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Lease Commitments
 3 Months Ended
Sep. 30, 2024
Commitments and Contingencies Disclosure [Abstract]  
Lease Commitments

Note 11 – Lease Commitments

 

Finance Leases

 

In July 2023, the Company entered into an equipment lease for $340,048. The related finance liability has an implied interest rate of 11.16% per annum and requires 5 equal annually payments on September 1, 2023. As of September 30, 2024 and June 30, 2024, the balance of the finance liability was $198,233 and $272,669, respectively.

 

The present value of future minimum lease payments due at September 30, 2024, was as follows:

 

      
2025   - 
2026   81,459 
2027   81,459 
Thereafter   81,458 
Total minimum payments   244,377 
Less: amount representing interest   (46,144)
Present value of minimum payments  $198,233 
Less: current portion   (58,887)
Long term portion  $139,346 

 

 

Operating Leases

 

The Company leases its instructional facilities under non-cancelable operating leases expiring at various dates through 2026. In most cases, the facility leases require the Company to pay various operating expenses of the facilities in addition to base monthly lease payments. In certain cases, the Company has options available under its leases to renew, and certain leases contain ordinary rental escalations on the space. Rent expense for the certain leases described above is recorded evenly over each lease term. The difference between rent expense recorded and the amount paid is reflected as deferred rent on the accompanying balance sheets for those leases with rent escalation clauses.

 

Because the rate implicit in each lease is not readily determinable, the Company uses its incremental borrowing rate to determine the present value of the lease payments. The Company has elected the practical expedient to use the risk-free rate as its incremental borrowing rate.

 

June 30, 2024 are as follows:

 

      
2025  $1,786,450 
2026   2,084,138 
2027   1,155,836 
2028   830,612 
2029   847,224 
After 2029   2,719,747 
Total future minimum operating lease payments   9,424,007 
Less: imputed interest   (837,235)
Total   8,586,772 
Current portion of operating lease   2,190,714 
Long term portion of operating lease  $6,396,058 

 

Total rent expense and related taxes and operating expenses under operating leases for the three months ended September 30, 2024 and 2023 were $999,115 and $867,624, respectively.

 

Supplemental balance sheet information related to leases was as follows:

 

   September 30, 2024   June 30, 2024 
         
Operating lease right-of-use assets  $8,370,928   $3,575,369 
           
Operating lease liability - current  $2,190,714   $1,868,560 
Operating lease liability – non-current   6,396,058    1,947,620 
Total operating lease liability  $8,586,772   $3,816,180 

 

Other supplemental information:

 

   2024   2023 
   For the three months ended September 30, 
   2024   2023 
Cash paid for operating lease  $782,273   $543,993