Company: TOMZ
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001654954-25-013088
Chunk: 11

Company: TOMI Environmental Solutions, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 11
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 in-substance fixed, will be captured as part of our lease components for balance sheet purposes. Furthermore, all variable payments included in lease agreements will be disclosed as variable lease expense when incurred. Generally, variable lease payments are based on usage and common area maintenance. These payments will be included as variable lease expense in the period in which they are incurred. Accounts Payable As of September 30, 2025, one vendor accounted for approximately 46% of accounts payable. As of December 31, 2024, one vendor accounted for approximately 60% of accounts payable. For the three and nine months ended September 30, 2025, two vendors accounted for 59% and 50% of cost of sales, respectively. For the three and nine months ended September 30, 2024, two vendors accounted for 53% and 65% of cost of sales, respectively. 

 11Table of Contents

Accrued Warranties Accrued warranties represent the estimated costs, if any, that will be incurred during the warranty period of our products. We estimate the expected costs to be incurred during the warranty period and record the expense to the consolidated statement of operations at the date of sale. Our manufacturers assume the warranty against product defects from date of sale, which we extend to our customers upon sale of the product. We assume responsibility for product reliability and results.  As of September 30, 2025, and December 31, 2024, our warranty reserve was $22,648 and $30,000, respectively. (See Note 14). Income Taxes Deferred income tax assets and liabilities are determined based on differences between the financial statement reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws in effect when the differences are expected to reverse. The measurement of deferred income tax assets is reduced, if necessary, by a valuation allowance for any tax benefits that are, on a more likely than not basis, not expected to be realized in accordance with FASB ASC Topic 740, Income Taxes guidance for income taxes.  Net deferred tax assets have been fully reserved as of September 30, 2025, and December 31, 2024. Net Income (Loss) Per Share Basic net income or (loss) per share is computed by dividing our net income or (loss) by the weighted average number of shares of common stock outstanding during the period presented. Diluted income or (loss) per