Company: LHI
Filing Date: 2025-11-20
Form Type: F-1/A
Source: 0001213900-25-112807
Chunk: 121

Company: Living Homeopathy International Ltd.
Filing Date: 2025-11-20
Form: F-1/A
Chunk 121
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| 4. | Allocate                                                                  
 the transaction price to the performance obligations in the contract; and |

| 5. | Recognize                                                           
 revenue when (or as) the entity satisfies a performance obligation. |

The Company primarily generates revenue from
sales of healthcare products, personal care products and water filters and related products to individuals and distributors. The Company
recognizes revenue when payment is tendered at the point of sale as the performance obligation has been satisfied. The single performance
obligation is satisfied at a point in time when the product has been delivered to the customer and control has been passed to the customer,
no obligation is outstanding, and the Company is reasonably assured that funds have been or will be collected from the customer, i.e.,
customers settled the amount by cash or credit card. Product acceptance is evidenced by sales invoice signed by the customer upon checkout
in the Company’s office. The transaction price is determined based on a fixed consideration in the contract with customers. There
is no variable consideration, significant financing components or noncash consideration in the contracts with customers. The transaction
price is clearly identifiable on the price list and revenue is recognized net of discounts. The Company generally does not offer return
in exchange for cash or credit. The Company offers returns in exchange for a product replacement within 7 days from the date of sales
in case of product defects. The Company determines that such a product warranty is not a separated performance obligation because the
nature of warranty is to provide assurance that a product will function as expected and in accordance with the customer’s specification
and the Company does not sell the warranty separately. As of March 31, 2025 and 2024, provisions for warranty cost of $490 and $Nil,
respectively, were recognized taking historical record into consideration.

Inventories, net

Inventories consist of raw materials and finished
goods and are stated at the lower of cost or net realizable value. The cost of inventories is calculated using the weighted average basis.
Cost of inventories sold is charged to cost of revenue, which also includes inbound freight cost and packaging fee. Adjustments are recorded
to write down the cost of inventories to the estimated net realizable value for slow-moving merchandises and damaged goods, which are
dependent upon factors such as historical and forecasted consumer demand, and other market conditions. The Company takes ownership, risks
and rewards of its inventories, and has sole discretion in establishing prices for goods to be sold. Write downs are recorded in