Company: DREM
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004861
Chunk: 8

Company: Dream Homes & Development Corp.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 8
Chunk 8
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 name to Dream Homes & Development Corporation (“DHDC”). DHDC maintains a
web site at www.dreamhomesltd.com.

Principles
of Consolidation

The
consolidated financial statements include the accounts of DHDC and its wholly owned subsidiaries, partnerships and other entities which
the Company has a controlling interest and variable interest entities in which the Company is deemed the primary beneficiary (collectively,
the “Company”). All intercompany balances and transactions have been eliminated in consolidation.

Property
and Equipment

 Property
and equipment is stated at cost less accumulated depreciation. Depreciation is provided using the straight-line method over an estimated
useful life of five years. Repairs and maintenance costs are expensed as incurred, and renewals and betterments are capitalized.

Use
of Estimates

 The
preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying
notes. Actual results could differ materially from these estimates.

    F-7

 Fair
Value of Financial Instruments

 Fair
value is defined as the price that we would receive to sell an asset or pay to transfer a liability (an exit price) in an orderly transaction
between market participants on the measurement date. In determining fair value, GAAP establishes a three-level hierarchy used in measuring
fair value, as follows:

    ●
    Level
    1 inputs are quoted prices available for identical assets and liabilities in active markets.

    ●
    Level
    2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets and
    liabilities in active markets or other inputs that are observable or can be corroborated by observable market data.

    ●
    Level
    3 inputs are less observable and reflect our own assumptions.

Our
financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses and loans payable
to related parties. The carrying amount of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, and
loans payable to related parties approximates fair value because of their short maturities.

Construction
Contracts

Revenue
recognition: The Company recognizes construction contract revenue using the percentage-of-completion method, based primarily on contract
cost incurred to date compared to total estimated contract cost. Cost of revenue includes an allocation of general overhead cost