Note 10 - Finance leases receivable

On January 16, 2018, Partner I entered into a Master Equipment Lease Agreement with G FarmaLabs Limited and GFarma Brands, Inc.  (the “GFarma Entities”) dated January 16, 2018.  Partner I acquired and delivered manufacturing equipment as determined by GFarma Entities under sales-type finance leases.  The Company recorded equipment sales revenue of $152,404 for the three months ended March 31, 2018.  At March 31, 2018, all leased equipment under the finance leases receivable is located in California. 

The net investment included in finance leases at March 31, 2018 are as follows: 

There were no finance leases receivable at December 31, 2017. 

At March 31, 2018, minimum future payments receivable under finance leases were as follows:

We review the finance leases receivables by individual account to determine expected collectability.  The allowance for credit losses is an estimate of the losses inherent in our finance receivables taking into consideration past loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of underlying collateral and current economic conditions.  No allowance is recorded at March 31, 2018.

The Company records prepayments on leases as a liability under deferred revenue.

 [Discussion of MP II lease to Pueblo West?]