Company: LDDD
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001213900-25-108744
Chunk: 15

Company: Longduoduo Co Ltd
Filing Date: 2025-11-12
Form: 10-Q
Item: Part I, Item 1
Chunk 15
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 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 necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC 740-10-30 requires income tax positions to
meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under ASC 740-10-30, tax positions that
previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in
which that threshold is met.

The application of tax laws and regulations is
subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a
result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability
may be materially different from our estimates, which could result in the need to record additional tax liabilities or potentially reverse
previously recorded tax liabilities or the deferred tax asset valuation allowance.

As a result of the implementation of ASC 740-10,
the Company made a comprehensive review of its portfolio of tax positions in accordance with recognition standards established by ASC
740-10. The Company recognized no material adjustments to liabilities or shareholder’s equity as a result of the implementation.

M. Earnings (loss) per share

The Company computes earnings (loss) per share
(“EPS”) in accordance with ASC 260, Earnings Per Share. ASC 260 requires companies with complex capital structures
to present basic and diluted EPS. Basic EPS is measured as net income (loss) divided by the weighted average common shares outstanding
during the period.

Diluted EPS is similar to basic EPS but presents
the dilutive effect on a per share basis of contracts to issue common shares (e.g., convertible securities, options and warrants) as if
they had been converted at the beginning of the periods presented, or issuance date, if later. The computation of diluted EPS includes
the estimated impact of the exercise of contracts to purchase common stock using the treasury stock method and the potential shares of
converted common stock associated with the convertible debt using