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Leases
 12 Months Ended
Dec. 31, 2023
Leases [Abstract]  
Leases

Note 13 — Leases

 

Lease commitments

 

The Company determines if a contract contains a lease at inception. US GAAP requires that the Company’s leases be evaluated and classified as operating or finance leases for financial reporting purposes. The classification evaluation begins at the commencement date and the lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain and failure to exercise such option which result in an economic penalty.

 

The Company has several offices lease agreements with lease terms ranging from two to six years. Upon adoption of ASU 2016-02 on January 1, 2022, the Company recognized approximately RMB 5.7 million right of use (“ROU”) assets and same amount of lease liabilities based on the present value of the future minimum rental payments of leases, using a incremental borrowing rate of 7.0%. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases generally do not contain options to extend at the time of expiration.

 

As of December 31, 2022 and December 31, 2023, the Company’s operating leases had a weighted average remaining lease term of approximately 2.93 years and 2.65 years, respectively.

 

Operating lease expenses are allocated between the cost of revenue and selling, research and development, general, and administrative expenses. Rent expenses for the years ended December 31,2021, 2022 and 2023 was and RMB 2,222,304, RMB 2,532,996 and RMB 2,306,237, respectively.

 

The five-year maturity of the Company’s operating lease obligations is presented below:

 

               
Twelve Months Ending December 31,   Operating Lease
Amount		     Operating Lease
Amount		  
    RMB     USD  
2024     1,243,004       175,499  
2025     1,307,489       184,603  
2026     875,622       123,628  
2027   -    - 
2028   -    - 
Total lease payments     3,426,115       483,730  
Less: Interest     (304,651 )     (43,013 )
Present value of lease liabilities     3,121,464       440,717  

 

Future amortization of Company’s ROU assets is presented below:

 

        
Twelve months ending December 31,  RMB   USD 
2024   1,061,871    149,925 
2025   1,138,324    160,719 
2026   788,496    111,327 
Total   2,988,691    421,971