Company: AGSS
Filing Date: 2025-05-19
Form Type: 10-Q
Source: 0001829126-25-003800
Chunk: 8

Company: AMERIGUARD SECURITY SERVICES, INC.
Filing Date: 2025-05-19
Form: 10-Q
Item: Part I, Item 1
Chunk 8
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the right-of-use asset and lease liability as recorded on the balance sheet as detailed in Note 6.

The Company has elected, for all underlying classes
of assets, not to recognize ROU assets and lease liabilities for short-term leases that have a lease term of 12 months or less at lease
commencement. As of March 31, 2025, the Company does not have any leases that qualify for this election.

    6

Revenue
Recognition

The Company recognizes revenue under ASC 606, Revenue from contracts
with customers. The core principle of the revenue standard is that a company should recognize revenue to depict the transfer of services
to customers in an amount that reflects the consideration to which the company expects to be entitled for those services. There are five
steps or qualifiers that determine the timing and amount of Revenue Recognition. Those five steps are:

1.Identifying the contract with a customer.

2.Identifying the performance obligation in the contract.

3.Determine the transaction price.

4.Allocate the transaction price to performance obligations.

5.Recognize the revenue when the entity satisfies the performance obligation.

The Company generates and recognizes revenue in three sales categories.
Those being, Formal Contracts, Sales Agreements and Retail activities. For the retail activities, the revenue is recognized on a cash
basis at the time of sale. For the other two categories, the customers are billed at the end of the month the services have been performed.

The formal contract and sales agreements stipulate the exact services
to be performed and the rate the services are to be billed, as per steps 1, 2 and 3. The Company provides details of services provided
with each billing invoice for customer review and approval. Any differences are resolved prior to payment, Step 4. The Company recognizes
revenue in the month the services stipulated in the agreement have been provided, Step 5.

Ninety eight percent of revenues are billed monthly
and recognized in the month the services were provided. Refunds and returns, which are minimal, are recorded as a reduction of revenue.
The Company has not recorded a reserve for returns on March 31, 2025, nor December 31, 2024, since it does not believe such returns
will be material.

Net Income/(Loss) per Share

Net income/(loss) per common share is computed by dividing net income or loss by the weighted average common shares outstanding during the period as defined by Financial Accounting Standards, ASC Topic 260, “Earnings per