Company: FLYE
Filing Date: 2025-02-19
Form Type: 10-Q
Source: 0001213900-25-015334
Chunk: 25

Company: Fly-E Group, Inc.
Filing Date: 2025-02-19
Form: 10-Q
Item: Part I, Item 1
Chunk 25
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    2023 
  
    Product revenues - retail (ASC 606) 
    $4,914,741  
    $6,292,490  
    $17,708,735  
    $19,229,491 
  
    Product revenues - wholesale (ASC 606) 
     714,308  
     1,135,722  
     2,618,146  
     4,804,906 
  
    Revenues - rental services (ASC 842) 
     48,961  
     —  
     48,961  
     — 
  
    Net revenues 
    $5,678,010  
    $7,428,212  
    $20,375,842  
    $24,034,397 

(p) Selling Expenses

Selling expenses mainly consist of advertising
costs, and payroll and related expenses for personnel engaged in selling and marketing activities. Advertising expenses, which consist
primarily of online and offline advertisements, are expenses when the services are received. The advertising expenses were $32,681 and
$6,629 for the three months ended December 31, 2024 and 2023, respectively. The advertising expenses were $230,742 and $32,695 for the
nine months ended December 31, 2024 and 2023, respectively.

14

(q) Research and Development Expenses

Research and development expenses include salaries
for the Company’s research and development personnel, as well as related development expenses paid to the third-party development
team. The Company recognizes internal use software acquired and internally developed in accordance with ASC 350-40 “Software—internal
use software”. The Company expenses all costs that are incurred in connection with the planning and implementation phases of development,
and costs that are associated with maintenance of the existing software for internal use. Certain costs associated with developing internal-use
software are capitalized when such costs are incurred within the application development stage of software development. As a result, the
Company expensed the development costs of the Fly E-Bike app as they incurred. For the three months ended December 31, 2024 and 2023,
development costs amounted to $125,312 and $89,420, respectively, which were recorded under general and administrative expenses. For the
nine months ended December 31, 2024 and 2023, development costs amounted to $434,760 and $