Company: APCXW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001683168-25-006148
Chunk: 8

Company: AppTech Payments Corp.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 8
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, balances may exceed federally insured limits of $250,000 per institution that pays Federal Deposit Insurance
Corporation (“FDIC”) insurance premiums. The Company has never experienced any losses related to these balances.

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The accounts receivable from merchant services are
paid by the financial institutions on a monthly basis. As of June 30, 2025, 58% of the accounts receivable balance was generated
from two customers. As of December 31, 2024, the top three customers accounted for 88% of total accounts receivable.

For the six months ended June 30, 2025, 66% of the
Company’s revenue was generated from two customers. For the six months ended June 30, 2024, the top three customers represented
82% of total revenues. The loss of a top customer would have a significant impact on the Company's financials.

Revenue Recognition

The Company accounts for revenue under Accounting
Standards Codification (“ASC”) 606 Revenue from Contracts with Customers, which provides a single comprehensive model for
entities to use in accounting for revenue arising from contracts with customers.

Merchant Processing Services

The Company provides merchant processing solutions
for credit card and ACH transactions. We act as an intermediary between merchants, who initiate transactions and banks that process them.
We collect either a flat fee, a fee for each transaction, and or a fee calculated as a percentage of its value, from both credit cards
and ACHs. Revenue is recognized when transactions are processed by banks or at month-end based on the processing activity. Payments to
channel partners are recorded as cost of revenues.

Intangible Assets and Intellectual Property

Intellectual Property

The Company amortizes intellectual property based
on the estimated period over which the economic benefits of the intangible assets are expected to be consumed. Typically, the Company
amortizes its intellectual property, including patents and other identifiable intangible assets, on a straight-line basis. The amortization
periods generally range from three years to fifteen years, depending on the nature of the asset and its expected useful life.

Capitalized Software Development Cost

The Company capitalizes certain costs related to the
development of its digital payment and banking platform, including employee compensation and consulting fees for third-party developers,
only when it is probable that the development will result in new or additional functionality. Costs incurred during the preliminary project
planning phase and post-implementation phase are expensed as incurred. The capitalized software development costs are amortized