preferences, privileges and restrictions granted and imposed upon any wholly unissued series of preferred stock, and to fix the number and designation of shares of any series of preferred stock. The Board, within limits and restrictions stated in any resolution of the Board, originally fixing the number of shares constituting any series may increase or decrease, but not below the number of such series then outstanding, the shares of any subsequent series.

Common Stock

The number of shares of common stock authorized is 250,000,000, par value $0.001 per share. At December 31, 2019 and 2018, the Company had 39,952,628 and 27,753,310 shares of common stock, respectively, issued and outstanding.

Common Stock Issued in Private Placements

During the year ended December 31, 2018, the Company sold 937,647 shares of common stock to an accredited investor in a private placement.

On June 5, 2019, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with an accredited investor (the “Investor”). Pursuant to the Purchase Agreement, the Company agreed to sell to the Investor and the Investor agreed to purchase, in a private placement, up to 7,000,000 shares of the Company’s common stock, at a price of $2.00 per share and warrants to purchase 100% of the number of shares of common stock sold. The warrants are for a term of three years and are exercisable at a price of $3.50.

At the initial closing on June 5, 2019, the Company issued and sold 1,500,000 shares of common stock and warrants to purchase 1,500,000 shares of common stock, for gross proceeds of $3,000,000.

The Purchase Agreement contemplates the sale of additional shares of common stock, subject to certain closing conditions set forth in the Purchase Agreement, as follows: (i) 3,500,000 shares of common stock and warrants to purchase 3,500,000 shares of common stock at a second closing to be held on or before July 15, 2019; (ii) 1,000,000 shares of common stock and warrants to purchase 1,000,000 shares of common stock at a third closing; and (ii) 1,000,000 shares of common stock and warrants to purchase 1,000,000 shares of common stock at a fourth closing.

On July 15, 2019, the Company entered into an amendment (the “Amendment”) to the Purchase Agreement. Pursuant to the Amendment, among other things, the Purchase Agreement was amended to provide for the sale, at the third closing, of a minimum of 3,000,000 shares of the Company’s common stock, with the Investor having the option to acquire up to an additional 2,500,000 shares of common stock for an aggregate of up to 5,500,000 shares of common stock and warrants to purchase 100% of the number of shares of common stock sold at the third closing.

The Amendment also removed as a closing condition to the second closing, the requirement that the Company shall have entered into definitive agreements for the acquisitions of each of (a) MedPharm Holdings, (b) Futurevision 2020, LLC, Futurevision Ltd, and Medicine Man Longmont, LLC, collectively, (c) MX, LLC, (d) Los Sueños Farms, LLC, and Emerald, and (e) Farm Boy and Baseball.

In addition, the Amendment removed all references to a fourth closing and the conditions for such closing, which were outlined in the Purchase Agreement.

On July 16, 2019, the Company issued and sold 3,500,000 shares of common stock and warrants to purchase 3,500,000 shares of common stock pursuant to the terms of the Purchase Agreement, as amended, for gross proceeds of $7,000,000.

On September 17, 2019, the Company issued and sold 3,000,000 shares of common stock and warrants to purchase 3,000,000 shares of common stock pursuant to the terms of the Purchase Agreement, as amended, for gross proceeds of $6,000,000.

On September 30, 2019, the Company issued and sold 1,100,000 shares of common stock and warrants to purchase 1,100,000 shares of common stock pursuant to the terms of the Purchase Agreement, as amended, for gross proceeds of $2,200,000.

During the year ended December 31, 2019, the Company issued an additional 700,000 shares of common stock and warrants to purchase 700,000 shares of common stock, for gross proceeds of $1,400,000.

Common Stock Issued in Connection with the Exercise of Warrants

During the year ended December 31, 2019, the Company issued 485,543 shares of common stock for proceeds of $602,560 under a series of stock warrant exercises with an exercise price of $1.33 per share.

Common Stock Issued as Compensation to Employees, Officers and Directors

During the year ended December 31, 2018, the Company granted 800,000 shares of common stock to certain employees, officers and/or directors, valued at $1,457,250.

On January 8, 2019, the Company granted to an officer of the Company, Paul Dickman, 1,000,000 shares of common stock, valued at $660,000.

On March 14, 2019, the Company granted 50,000 shares of common stock to James Toreson upon his resignation as a member of its board of directors for his service. These shares were valued at $95,000.

During the year ended December 31, 2019, the Company issued an additional 690,000 shares of common stock valued at $2,161,880 to employees, officers and directors as compensation.

Common Stock Issued in Exchange for Consulting, Professional and Other Services

Concurrent with his resignation as described above, the Company issued 50,000 shares of its common stock to Mr. Toreson in connection with a consulting agreement having a service period extending through May 31, 2020. These shares were valued at $95,000.

During the year ended December 31, 2019, the Company issued an additional 123,775 shares of common stock valued at $210,521 to contractors and professionals in exchange for services provided.

Warrants

The Company accounts for common stock purchase warrants in accordance with FASB ASC 480, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock, Distinguishing Liabilities from Equity. The Company estimates the fair value of warrants at date of grant using the Black-Scholes option pricing model. There is a moderate degree of subjectivity involved when using option pricing models to estimate the warrants, and the assumptions used in the Black Scholes option-pricing model are moderately judgmental.

During the year ended December 31, 2017, the Company issued 1,500,566 common stock purchase warrants with an exercise price of $1.33 per share, expiring on March 17, 2019. During the year ended December 31, 2019, an aggregate of 485,543 of these warrants were exercised while the remaining warrants were forfeited.

During the period ended December 31, 2017, the Company issued 2,000,000 common stock purchase warrants to three employees of the Company with an exercise price of $1.445 per share, expiring on December 31, 2019. As of September 30, 2018, all of these warrants were exercised.

During the year ended December 31, 2018, the Company issued 250,000 common stock purchase warrants to one employee of the Company with an exercise price of $1.49 per share for a period of time expiring on December 31, 2021. The Company estimated the fair value of these warrants at date of grant using the Black-Scholes option pricing model using the following inputs: (i) stock price on the date of grant of $1.49, (ii) the contractual term of the warrant of 3 years, (iii) a risk-free interest rate of 2.48% and (iv) an expected volatility of the price of the underlying common stock of 126%.

