Company: CDT
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010405
Chunk: 77

Company: CDT Equity Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 77
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 or services to be received in the future for use in research and development activities are recorded
as prepaid expenses. Such amounts are recognized as an expense as the goods are delivered or consumed or the related services are performed,
or until it is no longer expected that the goods will be delivered, or the services rendered.

    8

Income
Taxes

ASC
Topic 740, Income Taxes, sets forth standards for financial presentation and disclosure of income tax liabilities and expense.
Interest and penalties recognized have been classified in the unaudited condensed consolidated statements of operations and comprehensive
loss as income taxes. Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences
between the financial statement carrying amount of existing assets and liabilities and their respective tax bases and operating losses
carried forward. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the
years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities
of a change in tax rates is recognized in the unaudited condensed consolidated statements of operations and comprehensive loss in the
period that includes the enactment date. The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance for
any tax benefits of which future realization is uncertain.

Earnings/(Net
Loss) per Share Attributable to Common Stockholders

The
Company calculates basic and diluted earnings/(net loss) per share under ASC Topic 260, Earnings Per Share. Basic earnings/(net
loss) per share is computed by dividing the net income/(loss) by the number of weighted-average common shares outstanding for the period.
Diluted earnings/(net loss) is computed by adjusting net income/(loss) based on the impact of any dilutive instruments. Diluted earnings/(net
loss) per share is computed by dividing the diluted net income/(loss) by the number of weighted-average common shares outstanding for
the period including the effect, if dilutive, of any instruments that can be settled in common shares. When computing diluted net income/(loss)
per share, the numerator is adjusted to eliminate the effects that have been recorded in net income/(loss) (net of tax, if any) attributable
to any liability-classified dilutive instruments.

Warrants

The
Company determines the accounting classification of Warrants as either liability or equity by first assessing whether the Warrants meet
liability classification in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480