Our Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is provided in addition to the accompanying financial statements and notes to assist readers in understanding our results of operations, financial condition and cash flows. MD&A is organized as follows:





  ? Significant Accounting Policies - Accounting policies that we believe are
    important to understanding the assumptions and judgments incorporated in our
    reported financial results and forecasts.

  ? Results of Operations - Analysis of our financial results comparing the year
    ended December 31, 2021 to 2020.

  ? Liquidity and Capital Resources - Analysis of changes in our cash flows, and
    discussion of our financial condition and potential sources of liquidity.

This report includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward looking statements are often identified by words like: believe, expect, estimate, anticipate, intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this annual report. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.

Significant Accounting Policies

We have prepared our financial statements in conformity with accounting principles generally accepted in the United States, which requires management to make significant judgments and estimates that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. We base these significant judgments and estimates on historical experience and other applicable assumptions we believe to be reasonable based upon information presently available. These estimates may change as new events occur, as additional information is obtained and as our operating environment changes. These changes have historically been minor and have been included in the financial statements as soon as they became known. Actual results could materially differ from our estimates under different assumptions, judgments or conditions.

All of our significant accounting policies are discussed in Note 2, Summary of Significant Accounting Policies, to our financial statements, included elsewhere in this Annual Report. We have identified the following as our significant accounting policies and estimates, which are defined as those that are reflective of significant judgments and uncertainties, are the most pervasive and important to the presentation of our financial condition and results of operations and could potentially result in materially different results under different assumptions, judgments or conditions.

We believe the following significant accounting policies reflect our more significant estimates and assumptions used in the preparation of our financial statements:

Use of Estimates - The financial statements are prepared in conformity with accounting principles generally accepted in the United States ("GAAP"). Management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.





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Fair Value of Financial Instruments - Our short-term financial instruments, including cash, accounts receivable, accounts payable and other liabilities, consist primarily of instruments without extended maturities. We believe that the fair values of our current assets and current liabilities approximate their reported carrying amounts.





Results of Operations

Years Ended December 31, 2021 and 2020





Revenue

For the year ended December 31, 2021, the Company reported revenue of $1,918,882 an increase of $176,963 from revenue of $1,741,919 for the year ended December 31, 2020. The increase in revenue was primarily due to the strong sales for the MOJO Organic Coconut Water 1Liter product coupled with an increase in cases sold for the other MOJO branded products.





Cost of Revenue

Cost of revenue includes finished goods purchase costs, production costs, raw material costs and freight in costs. Also included in cost of revenue are adjustments made to inventory carrying amounts, including markdowns to market.

For the twelve months ended December 31, 2021, cost of revenue was $1,069,844 or 56% of revenue. For the twelve months ended December 31, 2020, cost of revenue was $917,639 or 53% of revenue. The 3% increase in cost of revenue was primarily due to the higher costs of ocean freight compared to last year.





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Operating Expenses

For the year ended December 31, 2021, the selling, general and administrative expenses was $844,654 a decrease of $65,564 from the year ended December 31, 2020 of $910,218.

This decrease in operating expenses was primarily due to lower selling expenses and professional fees. Office expenses and marketing fees also decreased compared to the same period last year. Selling expenses decreased by $27,865 compared while professional fees decreased by $12,068 compared to the year ended December 31, 2020. Office expenses including rent expense amounted to $20,096 for the year ended December 31, 2021 compared to $35,904 for the year ended December 31, 2020. Marketing fees decreased by $9,484 compared to the same period last year.





Net Income/(Loss)

For the year ended December 31, 2021, the net income was $39,892 a $123,610 improvement from a net loss of ($83,719) for the year ended December 31, 2020.

Liquidity and Capital Resources





Liquidity

As of December 31, 2021, the Company had working capital of $370,552 Net cash provided by operating activities was $103,463 for the year ended December 31, 2021, compared to net cash used in operating activities for the year ended December 31, 2020 of $26,203. Net cash used in financing activities was $107,215 for the year ended December 31, 2021 compared to net cash provided by financing activities of $20,458 for the year ended December 31, 2020. Net cash was used in financing activities to repurchase MOJO Restricted Common Stock for the year ended December 31, 2021.





Working Capital Needs

Our working capital requirements increase as demand grows for our products. During 2021 and 2020, the Company did not require additional funding. If the Company requires additional working capital during the next twelve months, it may seek to raise additional funds. Financing transactions may include the issuance of equity, debt securities and obtaining credit facilities.

OFF BALANCE SHEET ARRANGEMENTS

None

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