Company: QXO-PB
Filing Date: 2025-03-04
Form Type: 10-K
Source: 0001628280-25-009626
Chunk: 19

Company: QXO, Inc.
Filing Date: 2025-03-04
Form: 10-K
Item: Item 16
Chunk 19
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198 3,943 Property and equipment4,297 4,109 Less: Accumulated depreciation and amortization(3,852)(3,606)Property and equipment, net$445 $503 Depreciation expense related to these assets for the years ended December 31, 2024 and 2023 was $246,900 and $328,900, respectively.

34

Revenue RecognitionThe Company has elected the significant financing component practical expedient in accordance with ASC 606, Revenue from Contracts with Customers. In determining the transaction price, the Company does not adjust the promised amount of consideration for the effects of a significant financing component as the Company expects, at contract inception, that the period between when the entity transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less.The Company determines revenue recognition through the following five steps:•Identify the contract with a customer;•Identify the performance obligations in the contract;•Determine the transaction price;•Allocate the transaction price to the performance obligation in the contract; and•Recognize revenue when or as the entity satisfies a performance obligationSoftware product revenue is recognized when the product is delivered to the customer and the Company’s performance obligation is fulfilled.Service revenue is recognized when the professional consulting, maintenance or other ancillary services are provided to the customer. Most of our service revenue is based on time arrangements which require the client to pay based on the number of hours worked at agreed-upon rates. The Company recognizes revenues for these arrangements based on hours incurred and contracted rates utilizing a right-to-invoice practical expedient because we have a right to consideration for services completed to date. For all performance obligations related to contracts with a duration for less than one year, the Company has elected to apply the optional exemption provided in ASC 606 and, therefore, is not required to disclose the aggregate amount of transaction price allocated to performance obligations that are unsatisfied or partially satisfied at the end of the reporting period.With respect to professional, maintenance, and ancillary services revenue that are included in deferred revenue, these revenues are earned and recognized over the contractual or stated period, which generally ranges three to twelve months. Deferred revenue also includes deposits for future consulting, which are recognized when earned and billed to customer.Maintenance and subscription revenue is recognized on a gross basis when the Company primarily acts as the principal in these transactions. Maintenance and subscription revenue is recognized on a net basis when the Company primarily acts as an agent in a transaction.Shipping