| Lessee Leases |
Note
6 – 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 $1,606,417 and $1,289,714 as of March 31,
2023, and December 31, 2022, respectively. Accumulated amortization associated with finance leases was $471,149 and $394,391 as of March
31, 2023, and December 31, 2022, respectively.
Lease
costs recognized in our consolidated statements of operations is summarized as follows:
Schedule
of lease costs recognized in consolidated statements of operations
| |
|
2023 |
|
|
2022 |
|
| |
|
Three Months Ended
March 31, |
|
| |
|
2023 |
|
|
2022 |
|
| Operating lease cost included in cost of goods |
|
$ |
- |
|
|
$ |
7,964 |
|
| Operating lease cost included in operating costs |
|
|
22,179 |
|
|
|
7,200 |
|
| Total operating lease cost (1) |
|
|
22,179 |
|
|
|
15,164 |
|
| Finance lease cost, included in cost of goods: |
|
|
|
|
|
|
|
|
| Amortization of lease assets |
|
|
76,768 |
|
|
|
47,416 |
|
| Interest on lease liabilities |
|
|
14,483 |
|
|
|
6,929 |
|
| Total finance lease cost |
|
|
91,251 |
|
|
|
54,345 |
|
| Short-term lease cost |
|
|
- |
|
|
|
- |
|
| Total lease cost |
|
$ |
113,430 |
|
|
$ |
69,509 |
|
| (1) |
Right of use asset
amortization under operating agreements was $15,199 and $12,488 for the three months ended March 31, 2023 and 2022, respectively. |
Other
information about lease amounts recognized in our condensed consolidated financial statements is summarized as follows:
Schedule
of other information about lease amounts recognized in Condensed Consolidated Financial Statements
| |
|
March 31,
2023 |
|
|
December 31,
2022 |
|
| Weighted-average remaining lease term – operating leases |
|
|
4.75 years |
|
|
|
4.75 years
|
|
| Weighted-average remaining lease term – finance leases |
|
|
3.73 years |
|
|
|
4.63 years
|
|
| Weighted-average discount rate – operating leases |
|
|
6.0 |
% |
|
|
6.0 |
% |
| Weighted-average discount rate – finance leases |
|
|
6.9 |
% |
|
|
5.5 |
% |
Note
6 – Lessee Leases (continued)
Finance
lease liabilities were as follows:
Schedule
of finance lease liabilities
| |
|
March 31,
2023 |
|
|
December 31,
2022 |
|
| Gross finance lease liabilities |
|
$ |
1,268,848 |
|
|
$ |
897,849 |
|
| Less: imputed interest |
|
|
(148,115 |
) |
|
|
(89,939 |
) |
| Present value of finance lease liabilities |
|
|
1,120,733 |
|
|
|
807,910 |
|
| Less: current portion |
|
|
(225,738 |
) |
|
|
(232,058 |
) |
| Long-term finance lease liabilities |
|
$ |
894,995 |
|
|
$ |
575,852 |
|
Operating
lease liabilities were as follows:
Schedule
of operating lease liabilities
| |
|
March 31,
2023 |
|
|
December 31,
2022 |
|
| Gross operating lease liabilities |
|
$ |
437,219 |
|
|
$ |
428,946 |
|
| Less: imputed interest |
|
|
(82,255 |
) |
|
|
(58,782 |
) |
| Present value of operating lease liabilities |
|
|
354,964 |
|
|
|
370,164 |
|
| Less: current portion |
|
|
(64,484 |
) |
|
|
(62,861 |
) |
| Long-term operating lease liabilities |
|
$ |
290,480 |
|
|
$ |
307,303 |
|
Lease
maturities were as follows:
Maturity
of lease liabilities
Schedule
of lease maturities
| 12 months ending March 31, |
|
Finance leases |
|
|
Operating leases |
|
| 2022 |
|
$ |
225,738 |
|
|
$ |
64,484 |
|
| 2023 |
|
|
306,365 |
|
|
|
71,279 |
|
| 2024 |
|
|
290,463 |
|
|
|
78,611 |
|
| 2025 |
|
|
226,040 |
|
|
|
86,511 |
|
| 2026 |
|
|
72,127 |
|
|
|
54,077 |
|
| Total |
|
|
1,120,733 |
|
|
|
354,964 |
|
| Less: Current maturities |
|
|
(225,738 |
) |
|
|
(64,484 |
) |
| Long-term liability |
|
$ |
894,995 |
|
|
$ |
290,480 |
|
|