Company: DDC
Filing Date: 2025-01-28
Form Type: 20-F
Source: 0001213900-25-007160
Chunk: 218

Company: DDC Enterprise Ltd
Filing Date: 2025-01-28
Form: 20-F
Item: Item 19
Chunk 218
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 equivalents”.

As of December 31, 2022 and 2023, due to certain
closed and pending legal proceedings, bank accounts with the balances of RMB456,863and RMB497,108were frozen by the banks. Liabilities
related to such legal proceedings were recorded in “ Accrued expenses and other current liabilities” in the consolidated balance
sheets as it is probable that the liabilities have been incurred and the amount of loss can be reasonably estimated.

                                                  As of December 31,                                         
                                                  2022                                    2023               
 ─────────────────────────────────────────────────────────────────────────────────────────────────────────────
                                                  RMB                                     RMB                
  Restricted Cash balances in:                                                                               
  Financial institutions in Chinese mainland                                                                 
  — Denominated in the RMB                                                   456,863                497,108  
  Financial institutions in Hong Kong                                                                        
  — Denominated in the US$                                                69,646,000                -        
  Total Restricted Cash balances                                          70,102,863                497,108  

(j) Short-term Investment

Short-term investment represents the Company’s
investments in financial products managed by financial institutions which are redeemable at the option of the Company on any working day
or have the original maturities of less than twelve months. The Company measures the short-term investments at fair value using the quoted
prices or redemption prices provided by financial institutions at the end of each reporting period, with unrealized holding gains or losses,
net of the related tax effect, excluded from earnings and recorded as a separate component of accumulated other comprehensive loss until
realized. Realized gains or losses from the sale of short-term investments are determined on a specific identification basis and are recorded
as gain on short-term investments when earned in the consolidated statements of operations and comprehensive loss.

(k) Contract Balances

The timing of revenue recognition, billings and
cash collections result in accounts receivable, net and contract liabilities. A contract liability is recognized when the Company has
an obligation to transfer goods or services to a customer for which the Company has received consideration from the customer, or for which
an amount of consideration is due from the customer.

Accounts receivable, net are recognized in the
period when the Company has transferred products or provided services to its customers and when its right to consideration is unconditional.
Amounts collected on accounts receivable, net are included in net cash provided by operating activities in the consolidated statement
of cash flows. In evaluating the collectability of