Company: FOXX
Filing Date: 2025-10-15
Form Type: 10-K
Source: 0001213900-25-098953
Chunk: 473

Company: Foxx Development Holdings Inc.
Filing Date: 2025-10-15
Form: 10-K
Item: Item 1C
Chunk 473
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are stated at the lower of cost or net realizable value, the estimated selling prices in the ordinary course of business, less reasonably
predictable costs of completion, disposal and transportation. Cost is determined using the “First in, First out” method.
Inventories mainly include electronic products and accessories which are purchased from the Company’s suppliers as merchandized
goods and freight-in. On an annual basis, inventories are reviewed for potential write-downs for estimated obsolescence or unmarketable
inventories which equals the difference between the costs of inventories and the estimated net realizable value, the estimated selling
prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation, based upon forecasts
for future demand and market conditions. When inventories are written down to net realizable value, it is not marked up subsequently
based on changes in underlying facts and circumstances. As of June 30, 2025 and 2024, the Company had inventories of $12,686,739 and
$1,768,072, respectively. During the years ended June 30, 2025 and 2024, no inventory write-down was recorded.

Contract
assets

Contract
assets consisted of cash deposited or advanced to suppliers for future inventory purchases. This amount is refundable and bears no interest.
For any advances to suppliers determined by management that such advances will not be in receipts of inventories or refundable, the Company
will recognize an allowance account to reserve such balances. Management reviews its advances to suppliers on a regular basis to determine
if the allowance is adequate and adjusts the allowance when necessary. Delinquent account balances are written-off against allowance
for credit losses after management has determined that the likelihood of collection is not probable. The Company’s management continues
to evaluate the reasonableness of the valuation allowance policy and update it if necessary. As of June 30, 2025 and 2024, no allowance
for credit losses on contract assets was recorded.

Property
and equipment, net

Property
and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method
over the estimated useful lives of the assets with no residual value. The estimated useful lives are as follows:

      Useful Life   Computer and office equipment   5 years   Equipment   5 years   Vehicles   5 years  

The
cost