Company: SZZL
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001213900-25-075798
Chunk: 14

Company: Sizzle Acquisition Corp. II
Filing Date: 2025-08-13
Form: 10-Q
Item: Part I, Item 1
Chunk 14
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 in the accompanying unaudited condensed statements of operations.

Concentration of Credit Risk

Financial instruments that potentially subject
the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal
Deposit Insurance Corporation coverage limit of $250,000. Any loss incurred or a lack of access to such funds could have a significant
adverse impact on the Company’s financial condition, results of operations, and cash flows.

Offering Costs Associated with the Initial Public Offering 

The Company complies with the requirements of
the FASB ASC Topic 340-10-S99 and SEC Staff Accounting Bulletin Topic 5A, “Expenses of Offering”. Deferred offering costs
consist principally of professional and registration fees that are related to the Initial Public Offering. FASB ASC Topic 470-20, “Debt
with Conversion and Other Options,” addresses the allocation of proceeds from the issuance of convertible debt into its equity and
debt components. The Company applies this guidance to allocate Initial Public Offering proceeds from the Public Units between Public Shares
and Public Rights, using the residual method by allocating Initial Public Offering proceeds first to the assigned value of the Public
Rights and then to the Public Shares. Offering costs allocated to the Public Shares were charged to temporary equity, and offering costs
allocated to Public Rights and Private Placement Units were charged to shareholders’ deficit, as the Public Rights, after management’s
evaluation, were accounted for under equity treatment.

Fair Value of Financial Instruments

The fair value of the Company’s assets and
liabilities, which qualify as financial instruments under FASB ASC Topic 820, “Fair Value Measurements and Disclosures.” approximate
the carrying amounts represented in the accompanying condensed balance sheets, primarily due to their short-term nature.

Income Taxes

The Company accounts for income taxes under FASB
ASC Topic 740, “Income Taxes” (“ASC 740”), which requires an asset and liability approach to financial accounting
and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement
and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and 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 prescribes a recognition threshold and
a measurement attribute for the financial statement recognition and measurement of tax positions taken