During the year ended December 31, 2019, the Company issued 9,800,000 common stock purchase warrants to various accredited investors with an exercise price of $3.50 per share with an expiration date of three years from the date of issuance. The Company estimated the fair value of these warrants at date of grant using the Black-Scholes option pricing model using the following inputs: (i) stock price on the date of grant of $3.50, (ii) the contractual term of the warrant of 3 years, (iii) a risk-free interest rate ranging between 1.56% - 1.84% and (iv) an expected volatility of the price of the underlying common stock ranging between 158% - 162%.

	Number of shares

Balance as of January 1, 2019		2,647,461
Warrants exercised		(485,543	)
Warrants forfeited		(2,161,918	)
Warrants issued		9,800,000
Balance as of December 31, 2019		9,800,000

14. Tax Provision

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Tax Provision

14.	Tax Provision

The Company utilizes ASC 740, Income Taxes which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established if it is more likely than not that some portion or all of the deferred tax asset will not be realized. The Company generated a deferred tax credit through net operating loss carry forwards.

The following table sets forth the components of income tax (benefit) expense for the years ended December 31, 2019 and 2018:

	December 31, 2019			December 31, 2018

Federal	$	(477,625	)	$	477,625
State and local		(105,305	)		105,305
Total	$	(582,931	)	$	582,931

The following table sets forth a reconciliation of income tax expense (benefit) at the federal statutory rate to recorded income tax expense (benefit) for the years ended December 31, 2019 and 2018:

	December 31, 2019			December 31, 2018

Federal taxes at U.S. statutory rate		21.0%			21.0%
State income taxes		4.6%			4.6%
Permanent and temporary differences		(15.5%	)		27.5%
Change in valuation allowance		(6.8%	)		(15.1%	)
Effective tax rate		3.3%			38.1%

The following tables set forth the components of income taxes payable as of December 31, 2019 and 2018:

	December 31, 2019		December 31, 2018
Federal	$	–	$	477,625
State and local		–		105,305
Total	$	–	$	582,931

The following tables set forth the components of deferred income taxes as of December 31, 2019 and 2018:

	December 31, 2019			December 31, 2018

Deferred tax assets:
Bad debt allowance	$	18,168			–
Accrued expenses		38,413			–
Share based compensation accruals		3,528,726			373,493
Net operating loss carryforwards		1,703,425			–
Unrealized losses		578,201			118,766
Total deferred tax assets		5,866,934			492,259
Less: valuation allowance		(5,598,511	)		(492,259	)
Net deferred tax assets	$	268,423			–

Deferred tax liabilities:
Prepaid expenses	$	121,777			7,434
Fixed assets		12,388			24,256
Goodwill and intangible assets		636,188			174,173
Unrealized gains		417,046			–
Total deferred tax liabilities		1,187,399			205,863
Less: valuation allowance		(1,187,399	)		(205,863	)
Net deferred tax liabilities	$	–			–

Total deferred tax assets, net	$	268,423			–

On December 22, 2017, the United States enacted the Tax Cuts and Jobs Act (“TCJA”), which instituted fundamental changes to the taxation of corporations, including a reduction the U.S. corporate income tax rate to 21% beginning in 2018.

As of December 31, 2019, the Company had federal, state and local net operating loss carryforwards of approximately $6.6 million that are available to offset future liabilities for income taxes. The Company has generally established a valuation allowance against these carryforwards based on an assessment that it is more likely than not that these benefits will not be realized in future years. The federal and state net operating loss carryforwards expire in 2039.

The Company remains subject to examination in federal and state jurisdictions in which the Company conducts its operations and files tax returns. These tax years range from 2015 through 2019. The Company believes that the results of current or any prospective audits will not have a material effect on its financial position or results of operations as adequate reserves have been provided to cover any potential exposures related to these ongoing audits.

The Company has made its assessment of the level of tax authority for each tax position (including the potential application of interest and penalties) based on the technical merits and determined that no unrecognized tax benefits associated with the tax positions exist.

15. Major Customers and Accounts Receivable

12 Months Ended

Dec. 31, 2019

Major Customers And Accounts Receivable

Major Customers and Accounts Receivable

15.	Major Customers and Accounts Receivable

The Company had certain customers whose revenue individually represented 10% or more of the Company’s total revenue, or whose accounts receivable balances individually represented 10% or more of the Company’s total accounts receivable.

For the year ended December 31, 2019, one customer accounted for 14% of revenue. As of December 31, 2019, two customers accounted for 68% of accounts receivable, one with 57% and another with 11%.

For the year ended December 31, 2018, two customers accounted for 48% of revenue, one with 37% and another with 11%. As of December 31, 2018, three customers accounted for 88% of accounts receivable, one with 11%, one with 38% and another with 39%. The Company is currently pursuing litigation against two of these customers to receive contractual amounts owed. See “Part II, Item 1, Legal Proceedings” for further explanation.

16. Segment Information

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

Segment Information

16.	Segment Information

The Company has three identifiable segments as of December 31, 2019; (i) products, (ii) licensing and consulting and (iii) corporate, infrastructure and other. The products segment sells merchandise directly to customers via e-commerce portals, through the Company’s proprietary websites and retail location. The licensing and consulting segment sales derives its revenue from licensing and consulting agreements with cannabis related entities. The corporate, infrastructure and other segment represents new resources added in anticipation of various acquisition transactions and other corporate related costs.

