Company: VEEAW
Filing Date: 2025-01-10
Form Type: S-1/A
Source: 0001213900-25-002716
Chunk: 196

Company: VEEA INC.
Filing Date: 2025-01-10
Form: S-1/A
Chunk 196
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 these adjustments include changes in future demand forecasts,
market conditions, technological changes, product life cycle and development plans, component cost trends, product pricing, physical
deterioration, and quality issues. The write down for excess or obsolescence is charged to the provision for inventory, which is a component
of Cost of Goods Sold in the Company’s consolidated statements of operations and comprehensive loss. At the point of the loss recognition,
a new, lower cost basis for that inventory is established, and subsequent changes in facts and circumstances do not result in the restoration
or increase in that newly established cost basis.

Cost of Goods Sold

Cost of goods sold consists
primarily of the cost of finished goods, components purchased for manufacturing and freight. Cost of goods sold also includes third-party
vendor costs related to cloud hosting fees.

Shipping and Handling

The Company considers shipping
and handling to customers to represent activities performed in fulfilling the contract with the customer. When shipping is charged to
the customer, the Company nets such charges against actual shipping costs incurred.

Tax Collected from Customers

Taxes imposed by governmental
authorities on the Company’s revenue producing activities, such as sales taxes, are excluded from net sales.

Research and Development

Research and development
(“R&D”) costs that do not meet the criteria for capitalization are expensed as incurred. R&D costs primarily consist
of employee compensation, employee benefits, stock-based compensation related to technology developers and product management employees,
as well as fees paid for outside services and materials.

Sales and Marketing

Sales and marketing costs
consist of compensation and other employee related costs for personnel engage in selling and marketing, and sales support functions.
Selling expenses also include marketing, and the costs associated with customer evaluations. The Company does not incur advertising costs.

<div align='center'>F-14

Veea Inc. and Subsidiaries
Notes to Consolidated Financial Statements
Years Ended December 31, 2023 and 2022</div>

3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(cont.)

General and Administrative Expense

General and administrative
expense consists of compensation expense (including stock-based compensation expense), executive management, finance, legal, tax, and
human resources. General and administrative expense also include transaction costs, expenses associated with facilities, information
technology, external professional services, legal costs and settlement of legal claims and other administrative expenses.

Property and Equipment, net

Property and equipment,
net is stated at cost and depreciated on a straight-line basis of