Company: VEEAW
Filing Date: 2025-01-10
Form Type: S-1/A
Source: 0001213900-25-002701
Chunk: 193

Company: VEEA INC.
Filing Date: 2025-01-10
Form: S-1/A
Chunk 193
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 appropriate. The estimate
is a result of the Company’s ongoing evaluation of collectability, customer creditworthiness, historical levels of credit losses,
and future expectations. Credit loss expense and allowance for credit losses were not significant as of, and for the years ended,
December 31, 2023 and December 31, 2022.

Inventory

The Company values inventory at the lower of cost
or net realizable value. Cost is computed using standard cost which approximates actual cost on a first-in, first-out basis. At each reporting
period, the Company assesses the value of its inventory and writes down the cost of inventory to its net realizable value if required,
for estimated excess or obsolescence. Factors influencing these adjustments include changes in future demand forecasts, market conditions,
technological changes, product life cycle and development plans, component cost trends, product pricing, physical deterioration, and quality
issues. The write down for excess or obsolescence is charged to the provision for inventory, which is a component of Cost of Goods Sold
in the Company’s consolidated statements of operations and comprehensive loss. At the point of the loss recognition, a new, lower
cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration or increase
in that newly established cost basis.

Cost of Goods Sold

Cost of goods sold consists primarily of the cost
of finished goods, components purchased for manufacturing and freight. Cost of goods sold also includes third-party vendor costs related
to cloud hosting fees.

Shipping and Handling

The Company considers shipping and handling to customers
to represent activities performed in fulfilling the contract with the customer. When shipping is charged to the customer, the Company
nets such charges against actual shipping costs incurred.

Tax Collected from Customers

Taxes imposed by governmental authorities on the
Company’s revenue producing activities, such as sales taxes, are excluded from net sales.

Research and Development

Research and development (“R&D”)
costs that do not meet the criteria for capitalization are expensed as incurred. R&D costs primarily consist of employee compensation,
employee benefits, stock-based compensation related to technology developers and product management employees, as well as fees paid for
outside services and materials.

Sales and Marketing

Sales and marketing costs consist of compensation
and other employee related costs for personnel engage in selling and marketing, and sales support functions. Selling expenses also include
marketing, and the costs associated with customer evaluations. The Company does not incur advertising costs.

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