Company: OMTK
Filing Date: 2025-04-16
Form Type: 10-K/A
Source: 0001096906-25-000528
Chunk: 57

Company: Omnitek Engineering Corp
Filing Date: 2025-04-16
Form: 10-K/A
Chunk 57
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ables based on a review of all outstanding amounts on a monthly basis. Management determines the allowance for doubtful accounts by identifying troubled accounts and by using historical experience applied to an aging of accounts. Trade receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when received. Allowance for doubtful accounts for the years ended December 31, 2024, and 2023, was $ 0and $ 0, respectively. Additionally, bad debt expense for the years ended December 31, 2024, and 2023, was $ 0and $ 0, respectively. e. Inventories Inventories are stated at the lower of net realizable value, or average cost basis. The Company reviews inventories on hand at least annually and records provisions for estimated excess, slow moving and obsolete inventory, as well as inventory with a carrying value in excess of net realizable value. The regular and systematic inventory valuation reviews include a current assessment of future product demand, historical experience and product expiration. Accordingly, the Company has established an allowance for the cost of such obsolete inventory. f. Long-Lived Assets The Company assesses the recoverability of its long-lived assets annually and whenever circumstances indicate that there may be an impairment. The Company compares the estimated undiscounted future cash flows to the carrying Page F-7 OMNITEK ENGINEERING CORP. Notes to Financial Statements December 31, 2024, and 2023 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) value of the long-lived assets to determine if impairment has occurred. In the event that impairment has occurred, the Company recognize the impairment immediately. No impairment expense was recognized as of December 31, 2024, or 2023. g. Property and Equipment Property and equipment are recorded at cost. Depreciation and amortization are calculated on the straight-line method over the shorter of the lease term or the estimated useful lives of the assets ranging from three- to- five years. h. Revenue Recognition In general, revenue is recognized when control of the promised goods is transferred to our customers, in an amount that reflects the consideration to which we expect to be entitled in exchange for the goods or services. In order to achieve that core principle, a five-step approach is applied: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction