Note 9 – Accrued Expenses

Accrued expenses consisted of the following:

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The Product Development and Tooling Costs of $1,017,471 at June 30, 2026 have been expensed as research and development expense or were capitalized as manufacturing assets, primarily in our 2025 fiscal year. The capitalized tooling costs portion will be amortized and the deferred development expense portion will be paid to the vendor over the related product’s future production of a specified number of units.

The Company has warranty obligations in connection with the sale of certain of its products. The warranty period for its products is generally twelve (12) months, unless the customer purchases an extended warranty for an additional twelve (12) months. The costs incurred to provide for these warranty obligations are estimated and recorded as an accrued liability at the time of sale. The Company estimates its future warranty costs based upon product-based historical performance rates and related costs to repair.

The changes in the Company’s accrued warranty obligations for the six months ended June 30, 2026, were as follows:

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