Company: QSJC
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001683168-25-006089
Chunk: 7

Company: TANCHENG GROUP CO., LTD.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 7
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 is stated
at cost less accumulated depreciation and accumulated impairment losses. Cost represents the purchase price of the motor vehicle and other
costs incurred to bring the motor vehicle into its existing use. Gains or losses on disposals are reflected as gain or loss in the period
of disposal. All ordinary repair and maintenance costs are expensed as incurred.

Depreciation of the motor vehicle is provided
using the straight-line method over the estimated useful lives of 5 years with 5% residual value.

(f) Revenue Recognition

The Company’s revenue recognition policy
is compliant with ASC 606, Revenue from Contracts with Customers that revenue is recognized when a customer obtains control of promised
goods and is recognized in an amount that reflects the consideration that the Company expects to receive in exchange for those goods.
In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts
with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for
those goods. The Company applies the following five-step model in order to determine this amount:

    (i)
    identification of the goods and services in the contract;

    (ii)
    determination of whether the goods and services are performance obligations, including whether they are distinct in the context of the contract;

    (iii)
    measurement of the transaction price, including the constraint on variable consideration;

    (iv)
    allocation of the transaction price to the performance obligations; and

    (v)
    recognition of revenue when (or as) the Company satisfies each performance obligation.

     8 

The Company only applies the five-step model to
contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services
it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews
the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct.
The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when
the performance obligation is satisfied or as it is satisfied. Generally, the Company’s performance obligations are transferred
to customers at a point in time, typically upon delivery or service being rendered.

Contract liabilities consist of advance from customers
related to cash received from customers for the future transfer of goods to customers. The balance of advance from customers represents
unfulfilled performance obligations in the sales agreement, i