Annual report pursuant to Section 13 and 15(d)

Operating Leases

v3.23.1
Operating Leases
12 Months Ended
Dec. 31, 2022
Operating Leases  
Operating Leases

Note 10 - Operating Leases

 

In 2016, the Company entered into a six-year agreement to lease trailers used in the delivery of its products. Monthly payments currently total $24,760.

 

On July 1, 2015, the Company entered into a five-year lease for warehouse space in Corsicana, Texas. Rent is $3,750 monthly throughout the term of the lease. The Company is also responsible for the pro rata share of the projected monthly expenses for the property taxes. The current pro rata share is $882. The lease was extended on June 1, 2019 for five years. The Company recorded a right of use asset and an operating lease liability of $145,267. This amount represents the difference between the value from the remaining lease and the extended lease.

  

For the twelve months ended December 31, 2022 and 2021, the Company recorded an operating lease right of use asset and liabilities as follows:

 

 

 

December 31,

 

 

December 31,

 

 

 

2022

 

 

2021

 

 

 

 

 

 

 

 

Right of use asset - operating lease

 

$ 51,563

 

 

$ 390,098

 

Current portion of operating lease liability

 

 

43,262

 

 

 

340,207

 

Operating lease liability

 

 

11,289

 

 

 

54,551

 

 

Future remaining minimum lease payments under these non-cancelable leases are as follows:

 

For the twelve months ended December 31,

 

 

 

2023

 

$ 45,000

 

2024

 

 

11,250

 

Total

 

 

56,250

 

Less discount

 

 

(1,699 )

Total lease liabilities

 

 

54,551

 

Less current portion

 

 

(43,262 )

Operating lease obligation, net of current portion

 

$ 11,289

 

 

The weighted average remaining lease term for operating leases is 1.17 years and the weighted average discount rate used in calculating the operating lease asset and liability is 5.0%. For the year ended December 31, 2022, payments on lease obligations were $260,360 and amortization on the right of use assets was $338,535.

 

For the year ended December 31, 2022 and 2021, the Company’s lease cost consists of the following components, each of which is included in costs and expenses within the Company’s consolidated statements of operations:

 

 

For the Year

Ended

December 31,

2022

 

 

For the Year

Ended

December 31,

2021

 

Operating lease costs

 

$ 338,535

 

 

$ 405,771