Company: BRID
Filing Date: 2025-01-29
Form Type: 10-K
Source: 0001493152-25-004182
Chunk: 482

Company: BRIDGFORD FOODS CORP
Filing Date: 2025-01-29
Form: 10-K
Item: Item 6
Chunk 482
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 cannot be sold or must be sold at reduced prices and
could result in additional reserve provisions. The Company recorded a net realizable value reserve of $1,467 and $513 at November 1, 2024
and November 3, 2023, respectively, after determining that the market value on some meat products was less than the costs associated with
completion and sale of the product.

Property, plant, and equipment

Property, plant, and equipment
are carried at cost less accumulated depreciation. Major renewals and improvements are charged to the asset accounts while the cost of
maintenance and repairs is charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated depreciation
are removed from the respective accounts and the resulting gain or loss is credited or charged to income. Depreciation is computed on
a straight-line basis over 10 to 20 years for buildings and improvements, 5 to 10 years for machinery and equipment, and 3 to 5 years
for transportation equipment. We built a processing plant from the ground up and as such have attributed long useful lives accordingly
to these types of assets employed at the new facility in Chicago. The Company incurred interest costs of $429 and $579 for fiscal year
2024 and 2023, respectively, all of which were recorded as interest expense in relation to equipment at the production facility in Chicago.

We test long-lived assets
for recoverability whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If an impairment
is indicated, we measure the fair value of assets to determine if and when adjustments are recorded.

Leases

Leases are recognized in accordance
with ASC Topic 842 Leases (“ASC 842”) which requires a lessee to recognize assets and liabilities with lease terms of more
than 12 months. We lease or rent property for such operations as storing inventory and equipment. We analyze our agreements to evaluate
whether or not a lease exists by determining what assets exist for which we control usage for a period of time in exchange for consideration.
In the event a lease exists, we classify it as a finance or operating lease and record a right-of-use (“ROU”) asset and the
corresponding lease liability at the inception of the lease. In the case of month-to-month lease or rental agreements with terms of 12
months or less, we made an accounting policy election to not recognize lease assets and liabilities and record them on a straight-line
basis over the lease term