Company: LRHC
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032211
Chunk: 1909

Company: La Rosa Holdings Corp.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 6
Chunk 1909
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Revenue Recognition

The Company applies the provision of FASB ASC
606, Revenue from Contracts with Customers (“ASC 606”). The Company measures revenue within the scope of ASC 606 by
applying the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract;
(iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize
revenue when (or as) the Company satisfies a performance obligation. At contract inception, the Company assesses the goods or services
promised within each contract that falls under the scope of ASC 606, determines those that are performance obligations and assesses whether
each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated
to the respective performance obligation when the performance obligation is satisfied. The application of these five steps necessitates
the development of assumptions that require judgment.

The Company records revenue based upon the consideration
specified in the client arrangement, and revenue is recognized when the performance obligations in the client arrangement are satisfied.
A performance obligation is a contractual promise to transfer a distinct good or service to the customer. The transaction price of a contract
is allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance
obligation. Under ASC 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects
the consideration the Company expects to receive in exchange for those goods or services.

Real Estate Brokerage Services (Residential
and Commercial)

The Company serves as a licensed broker
in the areas in which it operates for the purpose of processing residential real estate transactions. Revenue from real estate brokerage
services (residential) mainly consists of commissions generated from real estate brokerage services. The Company is contractually obligated
to provide for the fulfillment of transfers of real estate between buyers and sellers. The Company provides these services itself and
controls the services of its agents necessary to legally transfer the real estate. Consequently, the Company is defined as the principal
in the transaction. The Company, as principal, satisfies its obligation upon the closing of a real estate transaction. The Company has
concluded that agents are not employees of the Company, rather deemed to be independent contractors. Upon satisfaction of its obligation,
the Company recognizes revenue in the gross amount of consideration it is entitled to receive. The transaction price is calculated by
app