Company: MIRA
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001641172-25-001183
Chunk: 1263

Company: MIRA PHARMACEUTICALS, INC.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 10
Chunk 1263
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total revenues, total expenses, and expenses by functional classification;  using this information to make decisions on a company-wide
basis.

Fair
value of financial instruments

The
Company measures the fair value of financial instruments in accordance with GAAP which defines fair value, establishes a framework for
measuring fair value, and expands disclosures about fair value measurements.

GAAP
defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal
or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
GAAP also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use
of unobservable inputs when measuring fair value. The Company considers the carrying amount of deferred offering costs to approximate
fair value due to short-term nature of this instrument. GAAP describes three levels of inputs that may be used to measure fair value:

Level
1 - quoted prices in active markets for identical assets or liabilities.

Level
2 - quoted prices for similar assets and liabilities in active markets or inputs that are observable.

Level
3 - inputs that are unobservable (for example cash flow modeling inputs based on assumptions).

Contingencies

In
the normal course of business, the Company may be subject to loss contingencies, such as legal proceedings, amounts arising from contractual
arrangements and claims arising out of the Company’s business that cover a wide range of matters, including, among others, government
investigations, shareholder lawsuits, and tax matters. In accordance with ASC Topic 450, Accounting for Contingencies, (ASC 450),
the Company records accruals for such loss contingencies when it is probable that a liability will be incurred, and the amount of loss
can be reasonably estimated. The Company, in accordance with this guidance, does not recognize gain contingencies until realized or realizable.

Earnings
per Share

Earnings
(loss) per share is computed in accordance with ASC Topic 260, “Earnings per Share” Basic weighted-average number
of shares of common stock outstanding for the year ended December 31, 2024 and December 31, 2023 include the shares of the Company issued
and outstanding during such period, on a weighted average basis. The basic weighted average number of shares of common stock outstanding
excludes common stock equivalents such as stock options and warrants, while diluted weighted average number of shares outstanding includes
such