Company: SIDU
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023543
Chunk: 97

Company: Sidus Space Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 2
Chunk 97
---
 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.

45

These
five elements, as applied to each of the Company’s revenue category, are summarized below:

Revenues
primarily from manufacturing related fixed price contracts that are still in progress at month end are recognized on the percentage-of-completion
method, measured by the percentage of total costs incurred to date to the estimated total costs for each contract. This method is used
because management considers total costs to be the best available measure of progress on these contracts. Revenue from fixed price contracts
and time-and-materials contracts that are completed in the month the work was started are recognized when the work is shipped.

Revenues
from fixed price contracts primarily related to the satellite side of the business that require milestone payments are recognized at
the