Company: ECIA
Filing Date: 2025-08-15
Form Type: 10-Q
Source: 0001079973-25-001326
Chunk: 3

Company: ENCISION INC
Filing Date: 2025-08-15
Form: 10-Q
Item: Item 8
Chunk 3
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 favorable than those projected by management, additional inventory write-downs may
be required. At June 30, 2025, and March 31, 2025, inventory consisted of the following:

     Schedule of inventory 

    June
    30, 2025  
    March
    31, 2025 
  
    Raw materials 
    $1,178,910  
    $1,093,530 
  
    Finished goods 
     355,977  
     389,652 
  
    Total inventories 
    $1,534,887  
    $1,483,182 

Property and Equipment. Property and equipment
are stated at cost, with depreciation computed over the estimated useful lives of the assets, generally five to seven years. Depreciation
expenses for the three months ended June 30, 2025, and 2024, were $17,445 and $14,144, respectively. The Company uses the straight-line
method of depreciation for property and equipment. Leasehold improvements are depreciated over the shorter of the remaining lease term
or the asset's estimated useful life. Maintenance and repairs are expensed as incurred, and significant additions, replacements, and improvements
are capitalized.

Operating lease ROU assets and operating lease liabilities
are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. ROU assets
also include any initial direct costs incurred and any lease payments made at or before the lease commencement date, less lease incentives
received. The Company uses the incremental borrowing rate based on the information available at the commencement date to determine the
lease liabilities, as the leases do not provide an implicit rate. Lease expense is recognized on a straight-line basis over the lease
term.

 Long-Lived Assets. Long-lived assets
are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
A long-lived asset is considered impaired when estimated future cash flows related to the asset, undiscounted and without interest, are
insufficient to recover the carrying amount of the asset. If deemed impaired, the long-lived asset is reduced to its estimated fair value.
Long-lived assets to be disposed of are reported at the lower of their carrying amount or estimated fair value less cost to sell.

Patents. The costs of applying for patents
are capitalized and amortized on a straight-line basis over the lesser of the patent’s economic or