| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES & USE OF ESTIMATES | NOTE
3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES & USE OF ESTIMATES Our
significant accounting policies are provided in “Note 2 – Summary of Significant Accounting Policies” in our Financial
Statements 2023 Form 10-K. Beginning in Q2 2024, there was a change in accounting policy in the recognition
of the distributions to an affiliate, Fonon Corporation, in fiscal year 2024 being treated as a contribution to a shareholder that considers
the above-referenced costs as a G&A expense as opposed to the previously assumed equity distribution to an affiliate. In 2024 G&A
expense is being treated as a form of compensation to the shareholder as opposed to a distribution to an affiliate company. The change
in policy was a result of the delayed execution in the previously assumed corporate restructuring under which Fonon Corporation would
become our parent company, which was the assumption for our Form 10-K for the fiscal year ended December 31, 2023 and first quarter 10-Q
filings as stated above. The plan going forward is to segregate the entities costs in the near future, administrative delays are the only
reason that has not occurred yet. Stock
Based Compensation The
Company accounts for stock-based payments in accordance with the provision of ASC 718, which requires that all share-based payments issued
to acquire goods or services, including grants of employee stock options, be recognized in the statement of operations based on their
fair values, net of estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary,
in subsequent periods if actual forfeitures differ from those estimates. Compensation expenses related to share-based awards is recognized
over the requisite service period, which is generally the vesting period. The
preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent liabilities at dates of the financial statements and the reported
amounts of revenue and expenses during the periods. Actual results could differ from these estimates. In the opinion of management, our
financial statements reflect all adjustments considered necessary by management to fairly state the results of operations, financial
position and cash flows of the Company for the periods presented. Revenue
Recognition Under
Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the
consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements
that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s)
with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the
transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance
obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration
it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined
to be within the scope of Topic 606, we assess the goods or services promised within each contract and determine those that are performance
obligations and assess whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction
price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Revenue
is then recognized for the transaction price allocated to each respective performance obligation when (or as) the performance obligation
is satisfied. For our products, revenue is generally recognized upon shipment or pickup by the customer. At this stage, the title on
the manufactured equipment is transferred to the customer, and the customer is responsible for transportation expenses, insurance, and
any transport-related damage to the equipment in transit. We do not hold any obligation to deliver beyond the collection warehouse, and
it is the customers’ contractual responsibility to ensure their goods reach their destination. Refunds
and returns, which are minimal, are recorded as a reduction of revenue. Payments received from customers before satisfying the above
criteria are recorded as unearned income on the combined balance sheets. Payments
received as deposits for specific purchase orders or future laser equipment sales to customers are recognized as customer deposits and
included in liabilities on the balance sheet. Customer deposits are recognized as revenue when control over the ordered equipment is
transferred to the customer. All
revenues are reported in net of any sales discounts or taxes. Other
Revenue Recognition Matters related to Distributors. Distributors
generally have no right to return unsold equipment. However, in limited circumstances, if the company determines that distributor stock
is morally aging beyond the company’s new model releases, it may accept returns and provide the distributor with credit against
their trading account at the company’s discretion under its warranty policy. This revenue is recognized on a consignment basis
and transfer of control is when an item is sold to end customer at which time the company recognizes revenue. Cash
and Cash Equivalents Cash
and cash equivalents consist of highly liquid investments with an original maturity of three months or less at the date of purchase.
