Annual report pursuant to Section 13 and 15(d)

Note 18 - Lease Commitments

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Note 18 - Lease Commitments
12 Months Ended
Dec. 31, 2018
Notes  
Note 18 - Lease Commitments

Note 18 – Lease commitments

 

Operating Leases

 

Mentor currently rents approximately 2,000 square feet of office space under a one year lease in Ramona, California in San Diego County, expiring in August 2019. For the years ended December 31, 2018 and 2017, rent expense was $32,080 and $30,240, respectively.

 

On October 11, 2018, Mentor leased a vehicle with an initial term of 3 years expiring in October 2021. For the years ended December 31, 2018 and 2017, vehicle lease expense of $2,587 and $0, respectively, is included in selling, general and administrative expenses in the consolidated income statement.

 

WCI rents approximately 3,000 of office and warehouse space in Tempe, Arizona under an operating lease expiring in January 2020 For the years ended December 31, 2018 and 2017, rent expense was $26,400 and $24,200, respectively.

 

WCI leases vehicles under a master fleet management agreement with initial terms of 4 years expiring through July 2022. For the years ended December 31, 2018 and 2017, vehicle lease expense of $231,817 and $195,095 is included in cost of sales in the consolidated income statement, respectively.

 

WCI has two small operating leases on office equipment entered into in 2015 with terms of 5 years expiring in 2020.

 

The approximate remaining annual minimum lease payments under the non-cancelable operating leases existing as of December 31, 2018 with original or remaining terms over one year were as follows:

 

Years ending

 

Rental

December 31,

 

expense

2018

$

244,215

2018

 

214,900

2019

 

141,488

2020

 

19,463

 

 

 

 

$

620,066

 

Subsequent to year-end, on January 1, 2019, the Company adopted ASU 2016-02, “Leases,” which requires lessees to recognize right-of-use assets and lease liabilities on the balance sheet for the rights and obligations created by all leases, including operating leases with terms of more than 12 months.