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LEASES | 9 Months Ended
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Sep. 30, 2021
Leases [Abstract] |
LEASES | NOTE－11 LEASES We adopted ASU No. 2016-02, Leases, on January 1, 2019, the beginning of our fiscal 2019, using the modified retrospective approach. We determine whether an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys the right to control the use of an identified fixed asset explicitly or implicitly for a period of time in exchange for consideration. Control of an underlying asset is conveyed if we obtain the rights to direct the use of and to obtain substantially all of the economic benefit from the use of the underlying asset. Some of our leases include both lease and non-lease components which are accounted for as a single lease component as we have elected the practical expedient. Some of our operating lease agreements include variable lease costs, primarily taxes, insurance, common area maintenance or increases in rental costs related to inflation. Substantially all of our equipment leases and some of our real estate leases have terms of less than one year and, as such, are accounted for as short-term leases as we have elected the practical expedient. Operating leases are included in the right-of-use lease assets, other current liabilities and long-term lease liabilities on the Consolidated Balance Sheet. Right-of-use assets and lease liabilities are recognized at each lease’s commencement date based on the present values of its lease payments over its respective lease term. When a borrowing rate is not explicitly available for a lease, our incremental borrowing rate is used based on information available at the lease’s commencement date to determine the present value of its lease payments. Operating lease payments are recognized on a straight-line basis over the lease term. We had no financing leases as of September 30, 2021 and December 31, 2020. The Company adopts a 5.26% as weighted average incremental borrowing rate to determine the present value of the lease payments. The weighted average remaining life of the lease was 3.48 year. During the period ended September 30, 2021, the Company enter into new lease arrangements, and accounted as per ASC 842, the ROU asset and lease obligation of $479,171. The Company excludes short-term leases (those with lease terms of less than one year at inception) from the measurement of lease liabilities or right-of-use assets. The following tables summarize the lease expense for the period ended September 30:
Schedule of Lease expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Three months ended September 30, |  | Nine months ended September 30,
|  | 2021 |  | 2020 |  | 2021 |  | 2020
Operating lease expense (per ASC 842) |  | $ | 13,554 |  |  | $ | 6,076 |  |  | $ | 31,975 |  |  | $ | 21,802 |
Short-term lease expense (other than ASC 842) |  |  | 63,363 |  |  |  | 4,627 |  |  |  | 66,420 |  |  |  | 31,258 |
Total lease expense |  | $ | 76,917 |  |  | $ | 10,703 |  |  | $ | 98,395 |  |  | $ | 53,060 |
As of September 30, 2021, right-of-use assets were $529,782 and lease liabilities were $533,312. As of December 31, 2020, right-of-use assets were $79,109 and lease liabilities were $83,205. Components of Lease Expense We recognize lease expense on a straight-line basis over the term of our operating leases, as reported within “general and administrative” expense on the accompanying consolidated statement of operations. Future Contractual Lease Payments as of September 30, 2021 The below table summarizes our (i) minimum lease payments over the next five years, (ii) lease arrangement implied interest, and (iii) present value of future lease payments for the next three years ending September 30:
Schedule of Future Contractual Lease Payments |  |  |
Years ended September 30, |  | Operating lease amount |
2022 |  |  | $ | 190,025 |
2023 |  |  |  | 166,530 |
2024 |  |  |  | 147,813 |
2025 |  |  |  | 77,997 |
Total |  |  |  | 582,365 |
Less: interest |  |  |  | (49,053 | )
Present value of lease liabilities |  |  | $ | 533,312 |
Less: non-current portion |  |  |  | (365,539 | )
Present value of lease liabilities – current liability |  |  | $ | 167,773 |

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- Definition The entire disclosure for lessee entity's leasing arrangements including, but not limited to, all of the following: (a.) The basis on which contingent rental payments are determined, (b.) The existence and terms of renewal or purchase options and escalation clauses, (c.) Restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing. + References Reference 1: http://fasb.org/us-gaap/role/ref/otherTransitionRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -URI http://asc.fasb.org/topic&trid=2208923 + Details
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