Company: DTCK
Filing Date: 2025-12-23
Form Type: 6-K
Source: 0001683168-25-009327
Chunk: 13

Company: DAVIS COMMODITIES Ltd
Filing Date: 2025-12-23
Form: 6-K
Chunk 13
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 matter.

(n) Revenue recognition

In May 2014, the Financial Accounting
Standards Board (“FASB”) issued Topic 606, “Revenue from Contracts with Customers”. This topic clarifies the
principles for recognizing revenue and develops a common revenue standard for U.S. GAAP. Simultaneously, this topic supersedes the
revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance throughout the Industry
Topics of the Codification. The core principle of the guidance requires an entity to recognize revenue to depict the transfer of
promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in
exchange for those goods or services.

The Company currently generates its revenue from
the following main sources:

Revenue from goods sold and services provided

Revenue from sales of goods and services in the
ordinary course of business is recognized when the Company satisfies a performance obligation (“PO’’) by transferring
control of a promised good or service to the customer. The amount of revenue recognized is the amount of the transaction price allocated
to the satisfied PO.

The transaction price is allocated to each
PO in the contract on the basis of the relative stand-alone selling prices of the promised goods or services. The individual stand-alone
selling price of a good or service that has not previously been sold on a stand-alone basis, or has a highly variable selling price, is
determined based on the residual portion of the transaction price after allocating the transaction price to goods and/or services with
observable stand-alone selling price. A discount or variable consideration is allocated to one or more, but not all, of the performance
obligations if it relates specifically to those performance obligations.

Transaction price is the amount of consideration
in the contract to which the Company expects to be entitled in exchange for transferring the promised goods or services. The transaction
price may be fixed or variable and is adjusted for the time value of money if the contract includes a significant financing component.
Consideration payable to a customer is deducted from the transaction price if the Company does not receive a separate identifiable benefit
from the customer. When consideration is variable, if applicable, the estimated amount is included in the transaction price to the extent
that it is highly probable that a significant reversal of the cumulative revenue will not occur when the uncertainty associated with the
variable consideration is resolved.

| F-12 |

Revenue may be recognized at a point in time or
over time following the timing of satisfaction of the PO