The following information represents segment activity for the years ended December 31, 2019 and 2018:

	For the Years Ended December 31,
	2019										2018
	Products		Licensing and Consulting			Corporate, Infrastructure and Other		Total			Products		Licensing and Consulting		Total

Revenues	$	7,820,518	$	4,580,436	$	–		$	12,400,955		$	2,031,603	$	7,410,952	$	9,442,555
Intangible assets amortization	$	5,465	$	443	$	–		$	5,908		$	5,987	$	528	$	6,515
Depreciation	$	7,186	$	48,614	$	–		$	55,800		$	5,848	$	69,598	$	75,446
Net income (loss)	$	794,747	$	1,688,147	$	(19,458,635	)	$	(16,975,742	)	$	878,067	$	70,848	$	948,915
Segment assets	$	12,406,230	$	6,081,485	$	13,740,892		$	32,228,607		$	5,631,127	$	12,590,478	$	18,221,605

17. Earnings per share (Basic and Dilutive)

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Earnings per share (Basic and Dilutive)

17.	Earnings per share (Basic and Dilutive)

The Company computes net (loss) income per share in accordance with ASC 260, Earnings per Share. ASC 260 requires presentation of both basic and diluted Earnings Per Share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. These potential dilutive shares include 2,215,500 vested stock options and 9,800,000 stock purchase warrants. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

The following is a reconciliation of the numerator and denominator used in the basic and diluted EPS calculations for the years ended December 31, 2019 and 2018.

	2019			2018
Numerator:
Net income (loss)	$	(16,975,742	)	$	948,915

Denominator:
Weighted-average shares of common stock		33,740,557			25,121,896
Dilutive effect of warrants		–			2,647,461
Diluted weighted-average shares of common stock		33,740,557			27,769,357

Net income (loss) per common share from:
Basic	$	(0.50	)	$	0.04
Diluted	$	(0.50	)	$	0.03

Dilutive-potential common share equivalents are excluded from the computation of net loss per share in loss periods, as their effect would be antidilutive. As the Company has incurred a loss from operations in 2019, shares issuable pursuant to equity awards were excluded from the computation of diluted net loss per share in the accompanying consolidated statements of operations, as their effect is anti-dilutive.

18. Subsequent Events

12 Months Ended

Dec. 31, 2019

Subsequent Events [Abstract]

Subsequent Events

18.	Subsequent events

In accordance with FASB ASC 855-10, Subsequent Events, the Company has analyzed its operations subsequent to December 31, 2019 to the date these consolidated financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these consolidated financial statements, except as follows:

On February 25, 2020, Andy Williams resigned from the positions of President and member of the Board of Directors of Medicine Man Technologies, Inc. Mr. Williams’s resignation is not the result of any disagreement with the Company on any matter relating to the company’s operations, policies or practices. Simultaneously, the Company entered into a Severance Agreement and Release (the “Severance Agreement”) with Mr. Williams.

The Severance Agreements provides that as severance and in consideration of a customary release against the Company and other customary covenants, Mr. Williams will receive (i) continued salary in the amount of $300,000, half of which is to be paid within ten days of the execution of the Severance Agreement, and the remaining half is to be paid in 26 equal disbursements in accordance with the Company’s regular payroll periods, (ii) bonus payment in the amount of $25,000, (iii) one year family health care coverage, (iv) stock options to purchase 350,000 shares of the Company’s common stock, which may be exercised on a cashless basis, and (v) stock options to purchase 15,000 shares of the Company’s common stock, which may be exercised on a cashless basis.

On March 6, 2020, the Company’s former Chief Operating Officer, Joe Puglise, issued an arbitration demand against the Company claiming breach of contract. While the Company believes it has meritorious defenses against the claim, the ultimate resolution of the matter, which is expected to occur within one year, could result in a loss of up to $3.5 million.

2. Critical Accounting Policies and Estimates (Policies)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

Use of Estimates

Use of Estimates

Reclassifications

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications had no impact on the Company’s net (loss) earnings and financial position.

Fair Value Measurements

Fair Value Measurements

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities.

		December 31, 2019				December 31, 2018
Level 1 – Marketable Securities Available-for-Sale – Recurring		$	406,774			$	2,199,344

Marketable Securities at Fair Value on a Recurring Basis

Marketable Securities at Fair Value on a Recurring Basis

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The carrying amounts of cash and current assets and liabilities approximate fair value because of the short-term maturity of these items. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect these estimates. Available for sale securities are recorded at current market value as of the date of this report.

Accounts receivable

Accounts Receivable

The following table depicts the composition of our accounts receivable as of December 31, 2019 and 2018:

	December 31, 2019			December 31, 2018

Accounts receivable – trade	$	384,202		$	1,180,757
Accounts receivable – related party		72,658			125,112
Accounts receivable – litigation, non-current		3,063,968			1,281,511
Allowance for doubtful accounts		(70,885	)		–
Total accounts receivable	$	3,449,943		$	2,587,380

The customer simultaneously receives and consumes the benefits provided by the entity’s performance as the entity performs.

The entity’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced.

The entity’s performance does not create an asset with an alternative use to the entity, and the entity has an enforceable right to payment for performance completed to date.

Paragraph 606-10-25 further states that the process for determining the proper treatment for a contract modification includes three steps:

Determine whether a change to a contract qualifies as a contract modification.

Determine appropriate accounting treatment for contract modification not accounted for as a separate contract.

Notes receivable

Notes Receivable

Other assets (current and non-current)

Other Assets (Current and Non-Current)

Other assets at December 31, 2019 and 2018 were $529,416 and $50,824, respectively.

At December 31, 2018, other assets included $29,005 in prepaid expenses and $21,819 in security deposits.

Goodwill and Intangible Assets

Goodwill and Intangible Assets

Long-Lived Assets

Long-Lived Assets

Accounts payable

Accounts Payable

Accounts payable at December 31, 2019 and 2018 were $699,961 and $202,515, respectively and were comprised of trade payables for various purchases and services rendered during the ordinary course of business.

Accrued expenses and other liabilities

Accrued Expenses and Other Liabilities

Accrued expenses and other liabilities at December 31, 2019 and 2018 were $1,091,204 and $291,084, respectively.

At December 31, 2019, accrued expenses and other liabilities was comprised of customer deposits of $148,109, accrued payroll of $714,220, and operating expenses of $228,875.

At December 31, 2018, accrued expenses and other liabilities was comprised of $163,568 in customer deposits, $21,330 in deferred rent expense and $106,185 in accrued payroll.

