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Leases

12 Months Ended

Dec. 31, 2023

NOTE 9 - LEASES

The Company has leases for certain office and production facilities in the PRC which are classified as operating leases. The leases contain payment terms for fixed amounts. Options to extend are recognized as part of the lease liabilities and recognized as right to use assets when management estimates to renew the lease. There are no residual value guarantees, no variable lease payments, and no restrictions or covenants imposed by leases. The discount rate used in measuring the lease liabilities and right of use assets was determined by reviewing the Company’s incremental borrowing rate at the initial measurement date. For the years ended December 31, 2023 and 2022, operating lease cost was $77,265 and $78,092, respectively and cash paid for amounts included in the measurement of lease liabilities for operating cash flows from operating leases was $80,647 and $82,015, respectively. As of December 31, 2023 and 2022, the Company reported operating lease right of use assets of $116,610 and $39,046, respectively and operating use liabilities of $117,637 and $40,445, respectively. As of December 31, 2023, its operating leases had a weighted average remaining lease term of 1.50 years and a weighted average discount rate of 4.75%.

Minimum lease payments for the Company’s operating lease liabilities were as follows for the twelve month periods ended December 31:

2024	$	80,647
2025	$	40,324
Total undiscounted cash flows		120,971
Less: Imputed interest		(3,334	)
		117,637
Less: Operating lease liabilities, current portion		(77,727	)
Operating lease liabilities, net of current portion	$	39,910

The Company has leases with terms less than one year for certain provincial sales offices that are not material.