Company: FLYE
Filing Date: 2025-02-19
Form Type: 10-Q
Source: 0001213900-25-015334
Chunk: 125

Company: Fly-E Group, Inc.
Filing Date: 2025-02-19
Form: 10-Q
Item: Part I, Item 8
Chunk 125
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 with the customers. Accounts receivable which
is deemed to be uncollectible is charged off against the allowance after all means of collection have been exhausted and the potential
for recovery is considered remote.

The Company adopt the current expected credit
loss model (“CECL model”) to estimate the expected credit losses, which is determined by multiplying the probability of default.
In determining the probability of default, the Company mainly considers factors such as aging schedule of receivables, migration rate
of receivables, assessment of receivables due from specific identifiable counterparties that are considered at risk or uncollectible,
current market conditions, as well as reasonable and supportable forecasts of future economic conditions.

There was nil and nil allowance for credit losses
as of December 31, 2024 and March 31, 2024, respectively.  

(h) Inventories, Net

Inventories,
consisting of products available for sale, are stated at the lower of cost or net realizable value using the first-in-first-out method.
Adjustments to the carrying value are recorded for estimated obsolescence or excess inventory equal to the difference between the cost
of inventory and the estimated net realizable value based upon assumptions about future demand and market conditions. Inventory cost consists
of the direct cost of merchandise including freight. For the three months ended December 31, 2024 and 2023, the impairment loss was $347,333
and $128,095, respectively. For the nine months ended December 31, 2024 and 2023, the impairment loss was $678,157  and
$287,946, respectively.

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(i) Prepayments and Other Receivables

Prepayments and other receivables are mainly prepayments
to vendors, prepaid expenses paid to service providers, prepaid taxes, advances to employees, and other deposits. Management regularly
reviews the aging of such balances and changes in payment and realization trends and records allowances when management believes that
the collection of amounts due is at risk. Accounts considered uncollectable are written off against allowances after exhaustive efforts
at collection are made. As of December 31, 2024 and March 31, 2024, no allowance against prepayments and other receivables was recorded.

(j) Property
and Equipment, Net  

Property and equipment are stated at cost less accumulated depreciation
and any recorded impairment.

The estimated useful lives are as follows:

    Machinery and equipment
     
    5