Company: QSJC
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001683168-25-008383
Chunk: 38

Company: TANCHENG GROUP CO., LTD.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 38
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 and liabilities are translated at exchange
rates at the balance sheet date and revenue and expenses are translated at the average exchange rates for the reporting period and equity
is translated at historical exchange rates. Any translation adjustments resulting are not included in determining net income but are included
in foreign exchange adjustments to other comprehensive income, a component of equity.

Transactions in currencies other than the functional
currencies during the year are converted into the applicable functional currencies at the applicable rates of exchange prevailing at the
dates of the transactions. Exchange gains and losses are recognized in the statements of operations.

The exchange rates utilized as follows:

    Schedule of exchange rates 

    September 30, 2025  
    September 30, 2024 
  
    Period-end RMB exchange rate 
     7,12  
     7.02 
  
    Annual average RMB exchange rate 
     7.22  
     7.19 

No representation is made that the RMB amounts could
have been, or could be, converted into U.S. dollars at the rates used in translation.

     9 

(h) Foreign Currency Risk

The RMB is not a freely convertible currency. The
State Administration for Foreign Exchange, under the authority of the People’s Bank of China, controls the conversion of the RMB
into other currencies. The value of the RMB is subject to changes in central government policies and to international economic and political
developments affecting supply and demand in the China Foreign Exchange Trading System market. All the Company’s cash and cash equivalents
are in RMB.

(i) Fair Value

Fair value is the price that would be received from
selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining
the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal
or most advantageous market in which it would transact, and it considers assumptions that market participants would use when valuing the
asset or liability. Authoritative literature provides a fair value hierarchy that prioritizes the inputs to valuation techniques used
to measure fair value into three broad levels. The level in the hierarchy within which the fair value measurement in its entirety falls
is based upon the lowest level of input that is significant to the fair value measurement as follows:

Level 1

Level 1 applies to assets or liabilities for
which there are quoted prices in active markets for identical assets or liabilities.

Level 2