Fair Value Measurements

12 Months Ended

Dec. 31, 2023

Fair Value Measurements [Abstract]

FAIR VALUE MEASUREMENTS

NOTE 11—FAIR VALUE MEASUREMENTS

The carrying amounts of financial assets and liabilities, such as and cash equivalents, receivables, inventories, prepaid expenses, accounts payable and accrued expenses, customer deposits, contract assets and liabilities approximate fair value given the short-term nature of these instruments. The carrying amounts of lease obligations, notes payable, and convertible notes payable approximates fair value given these instruments bear prevailing market interest rates.

Recurring Fair Value Measurements

The fair value of financial instruments measured on a recurring basis as of December 31, 2023 consisted of the following:

	Fair Value Measurements as of December 31, 2023
Description	Level 1		Level 2		Level 3		Total
Derivative liabilities	$	-	$	-	$	1,389,203	$	1,389,203

The Company had no financial instruments measured on a recurring basis as of December 31, 2022.

The following table provides a roll-forward of changes for financial instruments measured at fair value on a recurring basis for the years ended December 31, 2023:

Derivative liabilities	Amount
Balance as of December 31, 2022	$	-
Initial fair value of derivative liabilities upon issuance		2,613,177
Gain on change in fair value of derivative liabilities		(385,138	)
Extinguishment of derivative liabilities upon conversion of convertible notes		(838,836	)
Balance as of December 31, 2023	$	1,389,203

Warrant liability	Amount
Balance as of December 31, 2022	$	-
Fair value of warrant liability upon issuance		1,156,300
Loss on change in fair value of warrant liability		27,900
Extinguishment of warrant liability upon exercise of prefunded warrants		(1,184,200	)
Balance as of December 31, 2023	$	-

Non-recurring Fair Value Measurements

Certain assets, including long-lived assets and goodwill, are measured at fair value on a non-recurring basis if it is determined that impairment indicators are present using Level 3 inputs. During the year ended December 31, 2023, the Company recognized an $11.8 million impairment of goodwill and intangibles assets.