Company: SIDU
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001641172-25-024043
Chunk: 94

Company: Sidus Space Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Item 2
Chunk 94
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 prepared
in accordance with generally accepted accounting principles in the United States (“GAAP”). The preparation of these financial
statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure
of contingent assets and liabilities at the date of the financial statements, as well as the reported expenses incurred during the reporting
periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances,
the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent
from other sources. Actual results may differ from these estimates under different assumptions or conditions. While our significant accounting
policies are described in more detail in the notes to our financial statements included elsewhere in this annual report on Form 10-K,
we believe that the following accounting policies are critical to understanding our historical and future performance, as these policies
relate to the more significant areas involving management’s judgments and estimates.

We
believe our most critical accounting policies and estimates relate to the following:

    ●
    Revenue Recognition

    ●
    Inventory

    ●
    Credit losses

    ●
    Lease Accounting

    ●
    Stock Option and Warrant Valuation

Revenue
Recognition

We
adopted ASC 606 – Revenue from Contracts with Customers using the modified retrospective transition approach. The core principle
of ASC 606 is that revenue should be recognized in a manner that depicts the transfer of promised goods or services to customers in an
amount that reflects the consideration to which the entity expects to be entitled for exchange of those goods or services. Our updated
accounting policies and related disclosures are set forth below, including the disclosure for disaggregated revenue. The impact of adopting
ASC 606 was not material to the Consolidated Financial Statements.

Our
revenue is recognized under Topic 606 in a manner that reasonably reflects the delivery of its services and products to customers in
return for expected consideration and includes the following elements:

    ●
    executed contracts with
    our customers that we believe are legally enforceable;

    ●
    identification of performance
    obligations in the respective contract;

    ●
    determination of the transaction
    price for each performance obligation in the respective contract;

    ●
    allocation of the transaction
    price to each performance obligation; and

    ●
    recognition of revenue
    only when we satisfy each performance obligation.

44

These
five elements, as applied to each of the Company’s