Quarterly report pursuant to Section 13 or 15(d)

Lessee Leases

v3.22.1
Lessee Leases
3 Months Ended
Mar. 31, 2022
Leases [Abstract]  
Lessee Leases

Note 5 – Lessee Leases

 

Operating leases are comprised of office space and office equipment leases. Fleet leases entered into prior to January 1, 2019, are classified as operating leases. Fleet leases entered into on or after January 1, 2019, under ASC 842 guidelines, are classified as finance leases.

 

Gross right of use assets recorded under finance leases related to WCI vehicle fleet leases were $933,121 and $882,081 as of March 31, 2022 and December 31, 2021, respectively. Accumulated amortization associated with finance leases was $283,887 and $236,470 as of March 31, 2022 and December 31, 2021, respectively.

 

Lease costs recognized in our consolidated statements of operations is summarized as follows:

    2022     2021  
    Three Months Ended
March 31,
 
    2022     2021  
Operating lease cost included in cost of goods   $ 7,964     $ 32,864  
Operating lease cost included in operating costs     7,200       11,096  
Total operating lease cost (1)     15,164       43,960  
Finance lease cost, included in cost of goods:                
Amortization of lease assets     47,416       28,518  
Interest on lease liabilities     6,929       5,467  
Total finance lease cost     54,345       33,985  
Short-term lease cost     -       2,300  
Total lease cost   $ 69,509     $ 80,245  

 

  (1) Right of use asset amortization under operating agreements was $12,488 and $40,981 for the three months ended March 31, 2022 and 2021, respectively.

 

Other information about lease amounts recognized in our condensed consolidated financial statements is summarized as follows:

 

    March 31,
2022
    December 31,
2021
 
Weighted-average remaining lease term – operating leases     0.55 years       0.95 years  
Weighted-average remaining lease term – finance leases     3.72 years       3.83 years  
Weighted-average discount rate – operating leases     3.4 %     5.7 %
Weighted-average discount rate – finance leases     4.8 %     3.8 %

 

Finance lease liabilities were as follows:

 

    March 31,
2022
    December 31,
2021
 
Gross finance lease liabilities   $ 638,757     $ 634,192  
Less: imputed interest     (51,356 )     (51,212 )
Present value of finance lease liabilities     587,401       582,980  
Less: current portion     (175,797 )     (167,515 )
Long-term finance lease liabilities   $ 411,604     $ 415,465  

 

Operating lease liabilities were as follows:

 

    March 31,
2022
    December 31,
2021
 
Gross operating lease liabilities   $ 33,565     $ 55,865  
Less: imputed interest     (646 )     (8,832 )
Present value of operating lease liabilities     32,919       47,033  
Less: current portion     (32,919 )     (42,058 )
Long-term operating lease liabilities   $ -     $ 4,975  

 

 

Note 5 – Lessee Leases (continued)

 

Lease maturities were as follows:

 

Maturity of lease liabilities

 

12 months ending March 31,   Finance leases     Operating leases  
2022   $ 175,797     $ 32,919  
2023     150,502       -  
2024     140,912       -  
2025     100,785       -  
2026     19,405       -  
Total     587,401       32,919  
Less: Current maturities     (175,797 )     (32,919 )
Long-term liability   $ 411,604     $ -