Company: BOF
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004712
Chunk: 1291

Company: BranchOut Food Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 6
Chunk 1291
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 straight-line method based on the lesser of the estimated useful lives of the assets or the lease term based on the following
life expectancy:

 Schedule of Estimated Useful Lives

    Office equipment 
     3
                                            years 
  
    Furniture and fixtures 
     5
                                            years 
  
    Equipment and machinery 
     5-10
                                            years 

Repairs
and maintenance expenditures are charged to operations as incurred. Major improvements and replacements, which extend the useful life
of an asset, are capitalized, and depreciated over the remaining estimated useful life of the asset. When assets are retired or sold,
the cost and related accumulated depreciation are eliminated, and any resulting gain or loss is reflected in operations. Depreciation
expense was $171,873 and $223,856 for the years ended December 31, 2024 and 2023, respectively. For the year ended, December 31, 2024,
a total of $34,034 of depreciation was included in the inventoried production costs, which gets expensed as Cost of Goods Sold as the
inventory is sold.

Impairment
of Long-Lived Assets

Long-lived
assets held and used by the Company are reviewed for possible impairment whenever events or circumstances indicate the carrying amount
of an asset may not be recoverable or is impaired. Recoverability is assessed using undiscounted cash flows based upon historical results
and current projections of earnings before interest and taxes. Impairment is measured using discounted cash flows of future operating
results based upon a rate that corresponds to the cost of capital. Impairments are recognized in operating results to the extent that
carrying value exceeds discounted cash flows of future operations.

Our
indefinite-lived brand names and trademarks acquired and are assigned an indefinite life as we anticipate that these brand names will
contribute cash flows to the Company perpetually. We evaluate the recoverability of intangible assets periodically by considering events
or circumstances that may warrant revised estimates of useful lives or that indicate the asset may be impaired. The Company expenses
internally developed trademarks.

License
Agreement

The
Company is party to a license agreement under which it is licensed to utilize certain technology and production equipment developed and
manufactured by another company, relating on an exclusive basis to avocado products and on a non-exclusive basis to other products. The
license is not discernible from the equipment; therefore, the license costs have been capitalized and depreciated over the useful life
of the equipment. The license agreement also