Revenue recognition and related allowances

Revenue Recognition and Related Allowances

Intellectual Property Licensing Agreement with ABBA Medix Corp.

Intellectual Property Licensing Agreement with ABBA Medix Corp.

On July 17, 2018, the Company entered into an intellectual property license agreement with Abba Medix Corp. (“AMC”), a wholly-owned subsidiary of publicly-traded CHV.

As consideration for granting the license to AMC, the Company received the following:

$1,150,000 in cash;

$3,500,000 in shares of CHV common stock; and

Ongoing licensing fees calculated as a percentage of AMC’s sales revenue directly related to the Company’s intellectual property.

Additionally, under the terms of the agreement, the Company agreed to provide a loan facility to AMC under the following terms:

Cultivation Max fees

Cultivation Max fees

On August 6, 2018, the Company entered into an agreement with a client that was comprised of two basic elements:

The term for receiving 25% of the value grown over 2 pounds per light, was reduced from five years to three years

The 25% level was reduced to 5%

The customer simultaneously receives and consumes the benefits provided by the entity’s performance as the entity performs (see paragraphs 606-10-55-5 through 55-6).

The entity’s performance creates or enhances an asset (for example, work in process) that the customer controls as the asset is created or enhanced (see paragraph 606-10-55-7).

With respect to Element Two in terms of considering the revenue method of recognition under ASC 606, the following characteristics of the transaction were considered:

The Company had no further performance obligations

The customer contractually deemed this fee as earned

The future potential value of the reduction from 25% over five years, to 5% over three years, is an asset that legally passed to the client.

The customer paid the fee

Cost of Goods and Services Sold

Costs of Goods and Services Sold

Costs of goods and services sold are comprised of related expenses incurred while supporting the implementation and sales of Company’s products and services.

General and Administrative Expenses

General and Administrative Expenses

General and administrative expense are comprised of all expenses not linked to the production or advertising of the Company’s products or services.

Advertising and Marketing Costs

Advertising and Marketing Costs

Advertising and marketing costs are expensed as incurred and totaled $455,047 and $291,711 for years ended December 31, 2019 and 2018, respectively.

Stock-Based Compensation

Stock-Based Compensation

The Company recognized $7,279,363 and $1,457,250 in expense for stock-based compensation to directors, employees and consultants during the years ended December 31, 2019 and 2018, respectively.

Income Taxes

Income Taxes

Right of Use Assets and Lease Liabilities

Right of Use Assets and Lease Liabilities

Operating leases are included in operating lease Right-of-Use assets and operating lease liabilities, current and non-current, on the Company's consolidated balance sheets.

1. Liquidity and Capital Resources (Tables)

12 Months Ended

Dec. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Composition of cash

The following table depicts the composition of the Company’s cash and cash equivalents as of December 31, 2019 and 2018:

	December 31, 2019		December 31, 2018

Deposits placed with banks	$	736,101	$	321,788
United States Treasury Bills		11,117,526		–
Total cash and cash equivalents	$	11,853,627	$	321,788

2. Critical Accounting Policies and Estimates (Tables)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Schedule of fair value measurement

		December 31, 2019				December 31, 2018
Level 1 – Marketable Securities Available-for-Sale – Recurring		$	406,774			$	2,199,344

Schedule of Accounts Receivable

	December 31, 2019			December 31, 2018

Accounts receivable – trade	$	384,202		$	1,180,757
Accounts receivable – related party		72,658			125,112
Accounts receivable – litigation, non-current		3,063,968			1,281,511
Allowance for doubtful accounts		(70,885	)		–
Total accounts receivable	$	3,449,943		$	2,587,380

4. Fixed Assets (Tables)

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Property and equipment table

	December 31, 2019			December 31, 2018
Furniture and fixtures	$	98,903		$	98,395
Leasehold improvements		40,953			36,900
Vehicles		34,000			34,000
Office equipment		33,833			74,360
Work in process		190,743			–
		398,432			243,655
Less: accumulated depreciation		(159,354	)		(149,015	)
Total property and equipment, net of depreciation	$	239,078		$	94,640

Schedule of property and equipment useful lives

Depreciation on equipment is provided on a straight-line basis over its expected useful lives at the following annual rates.

Furniture and fixtures			3 years
Marketing display			3 years
Vehicles			3 years
Office equipment			3 years

5. Intangible Asset (Tables)

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible assets

	December 31, 2019			December 31, 2018

License agreement	$	5,300		$	5,300
Product license and registration		57,300			57,300
Trade secret – intellectual property		32,500			32,500
		95,100			95,100
Less: accumulated amortization		(19,811	)		(13,903	)
Total intangible assets, net of amortization	$	75,289		$	81,197

8. Goodwill and Acquisition Accounting (Tables)

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Business acquisition allocation

The Big Tomato Balance Sheet

	Book/Fair Value					Book/Fair Value
Assets:				Liabilities:
Inventory	$	291,000		Accounts payable		$	272,266
Other assets		4,950		Customer Deposits			23,684
	$	295,950				$	295,950

Purchase Price (1,933,329*1.5517)
			$	3,000,000
Less: BV of Assets				(295,950	)
Add: BV of Liabilities				295,950
Goodwill			$	3,000,000

11. Leases (Tables)

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Balance Sheet Classification Table

Balance Sheet Classification of Operating Lease Assets and Liabilities

	Balance Sheet Line	December 31, 2019
Asset
Operating lease asset	Non-Current Assets	$	59,943
Liabilities
Operating lease liability	Non-Current Liabilities	$	66,803

Operating Lease Costs

The table below summarizes the components of lease costs for the year ended December 31, 2019.

