Company: LDDD
Filing Date: 2025-09-26
Form Type: 10-K
Source: 0001213900-25-091988
Chunk: 378

Company: Longduoduo Co Ltd
Filing Date: 2025-09-26
Form: 10-K
Item: Item 4
Chunk 378
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 notification from the customers. The liability for sales returns and allowances relating to the sale of healthcare service
packages amounted to $208 and $923 as of June 30, 2025 and June 30, 2024, respectively. Management’s provision for sales
returns and allowances was 1.60% and 1.13%, respectively, of the total service revenue for the years ended June 30, 2025 and
2024.

The
Company typically collects fees before delivery of healthcare packages. Amounts received from a customer before the delivery of the healthcare
package are recorded as deferred revenue on the Consolidated Balance Sheets.

Commission
Revenue

Commencing
in the three months ended June 30, 2023, the Company started offering in a sales agent capacity healthcare service and product packages
of a third-party provider. The third party is responsible for fulfillment of the services to the customer and the Company has no performance
commitment or liability to the customer. The Company receives deposits from the customers, remits to the third-party provider the provider’s
contracted amounts, and retains the remaining amounts as commission revenue. The commission revenue is recognized upon acceptance of
the customer contract by the third-party provider and is presented on a net basis in the Statement of Operations and Comprehensive Income.

Cost
of Revenues

Cost
of service revenue consists primarily of the cost of healthcare service packages purchased from third party healthcare service providers
to fulfill contracts with customers.

Cost
of product revenue consists primarily of the cost of healthcare products purchased from suppliers. Cost of product revenue is recognized
when the product has been delivered to the customer.

F-11

LONGDUODUO
COMPANY LIMITED AND SUBSIDIARIES

NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS

FOR
THE YEARS ENDED JUNE 30, 2025 AND JUNE 30, 2024

L.
Income taxes

The
Company follows FASB ASC Section 740, Income Taxes, which requires the recognition of deferred tax assets and liabilities
for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method,
deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities
and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods
in which the differences are expected to affect taxable income. Valuation allowances are established, when