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Operating Lease | 3 Months Ended
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Mar. 31, 2021
Leases [Abstract] |
Operating Lease | NOTE 7. OPERATING LEASE On May 13, 2020, the Company entered into an operating lease for new warehouse and office space which will serve as its new principal executive office and primary business location. The original lease agreement was amended on August 28, 2020 to correct the footage under lease and monthly payment amounts resulting from such correction. The lease terms, as amended include no base rent for the first nine months and monthly payments ranging from $12,398 to $14,741 thereafter, with a termination date of December 2026. The Company is responsible for property taxes, utilities, insurance and its proportionate share of common area costs related to its new location. The Company took possession of the leased facilities on June 15, 2020. The remaining lease term for the Company’s office and warehouse operating lease as of March 31, 2021 was sixty-nine months. The Company’s previous office and warehouse space lease expired in April 2020 and the Company paid holdover rent for the time period until it moved to and commenced occupying the new space on June 15, 2020. The Company entered into an operating lease with a third party in October 2019 for copiers used for office and warehouse purposes. The terms of the lease include 48 monthly payments of $1,598 with a maturity date of October 2023. The Company has the option to purchase the equipment at maturity for its estimated fair market value at that point in time. The remaining lease term for the Company’s copier operating lease as of March 31, 2021 was 31 months. Lease expense related to the office space and copier operating leases were recorded on a straight-line basis over their respective lease terms. Total lease expense under the two operating leases was $32,057 for the three months ended March 31, 2021. The discount rate implicit within the Company’s operating leases was not generally determinable and therefore the Company determined the discount rate based on its incremental borrowing rate on the information available at commencement date. As of commencement date, the operating lease liabilities reflect a weighted average discount rate of 8%. The following sets forth the operating lease right of use assets and liabilities as of March 31, 2021:
Assets: |  |  |  |
Operating lease right of use assets |  | $ | 748,742 |
Liabilities: |  |  |  |
Operating lease obligations-current portion |  | $ | 117,322 |
Operating lease obligations-less current portion |  | $ | 703,983 |
Total operating lease obligations |  | $ | 821,305 |
The components of lease expense were as follows for the three months ended March 31, 2021:
Selling, general and administrative expenses |  | $ | 32,057 |
Following are the minimum lease payments for each year and in total.
Year ending December 31: |  |  |
2021 (April 1, 2021 to December 31, 2021) |  | $ | 133,260 |
2022 |  |  | 184,145 |
2023 |  |  | 184,241 |
2024 |  |  | 171,642 |
2025 & beyond |  |  | 333,705 |
Total undiscounted minimum future lease payments |  |  | 1,006,993 |
Imputed interest |  |  | (185,688 | )
Total operating lease liability |  | $ | 821,305 |

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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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