Company: ZRCN
Filing Date: 2025-09-10
Form Type: 10-K
Source: 0001641172-25-027037
Chunk: 168

Company: ZRCN Inc.
Filing Date: 2025-09-10
Form: 10-K
Item: Item 1
Chunk 168
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 due, significant one-time events and historical experience. Balances that are still outstanding
after management has used reasonable collection efforts are written off through a charge to the provision for credit losses and a credit
to accounts receivable. Based on management’s assessment of the credit history with customers having outstanding balances and current
relationships with them, management believes that losses on balances outstanding will not exceed the provision for credit losses.

Accounts
receivable consisted of the following:

Schedule
of Accounts Receivable 

    (In
    thousands) 
    March
    31, 2025  
    March
    31, 2024 
  
    Accounts
    receivable 
    $6,155  
    $8,658 
  
    Less
    provision for credit losses 
     (53) 
     (14)
  
    Accounts
    receivable, net 
    $6,102  
    $8,644 

Activity
related to the Company’s provision for credit losses was as follows:

 Schedule
of  Provision for Credit losses

    (In
    thousands) 
    March
    31, 2025  
    March
    31, 2024 
  
    Balance,
    beginning of period 
    $14  
    $10 
  
    Credit
    loss provision 
     195  
     4 
  
    Write-offs 
     (156) 
     — 
  
    Balance,
    end of period 
    $53  
    $14 

Inventory,
net

Inventories,
which consist of raw materials, work in process, and finished goods, are stated at the lower of cost or net realizable value. The Company
states inventory cost utilizing the first-in, first-out (FIFO) method. Labor and overhead associated with inventory purchases are estimated
and capitalized in inventory. The need for an allowance for inventory obsolescence is based on an evaluation of slow-moving or obsolete
inventory. For the years ended March 31, 2025 and 2024,
the Company recognized $0.6 million and $0.4 million in impairment expense, respectively.

Property
and Equipment, Net

Property
and equipment are stated at cost. Leasehold improvements are amortized over the shorter of the lease terms or estimated useful lives
of the respective assets. Depreciation is computed using the straight-line method over the following estimated useful lives of the respective
assets: