Company: LGCY
Filing Date: 2025-09-25
Form Type: 10-K
Source: 0001493152-25-014945
Chunk: 499

Company: Legacy Education Inc.
Filing Date: 2025-09-25
Form: 10-K
Item: Item 1B
Chunk 499
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 Consolidation

The
audited consolidated financial statements include the accounts of HDMC and its wholly-owned subsidiaries, CCC, Integrity and CCMCC.
All significant intercompany balances and transactions have been eliminated in consolidation.

Use
of Estimates

The
preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”)
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent
assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the assumptions
used in the evaluation of the Company’s distinct performance obligations, the valuation of equity instruments and allowance for
credit losses related to accounts receivable.

Reclassifications

Certain
amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications
had no effect on reported consolidated net income.

Cash
and Cash Equivalents

The
Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents. As of June
30, 2025 and 2024 approximately $10.38 million and $2.15 million, respectively, of cash equivalents was held in instruments
considered level 1 securities as defined in the “Fair Value of Financial Instruments” note below.

Property
and Equipment

Property
and equipment are recorded at cost less accumulated depreciation. Depreciation is computed using the straight-line method. Normal repairs
and maintenance are expensed as incurred. Expenditures that materially extend the useful life of an asset are capitalized. Depreciation
is provided using the straight-line method over the estimated useful lives of the assets. Furniture and fixtures, machinery, computer
equipment, and vehicles generally have estimated useful lives of ten, seven, four, and five years, respectively. Leasehold improvements
are depreciated over the shorter of their lease term or their useful life.

Leases

The
Company accounts for leases in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification
(“ASC”) Topic 842 Leases, which requires the recognition of assets and liabilities by lessees for those leases classified
as operating leases under GAAP. The Company determines if an arrangement is a lease at inception and evaluates the lease agreement to
determine whether the lease is a finance or operating lease. The guidance requires that