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Operating Lease Assets
6 Months Ended
Jun. 30, 2023
Operating Lease Assets  
Operating Lease Assets

6. Operating Lease Assets

 

The Company entered into a lease agreement on February 1, 2021, for 8,898 square feet, for its office facilities in Chandler, AZ through January 2027. Monthly rental payments, excluding common area maintenance charges, are $25,953 to $28,733. The first twelve months of the lease included a 50% abatement period and a deposit of $110,000 was required. The lessor contributed $110,000 towards the purchase of office furniture as part of the lease agreement. As of June 30, 2023, we have an operating lease asset balance of $878,380 and an operating lease liability balance of $1,065,155 recorded in accordance with ASC 842, Leases (ASC “842”).

 

The following are additional details related to leases recorded on our balance sheet as of June 30, 2023:

 

Leases  Classification  Balance at
June 30, 2023
 
Assets        
Current        
Operating lease assets  Operating lease assets  $ 
Noncurrent        
Operating lease assets  Noncurrent operating lease assets  $878,380 
Total lease assets     $878,380 
         
Liabilities        
Current        
Operating lease liabilities  Operating lease liabilities  $263,663 
Noncurrent        
Operating lease liabilities  Noncurrent operating lease liabilities  $801,492 
Total lease liabilities     $1,065,155 

 

 

The maturity analysis below summarizes the remaining future undiscounted cash flows for our operating leases, a reconciliation to operating lease liabilities reported on the Condensed Consolidated Balance Sheet, our weighted-average remaining lease term, and weighted average discount rate:

 

Year ending December 31,     
2023   $162,389 
2024    330,894 
2025    337,568 
2026    344,241 
2027    28,733 
Thereafter     
Total future lease payments    1,203,825 
Less: imputed interest    (138,670)
Total   $1,065,155 

 

 

Weighted Average Remaining Lease Term (years)    
Operating leases   3.58 
      
Weighted Average Discount Rate     
Operating leases   6.75%