Company: DGLY
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001493152-25-021680
Chunk: 45

Company: DIGITAL ALLY, INC.
Filing Date: 2025-11-12
Form: 10-Q
Item: Part I, Item 1
Chunk 45
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 equity offering 
     (1,803)

    Transition of warrant derivative liability to equity due to exercise of Series B common stock purchase warrants issued in June 2024 Private Placement 
     (1,989,806)

    Transition of warrant derivative liability to equity due to exercise of Series B common stock purchase warrants issued in February 2025 Public Equity Offering 
     (5,406,320)

    Transition of warrant derivative liability to equity due to elimination of net cash settlement provisions relative to the Series A common stock purchase warrants issued in February 2025 Public Equity Offering 
     (530,101)

    Change in fair value of warrant derivative liabilities 
     (3,373,919)

    Balance, September 30, 2025 
    $1,116 

NOTE
7. ACCRUED EXPENSES

Accrued
expenses consisted of the following at September 30, 2025 and December 31, 2024:

 SCHEDULE OF ACCRUED EXPENSES

    September 30, 2025  
    December 31, 2024 
  
    Accrued warranty expense 
    $—  
    $11,615 
  
    Accrued payroll and related fringes 
     57,732  
     428,380 
  
    Accrued sales returns and allowances 
     93,170  
     93,170 
  
    Accrued sales taxes 
     98,589  
     104,404 
  
    Accrued interest - related party 
     —  
     492,177 
  
    Accrued board of directors’ fees 
     120,000  
     197,000 
  
    Customer deposits 
     2,400  
     165,779 
  
    Other 
     64,791  
     21,983 
  
    Total
    accrued expenses 
    $436,682  
    $1,514,508 

    19

NOTE
8. INCOME TAXES

The
effective tax rate for the three and nine months ended September 30, 2025, and 2024 varied from the expected statutory rate due to the
Company continuing to provide a 100% valuation allowance on net deferred tax assets. The Company determined that it was appropriate to
continue the full valuation allowance on net deferred tax assets as of September 30, 2025,