Leases

12 Months Ended

Dec. 31, 2022

Leases

Leases

12. Leases

The Company leases an office, a plant and certain equipment under non-cancelable operating and finance lease agreements. The leases have remaining lease terms ranging from one year to ten years.

 Supplemental balance sheet information related to leases is as follows:     

Balance Sheet Location		December 31, 2022
Operating Leases
Right-of-use assets, net		$	2,517,559
Current liabilities	Lease liability, current maturities		(418,619	)
Non-current liabilities	Lease liability, net of current maturities		(2,118,958	)
Total operating lease liabilities		$	(2,537,577	)
Finance Leases
Right-of-use assets		$	1,903,443
Current liabilities	Lease liability, current maturities		(806,775	)
Non-current liabilities	Lease liability, net of current maturities		(920,878	)
Total finance lease liabilities		$	(1,727,653	)
Weighted Average Remaining Lease Term
Operating leases			6.93 years
Finance leases			2 years
Weighted Average Discount Rate
Operating leases			3%
Finance leases			3%

As the leases do not provide an implicit rate, the Company used an incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments, which is reflective of the specific term of the leases and economic environment of each geographic region. 

Anticipated future lease costs, which are based in part on certain assumptions to approximate minimum annual rental commitments under non-cancelable leases, are as follows: 

Year Ending December 31,		Operating		Financing		Total
2023	$	525,718	$	851,792	$	1,377,510
2024		523,722		801,869		1,325,591
2025		446,349		131,544		577,893
2026		207,379		—		207,379
2027		211,526		—		211,526
Thereafter		908,376		—		908,376
Total lease payments		2,823,070		1,785,205		4,608,275
Less: Imputed interest		285,493		57,552		343,045
Present value of lease liabilities	$	2,537,577	$	1,727,653	$	4,265,230

Chicago Airport Testing has subleased its leased vacant area for a period of one year, the sublessee has the option to terminate at any time after the first six months. The sublessee elected to terminate the Agreement, effective as of July 31, 2021 and the Company has no remaining lease revenue from the sublessee.

Total lease expense amounted to $770,272 and $367,869 for the years ending December 31, 2022 and 2021.