Company: MVNC
Filing Date: 2025-05-19
Form Type: 10-Q
Source: 0001683168-25-003814
Chunk: 51

Company: Marvion Inc.
Filing Date: 2025-05-19
Form: 10-Q
Item: Part I, Item 8
Chunk 51
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 date in determining the present value
of lease payments. The incremental borrowing rate is the rate that the Company would have to pay to borrow, on a collateralized basis,
an amount equal to the lease payments, in a similar economic environment and over a similar term. The Company depreciated the ROU assets
on a straight-line basis from the lease commencement date to the earlier of the end of the useful life of the ROU assets or the end of
the lease term. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

All of the Company’s real
estate leases are classified as operating leases and there was no lease with a duration of twelve months or less.

Revenue recognition

The Company adopted Accounting
Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”) using
the full retrospective transition method.

The Company applies the following
five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:

    ·
    identify the contract with a customer;

    ·
    identify the performance obligations in the contract;

    ·
    determine the transaction price;

    ·
    allocate the transaction price to performance obligations in the contract; and

    ·
    recognize revenue as the performance obligation is satisfied.

Revenue is recognized when the
Company satisfies its performance obligation under the contract by transferring the promised product to its customer that obtains control
of the product and collection is reasonably assured. A performance obligation is a promise in a contract to transfer a distinct product
or service to a customer. Most of the Company’s contracts have a single performance obligation, and such fees are billed to the
customer when the performance obligation is satisfied. The Company recognizes such revenue in the period when the amounts are determined
to be fixed and the performance obligation is satisfied as the Company completes the obligations.

Revenue is measured as the amount
of consideration the Company expects to receive in exchange for transferring products or providing services. As such, revenue is recorded
net of returns, allowances, customer discounts, and incentives. Sales taxes and other taxes are excluded from revenues.

Upon the development of
new warehouse building in October 2023, the Company focuses on the provision of logistic and warehousing services to the customers through
the storage of merchandise in its warehouse facilities, as well as packaging and delivery and transportation services from its warehouse
to domestic destinations designated by the customers.