Year Ended

December 31, 2019

Operating lease costs

227,115

Maturities of Lease Liabilities

Maturities of lease liabilities as of December 31, 2019 are as follows:

2020 fiscal year	$	67,904
Total lease payments		67,904
Less: Interest		(1,101	)
Present value of lease liabilities	$	66,803

Future minimum lease obligations

The following table presents the Company’s future minimum lease obligation under ASC 840 as of December 31, 2019:

2020 fiscal year

67,904

13. Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2019

Equity [Abstract]

Schedule of warrant activity

	Number of shares

Balance as of January 1, 2019		2,647,461
Warrants exercised		(485,543	)
Warrants forfeited		(2,161,918	)
Warrants issued		9,800,000
Balance as of December 31, 2019		9,800,000

14. Tax Provision (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Components of income tax expense

	December 31, 2019			December 31, 2018

Federal	$	(477,625	)	$	477,625
State and local		(105,305	)		105,305
Total	$	(582,931	)	$	582,931

Reconciliation of income tax expense

	December 31, 2019			December 31, 2018

Federal taxes at U.S. statutory rate		21.0%			21.0%
State income taxes		4.6%			4.6%
Permanent and temporary differences		(15.5%	)		27.5%
Change in valuation allowance		(6.8%	)		(15.1%	)
Effective tax rate		3.3%			38.1%

Components of income tax payable

	December 31, 2019		December 31, 2018
Federal	$	–	$	477,625
State and local		–		105,305
Total	$	–	$	582,931

Components of deferred income tax

	December 31, 2019			December 31, 2018

Deferred tax assets:
Bad debt allowance	$	18,168			–
Accrued expenses		38,413			–
Share based compensation accruals		3,528,726			373,493
Net operating loss carryforwards		1,703,425			–
Unrealized losses		578,201			118,766
Total deferred tax assets		5,866,934			492,259
Less: valuation allowance		(5,598,511	)		(492,259	)
Net deferred tax assets	$	268,423			–

Deferred tax liabilities:
Prepaid expenses	$	121,777			7,434
Fixed assets		12,388			24,256
Goodwill and intangible assets		636,188			174,173
Unrealized gains		417,046			–
Total deferred tax liabilities		1,187,399			205,863
Less: valuation allowance		(1,187,399	)		(205,863	)
Net deferred tax liabilities	$	–			–

Total deferred tax assets, net	$	268,423			–

16. Segment Information (Tables)

12 Months Ended

Dec. 31, 2019

Segment Reporting [Abstract]

Schedule of Segment Reporting Information

	For the Years Ended December 31,
	2019										2018
	Products		Licensing and Consulting			Corporate, Infrastructure and Other		Total			Products		Licensing and Consulting		Total

Revenues	$	7,820,518	$	4,580,436	$	–		$	12,400,955		$	2,031,603	$	7,410,952	$	9,442,555
Intangible assets amortization	$	5,465	$	443	$	–		$	5,908		$	5,987	$	528	$	6,515
Depreciation	$	7,186	$	48,614	$	–		$	55,800		$	5,848	$	69,598	$	75,446
Net income (loss)	$	794,747	$	1,688,147	$	(19,458,635	)	$	(16,975,742	)	$	878,067	$	70,848	$	948,915
Segment assets	$	12,406,230	$	6,081,485	$	13,740,892		$	32,228,607		$	5,631,127	$	12,590,478	$	18,221,605

17. Earnings per share (Basic and Dilutive) (Tables)

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Basic and diluted earnings per share

	2019			2018
Numerator:
Net income (loss)	$	(16,975,742	)	$	948,915

Denominator:
Weighted-average shares of common stock		33,740,557			25,121,896
Dilutive effect of warrants		–			2,647,461
Diluted weighted-average shares of common stock		33,740,557			27,769,357

Net income (loss) per common share from:
Basic	$	(0.50	)	$	0.04
Diluted	$	(0.50	)	$	0.03

1. Liquidity and Capital Resources (Details - Cash) - USD ($)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Total cash and cash equivalents	$ 11,853,627	$ 321,788	$ 748,715
Bank Deposits [Member]
Total cash and cash equivalents	736,101	321,788
U S Treasury Bills [Member]
Total cash and cash equivalents	$ 11,117,526	$ 0

1. Liquidity and Capital Resources (Details Narrative) - USD ($)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Cash and cash equivalents	$ 11,853,627	$ 321,788	$ 748,715

2. Critical Accounting Policies and Estimates (Details - Level 3) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Fair Value Inputs Level 1 [Member] \| Fair Value Measurements Recurring [Member] \| Marketable Securities [Member]
Fair value assets	$ 406,774	$ 2,199,344

2. Critical Accounting Policies and Estimates (Details Receivables) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Total accounts receivable	$ 3,449,943	$ 2,587,380
Allowance for doubtful accounts	(70,885)	0
Trade Accounts Receivable [Member]
Total accounts receivable	384,202	1,180,757
Accounts receivable - related party [Member]
Total accounts receivable	72,658	125,112
Accounts receivable - litigation [Member]
Total accounts receivable	$ 3,063,968	$ 1,281,511

