Company: XXC
Filing Date: 2025-11-18
Form Type: 20-F
Source: 0001213900-25-111691
Chunk: 84

Company: XINXU COPPER INDUSTRY TECHNOLOGY Ltd
Filing Date: 2025-11-18
Form: 20-F
Item: Item 19
Chunk 84
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izes the inputs used to measure fair value. The hierarchy requires entities to maximize
the use of observable inputs and minimize the use of unobservable inputs. The three levels of input used to measure fair value are as
follows:

  Level 1 inputs to the valuation methodology are quoted prices  

  Level 2 inputs to the valuation methodology include quoted                                                                                   

  Level 3 inputs to the valuation methodology use one or more                                                                                        

For the Company’s financial instruments, including cash, loan receivables, accounts receivable, other receivables, other current
assets, accounts payable, other current liabilities, due to related parties, and short-term borrowings, the carrying amounts approximate
their fair values due to their short maturities as of June 30, 2025 and 2024.

F-11

XINXU COPPER INDUSTRY TECHNOLOGY LIMITED

NOTE 2 - SIGNIFICANT ACCOUNTING
POLICIES(cont.)

Value-added Tax (“ VAT”)

Sales revenue represents the
invoiced value of goods, net of VAT. All the Company’s products that are sold in the PRC are subject to a VAT on the gross
sales price. The Company is subject to a VAT rate of17% before May 1, 2018,16% on and after May 1, 2018, and a new VAT rate
of13% effective onApril 1, 2019. The VAT may be offset by VAT paid by the Company on raw materials and other materials included
in the cost of producing or acquiring its finished products.

Revenue Recognition

The Company generates its revenues
mainly from (1) sales of self-manufactured copper products, such as T2 purple copper bars, tin-plated copper bars, copper
rods, and electrolytic copper, to third-party customers, who are mainly distributors and retailers; (2) resales of copper materials,
primarily electrolytic copper; and (3) service income for processing copper bars as per customer’s requirements. The Company
follows Financial Accounting Standards Board (FASB) ASC 606 and accounting standards updates (“ ASU”) 2014-09 for
revenue recognition. On July 1, 2018, the Company early adopted ASU 2014-09, which is a comprehensive new revenue recognition
model that requires revenue to be recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects
the consideration expected