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Lease

9 Months Ended

Sep. 30, 2020

ASU 2016-02 Transition [Abstract]

Lessee, Operating Lease, Disclosure [Table Text Block]

Note 15 - Lease

On June 17, 2013, the Company entered into a lease agreement for office, warehouse, storage, and distribution space with a five year term, commencing on November 1, 2013 and expiring on October 31, 2018. The lease agreement also provides an option to extend the term for an additional six years. On April 23, 2018, the Company extended the lease for another 36 months with an expiration date of October 31, 2021. The monthly rental payment is $42,000 with an annual 3% increase.  

The Company has entered into several lease agreements for office and warehouse space in Commerce, California and showroom space in Las Vegas, Nevada and High Point, North Carolina on monthly or annual terms.

On July 15, 2019, Nova Malaysia entered into a sublease agreement for warehouse space with a two year term, expiring on July 14, 2021. The monthly rental payment is 20,000 Malaysia Ringgit ($4,724). 

On October 29, 2019, Nova Malaysia entered into a lease agreement for office space with a two year term, commencing on December 1, 2019 and expiring on November 30, 2021. The monthly rental payment is 9,280 Malaysia Ringgit ($2,192). 

On August 20, 2020, Nova Malaysia entered into a sublease agreement for an office and service center with a two year term, commencing on September 1, 2020 and expiring on August 31, 2022. The monthly rental payment is $30,000 Malaysia Ringgit ($7,086).

The operating lease expense for the nine and three months ended September 30, 2020 and 2019 were as follows:

		Nine months ended September 30,								Three months ended September 30,
		2020				2019				2020				2019
Operating lease cost		$	384,108			$	465,735			$	107,745			$	155,245

The following is a schedule, by years, of maturities of lease liabilities as of September 30, 2020:

		Operating Leases
12 months ending September 30,
2021		$	774,993
2022			720,725
2023			656,010
2024			675,690
Thereafter			-
Total undiscounted cash flows			2,827,418
Less: imputed interest			(256,416	)
Present value of lease liabilities			2,571,002

Lease Term and Discount Rate 

		September 30, 2020
Weighted-average remaining lease term - years
Operating leases - USA			4.09
Operating leases - Malaysia			1.56
Weighted-average discount rate (%)
Operating leases - USA			5.00	%
Operating leases - Malaysia			3.07	%

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- References

No definition available.

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- Definition

Tabular disclosure for lessee's operating leases. Includes, but is not limited to, description of lessee's operating lease, existence and terms of renewal or purchase options and escalation clauses, restrictions imposed by lease, such as those concerning dividends, additional debt, and further leasing, rent holidays, rent concessions, or leasehold improvement incentives and unusual provisions or conditions.

+ References

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-Publisher FASB
-Name Accounting Standards Codification
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-Section 55
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