2. Critical Accounting Policies and Estimates (Details Narrative) - USD ($)	3 Months Ended	6 Months Ended	12 Months Ended
	Mar. 22, 2019	Jul. 02, 2019	Dec. 31, 2019	Dec. 31, 2018	Aug. 02, 2019	Jul. 17, 2018
Accounts receivable			$ 3,449,943	$ 2,587,380
Allowance for doubtful accounts			70,885	0
Accounts receivable written off			80,284	0
Accounts receivable - litigation			3,063,968	1,281,511
Revenues			12,400,955	9,442,555
Cumulative effect of new accounting principle					$ 1,782,457
Long-term notes receivable			241,711	92,888
Other assets			529,416	50,824
Accounts payable			699,961	202,515
Accrued expenses and other liabilities			1,091,204	291,084
Advertising and marketing expense			455,047	291,711
Stock based compensation expense			7,279,363	1,457,250
Litigation Revenue [Member]
Revenues			1,782,457	1,518,099
Licensing, consulting and Cultivation Max fees [Member]
Revenues			2,767,649	5,810,815
Factoring Agreement [Member]
Accounts receivable pledged	$ 810,000
Proceeds from pledged collateral	$ 582,000
Repayment of pledged collateral		$ 436,607
Interest expense			192,107
Trade Accounts Receivable [Member]
Accounts receivable			384,202	1,180,757
AMC [Member]
Long-term notes receivable			241,711	92,888
Capital G Ltd. [Member]
Loss on investment				(250,000)
Loss on investment, interest income				(49,018)
AMC [Member] \| Trade Accounts Receivable [Member]
Accounts receivable			250,000
Prepaid Expenses [Member]
Other assets			480,881	29,005
Interest Receivable [Member]
Other assets			21,085
Security Deposits [Member]
Other assets			27,450	21,819
Customer Deposits [Member]
Accrued expenses and other liabilities			148,109	163,568
Accrued Payroll [Member]
Accrued expenses and other liabilities			714,220	106,185
Operating Expenses [Member]
Accrued expenses and other liabilities			228,875
Deferred Rent Expense [Member]
Accrued expenses and other liabilities				21,330
Factoring Agreement [Member]
Interest expense			192,107
License Agreement [Member] \| AMC [Member]
Proceeds from licensing agreement				1,150,000
Investment shares received, value						$ 3,500,000
License Agreement [Member] \| AMC [Member] \| Licensing, consulting and Cultivation Max fees [Member]
Revenues				4,650,000
Cultivation License [Member] \| Licensing, consulting and Cultivation Max fees [Member]
Revenues				1,000,000
2nd Breach of Contract [Member]
Accounts receivable - litigation			290,647	290,647
Breach of Contract [Member]
Accounts receivable - litigation			2,773,321	990,864
Breach of Contract [Member] \| Litigation Revenue [Member]
Revenues			$ 1,782,457	$ 1,015,154

4. Fixed Assets (Details) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Property and Equipment, gross	$ 398,432	$ 243,655
Less: Accumulated Depreciation	(159,354)	(149,015)
Property and equipment, net	239,078	94,640
Furniture and Fixtures [Member]
Property and Equipment, gross	98,903	98,395
Leasehold Improvements [Member]
Property and Equipment, gross	40,953	36,900
Work In Progress [Member]
Property and Equipment, gross	34,000	34,000
Vehicles [Member]
Property and Equipment, gross	33,833	74,360
Office Equipment [Member]
Property and Equipment, gross	$ 190,743	$ 0

4. Fixed Assets (Details - Expected life)	12 Months Ended
4. Fixed Assets (Details - Expected life)	Dec. 31, 2019
Furniture and Fixtures [Member]
Estimated useful life	3 years
Marketing Display [Member]
Estimated useful life	3 years
Vehicles [Member]
Estimated useful life	3 years
Office Equipment [Member]
Estimated useful life	3 years

4. Fixed Assets (Details Narrative) - USD ($)	12 Months Ended
4. Fixed Assets (Details Narrative) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 55,800	$ 75,446

5. Intangible Asset (Details) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Intangible assets, gross	$ 95,100	$ 95,100
Less: accumulated amortization	(19,811)	(13,903)
Intangible assets, net	75,289	81,197
License Agreement [Member]
Intangible assets, gross	5,300	5,300
Product License and Registration [Member]
Intangible assets, gross	57,300	57,300
Trade Secret [Member]
Intangible assets, gross	$ 32,500	$ 32,500

5. Intangible Asset (Details Narrative) - USD ($)	12 Months Ended
5. Intangible Asset (Details Narrative) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense	$ 5,908	$ 6,515

6. Derivative Liability (Details Narrative) - USD ($)		4 Months Ended	5 Months Ended	12 Months Ended
6. Derivative Liability (Details Narrative) - USD ($)	Jan. 08, 2019	Apr. 23, 2019	Jun. 11, 2019	Dec. 31, 2019	Dec. 31, 2018
Fair value of derivative liabilities				$ 3,773,382	$ 0
Change in fair value of derivatives				$ 1,627,176	$ 0
Officer [Member]
Restricted stock granted, shares	500,000	1,000,000	1,000,000

7. Related Party Transactions (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Notes receivable issued	$ 916,518	$ 97,889
Super Farm [Member]
Revenue from related parties	578,655	264,103
Accounts receivable from related parties	33,127	61,110
Discount on sales given	$ 291,823
Super Farm [Member] \| Chief Cultivation Officer [Member]
Ownership percentage by related party	20.00%
DeBest [Member]
Revenue from related parties	$ 191,915	88,063
Accounts receivable from related parties	2,180	20,503
Discount on sales given	$ 95,957
DeBest [Member] \| Chief Cultivation Officer [Member]
Ownership percentage by related party	20.00%
Med Man Denver [Member]
Revenue from related parties	$ 402,839	158,805
Accounts receivable from related parties	34,748	28,893
Discount on sales given	143,473
Costs and expenses to related party	$ 125,897
Med Man Denver [Member] \| Former CEO [Member]
Ownership percentage by related party	38.00%
Med Pharm Holdings [Member]
Revenue from related parties	$ 64,378	34,438
Accounts receivable from related parties	2,604	10,425
Discount on sales given	7,498
Notes receivable issued	$ 767,695
Note receivable interest rate	8.00%
Med Pharm Holdings [Member] \| Chief Executive Officer [Member]
Ownership percentage by related party	29.00%
Baseball 18 LLC [Member]
Revenue from related parties	$ 165,617
Accounts receivable from related parties	169,960
Farm Boy [Member]
Revenue from related parties	321,307
Accounts receivable from related parties	$ 330,911
Med Pharm Iowa [Member]
Revenue from related parties		10,026
Accounts receivable from related parties		1,195
FutureVision [Member]
Accounts receivable from related parties		2,986
Brett Roper [Member]
Accounts payable to related party		$ 69,714

8. Goodwill and Acquisition Accounting (Details - Acquisition) - USD ($)	9 Months Ended
	Sep. 17, 2018	Dec. 31, 2019	Dec. 31, 2018
Business Combination assumed assets/liabilities
Goodwill		$ 12,304,306	$ 12,304,306
Big Tomato [Member]
Business Combination assumed assets/liabilities
Inventory	$ 291,000
Other assets	4,950
Total assets	295,950
Accounts payable	272,266
Customer deposits	23,684
Total liabilities	295,950
Purchase price	3,000,000
Less: Book value of assets	(295,950)
Add: Book value of liabilities	295,950
Goodwill	$ 3,000,000	$ 3,000,000

