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Leases

6 Months Ended

Jun. 30, 2024

NOTE 8 - LEASES

The Company leases both office space and warehouse space for its operations. Lease maturities vary from 2 to 5 years. Leases are viewed and recorded as operating leases and as such periodic payments (monthly) are expensed according to the period for which payment is made. Operating lease costs recorded in general and administrative expenses in the consolidated statements of operations were $163,965 and $141,787 for the three months ended June 30, 2024 and 2023, respectively and $327,930 and $272,729 for the six months ended June 30, 2024 and 2023, respectively.

The Company also leases multiple vehicles for its operations. The leases on vehicles generally have a 5-year term and are recorded as finance leases.

Finance lease costs recorded in depreciation and amortization in the consolidated statements of operations were $34,118 and $27,523 for the three months ended June 30, 2024, and 2023, respectively. Finance lease costs recorded in depreciation and amortization in the consolidated statements of operations were $68,236 and $30,644 for the six months ended June 30, 2024, and 2023, respectively. Finance lease costs recorded in interest expense in the consolidated statements of operations were $13,395 and $12,740 for the three months ended June 30, 2024, and 2023, respectively. Finance lease costs recorded in interest expense in the consolidated statements of operations were $27,495 and $14,258 for the six months ended June 30, 2024, and 2023, respectively.

The following amounts were recorded in the Company’s balance sheet relating to its operating and finance leases and other supplemental information:

	June 30, 2024			December 31, 2023
Right -of-use operating lease asset	$	828,447		$	1,135,668
Right-of-use finance lease asset		515,248			583,484

Current portion of obligations under operating leases		384,415			539,599
Current portion of obligations under finance leases		124,293			118,416
Obligations under operating leases, non-current		468,796			636,414
Obligations under finance leases, non-current		415,619			479,271
Total lease liabilities	$	1,393,123		$	1,773,700

Other supplemental information:
Weighted average remaining lease term (years)
Operating lease		2.82			2.86
Finance lease		3.78			4.28

Weighted average discount rate
Operating lease		4.19	%		4.26	%
Finance lease		9.76	%		9.75	%

The following table presents the maturity analysis of operating and finance lease liabilities as of June 30, 2024:

Operating leases

Years	Operating Leases
2024	$	232,036
2025		291,270
2026		186,931
2027		138,284
2028		58,566
Total lease payments		907,087
Less interest		53,876
Present value of lease liabilities		853,211

Finance leases

Years	Finance Leases
2024	$	85,738
2025		171,476
2026		171,476
2027		171,476
2028		47,607
Total lease payments		647,773
Less interest		107,861
Present value of lease liabilities		539,912

The Company has deposited security payments related to the facility leases of $71,515 included in the accompanying condensed consolidated balance sheets as other assets.