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CAPITAL LEASE
 3 Months Ended
Sep. 30, 2012
Capital Lease Obligations [Abstract]  
Capital Leases in Financial Statements of Lessee Disclosure [Text Block]

5.  CAPITAL LEASE

 

Digipath is the lessee of equipment under a capital lease expiring September 2015.  The asset and liability are recorded at the lower of the present value of the minimum lease payments or fair value of the asset.  The asset is amortized over the shorter of the lease term or the estimated life of the asset.  The following is a summary of the property held under the capital lease:  

 

 

 

 

 

September 30,

 

 

 

 

 

2012

 

 

Machinery and equipment

 

$

181,384

 

 

Less accumulated amortization

 

 

63,484

 

 

 

 

$

117,900

 

 

Minimum future lease payments under the capital lease are as follows:

 

 

Year Ending September 30,

 

 

 

 

 

2013

 

$

39,897

 

 

2014

 

 

39,897

 

 

2015

 

 

39,897

 

 

2016

 

 

13,299

 

 

Total minimum lease payments

 

 

132,990

 

 

Less amount representing interest

 

 

13,219

 

 

Present value of minimum lease payments

 

 

119,771

 

 

Less current portion of obligation under capital lease

 

 

44,945

 

 

Long-term portion of obligation under capital lease

 

$

74,826

 

 

Interest on the capital lease is 6.25% and is imputed based on the lower of the incremental borrowing rate at the inception of the lease or the lessor’s implicit rate of return.  Interest expense for the three months ended September 30, 2012 was $291.