Company: PDEX
Filing Date: 2025-10-30
Form Type: 10-Q
Source: 0001079973-25-001655
Chunk: 2

Company: PRO DEX INC
Filing Date: 2025-10-30
Form: 10-Q
Item: Item 8
Chunk 2
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 included in
deferred revenue in the prior year. The revenue recognized from the contract liabilities consisted of satisfying our performance obligations
during the normal course of business.

The
following tables summarize our contract assets and liability balances (in thousands):

    Schedule of contract assets and liability 

    As of
    and for the Three Months Ended September 30, 

    2025  
    2024 
  
    Contract assets beginning balance	 
    $24  
    $262 
  
    Expenses incurred during the year	 
     84  
     57 
  
    Amounts reclassified to cost of sales	 
     (76) 
     (102)
  
    Amounts allocated to discounts for standalone selling price	 
     —  
     (6)
  
    Contract assets ending balance	 
    $32  
    $211 

    As of
    and for the Three Months Ended September 30, 

    2025  
    2024 
  
    Contract liabilities beginning balance	 
    $202  
    $14 
  
    Payments received from customers	 
     —  
     — 
  
    Amounts reclassified to revenue	 
     (80) 
     (14)
  
    Contract liabilities ending balance	 
    $122  
    $— 

    7 
    PRO-DEX INC. AND SUBSIDIARYNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(UNAUDITED) 

NOTE 4. FAIR VALUE MEASUREMENTS

Fair
value is defined as the price that would be received from selling an asset or paid to transfer a liability (i.e., the “exit price”)
in an orderly transaction between market participants at the measurement date. In determining fair value, the use of various valuation
methodologies, including market, income, and cost approaches is permissible. We consider the principal or most advantageous market in
which it would transact and assumptions that market participants would use when pricing the asset or liability.

Fair
Value Hierarchy. The accounting guidance for fair value measurements establishes a fair value hierarchy that requires an entity to
maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of
inputs that may be used to measure fair value based on the reliability of inputs. A financial instrument’s categorization within
the fair value hierarchy is based on