Company: LGCY
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001493152-25-022296
Chunk: 41

Company: Legacy Education Inc.
Filing Date: 2025-11-13
Form: 10-Q
Item: Part II, Item 8
Chunk 41
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 compliance and other corporate functions. This
expense also includes marketing and advertising costs, which are expensed in the fiscal year incurred.

Depreciation
and amortization. This expense reflects depreciation and amortization of property and equipment, amortization of assets under capital
leases and amortization of intangible assets.

Interest
expense

This
expense reflects interest paid under notes issued to our investors, IRS interest, non-cash interest related to unit option grants, interest
related to notes associated with CCMCC, and other debt related interest.

5

Interest
income

This
income relates to interest received from investments.

Factors
Affecting Comparability

We
believe the following factors have had, or can be expected to have, a significant effect on the comparability of recent or future results
of operations:

Seasonality

Our
operations are generally subject to seasonal trends. We generally experience a seasonal increase in new enrollments during the first
quarter of our fiscal year, as well as during the third quarter each year, when most other colleges and universities begin their fall
semesters and subsequent to holiday break. While we enroll students throughout the year, our second quarter revenue generally is lower
than other quarters due to the holiday season.

Critical
Accounting Policies and Use of Estimates

The
preparation of the financial statements included elsewhere in this Quarterly Report on Form 10-Q requires us to make estimates and assumptions
that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosures. We evaluate our estimates and assumptions
on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable
under the circumstances. Our actual results could differ from these estimates.

The
preparation of financial statements in conformity with 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 evaluation of the Company’s distinct performance obligations, the valuation
of equity instruments and valuation allowances for credit losses related to accounts receivable.

Allowance
for credit losses

We
record an allowance for doubtful credit losses for estimated losses resulting from the inability, failure or refusal of our students
to make required payments, which includes the recovery of financial aid funds advanced to a student for amounts in excess of the student’s
cost