Company: GURE
Filing Date: 2025-05-13
Form Type: 10-Q
Source: 0001193805-25-000638
Chunk: 12

Company: GULF RESOURCES, INC.
Filing Date: 2025-05-13
Form: 10-Q
Item: Part I, Item 1
Chunk 12
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cash. The ASU requires an entity to recognize expected credit losses rather than incurred losses for financial assets. For public entities,
the amendments are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years.
For the Company which is a smaller reporting company, ASU No. 2019-10 extends the effective dates for two years. The Company is currently
evaluating the effect of this on the condensed consolidated financial statements and related disclosure.

(t) Fair Value Measurement

The Company applies Accounting Standards Codification
(“ ASC”) Topic 820, Fair Value Measurements and Disclosures which defines fair value, establishes a framework for measuring
fair value and expands financial statement disclosure requirements for fair value measurements.

ASC Topic 820 defines fair value as the price
that would be received from the sale of an asset or paid to transfer a liability (an exit price) on the measurement date in an orderly
transaction between market participants in the principal or most advantageous market for the asset or liability.

ASC Topic 820 specifies a hierarchy of valuation
techniques, which is based on whether the inputs into the valuation technique are observable or unobservable. The hierarchy is as follows:

Level 1 inputs to the valuation methodology are
quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 inputs to the valuation methodology include
quoted prices for identical or similar assets and liabilities in active markets or in inactive markets, and inputs that are observable
for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.

Level 3 inputs to the valuation methodology are
unobservable and significant to the fair value.

The carrying amounts of the Company’s financial
instruments approximate their fair values because of their short-term nature. The Company’s financial instruments include cash,
accounts receivable, amounts due to related parties, accounts payable and other current payables. There were no material unrecognized
financial assets and liabilities as of March 31, 2025 and 2024.

NOTE 2 - ACCOUNTS RECEIVABLE, NET

                                   March 31,                     December 31,                
  Accounts receivable              $              2,143,976      $                  594,234  
  Allowance for doubtful debt                      ( 29,754                        ( 29,711  
  Accounts receivable, net         $              2,114,222      $                  564,523  

The overall accounts receivable balance
as of March 31