Company: KPEA
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001641172-25-023821
Chunk: 28

Company: Kun Peng International Ltd.
Filing Date: 2025-08-14
Form: 10-Q
Item: Item 1
Chunk 28
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 consumer health care products on its online platform, King Eagle Mall, and promoting its own brand of preventive
health care related products on its new online platform to reduce its costs of goods sold, streamlining its overhead costs, or obtaining
financing from its stockholders or directors.

Concentration
of customers and vendors

There
was no revenue from customers that individually represent greater than 10% of the Company’s total revenue for the nine months ended
June 30, 2025 and 2024.

For
the nine months ended June 30, 2025, three major vendors accounted for 78.3% of the Company’s total cost of revenues.

For
the nine months ended June 30, 2024, one major vendor accounted for 10.7% of the Company’s total cost of revenues.

Income
Taxes

We
account for income taxes using the liability method. Under this method, deferred tax assets and liabilities are determined based on the
difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in
the period in which the differences are expected to reverse. The Company records a valuation allowance against deferred tax assets if,
based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not
be realized. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment
date.

We
apply ASC 740, Accounting for Income Taxes, to account for uncertainty in income taxes and the evaluation of a tax position is
a two-step process. The first step is to determine whether it is more likely than not that a tax position will be sustained upon examination,
including the resolution of any related appeals or litigation based on the technical merits of that position. The second step is to measure
a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements.
A tax position is measured at the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlement.
Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent
period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should
be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met.

Commitments
and Conting