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Note 11 - Commitments | 9 Months Ended
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Sep. 30, 2023
Notes to Financial Statements |
Commitments and Contingencies Disclosure [Text Block] | NOTE 11 — COMMITMENTS (1) Contract Manufacturing Agreement Milestone Scientific has informal arrangements with third-party manufacturers of the STA devices, and epidural instruments pursuant to which they manufacture these products under specific purchase orders but without any long-term contract or minimum purchase commitment. The Company has a purchase commitment for the delivery of 2,800 STA instruments as of September 30, 2023. As of September 30, 2023, the purchase order commitment was approximately $2.7 million, and approximately $1.7 million was paid and reported in advances on contracts in the condensed consolidated balance sheet. As of December 31, 2022, the purchase order commitment was approximately $1.7 million, and approximately $1.2 million was paid and reported in advances on contracts in the condensed consolidated balance sheet. The advances on contracts represent funding of future epidural instruments, and epidural replacements parts. The balance of the advances as of September 30, 2023 and December 31, 2022 is approximately $41,000. The advance is classified as current based on the estimated annual usage of the underlying inventory. (2) Leases Operating Leases The Company identified and assessed the following significant assumptions in recognizing its right-of-use assets and corresponding lease liabilities:
| ● | As the Company’s leases do not provide an implicit rate, the Company estimated the incremental borrowing rate in calculating the present value of the lease payments. The Company has utilized its incremental borrowing rate based on the long-term borrowing costs of comparable companies in the Medical Device industry.
| ● | Since the Company elected to account for each lease component and its associated non-lease components as a single combined lease component, all contract consideration was allocated to the combined lease component.
| ● | The expected lease terms include non-cancellable lease periods. Renewal option periods are not included in the determination of the lease terms as they were not reasonably certain to be exercised.
The components of lease expense were as follows:
|  | Three months ended |  |  | Nine months ended |
|  | September 30, 2023 |  |  | September 30, 2022 |  |  | September 30, 2023 |  |  | September 30, 2022 |
Cash paid for operating lease liabilities |  | $ | 34,320 |  |  | $ | 31,999 |  |  | $ | 98,083 |  |  | $ | 95,996 |
Cash paid for finance lease liabilities |  |  | 2,685 |  |  |  | 2,685 |  |  |  | 8,055 |  |  |  | 8,055 |
Right-of-use assets obtained in exchange for new operating lease liabilities (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 663,009 |
Property and equipment obtained in exchange for new finance lease liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 43,242 |
Weighted Average Remaining Lease Term |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Finance leases (years) |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 1.3 |
Operating leases (years) |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 3.5 |
Weighted-average discount rate – operating leases |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 9.20 | %
Weighted-average discount rate – finance leases |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 9.20 | %

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