Company: BLNE
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004793
Chunk: 245

Company: Beeline Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1A
Chunk 245
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 as IRLCs. IRLCs
are subject to price risk primarily related to fluctuations in market interest rates. To hedge the interest rate risk on certain IRLCs,
the Company enters into best effort forward sale commitments with investors, whereby certain loans are locked with a borrower and simultaneously
committed to an investor at a fixed price. If the best effort IRLC does not fund, the Company has no obligation to fulfill the investor
commitment.

ASC
815-25, Derivatives and Hedging, requires that all derivative instruments be recognized as assets or liabilities on the consolidated
balance sheets at their fair value. Changes in the fair value of the derivative instruments are recognized in gain on sale of loans,
net on the consolidated statements of operations in the period in which they occur. The Company accounts for all derivative instruments
as free-standing derivative instruments and does not designate any for hedge accounting.

Inventories.
Bridgetown Spirits’ inventories primarily consist of bulk and bottled liquor and merchandise and are stated at the lower
of cost or market. Cost is determined using an average costing methodology, which approximates cost under the first-in, first-out method.
A portion of inventory is held by certain independent distributors on consignment until it is sold to a third party. Bridgetown Spirits
regularly monitors inventory quantities on hand and records write-downs for excess and obsolete inventories based primarily on the estimated
forecast of product demand and production requirements. Such write-downs establish a new cost basis of accounting for the related inventory.

55

Business
Combination. The Company accounts for business combinations in accordance with ASC 805, Business Combinations. Under this
guidance, the Company allocates the purchase price of an acquired business to the identifiable assets acquired and liabilities assumed
at their estimated fair values as of the acquisition date. The excess of the purchase price over the estimated fair value of net assets
acquired is recorded as goodwill.

Goodwill
represents the excess purchase price over the fair value of the tangible net assets and intangible assets acquired in the business combination.
The increases or decreases in the fair value of the Company’s assets and liabilities can result from changes in fair values as
of the acquisition date as determined during the one-year measurement period under ASC 805.

Goodwill.
Goodwill is the excess of the purchase price over the estimated fair value of identifiable net assets acquired in business combinations.
The Company tests goodwill for impairment annually in the fourth quarter, or more frequently when indications of potential impairment
exist.