Company: GURE
Filing Date: 2025-05-13
Form Type: 10-Q
Source: 0001193805-25-000638
Chunk: 8

Company: GULF RESOURCES, INC.
Filing Date: 2025-05-13
Form: 10-Q
Item: Part I, Item 1
Chunk 8
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 ACCOUNTING POLICIES - Continued

(j) Recoverability
of Long-lived Assets

In accordance with Financial Accounting Standards
Board (“ FASB”) Accounting Standards Codification (“ ASC”) 360-10-35“ Impairment or Disposal of Long-lived
Assets”, long-lived assets to be held and used are analyzed for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be fully recoverable or that the useful lives of those assets are no longer appropriate.
The Company evaluates at each balance sheet date whether events and circumstances have occurred that indicate possible impairment.

The Company determines the existence of such impairment
by measuring the expected future cash flows (undiscounted and without interest charges) and comparing such amount to the carrying amount
of the assets. An impairment loss, if one exists, is then measured as the amount by which the carrying amount of the asset exceeds the
discounted estimated future cash flows. Assets to be disposed of are reported at the lower of the carrying amount or fair value of such
assets less costs to sell. Asset impairment charges are recorded to reduce the carrying amount of the long-lived asset that will be sold
or disposed of to their estimated fair values. Charges for the asset impairment reduce the carrying amount of the long-lived assets to
their estimated salvage value in connection with the decision to dispose of such assets.

For the three-month period ended March 31, 2025
and 2024, the Company determined that there were no events or circumstances indicating possible additional impairment of its long-lived
assets.

(k) Basic
and Diluted Net Income per Share of Common Stock

Basic earnings per common share are based on the
weighted average number of shares outstanding during the periods presented. Diluted earnings per share are computed using weighted
average number of common shares plus dilutive common share equivalents outstanding during the period. Potential common shares that would
have the effect of increasing diluted earnings per share are considered to be anti-dilutive, i. e. the exercise prices of the outstanding
stock options were greater than the market price of the common stock. Anti-dilutive common stock equivalents which were excluded from
the calculation of number of dilutive common stock equivalents amounted to 0 and 0 shares for the three-month periods ended March 31,
2025 and 2024, respectively.

Because the Company reported a net loss for the
three-month periods ended March 31, 2025 and 2024, common stock equivalents including stock options and warrants