Company: DHR
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0000313616-25-000043
Chunk: 203

Company: DANAHER CORP /DE/
Filing Date: 2025-02-20
Form: 10-K
Item: Item 5
Chunk 203
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 of Earnings.  The OTLs are generally not cancellable until after an initial term and may or may not require the customer to purchase a minimum number of consumables or tests throughout the contract term.  The Company also enters into sales-type lease (“STL”) arrangements with customers which result in earlier recognition of equipment lease revenue as compared to an OTL.

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For a contract with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation on a relative standalone selling price basis using the Company’s best estimate of the standalone selling price of each distinct product or service in the contract.  The primary method used to estimate standalone selling price is the price observed in standalone sales to customers.  Allocation of the transaction price is determined at the contracts’ inception. Shipping and Handling—Shipping and handling costs are included as a component of cost of sales.  Revenue derived from shipping and handling costs billed to customers is included in sales.Advertising—Advertising costs are expensed as incurred.Research and Development—The Company conducts research and development activities for the purpose of developing new products, enhancing the functionality, effectiveness, ease of use and reliability of the Company’s existing products and expanding the applications for which uses of the Company’s products are appropriate.  Research and development costs are expensed as incurred.Contract Termination—The Company has certain contractual relationships with distributors who sell the Company’s products.  During the year ended December 31, 2024 the Company terminated three contracts with distributors and incurred $56 million of costs related to the termination of the arrangements, which are recorded within selling, general and administrative expenses in the accompanying Consolidated Statements of Earnings.Income Taxes—The Company’s income tax expense represents the tax liability for the current year, the tax benefit or expense for the net change in deferred tax liabilities and assets during the year, as well as reserves for unrecognized tax benefits and return to provision adjustments.  Deferred tax liabilities and assets are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted rates expected to be in effect during the year in which the differences reverse.  Deferred tax assets generally represent items that can be used as a tax deduction or credit in the Company’s tax return in future years for which the tax benefit has already been reflected on the Company’s Consolidated Statements of Earnings.  The Company establishes valuation allowances for its deferred tax assets if it is more likely than not that some or all of the deferred tax asset will not be realized.  Deferred tax liabilities generally represent