Company: SNBH
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001731122-25-001574
Chunk: 36

Company: SENTIENT BRANDS HOLDINGS INC.
Filing Date: 2025-11-19
Form: 10-Q
Item: Part I, Item 1
Chunk 36
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. Actual results may differ from these estimates under different assumptions or conditions. We believe
the following critical accounting policies affect our more significant judgments and estimates used in the preparation of the consolidated
financial statements.

22

Revenue
Recognition

We
recognize revenue when persuasive evidence of an arrangement exists, delivery has occurred or products have been sold, the purchase price
is fixed or determinable and collectability is reasonably assured.

Our
customers place orders for our products pursuant to their purchase orders and we are paid by our customers pursuant to our invoices.
Each invoice calls for a fixed payment in a fixed period of time. We recognize revenue by selling our products under our customers’
purchase orders and our related invoices to our customers. Revenue related to the sales of our products to our customers is recognized
as the products are sold and amounts are paid, using the straight-line method over the term of the sales transaction. Prepayments, if
any, received from customers prior to the products being delivered are recorded as advance from customers. In these cases, when the products
are sold, the amount recorded as advance from customers is recognized as revenue.

Income
Taxes

We
are governed by the income tax laws of the United States. Income taxes are accounted for pursuant to ASC 740 “Accounting for Income
Taxes,” which is an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected
future tax consequences of events that have been recognized in our financial statements or tax returns. The charge for taxes is based
on the results for the period as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have
been enacted or substantively enacted by the balance sheet date.

Deferred
tax is accounted for using the balance sheet liability method in respect of temporary differences arising from differences between the
carrying amount of assets and liabilities in the financial statements and the corresponding tax basis used in the computation of assessable
tax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences, and deferred tax assets are
recognized to the extent that it is probably that taxable profit will be available against which deductible temporary differences can
be utilized.

Deferred
tax is calculated using tax rates that are expected to apply to the period when the asset is realized, or the liability is settled. Deferred
tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity, in which
case the deferred tax is changed to equity