Cash and cash equivalents are carried at a cost, which approximates fair value. The company has $ 2,539,472 The terms on this CD if flexible, having a term of 9 months that automatically renews, Full balance and interest can
be withdrawn prior to maturity. A penalty of 7 days interest will be imposed for early withdrawals within the first 6 days of the account
term. Current
Liabilities Accounts
Payable Accounts
payable consist of short-term liability to our vendors and sub-contractors, who extend credit terms to the Company or deliver goods or
services with delayed payment terms. As of June 30, 2024, and December 31, 2023, our accounts payable were recorded at $ 198,236 223,040 Deferred
Revenue Deferred
Revenue is primarily comprised of products that have been made available to key distributors that have not been sold. As of June 30,
2024, the Company had $ 116,564 213,114 As
of June 30, 2024, there were no loan balances owed by the Company. Net
Earnings/Loss per Share Basic
Earnings/Loss Earnings/Loss Earnings/Loss Earnings/Loss Earnings/Loss
Accounts
Receivable Trade
accounts receivable is recorded net of allowance for expected uncollectible accounts. The Company extends credit to its customers in
the normal course of business and performs on-going credit evaluations of its customers. All accounts, or portions thereof, that are
deemed uncollectible are written off to bad debt expense, as incurred. In addition, most sales orders are not accepted without a substantial
deposit. As of June 30, 2024, the balance of collectible accounts was $ 446,016 no Inventory Inventories
are stated at a lower cost or net realizable value using the first-in first-out (FIFO) method. The Company has four principal categories
of inventory: Sales
demonstration inventory Equipment
parts inventory Work
in process inventory - Finished
goods inventory As
of June 30, 2024, and December 31, 2023, respectively, our inventory consisted of the following: SCHEDULE OF INVENTORY
Inventory As of June 30, 2024 As of December 31, 2023
Equipment Parts Inventory $ 992,741 $ 862,940
Finished Goods Inventory 931,227 992,744
Sales Demo Inventory 258,954 162,958
Work in process Inventory 203,683 243,029
Inventory Reserve (281,184 ) (24,216 )
Total Inventory $ 2,105,421 $ 2,237,455 Fixed
Assets - Plant Machinery and Equipment Property
and equipment are recorded at cost. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance,
and repairs are charged to expense as incurred. When property and equipment are retired or otherwise disposed of, the cost and accumulated
depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective
period. Machinery
and Equipment Depreciation
is provided over the estimated useful lives of the related assets using the straight-line method for financial statement purposes. SCHEDULE OF ESTIMATED USEFUL LIVES FOR SIGNIFICANT PROPERTY AND EQUIPMENT
Category Economic Useful
Life
Office
furniture and fixtures 5 - 7
Machinery.
Vehicles and equipment 5 7
Leasehold
improvements 1 3 SCHEDULE OF FIXED ASSETS
Fixed Assets As
of As of December 31, 2023 (Audited)
Accumulated Depreciation $ (958,842 ) $ (729,956 )
Machinery & Equipment 799,652 796,783
Office Furniture & Computer Equipment 87,553 77,487
Vehicles 90,959 90,959
R&D Equipment 42,068 37,973
Leasehold improvements 214,494 31,775
Demonstration equipment 647,790 647,790
Property, Plant and Equipment, Gross 647,790 647,790
Total Fixed Assets $ 923,674 $ 952,811 Intangible
Assets Intangible
assets consist primarily of capitalized equipment design documentation, software costs for equipment manufactured for sale, as well as certain patent, trademark and license costs. Capitalized software and equipment design documentation development
costs are recorded in accordance with Accounting Standard Codification (“ASC”) 985 “Software” with costs amortized
using the straight-line method over a ten-year period. Patent, trademark and license costs are amortized using the straight-line method
over their estimated useful lives of 15 The
Company employs various core technologies across many different product families and applications in an effort to maximize the impact
of our research and development costs and increase economies of scale and to leverage its technology-specific expertise across multiple
product platforms. The technologies inherent in its laser equipment products include application documentation, proprietary and custom
software developed for operation of its equipment, specific knowledge of supply chain and, mostly important, equipment design documentation,
consisting of 3D engineering drawings, bills of materials, wiring diagrams, parts AutoCad drawings, software architecture documentation,
etc. Intangible assets were received from a related party, ICT Investments, and therefore transferred and booked by Laser Photonics Corp.
at their historical cost. SCHEDULE OF INTANGIBLE ASSETS ASSETS
Intangible
Assets As
of As
of
Accumulated
Amortization $ (927,553 ) $ (725,228 )
Customer
Relationships 211,000 211,000
Equipment
Design Documentation 2,675,000 2,675,000
Operational
Software & Website 339,539 339,539
Trademarks 216,800 216,800
Goodwill - -
License
& Patents 1,562,876 1,562,876
Intangible Assets, Gross 1,562,876 1,562,876
Total
Intangible Assets $ 4,077,662 $ 4,279,987 Long-Lived
Assets Long-lived
assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable.
Impairment is measured by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected
to result from use of the assets and their ultimate disposition. In instances where impairment is determined to exist, the Company will
write down the asset to its fair value based on the present value of estimated future cash flows. |
