Company: SWAGW
Filing Date: 2025-04-14
Form Type: 10-K
Source: 0001213900-25-031596
Chunk: 1590

Company: Stran & Company, Inc.
Filing Date: 2025-04-14
Form: 10-K
Item: Item 7A
Chunk 1590
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. If we conclude based on our qualitative assessment that it is more likely than not that
the fair value of a reporting unit is less than its carrying value, we then measure the fair value of the reporting unit and compare its
fair value to its carrying value (Step 1 of the goodwill impairment test). The majority of the inputs used in the discounted cash flow model
are unobservable and thus are considered to be Level 3 inputs. The inputs for the market capitalization calculation are considered Level
1 inputs.

13.Revenue Recognition - The Company accounts for revenue under ASC 606, Revenue for Contracts with Customers
(“ASC 606”). Revenue is generated through various types of transactions, including promotional product sales, administering
a customer’s rewards program, administering redemption code programs, and additional contract add-ons to enhance customer experience.
The Company follows the five step model of revenue recognition:

i.identify the contract(s) with a customer;

ii.identify the performance obligations in the contract;

iii.determine the transaction price;

iv.allocate the transaction price to the performance obligations within the contract; and

v.recognize revenue when (or as) the entity satisfies a performance obligation.

The Company’s contract assessment
and approval varies based on whether the customer requests a one-time sale or a long-term contract. Customers with long-term contracts
require signed Master Sales Agreements, while one-time sales contracts may be approved via email, electronic signature, or verbally. Once
the contract is identified and approved, the Company assesses the goods or services promised within the contract to determine whether
each promised good or service is a performance obligation. The Company identifies each piece of promotional product as an individual performance
obligation based on the following fact pattern. Customers can benefit from each item of promotional product produced on its own. Each
piece of promotional product does not significantly modify or customize other promotional products and are not highly interdependent or
interrelated with each other. The Company can, and frequently does, break portions of contracts into separate shipments to meet Customer
demands. As such, each piece of promotional product is considered a separate and distinct performance obligation.

F-11

STRAN & COMPANY, INC.

NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS

(in thousands, except share and per share amounts)

The transaction price for the majority
of the Company’s sales can be clearly identified in a significant majority of the contracts due to an observable selling price. The transaction
price is then