Company: XAIR
Filing Date: 2025-06-20
Form Type: 10-K
Source: 0001641172-25-015750
Chunk: 1280

Company: Beyond Air, Inc.
Filing Date: 2025-06-20
Form: 10-K
Item: Item 2
Chunk 1280
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 contract devices and consumables in cost of revenue in its consolidated statements of operations and comprehensive
loss.

See Note 16 to the consolidated financial statements
for more information regarding leasing arrangements.

Accounts Receivable

The Company extends credit
to its customers on an unsecured basis. Accounts receivable are recorded at the invoiced amount, based on agreed contract terms. Receivables
are written off when it is determined that amounts are uncollectible. There are currently no allowances for expected credit losses and
no doubtful debts recorded in accounts receivable and the Company has not experienced any credit losses to date.

Fair Value Measurements

ASC 820, Fair Value Measurements and Disclosures
(“ASC 820”), defines fair value as the price that would be received to sell an asset, or paid to transfer a liability, in
the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The fair value
standard also establishes a three-level hierarchy, which requires an entity to maximize the use of observable inputs and minimize the
use of unobservable inputs when measuring fair value. The valuation hierarchy is based upon the transparency of inputs to the valuation
of an asset or liability on the measurement date. The three levels are defined as follows:

Level 1—inputs to the valuation methodology
are quoted prices (unadjusted) for an identical asset or liability in an active market.

Level 2—inputs to the valuation methodology
include quoted prices for a similar asset or liability in an active market or model-derived valuations in which all significant inputs
are observable for substantially the full term of the asset or liability.

Level 3—inputs to the valuation methodology
are unobservable and significant to the fair value measurement of the asset or liability.

As of March 31, 2025 and March 31, 2024, the Company’s
financial instruments included restricted cash, marketable securities, accounts payable, long-term debt and liability classified warrants.
In addition, as of March 31, 2024, the Company’s financial instruments also included derivative liabilities. The carrying amounts
reported in the accompanying consolidated financial statements for cash and cash equivalents, restricted cash and marketable securities
approximate their respective fair values because of the short-term nature of these accounts. The carrying value of the Company’s
long-term debt approximates fair value based on current interest rates for similar types of borrowings and is in Level 3 of the fair value
hierarchy. The liability classified warrants and derivative liabilities are each recorded at their