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OPERATING LEASES
 6 Months Ended
Jun. 30, 2024
Leases [Abstract]  
OPERATING LEASES

NOTE 6 – OPERATING LEASES

 

The Company periodically enters operating lease contracts for office space and equipment. Arrangements are evaluated at inception to determine whether such arrangements constitute a lease. Right of use assets (“ROU assets”) represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities were recognized on the transition date based on the present value of lease payments over the respective lease term, with the office space ROU asset adjusted for deferred rent liability.

 

The Company has three material operating leases for office space. In March and September of 2023, the Company amended its primary office lease to obtain additional space, as well as extend the term. The leases have remaining lease terms of 78, 14 and 31 months as of June 30, 2024. For practical expediency, the Company has elected to not recognize ROU assets and lease liabilities related to short-term leases.

 

In accordance with ASC Topic 842, Leases, the Company has recorded ROU assets of $1,792,448 and a related lease liability of $1,906,247 as of June 30, 2024. The Company recorded lease expense of $277,596 and $184,575 for the six months ended June 30, 2024 and 2023, respectively. Cash paid for amounts included in the measurement of operating lease liabilities was $267,223 and $175,382 for the six months ended June 30, 2024 and 2023, respectively.

 

 

The present value of the Company’s operating lease liabilities as of June 30, 2024 is shown below.

 

Maturity of Operating Lease Liabilities

 

   June 30, 2024 
Remainder of 2024  $237,793 
2025   532,053 
2026   379,529 
2027   297,947 
2028   295,689 
2029   300,158 
Thereafter   303,892 
      
Total lease payments   2,347,061 
Less imputed interest   (440,814)
Present Value of Lease Liabilities  $1,906,247 
      
Operating lease liabilities – current  $393,663 
Operating lease liabilities – long-term  $1,512,584 

 

As of June 30, 2024, the Company’s operating leases had a weighted average remaining lease term of 5.5 years and a weighted average discount rate of 7.64%.