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LEASES | 6 Months Ended
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Jun. 30, 2023
LEASES |
LEASES | NOTE 11 — LEASES In determining our right-of-use assets and lease liabilities, we apply a discount rate to the minimum lease payments within each lease agreement. ASC 842 requires us to use the interest rate that a lessee would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. If we cannot readily determine the discount rate implicit in lease agreements, we utilize our incremental borrowing rate. The Company has nine operating leases as of June 30, 2023—five in DFW, two in Mt. Pleasant, South Carolina and two in Chandler, Arizona. The leases for the consumer segment are: 1) the flagship store located at 13022 Preston Road, Dallas, Texas expiring on January 31, 2027, with an option to extend the lease for an additional five years, at the prevailing market rate for comparable space in comparable buildings in the vicinity; 2) the Grand Prairie, Texas lease expiring June 30, 2027, with an option to extend the lease for an additional five years; 3) the two leases for the Mt. Pleasant, South Carolina location expiring on April 30, 2025, with no additional renewal options; and 4) the lease for the Euless, Texas location expiring June 30, 2025, with an option to extend the lease for an additional five years. The leases for the commercial segment are: 1) the Echo location on W. Belt Line Road, in Carrollton, Texas, expiring January 31, 2026, with an option to extend the lease an additional five years: 2) the lease for the Teladvance location, which also houses ITAD USA and CEX, on Realty Road in Carrollton, Texas expiring January 31, 2027, with no additional renewal options; and 3) the two leases for the Avail location in Chandler, Arizona expiring on May 31, 2025, with no additional renewal options. All of the Company’s nine leases as of June 30, 2023 are triple net, for which it pays its proportionate share of common area maintenance, property taxes and property insurance. Leasing costs for the three months ended June 30, 2023 and 2022 were $705,365 and $659,860 respectively, comprised of a combination of minimum lease payments and variable lease costs. Leasing costs for the six months ended June 30, 2023 and 2022 were $1,361,885 and $1,282,723, respectively, comprised of a combination of minimum lease payments and variable lease costs. As of June 30, 2023, the weighted average remaining lease term and weighted average discount rate for operating leases was 2.8 years and 4.4%, respectively. For the three months ended June 30, 2023 and 2022, the Company’s cash paid for operating lease liabilities was $706,372 and $650,606 respectively. For the six months ended June 30, 2023 and 2022, the Company’s cash paid for operating lease liabilities was $1,362,892 and $1,266,703, respectively. Future annual minimum lease payments as of June 30, 2023:
|  | Operating |
|  | Leases |
Consumer |  |  |
2023 (excluding the six months ending June 30, 2023) |  |  | 271,657 |
2024 |  |  | 552,414 |
2025 |  |  | 434,274 |
2026 |  |  | 355,000 |
2027 and thereafter |  |  | 50,114 |
Total minimum lease payments |  |  | 1,663,459 |
Less imputed interest |  |  | (110,394 | )
Consumer Sub-Total |  |  | 1,553,065 |
Commercial |  |  |  |
2023 (excluding the six months ending June 30, 2023) |  |  | 679,530 |
2024 |  |  | 1,396,129 |
2025 |  |  | 1,321,297 |
2026 |  |  | 474,326 |
2027 and thereafter |  |  | 33,455 |
Total minimum lease payments |  |  | 3,904,737 |
Less imputed interest |  |  | (235,751 | )
Commercial Sub-Total |  |  | 3,668,986 |
Total |  |  | 5,222,051 |
Current portion |  |  | 1,744,419 |
|  | $ | 3,477,632 |

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- Definition The entire disclosure for lessee entity's leasing arrangements including, but not limited to, all of the following: (a.) The basis on which contingent rental payments are determined, (b.) The existence and terms of renewal or purchase options and escalation clauses, (c.) Restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing. + References Reference 1: http://fasb.org/us-gaap/role/ref/otherTransitionRef -Topic 840 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//840/tableOfContent + Details
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