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RIGHT-OF-USE ASSETS
 6 Months Ended 12 Months Ended
Jun. 30, 2025
Dec. 31, 2024
Right-of-use Assets    
RIGHT-OF-USE ASSETS

9. RIGHT-OF-USE ASSETS

 

The Company leases office and restaurant premises under non-cancelable operating lease agreements, with an option to renew the leases. Per the new lease standard ASC 842-10-55, these leases are treated as operating leases. Management determined the loan interest rate of 3.50% is the weighted average discount rate for the lease that began in 2025. The rental expense for the six months ended June 30, 2025 and 2024 was $ 15,315 and $52,864, respectively. All leases are on a fixed payment basis. None of the leases include contingent rentals.

 

Rights-of-use assets, net consisted of the following:

  

   June 30,   December 31, 
   2025   2024 
Leased properties under operating lease, cost  $209,858    - 
Less: accumulated amortization   (14,913)   - 
Right-of-use assets, net  $194,945    - 

 

The Company does not have any variable lease costs. Cash payment made under the lease agreements is $20,466 and $60,262 for the six months ended June 30, 2025 and 2024, respectively. The weighted-average remaining lease term is 2.58 and 0 years as of June 30, 2025 and December 31, 2024. Interest expense was $ 1,442 and $2,653 for the six months ended June 30,2025 and 2024 respectively.

 

The following table presents maturity of lease liabilities as of June 30, 2025:

      
2025  $38,141 
2026   76,281 
2027   79,110 
2028   11,883 
Total Lease Payments  $205,415 
 Less: imputed interest  $(9,604)
Present value of lease liabilities  $195,811 
Lease liabilities - Current  $70,552 
Lease liabilities – Non current   125,259 

 

Amortization expense was recognized as lease expense in general and administrative expense. Non-cash portion of amortization expense was $14,730 and $42,056 for the six months ended June 30, 2025 and 2024, respectively.

 

The estimated amortization expenses for each of the five succeeding years is as follows:

  

Year ending  Amortization expense 
2025   36,349 
2026   72,697 
2027   72,697 
2028   10,809 
Total  $192,552 

 

On January 1, 2025, Xiamen Xinbaihui Digital Technology Co., LTD(“Xiamen Xinbaihui”) entered a lease with Chunshang Xiamen to lease our executive offices to us for a lease term from January 1, 2025 to December 31, 2027, at a monthly net rent of RMB5,000.00 (approximately, $689).

 

On May 1, 2025, Guangzhou Jingyao Real Estate Co., Ltd. (“Guangzhou Jingyao”) entered a lease with Chunran Guangzhou to lease our executive offices to us for a lease term from May 1, 2025 to February 29, 2028, at a monthly net rent of RMB40,537.35 (approximately, $ 5,589) from May 1, 2025 to February 28, 2027, a monthly net rent of RMB 42,563.85 (approximately, $5,869) from March 1, 2027 to February 29, 2028.

 

11. RIGHT-OF-USE ASSETS

 

The Company leases office and restaurant premises under non-cancelable operating lease agreements, with an option to renew the leases. Per the new lease standard ASC 842-10-55, these leases are treated as operating leases. Management determined the loan interest rate of 4.75% is the weighted average discount rate for the lease that began in 2018. The rental expense for the years ended December 31, 2024, 2023 and 2022 was $110,130, $110,130 and $96,356, respectively. All leases are on a fixed payment basis. None of the leases include contingent rentals.

 

Rights-of-use assets, net consisted of the following:

 

   December 31,   December 31, 
   2024   2023 
Leased properties under operating lease  $        -    293,991 
Less: accumulated amortization   -    (174,935)
Right-of-use assets  $-    119,056 

 

The Company does not have any variable lease costs. Cash payment made under the lease agreements is $120,066, $113,981 and $80,045 for the years ended December 31, 2024, 2023 and 2022, respectively. The weighted-average remaining lease term is 0 and 1.16 years as of December 31, 2024 and 2023. Interest expense was $3,951, $9,303 and $9,631 for the years ended December 31,2024,2023 and 2022 respectively.

 

Amortization expense was recognized as lease expense in general and administrative expense. Non-cash portion of amortization expense was $100,690, $278,957 and $14,436 for the years ended December 31, 2024, 2023 and 2022, respectively.

 

 

MEIWU TECHNOLOGY COMPANY LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS