Lease Liabilities

9 Months Ended

Sep. 30, 2019

Lease Liabilities - Schedule Of Future Minimum Lease Payments

Lease Liabilities

7. Lease Liabilities

During the nine month period ended September 30, 2019, the Company signed a lease agreement for warehouse space to commence on August 1, 2019 and end on July 31, 2022 with monthly lease payments of $2,496. The Company has accounted for its leases upon adoption of ASC 842 whereby it recognizes a lease liability and a right-of-use asset at the date of initial application, being January 1, 2019. The lease liability is measured at the present value of the remaining lease payments, discounted using the Company’s incremental borrowing rate of 10%. The Company has measured the right-of-use asset at an amount equal to the lease liability.

The Company’s right-of-use asset for the nine months ended September 30, 2019 is as follows:

	September 30, 2019
Right-of-use asset	$	63,399
Current lease liability	$	21,221
Long-term lease liability	$	42,178

The components of lease expense are as follows:

		September 30, 2019
Amortization of right-of-use	$	3,296
Interest on lease liability	$	1,212
Total lease cost	$	4,508

Maturities of lease liability are as follows:

Future minimum lease payments as of September 30, 2019,

2019	$	6,651
2020		26,606
2021		26,606
2022		13,303
Total future minimum lease payments		73,166
Less: amount representing interest		(9,717	)
Present value of future payments		63,399
Current portion		21,221
Long term portion	$	42,178