Company: LRHC
Filing Date: 2025-05-29
Form Type: 10-Q
Source: 0001213900-25-048370
Chunk: 9

Company: La Rosa Holdings Corp.
Filing Date: 2025-05-29
Form: 10-Q
Item: Item 1
Chunk 9
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 Company as of and for the year ended
December 31, 2024, included in the Company’s Annual Report on Form 10-K. The condensed consolidated balance sheet as of December
31, 2024 was derived from the Company’s audited financial statements referred to above.

Accounts Receivable and Allowance for Credit
Losses

The Company’s trade accounts receivable consist of balances due
from agents, tenants, franchisees, and commissions for closings and are presented on the consolidated balance sheets net of the allowance
for credit losses. Management determines the allowance for expected credit losses based upon historical experiences as well as current
conditions that affect the collectability of the reported amount and regularly evaluates individual customer receivables and considering
financial condition, credit history, current economic conditions and other relevant factors, in setting specific reserves for certain
accounts. Receivables are written off once they are deemed uncollectible, which may arise when the debtor is deemed unable to pay the
amounts owed to the Company. The allowance for credit losses was $312,247 and $166,504 as of March 31, 2025 and December 31, 2024, respectively.
Estimates of uncollectible accounts receivable are recorded to general and administrative expense.

The activity for the allowance for credit losses during the three
months ended March 31, 2025 and 2024 is set forth in the table below:

    Balance at  
       
    Deductions  
    Balance at 

    Beginning of  
    Charged to  
    from the  
    End of 

    Period  
    Expenses  
    Allowance  
    Period 
  
    Three Months ended March 31, 2025 Allowance for Credit Losses 
    $166,504  
    $145,743  
    $-  
    $312,247 
  
    Three Months ended March 31, 2024 Allowance for Credit Losses 
    $83,456  
    $17,136  
    $(1,149) 
    $99,443 

Liquidity – Going Concern and Management’s
Plans

On March 31, 2025, the Company had a cash balance of $4.9 million and
negative working capital of $94.0 million.

On February 4, 2025 (the “Closing Date”),
the Company entered into a Securities Purchase Agreement (the “SPA”),