Company: ZDAN
Filing Date: 2025-07-28
Form Type: F-1/A
Source: 0001683168-25-005450
Chunk: 297

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-07-28
Form: F-1/A
Chunk 297
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 are expensed as incurred. Contract acquisition costs are amortized
over the period the costs are expected to contribute directly or indirectly to future cash flows, which is generally over the contract
term, on a basis consistent with the transfer of goods or services to the customer to which the costs relate. Contract fulfillments costs
consist of costs incurred by the Company to fulfill a contract with a customer and are capitalized when the costs generate or enhance
resources that will be used in satisfying future performance obligations of the contract and the costs are expected to be recovered.
Capitalized contract fulfillment costs generally include contracted services, direct labor, materials, and allocable overhead directly
related to resources required to fulfill the contract. Contract fulfillment costs are recognized in cost of revenue during the period
that the related costs are expected to contribute directly or indirectly to future cash flows, which is generally over the contract term,
on a basis consistent with the transfer of goods or services to the customer to which the costs are related. There were no contract acquisition
costs and fulfillment costs as of September 30, 2024 and 2023.

Contract balance

When a revenue contract has been performed, the
Company presents the contract in the consolidated balance sheet as a contract asset or a contract liability, depending on the relationship
between the Company’s performance and the customer’s payment. The contract assets consist of accounts receivable and deferred
cost. Accounts receivable represent revenue recognized for the amounts invoiced and/or prior to invoicing when the Company has satisfied
its performance obligation and has unconditional right to the payment. Deferred cost is deferred for the contract preparation and will
be recognized as cost of revenues when goods or services are transferred to customers.

| F-15 |

The contract liabilities consist of advance from
customers, which represent the billings or cash received for services or product sales in advance of revenue recognition and are recognized
as revenue when all of the Company’s revenue recognition criteria are met. For the years ended September 30, 2024 and 2023, the
contract liabilities at the beginning of the reporting period, which amounted to $287,369 and $5,909,534, respectively, have been recognized
as revenue during the years. The Company’s contract liability amounted to $420,756 and $363,433 as of September 30, 2024 and 2023,
respectively. The Company expects to recognize this balance as revenue over the next 12 months.

Government Subsidies

Government subsidies are recognized when received
and