Company: GURE
Filing Date: 2025-04-11
Form Type: 10-K
Source: 0001193805-25-000461
Chunk: 391

Company: GULF RESOURCES, INC.
Filing Date: 2025-04-11
Form: 10-K
Item: Item 6
Chunk 391
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 Pursuant to the Opinions of the Ministry of Natural Resources on Several Issues in Promoting the Reform
of Mineral Resources Management (Trial) promulgated by the Ministry of Natural Resources of PRC on January 9, 2020, which came into effect
on May 1, 2020, privately owned enterprises are allowed to participate in the natural gas production. The Company plans to proceed with
its applications for the natural gas and brine project approvals with related government departments until the governmental planning has
been finalized.

(d)      Use of Estimates

The Company’s consolidated
financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and
this requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the
consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its
estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. The most
significant accounting estimates with regard to these consolidated financial statements that require the most significant and subjective
judgments include, but are not limited to, useful lives of property, plant and equipment, recoverability of long-lived assets, determination
of impairment losses, assessment of market value of inventories and provision for inventory obsolescence, allowance for doubtful accounts,
recognition and measurement of deferred income taxes, valuation allowance for deferred tax assets, and assumptions used for the valuation
of share based payments. Accordingly, actual results may differ significantly from these estimates under different assumptions or conditions.

    F-9 

GULF RESOURCES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS DECEMBER 31, 2024

(Expressed in U.S. dollars)

NOTE 1 – BASIS OF PRESENTATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued

(e)      Cash and Cash Equivalents

Cash and cash equivalents consist
of all cash balances and highly liquid investments with original maturities of three months or less. Because of short maturity of these
investments, the carrying amounts approximate their fair values.

(f)      Accounts receivable and Allowance for Doubtful Accounts

Accounts receivable is stated
at cost, net of allowance for doubtful accounts. The normal credit term extended to customers ranges between 90 and 240 days. The company
reviews all receivables