Company: LDDD
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-013782
Chunk: 15

Company: Longduoduo Co Ltd
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 1
Chunk 15
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811 and
$923 as of December 31, 2024 and June 30, 2024, respectively. Management’s provision for sales returns and allowances was 1.4%
and 1.13%, respectively, of the total service revenue for the three months ended December 31,
2024 and 2023

The Company typically collects fees before delivery
of healthcare packages. Amounts received from a customer before the delivery of the healthcare package are recorded as deferred revenue
on the Consolidated Balance Sheets.

Commission
Revenue

Commencing in the three months ended June 30,
2023, the Company started offering in a sales agent capacity healthcare service and product packages of a third-party provider. The third
party is responsible for fulfillment of the services to the customer and the Company has no performance commitment or liability to the
customer. The Company receives deposits from the customers, remits to the third-party provider the provider’s contracted amounts,
and retains the remaining amounts as commission revenue. The commission revenue is recognized upon acceptance of the customer contract
by the third-party provider and is presented on a net basis in the Statement of Operations and Comprehensive Income (Loss).

Cost of Revenues

Cost of service revenue consists primarily of
the cost of healthcare service packages purchased from third party healthcare service providers to fulfill contracts with customers.

Cost of product revenue consists primarily of
the cost of healthcare products purchased from suppliers. Cost of product revenue is recognized when the product has been delivered to
the customer.

F-9

LONGDUODUO COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED DECEMBER 31, 2024 AND
DECEMBER 31, 2023

(UNAUDITED)

M. Income
taxes

The Company follows FASB ASC Section 740, Income
Taxes, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that
have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences
in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end
based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.
Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC 740-10-