Company: GURE
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001193805-25-001184
Chunk: 14

Company: GULF RESOURCES, INC.
Filing Date: 2025-08-13
Form: 10-Q
Item: Item 1
Chunk 14
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 government new policies, the Company is also required to obtain an
exploration license and a mining license for bromine and natural gas, respectively. Pursuant to the Opinions of the Ministry of
Natural Resources on Several Issues in Promoting the Reform of Mineral Resources Management(Trial) promulgated by the Ministry of
Natural Resources of PRC on January 9, 2020, which came into effect on May 1, 2020, privately owned enterprises are allowed to
participate in the natural gas production. The Company plans to proceed with its applications for the natural gas and brine project
approvals with related government departments until the governmental planning has been finalized. 

(d) Use of Estimates

The Company’s consolidated financial statements have been
prepared in accordance with accounting principles generally accepted in the United States of America and this requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial
statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates on
historical experience and on various other assumptions that are believed to be reasonable under the circumstances. The most
significant accounting estimates with regard to these consolidated financial statements that require the most significant and
subjective judgments include, but are not limited to, useful lives of property, plant and equipment,recoverability of long-lived
assets, determination of impairment losses, assessment of market value of inventories and provision for inventory obsolescence,
allowance for doubtful accounts, recognition and measurement of deferred income taxes, valuation allowance for deferred tax assets,
and assumptions used for the valuation of share based payments. Accordingly, actual results may differ significantly from these
estimates under different assumptions or conditions.

(e) Cash and Cash Equivalents

Cash and cash equivalents consist of all cash balances and highly
liquid investments with original maturities of three months or less. Because of short maturity of these investments, the carrying
amounts approximate their fair values.

(f)  Allowance
for Doubtful Accounts

We make estimates of the uncollectibility of accounts
receivable, especially analyzing accounts receivable and historical bad debts, customer concentrations, customer credit-worthiness, current
economic trends and changes in customer payment terms, when evaluating the adequacy of the allowance for doubtful accounts. Credit evaluations
are undertaken for all major sale transactions before shipment is authorized. On a quarterly basis, we evaluate aged items in the accounts
receivable aging report and provide an allowance in