Leases

3 Months Ended

Mar. 31, 2019

Leases [Abstract]

Leases

The Company has various operating lease agreements with initial terms up to three years, all of which relate to vehicles. The Company’s office lease is on a month-to-month basis and so is not recognized on the balance sheet. Some leases include options to purchase, terminate or extend for one or more years. These options are included in the lease term when it is reasonably certain that the option will be exercised.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating right-of-use lease assets and lease liabilities on the consolidated balance sheets, totaling $14,877 and $7,332 at March 31, 2019, respectively, including $7,544 of operating right-of-use assets previously prepaid at lease commencement. These assets and liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term using the Company’s secured incremental borrowing rates or implicit rates, when readily determinable. Short-term operating leases, which have an initial term of 12 months or less, are not recorded on the balance sheet.

The Company’s operating leases do not provide an implicit rate that can readily be determined. Therefore, the Company uses a discount rate based on its incremental borrowing rate.

The Company’s weighted-average remaining lease term relating to its operating leases is 0.66 years and weighted-average remaining payments for operating lease liabilities is 0.32 years, with a weighted-average discount rate of 6.00%.

Operating lease expense is recognized on a straight-line basis over the lease term within Selling, general and administrative expenses on the Company’s consolidated statement of operations. The Company incurred lease expense of $8,163 and $14,998 for the three months ended March 31, 2019 and 2018, respectively. The Company made cash payments of $6,452 for operating leases for the three months ended March 31, 2019.

The following table presents information about the amount and timing of cash flows arising from the Company’s operating leases as of March 31, 2019.

Maturity of Lease Liability
2019	$	7,420
Total undiscounted operating lease payments		7,420
Less: Imputed interest		88
Present value of operating lease liabilities	$	7,332