Company: CERO
Filing Date: 2025-08-22
Form Type: 10-Q
Source: 0001213900-25-079898
Chunk: 143

Company: CERO THERAPEUTICS HOLDINGS, INC.
Filing Date: 2025-08-22
Form: 10-Q
Item: Item 8
Chunk 143
---
 accounts and the resulting gain or loss is reflected in the condensed
consolidated statements of operations.

Impairment
of long-lived assets – The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. When such an event occurs, management determines whether there has been
an impairment by comparing the anticipated undiscounted future net cash flows to the related asset’s carrying value. If an asset
is considered impaired, the asset is written down to fair value, which is determined based either on discounted cash flows or appraised
value, depending on the nature of the asset. Through June 30, 2025, the Company has not experienced any impairment losses on its long-lived
assets.

Leases
– The Company determines if an arrangement contains a lease at inception. A lease is an operating or financing contract, or
part of a contract, that conveys the right to control the use of an identified tangible asset for a period of time in exchange for consideration.

At
lease inception, the Company recognizes a lease liability equal to the present value of the remaining lease payments, and a right of
use asset equal to the lease liability, subject to certain adjustments, such as for lease incentives. In determining the present value
of the lease payments, the Company uses its incremental borrowing rate, determined by estimating the Company’s applicable, fully
collateralized borrowing rate, with adjustment as appropriate for lease term. The lease term at the lease commencement date is determined
based on the non-cancellable period for which the Company has the right to use the underlying asset, together with any periods covered
by an extension option if the Company is reasonably certain to exercise that option.

Right-of-use
assets and obligations for leases with an initial term of 12 months or less are considered short term and are (a) not recognized in the
balance sheet and (b) recognized as an expense on a straight-line basis over the lease term. The Company does not sublease any of its
leased assets to third parties and the Company’s lease agreements do not contain any residual value guarantees or restrictive covenants.

The
accounting for leases includes a number of reassessment and re-measurement requirements for lessees based on certain triggering events
or impairment conditions. There were no impairment indicators identified in each of the six months periods ended June 30, 2025 and 2024,
that would require impairment testing of the Company’s right-of-use assets.

Certain