Company: LASE
Filing Date: 2025-12-23
Form Type: 10-Q
Source: 0001493152-25-028857
Chunk: 15

Company: Laser Photonics Corp
Filing Date: 2025-12-23
Form: 10-Q
Item: Part I, Item 1
Chunk 15
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possession of the leased property for purposes of recognizing lease expense on a straight-line basis over the term of the lease. Lease
renewal periods are considered on a lease-by-lease basis and are generally not included in the initial lease term.

Revenue
Recognition

Under
Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the
consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements
that an entity determines are within the scope of Topic 606, the entity performs 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 entity satisfies a performance
obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration
it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined
to be within the scope of Topic 606, we assess the goods or services promised within each contract and determine those that are performance
obligations and assess 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 (or as) the performance obligation is satisfied.

The Company
also earns revenue through affiliate arrangements. These contracts are evaluated under ASC 606 using the same five-step model. Affiliate
revenue is recognized when the Company satisfies its performance obligations under the affiliate agreement, which typically occurs when
the affiliate completes a qualifying transaction or when the Company provides agreed-upon services. The transaction price is determined
based on the contractual terms with the affiliate, and revenue is recorded in the amount the Company expects to receive.

Revenue
is then recognized for the transaction price allocated to each respective performance obligation when (or as) the performance obligation
is satisfied. For our products, revenue is generally recognized upon shipment or pickup by the customer. At this stage, the title on
the manufactured equipment is transferred to the customer, and the customer is responsible for transportation expenses, insurance, and
any transport-related damage to the equipment in transit. We do not have any obligation to deliver beyond the collection warehouse, and
it is the customers’