Company: LASE
Filing Date: 2025-06-24
Form Type: 10-K
Source: 0001641172-25-016194
Chunk: 365

Company: Laser Photonics Corp
Filing Date: 2025-06-24
Form: 10-K
Item: Item 1A
Chunk 365
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 and their ultimate disposition. In instances where
impairment is determined to exist, the Company will write down the asset to its fair value based on the present value of estimated future
cash flows.

Major
customers. While we would expect to depend on current customers for a large percentage of our annual net sales, the
composition of this group can change from year to year. Net sales derived from our current customers as a percentage of our annual net
sales was 17.42% in 2024. New customers accounted for 82.58% of our net sales in 2024. We seek to add new customers and to expand our
relationships with existing customers.

Relationship
with distributors. All orders received on revolving bases in accordance with LPC standard Terms and Conditions of Sale. Orders are not
cancelable. Orders typically consist of multiple units. Payment terms are typically Net 30 days from transferring the ownership of equipment
to Distributor. Revenue recognized on a “piece by piece” equipment bases after appropriate transfer equipment ownership to
Distributor. Payments are made by Distributor to The Company when Distributor collects funds from their regional customers, or then they
have funds availability to reduce the outstanding balance. The company allocates payments in accordance with LPC Accounting practices.
Detailed aging is accounted in MRP system – DBA Manufacturing keeping records of all equipment units ever manufactured with coordinating
serial numbers. Higher level account-related data with payment history is recorded in Company’s Quick Books Accounting software.

42

Distributor
Discounts. Distributors and representatives earn various rebates and discounts based on purchase volume commitments and the achievement
of certain performance KPIs. The company estimates the amount of discounts based on historical volumes, geographical market, end customer
buying potential, and the ordered equipment amount. The company also utilizes various programs to offer volume cash discounts, first
customer discounts, or reimburse distributors for certain expenses, mainly associated with warranty, transportation costs, and inventory
interest costs incurred by the distributor for limited periods of time, generally up to eighteen months.

Repurchase
policy. LPC Operational Management regular conducts evaluation of unsold equipment in Distributors possession and determines what particular
units cannot be sold anymore because of the moral aging. However, after the manufacturing upgrade it can be added back to the finished
goods inventory and sold as a current model. Repurchase records can be viewed in the Repurchase History Records folder.

Critical
Accounting Policies and Estimates

The
preparation of financial statements in conformity with accounting principles generally accepted in