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Note 14 - Operating Leases | 6 Months Ended
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May 31, 2020
Notes to Financial Statements |
Lessee, Operating Leases [Text Block] |
| 14 ) | Operating Leases
The Company determines if an arrangement is a lease at inception of a contract. The nature of the Company’s operating leases at this time is office equipment, mainly copiers, with terms of 12 to 60 months. Operating leases are included in other assets as operating lease right-of-use (“ROU”) assets on the Condensed Consolidated Balance Sheets while current lease liabilities are included as accrued expenses. The long-term portions of operating lease liabilities are shown as long-term liabilities on the Condensed Consolidated Balance Sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company generally uses its incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has copier lease agreements with lease and non-lease components and has elected the practical expedient not to separate lease and non-lease components for this asset class. The Company has also elected not to recognize lease liabilities and ROU assets for short-term leases. The Company recognizes variable costs that depend on usage in profit or loss as they are incurred. The components of operating leases on the Condensed Consolidated Balance Sheets at May 31, 2020 were as follows:
|  | May 31 , 2020 |
Operating lease right-of-use assets |  | $ | 32,072 |
Current portion of operating lease liabilities |  | $ | 9,297 |
Long-term portion of operating lease liabilities |  |  | 22,775 |
Total operating lease liabilities |  | $ | 32,072 |
The Company included $32,072 of operating lease ROU assets in other assets, the current portion of operating lease liabilities of $9,297 was included in accrued expenses and the $22,775 of long-term operating lease liabilities was included in the long-term liability portion of the Condensed Consolidated Balance Sheets. The Company recorded $5,481 and $13,632 of operating lease costs in the three and six months ended May 31, 2020, respectively, which included variable costs tied to usage. The Company’s operating leases carry a weighted average lease term of 39 months and have a weighted average discount rate of 5.50% Future maturities of operating lease liabilities are as follows:
Maturities of operating lease liabilities are as follows: |
Year Ending November 30, |  |  |  |
2020 |  |  | 5,138 |
2021 |  |  | 10,847 |
2022 |  |  | 10,847 |
2023 |  |  | 6,456 |
2024 |  |  | 1,630 |
Total lease payments |  |  | 34,918 |
Less imputed interest |  |  | (2,847 | )
Total operating lease liabilities |  |  | 32,072 |

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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 + Details
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