8. Goodwill and Acquisition Accounting (Details Narrative) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 17, 2018	Dec. 31, 2019	Dec. 31, 2018
Goodwill		$ 12,304,306	$ 12,304,306
Impairment		0
Big Tomato [Member]
Stock issued for acquisition, shares	1,933,329
Consideration transferred	$ 3,000,000
Goodwill	$ 3,000,000	3,000,000
Denver Consulting Group [Member]
Goodwill		3,003,226
Success Nutrients and Pono Publications [Member]
Goodwill		$ 6,301,080

9. Inventory (Details Narrative) - USD ($)	12 Months Ended
9. Inventory (Details Narrative) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Finished goods inventory	$ 684,940	$ 489,239
Inventory obsolescence	$ 0	$ 0

11. Leases (Details - Balance Sheet Classification) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Leases [Abstract]
Operating lease asset - non-current	$ 59,943	$ 0
Operating lease liability - non-current	$ 66,803	$ 0

11. Leases (Details - Operating lease cost)	12 Months Ended
11. Leases (Details - Operating lease cost)	Dec. 31, 2019 USD ($)
Leases [Abstract]
Operating lease costs	$ 227,115

11. Leases (Details - Lease maturities)	Dec. 31, 2019 USD ($)
Leases [Abstract]
2020 fiscal year	$ 67,904
Total lease payments	67,904
Less: interest	(1,101)
Present value of lease liabilities	$ 66,803

11. Leases (Details - Minimum lease obligation)	Dec. 31, 2019 USD ($)
Leases [Abstract]
2020 fiscal year	$ 67,904

11. Leases (Details Narrative)	Dec. 31, 2019
Leases [Abstract]
Weighted average remaining lease term	1 year
Weighted average lease discount rate	6.00%

12. Commitments and Contingencies (Details Narrative) - USD ($)	5 Months Ended		7 Months Ended		8 Months Ended
	May 31, 2019	May 24, 2019	Aug. 15, 2019	Aug. 06, 2019	Sep. 09, 2019	Sep. 06, 2019	Sep. 05, 2019	Aug. 31, 2019	Aug. 30, 2019	Aug. 29, 2019	Aug. 28, 2019
Farm Boy [Member]
Consideration to be transferred		$ 5,937,500
Cash to be paid for acquisition		$ 1,187,500
Stock to be issued for acquisition		1,578,073
Los Suenos [Member]
Consideration to be transferred		$ 5,937,500
Cash to be paid for acquisition		$ 1,187,500
Stock to be issued for acquisition		1,578,073
Mesa Organics [Member]
Consideration to be transferred	$ 12,012,758
Cash to be paid for acquisition	$ 2,402,552
Stock to be issued for acquisition	2,801,809
Dabble [Member]
Consideration to be transferred				$ 3,750,000
Cash to be paid for acquisition				$ 750,000
Stock to be issued for acquisition				996,678
Medically Correct [Member]
Consideration to be transferred			$ 17,250,000
Cash to be paid for acquisition			$ 3,450,000
Stock to be issued for acquisition			4,677,967
Starbuds [Member]
Consideration to be transferred											$ 31,005,089
Cash to be paid for acquisition											$ 23,253,816
Stock to be issued for acquisition											2,601,098
Colorado Harvest Company [Member]
Consideration to be transferred										$ 12,500,000
Cash to be paid for acquisition										$ 4,000,000
Stock to be issued for acquisition										2,881,356
Targets [Member]
Consideration to be transferred									$ 36,898,499
Cash to be paid for acquisition									$ 27,673,874
Stock to be issued for acquisition									3,095,512
SB [Member]
Consideration to be transferred								$ 50,096,413
Cash to be paid for acquisition								$ 37,590,310
Stock to be issued for acquisition								4,202,720
Roots RX [Member]
Consideration to be transferred							$ 15,000,000
Cash to be paid for acquisition							$ 9,750,000
Stock to be issued for acquisition							1,779,661
Strawberry Fields [Member]
Consideration to be transferred						$ 31,000,000
Cash to be paid for acquisition						$ 14,000,000
Stock to be issued for acquisition						5,704,698
Canyon [Member]
Consideration to be transferred					$ 5,130,000
Cash to be paid for acquisition					$ 2,565,000

13. Stockholders' Equity (Details Warrant Activity) - Warrants [Member]	12 Months Ended
	Dec. 31, 2019 shares
Warrants outstanding, beginning balance	2,647,461
Warrants exercised	(485,543)
Warrants forfeited	(2,161,918)
Warrants issued	9,800,000
Warrants outstanding, ending balance	9,800,000

