Company: LASE
Filing Date: 2025-06-24
Form Type: 10-K
Source: 0001641172-25-016194
Chunk: 585

Company: Laser Photonics Corp
Filing Date: 2025-06-24
Form: 10-K
Item: Item 1C
Chunk 585
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 may accept returns and provide the distributor with credit against
their trading account at the company’s discretion under its warranty policy. This revenue is recognized on a consignment basis
and transfer of control is when item is sold to end customer at which time the company recognizes revenue.

Fair
Value of Financial Instruments

The
Company applies the accounting guidance under Financial Accounting Standards Board (“FASB”) ASC 820-10, “Fair Value
Measurements”, as well as certain related FASB staff positions. This guidance defines fair value as the price that would be received
from selling an asset or paid to transfer liability in an orderly transaction between market participants at the measurement date. When
determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal
or most advantageous market in which it would transact business and considers assumptions that marketplace participants would use when
pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

The
guidance also establishes a fair value hierarchy for measurements of fair value as follows:

    ☐
    Level
    1 -
    quoted
    market prices in active markets for identical assets or liabilities.

    ☐
    Level
    2 -
    inputs
    other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets
    or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that
    are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

    ☐
    Level
    3 -
    unobservable
    inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The
carrying amount of the Company’s financial instruments approximates their fair value as of December 31, 2024 and 2023, due to the
short-term nature of these instruments.

    F-13

Income
Taxes.

Under
ASC 740, “Income Taxes,” deferred tax assets and liabilities are recognized for the future tax consequences attributable
to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax
bases.

Provisions
for income taxes are based on taxes payable or refundable for the current year and deferred income taxes. Deferred income taxes are provided
on differences between the tax bases of assets and liabilities and