Company: BRID
Filing Date: 2025-06-02
Form Type: 10-Q
Source: 0001641172-25-013252
Chunk: 7

Company: BRIDGFORD FOODS CORP
Filing Date: 2025-06-02
Form: 10-Q
Item: Part I, Item 1
Chunk 7
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 after the
customer has obtained control of the product is recorded as a fulfillment cost rather than an additional performance obligation. Costs
paid to third party brokers to obtain contracts are recognized as part of selling expenses. Other sundry items in context of the contract
are also recognized as selling expenses. Any taxes collected on behalf of the government are excluded from net revenue.

We
record revenue at the transaction price which is measured as the amount of consideration we anticipate receiving in exchange for providing
products to our customers. Revenue is recognized as the net amount estimated to be received after deducting estimated or known amounts
including variable consideration for discounts, trade allowances, consumer incentives, coupons, volume-based incentives, cooperative
advertising, product returns and other such programs. Promotional allowances, including customer incentive and trade promotion activities,
are recorded as a reduction to sales based on amounts estimated being due to customers, based primarily on historical utilization and
redemption rates. Estimates are reviewed regularly until incentives or product returns are realized and the result of any such adjustments
are known. Promotional allowances deducted from sales for the twelve weeks ended April 18, 2025, and April 19, 2024, were $4,219 and
$3,871, respectively. Promotional allowances deducted from sales for the twenty-four weeks ended April 18, 2025, and April 19, 2024,
were $8,042 and $8,051, respectively.

Leases

Leases
are recognized in accordance with ASC 842 Leases (“ASC 842”) which requires a lessee to recognize assets and liabilities
with lease terms of more than twelve months. We lease or rent property for operations such as storing inventory and equipment. We analyze
our agreements to evaluate whether or not a lease exists by determining what assets exist for which we control usage for a period of
time in exchange for consideration. In the event a lease exists, we classify it as a finance or operating lease and record a right-of-use
(“ROU”) asset and the corresponding lease liability at the inception of the lease. The classification as a finance or operating
lease determines whether the recognition, measurement and presentation of expenses and cash flows are considered operating or financing.
In the case of month-to-month lease or rental agreements with terms of twelve months or less, we made an accounting policy election to
not recognize lease assets and liabilities and record them on a straight-line basis over the lease term. The storage units rented on
a month-to-month basis for use