13. Stockholders' Equity (Details Narrative) - USD ($)		2 Months Ended	5 Months Ended	7 Months Ended	9 Months Ended		12 Months Ended
13. Stockholders' Equity (Details Narrative) - USD ($)	Jan. 08, 2019	Mar. 14, 2019	Jun. 05, 2019	Jul. 16, 2019	Sep. 30, 2019	Sep. 17, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Common stock authorized							250,000,000	90,000,000
Common stock par value							$ 0.001	$ 0.001
Common stock issued							39,952,626	27,753,310
Common stock outstanding							39,952,626	27,753,310
Preferred stock authorized							10,000,000	10,000,000
Preferred stock par value							$ 0.001	$ 0.001
Proceeds from warrant exercises							$ 602,560	$ 0
Stock issued for compensation, value							$ 3,222,401	$ 1,457,250
Warrants [Member] \| Issued during the FYE December 31, 2017
Warrants issued, shares									1,500,566
Warrant exercisable price									$ 1.33
Warrants exercised							485,543
Warrants forfeited							1,048,140
Employees, Officers and Directors [Member]
Stock issued for compensation, shares							690,000	800,000
Stock issued for compensation, value							$ 2,160,880	$ 1,457,250
Paul Dickman [Member]
Stock issued for compensation, shares	1,000,000
Stock issued for compensation, value	$ 660,000
Warrant Exercises [Member]
Warrant exercisable price							$ 1.33
Issuance of common stock in connection with the exercise of common stock purchase warrants, shares							485,543
Proceeds from warrant exercises							$ 602,560
James Toreson [Member]
Stock issued for services, shares		50,000
Stock issued for services, value		$ 95,000
Contractors and Professionals [Member]
Stock issued for services, shares							123,775
Stock issued for services, value							$ 210,521
Three Employees [Member] \| Warrants [Member] \| Issued during the FYE December 31, 2017
Warrants issued, shares									2,000,000
Warrant exercisable price									$ 1.445
Warrants exercised							2,000,000
One Employee [Member] \| Warrants [Member] \| December 31, 2018 [Member]
Warrants issued, shares								250,000
Warrant term								3 years
Warrant exercisable price								$ 1.49
Various Accredited Investors [Member] \| Warrants [Member]
Warrants issued, shares							9,800,000
Warrant term							3 years
Warrant exercisable price							$ 3.50
Private Placement [Member] \| Accredited Investor [Member]
Stock issued new, shares								937,647
Purchase Agreement [Member]
Stock issued new, shares			1,500,000	3,500,000	1,100,000	3,000,000
Warrants issued, shares			1,500,000	3,500,000	1,100,000	3,000,000
Proceeds from sale of equity			$ 3,000,000	$ 7,000,000	$ 2,200,000	$ 6,000,000
Warrant term			3 years
Warrant exercisable price			$ 3.50
Other Transaction [Member]
Stock issued new, shares							700,000
Warrants issued, shares							700,000
Proceeds from sale of equity							$ 1,400,000

14. Tax Provision (Details - Components of Income Tax) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Federal income tax expense	$ (477,625)	$ 477,625
State and local income tax expense	(105,305)	105,305
Income tax expense	$ (582,931)	$ 582,931

14. Tax Provision (Details - Reconciliation of income taxes)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Federal taxes at U.S. statutory rate	21.00%	21.00%
State income taxes	4.60%	4.60%
Permanent and temporary differences	(15.50%)	27.50%
Change in valuation allowance	(6.80%)	(15.10%)
Effective tax rate	3.30%	38.10%

14. Tax Provision (Details - Components of Income tax payable) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Total income taxes payable	$ 0	$ 582,931
Federal [Member]
Total income taxes payable	0	477,625
State and Local [Member]
Total income taxes payable	$ 0	$ 105,305

14. Tax Provision (Details - Deferred Income Taxes) - USD ($)	Dec. 31, 2019	Dec. 31, 2018
Deferred tax assets:
Bad debt allowance	$ 18,168	$ 0
Accrued expenses	38,413	0
Share based compensation accruals	3,528,726	373,493
Net operating loss carryforwards	1,703,425	0
Unrealized losses	578,201	118,766
Total deferred tax assets	5,866,934	492,259
Less: valuation allowance	(5,598,511)	(492,259)
Net deferred tax assets	268,423	0
Deferred tax liabilities:
Prepaid expenses	121,777	7,434
Fixed assets	12,388	24,256
Goodwill and intangible assets	636,188	174,173
Unrealized gains	417,046	0
Total deferred tax liabilities	1,187,399	205,863
Less: valuation allowance	(1,187,399)	(205,863)
Net deferred tax liabilities	0	0
Total deferred tax assets, net	$ 268,423	$ 0

14. Tax Provision (Details Narrative)	12 Months Ended
14. Tax Provision (Details Narrative)	Dec. 31, 2019 USD ($)
Income Tax Disclosure [Abstract]
Net operating loss carryover	$ 6,600,000
NOL beginning expiration date	Dec. 31, 2039

15. Major Customers and Accounts Receivable (Details Narrative)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Sales Revenue, Net [Member] \| One Customer [Member]
Concentration percentage	14.00%	37.00%
Sales Revenue, Net [Member] \| Another Customer [Member]
Concentration percentage		11.00%
Accounts Receivable [Member] \| One Customer [Member]
Concentration percentage	57.00%	11.00%
Accounts Receivable [Member] \| Another Customer [Member]
Concentration percentage	11.00%	38.00%
Accounts Receivable [Member] \| Another Customer [Member]
Concentration percentage		39.00%

16. Segment Information (Details- Segment Information) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Revenues	$ 12,400,955	$ 9,442,555
Intangible assets amortization	5,908	6,515
Depreciation	55,800	75,446
Net income (loss)	(16,975,742)	948,915
Segment assets	32,228,607	18,221,606
Products [Member]
Revenues	7,820,518	2,031,603
Intangible assets amortization	5,465	5,987
Depreciation	7,186	5,848
Net income (loss)	794,747	878,067
Segment assets	12,406,230	5,631,127
Licensing and Consulting [Member]
Revenues	4,580,436	7,410,952
Intangible assets amortization	443	528
Depreciation	48,614	69,598
Net income (loss)	1,688,147	70,848
Segment assets	6,081,485	$ 12,590,478
Corporate, Infrastructure and Other [Member]
Revenues	0
Intangible assets amortization	0
Depreciation	0
Net income (loss)	(19,458,635)
Segment assets	$ 13,740,892

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

17. Earnings per share (Basic and Dilutive) (Details - Basic and diluted earnings per share ) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Numerator:
Net income (loss)	$ (16,975,742)	$ 948,915
Denominator:
Weighted-average shares of common stock	33,740,557	25,121,896
Dilutive effect of warrants	0	2,647,461
Diluted weighted-average shares of common stock	33,740,557	27,769,357
Net loss per common share from Basic	$ (0.50)	$ 0.04
Net loss per common share from Diluted	$ (0.50)	$ 0.03

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

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- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

+ References

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+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

17. Earnings per share (Basic and Dilutive) (Details Narrative)	12 Months Ended
	Dec. 31, 2019 shares
Option [Member]
Potential dilutive shares	2,215,500
Warrants [Member]
Potential dilutive shares	9,800,000