Company: JUNS
Filing Date: 2025-08-19
Form Type: 10-Q
Source: 0001641172-25-024684
Chunk: 5

Company: JUPITER NEUROSCIENCES, INC.
Filing Date: 2025-08-19
Form: 10-Q
Item: Item 8
Chunk 5
---
 1: Observable inputs such as quoted prices (unadjusted)
in active markets for identical assets or liabilities.

  ●
  Level 2: Inputs, other than quoted prices that are observable,
either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are
not active.

  ●
  Level 3: Unobservable inputs in which little or no market data
exists, therefore developed using estimates and assumptions developed by us, which reflect those that a market participant would use.

In instances where the determination of the fair value
measurement is based on inputs from different levels of the Fair Value Hierarchy, the level in which the fair value of a financial instrument
is classified is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s
assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors
specific to the asset or liability.

The carrying amounts reported in the
condensed consolidated balance sheet for cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate
fair value based on the short-term maturity of these instruments. The amount reported in the condensed consolidated balance sheet for
note payable, related party approximates fair value as the interest rate substantially equivalent the Company’s incremental borrowing
rate for an instrument with similar terms and time to maturity.

See
Note 5 - Convertible Debt and Derivative Liability.

    11

JUPITER
NEUROSCIENCES, INC.

NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE
30, 2025

Note
2 – Significant Accounting Policies, continued

Derivative
Instruments

Derivative
instruments measured at fair value. Gains or losses resulting from changes in the fair value of derivatives instruments recorded as assets
or liabilities are recognized in earnings at each reporting period.

Leases

Operating
lease right-of-use (“ROU”) assets and related operating lease liabilities
are recognized based on the present value of future minimum lease payments over the expected term of the lease after taking into account the likelihood of renewals and extensions.at inception. In the
event an implicit interest rate is not present in the lease agreement, the Company utilizes its incremental borrowing rate at lease inception
in order to determine the present value. Short term leases with an initial term of less than twelve months are expensed as incurred.

Note