2. Supplemental Balance Sheet Disclosures

Inventories

Inventories are stated at the lower of cost (first-in, first-out) or net realizable value, net of write-downs for excess and obsolete inventory, and consist of the following:


	December 31,		September 30,
	2019		2019

Raw materials	$	3,527,323	$	3,408,742
Work-in-process		856,314		775,770
Finished goods		288,826		286,182
	$	4,672,463	$	4,470,694

Prepaid expenses and other current assets

Prepaid expenses and other current assets consist of the following:


	December 31,		September 30,
	2019		2019

Prepaid insurance	$	449,398	$	302,376
Other		237,216		339,673
	$	686,614	$	642,049

Property and equipment

Property and equipment, net consists of the following:


	December 31,		September 30,
	2019		2019

Computer equipment	$	2,296,617	$	2,285,152
Corporate airplanes		5,601,039		5,601,039
Furniture and office equipment		1,033,779		1,033,779
Manufacturing facility		5,733,313		5,733,313
Equipment		5,635,134		5,635,134
Land		1,021,245		1,021,245
		21,321,127		21,309,662
Less: accumulated depreciation and amortization		(12,955,650)		(12,864,970)
	$	8,365,477	$	8,444,692

Depreciation and amortization related to property and equipment was approximately $96,644 and $107,300 for the three months ended December 31, 2019 and 2018, respectively. The corporate airplanes are utilized primarily in support of product development. The Pilatus PC-12 airplane, one of the Company’s two corporate airplanes, has been depreciated to its estimated salvage value.

Other assets

Other assets consist of the following:


	December 31,		September 30,
	2019		2019
Intangible assets, net of accumulated amortization of $555,837 and $551,037 at December 31, 2019 and September 30, 2019, respectively	$	44,400	$	49,200
Operating lease right-of-use asset	$	108,675	$	—
Other non-current assets		102,151		104,841
	$	255,226	$	154,041

Intangible assets consist of licensing and certification rights which are amortized over a defined number of units. No impairment charges were recorded in the three months ended December 31, 2019 and 2018.

Intangible asset amortization expense was approximately $4,800 and $7,200 for the three months ended December 31, 2019 and 2018, respectively. The timing of future amortization expense is not determinable because the intangible assets are being amortized over a defined number of units.

Other non-current assets as of December 31, 2019 and September 30, 2019 include the security deposit for an airplane hangar, and a deposit for medical claims required under the Company’s medical plan. In addition, other non-current assets as of December 31, 2019 and September 30, 2019 includes $26,850 and $29,541, respectively, of prepaid software licenses that will be earned upon the shipment of a certain product to a customer. Other non-current assets amortization expense was approximately $2,691 and $1,615 for the three months ended December 31, 2019 and 2018, respectively.

Accrued expenses

Accrued expenses consist of the following:


	December 31,		September 30,
	2019		2019

Warranty	$	559,180	$	606,680
Salary, benefits and payroll taxes		362,025		212,322
Professional fees		314,054		153,298
Operating lease		84,368		—
Other		94,418		138,618
	$	1,414,045	$	1,110,918

Warranty cost and accrual information for the three months ended December 31, 2019 is highlighted below:


	Three Months Ending
	December 31, 2019

Warranty accrual, beginning of period	$	606,680
Release of accrual, net		(22,801)
Warranty cost		(24,699)
Warranty accrual, end of period	$	559,180