Company: BSAI
Filing Date: 2025-04-01
Form Type: 10-K
Source: 0001096906-25-000357
Chunk: 168

Company: BLUSKY AI INC.
Filing Date: 2025-04-01
Form: 10-K
Item: Item 11
Chunk 168
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 of financial instruments on December 31, 2024 are summarized below:   Level 1   Level 2   Level 3   Total              Debt derivative liabilities  -   -   186,542   186,542 Total Liabilities $-  $-  $186,542  $186,542 

 F-9Table of Contents

The fair value of financial instruments on December 31, 2023 are summarized below:   Level 1  Level 2  Level 3  Total              Warrant liabilities $-  $-  $-  $- Debt derivative liabilities  -   -   39,281   39,281 Total Liabilities $-  $-  $39,281  $39,281  The Company recognizes its derivative liabilities as level 3 and values its derivatives using the methods discussed below in Note 3. While the Company believes that its valuation methods are appropriate and consistent with other market participants, it recognizes that the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. The primary assumptions that would significantly affect the fair values using the methods discussed below in Note 3 are that of volatility and market price of the underlying common stock of the Company. Notes Receivable – Notes receivable include amounts due to the Company pursuant to financial agreements stipulating interest rates, payment terms and maturity dates. As of December 31, 2024 and 2023, notes receivable balances include one note due from Mother Load Mining, Inc. in the amounts of $2,219,442, net of reserves of $2,219,442 (see Note 4 – Note Receivable). However, the Company has elected to create an allowance for doubtful collection of this note for the full outstanding balance of $2,219,442 as of December 31, 2024 and recognized a bad debt expense of $2,219,442 during the year ended December 31, 2023. Long-Lived Assets – We review the carrying amount of our long-lived assets for impairment whenever there are negative indicators of impairment. An asset is considered impaired when estimated future cash flows are less than the carrying amount of the asset. In the event the carrying amount of such asset is