Company: FLYE
Filing Date: 2025-08-19
Form Type: 10-Q
Source: 0001213900-25-078571
Chunk: 16

Company: Fly-E Group, Inc.
Filing Date: 2025-08-19
Form: 10-Q
Item: Part I, Item 1
Chunk 16
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 financial institutions may, from time to time, exceed the Federal
Deposit Insurance Corporation’s (the “FDIC”) federally insured limit, which is $250,000. The Company has not incurred
any losses in the past for amount over the FDIC limits. As of June 30, 2025 and March 31, 2025, $920,754 and nil deposited with
banks was uninsured, respectively.

(g) Accounts Receivable

Accounts receivable includes trade account due from customers. Accounts receivable is recorded
at the invoiced amount less an allowance for any credit loss and does not bear interest, which is due after 30 to 90 days,
depending on the credit term with the customers. Accounts receivable which is deemed to be uncollectible is charged off against the allowance
after all means of collection have been exhausted and the potential for recovery is considered remote.

The
Company adopt the current expected credit loss model (“CECL model”) to estimate the expected credit losses, which is determined
by multiplying the probability of default. In determining the probability of default, the Company mainly considers factors such as aging
schedule of receivables, migration rate of receivables, assessment of receivables due from specific identifiable counterparties that are
considered at risk or uncollectible, current market conditions, as well as reasonable and supportable forecasts of future economic conditions. As
of June 30, 2025 and March 31, 2025, the Company provided allowance for credit losses   of
$116,746, consisting of $41,100 related to accounts receivable from a related party customer and $75,646 related to accounts receivable
from a third party customer, respectively.

(h) Inventories, Net

Inventories, consisting of products available for sale, are stated at the lower of cost
or net realizable value using the first-in-first-out method. Adjustments to the carrying value are recorded for estimated obsolescence
or excess inventory equal to the difference between the cost of inventory and the estimated net realizable value based upon assumptions
about future demand and market conditions. Inventory cost consists of the direct cost of merchandise including freight. For the three
months ended June 30, 2025 and 2024, the impairment loss was $229,780 and $176,072, respectively.

(i) Prepayments and Other Receivables

Prepayments
and other receivables are mainly prepayments to