Company: ZRCN
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001493152-25-006748
Chunk: 9

Company: ZRCN Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Item 8
Chunk 9
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, accounts receivable, prepaid expenses and other assets, accounts payable, accrued expenses,
and other current liabilities approximated their fair values as of December 31, 2024 and March 31, 2024 due to their short-term nature.
Management measures intangible assets at fair value on a non-recurring basis using internally developed assumptions about the market
as there is no market activity available. All carrying amounts of other applicable assets and liabilities on the Company’s balance
sheet approximate fair value. For long-term debt, the estimated fair value approximates its carrying value, as the interest rate is in
line with the market interest rates for this type of debt.

Income
Taxes

Income
taxes are recorded in accordance with ASC 740, Income Taxes (“ASC 740”), which provides for deferred taxes using an
asset and liability approach. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of
events that have been included in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on
the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year
in which the differences are expected to reverse. Valuation allowances are provided, if based upon the weight of available evidence,
it is more likely than not that some or all of the deferred tax assets will not be realized. The Company accounts for uncertain tax positions
in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions
to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination
as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as
consideration of the available facts and circumstances. Management believes estimates related to income tax uncertainties are appropriate
based on current facts and circumstances. The Company’s conclusions regarding uncertain tax positions may be subject to review
and adjustment at a later date based upon ongoing analyses of tax laws, regulations and interpretations thereof, as well as, other factors.
Any interest and penalties related to income tax matters are classified as a component of income tax expense.

As
of April 14, 2023, Zircon’s election to be an S Corporation under the Internal Revenue Code was no longer in effect.

Net
Income (Loss) Per Share

Basic
net income (loss) per share of common stock is computed by dividing net income or loss attributable to ZRC