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Supplemental Balance Sheet Disclosures

6 Months Ended

Mar. 31, 2022

Supplemental Balance Sheet Disclosures

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:


	March 31,		September 30,
	2022		2021
Raw materials	$	3,751,366	$	3,729,692
Work-in-process		732,778		629,814
Finished goods		205,117		185,886
	$	4,689,261	$	4,545,392

Prepaid expenses and other current assets

Prepaid expenses and other current assets consist of the following:


	March 31,		September 30,
	2022		2021
Prepaid insurance	$	544,254	$	318,138
Other		333,777		514,938
	$	878,031	$	833,076

Property and equipment

Property and equipment, net consists of the following:


	March 31,		September 30,
	2022		2021
Computer equipment	$	2,294,387	$	2,309,053
Corporate airplanes		5,601,039		5,601,039
Furniture and office equipment		977,735		970,725
Manufacturing facility		5,889,491		5,889,491
Equipment		5,622,877		5,545,529
Land		1,021,245		1,021,245
		21,406,774		21,337,082
Less: accumulated depreciation and amortization		(13,359,428)		(13,193,599)
	$	8,047,346	$	8,143,483

Depreciation and amortization related to property and equipment was $88,122 and $95,844 for the three-month periods ended March 31, 2022 and 2021, 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.

Depreciation and amortization related to property and equipment was approximately $180,494 and $188,895 for the six-month periods ended March 31, 2022 and 2021, respectively.

Other assets

Other assets consist of the following:


	March 31,		September 30,
	2022		2021
Intangible assets, net of accumulated amortization of $635,095 and $634,032 at March 31, 2022 and September 30, 2021	$	61,411	$	62,474
Operating lease right-of-use asset		35,741		42,976
Other non-current assets		76,257		82,834
	$	173,409	$	188,284

Intangible assets consist of licensing and certification rights which are amortized over a defined number of units. No impairment charges were recorded in the six-month periods ended March 31, 2022 and 2021.

Intangible asset amortization expense was $1,063 and $12,559 for the three-month periods ended March 31, 2022 and 2021, respectively. Intangible asset amortization expense was $1,063 and $32,473 for the six-month periods ended March 31, 2022 and 2021, 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 March 31, 2022 and September 30, 2021 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 March 31, 2022 and September 30, 2021 includes $958 and $7,535, 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 $3,557 and $2,392 for the three-month periods ended March 31, 2022 and 2021, respectively. Other non-current assets amortization expense was $6,577 and $3,110 for the six-month periods ended March 31, 2022 and 2021, respectively.

Accrued expenses

Accrued expenses consist of the following:


	March 31,		September 30,
	2022		2021
Warranty	$	585,867	$	589,260
Salary, benefits and payroll taxes		366,801		385,287
Professional fees		129,584		163,130
Income tax		164,715		104,737
Operating lease		13,951		14,296
Other		297,243		174,405
	$	1,558,161	$	1,431,115

Warranty cost and accrual information for the three-month period ended March 31, 2022 is highlighted below:


	Three Months Ending		Six Months Ending
	March 31, 2022		March 31, 2022
Warranty accrual, beginning of period	$	596,436	$	589,260
Accrued expense		32,054		64,644
Warranty cost		(42,623)		(68,037)
Warranty accrual, end of period	$	585,867	$	585,867