Lessee Leases

6 Months Ended

Jun. 30, 2021

Leases [Abstract]

Lessee Leases

Note 6 – Lessee Leases

Operating leases are comprised of office space and office equipment leases. Fleet leases entered into prior to January 1, 2019, are classified as operating leases. Fleet leases entered into on or after January 1, 2019, under ASC 842 guidelines, are classified as finance leases.

Gross right of use assets recorded under finance leases related to WCI vehicle fleet leases were $777,451 and $406,242 as of June 30, 2021 and December 31, 2020, respectively. Accumulated amortization associated with finance leases was $161,750 and $110,164 as of June 30, 2021 and December 31, 2020, respectively.

Lease costs recognized in our consolidated statements of operations is summarized as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Operating lease cost included in cost of goods	$	29,837	$	38,615	$	62,701	$	84,571
Operating lease cost included in operating costs		13,496		13,846		24,592		28,119
Total operating lease cost (1)		43,333		52,461		87,293		112,690
Finance lease cost, included in cost of goods:
Amortization of lease assets		38,952		17,434		51,586		31,427
Interest on lease liabilities		6,363		4,475		11,830		7,969
Total finance lease cost		45,315		21,909		63,416		39,396
Short-term lease cost		0		8,970		2,300		17,940
Total lease cost	$	88,648	$	83,340	$	153,009	$	170,026

(1) Right of use asset amortization under operating agreements was $26,558 and $49,846 for the three months ended June 30, 2021 and 2020, respectively. Right of use asset amortization under operating agreements was $67,539 and $95,722 for the six months ended June 30, 2021 and 2020, respectively.

Other information about lease amounts recognized in our condensed consolidated financial statements is summarized as follows:

	June 30, 2021			December 31, 2020
Weighted-average remaining lease term – operating leases		1.29 years			.93 years
Weighted-average remaining lease term – finance leases		4.05 years			3.41 years
Weighted-average discount rate – operating leases		7.9	%		10.1	%
Weighted-average discount rate – finance leases		5.5	%		8.3	%

Finance lease liabilities were as follows:

	June 30, 2021			December 31, 2020
Gross finance lease liabilities	$	609,184		$	310,685
Less: imputed interest		(52,213	)		(40,183	)
Present value of finance lease liabilities		556,971			270,502
Less: current portion		(145,399	)		(79,526	)
Long-term finance lease liabilities	$	411,572		$	190,976

Operating lease liabilities were as follows:

	June 30, 2021			December 31, 2020
Gross operating lease liabilities	$	108,208		$	146,171
Less: imputed interest		(3,616	)		(6,863	)
Present value of operating lease liabilities		104,592			139,308
Less: current portion		(83,920	)		(123,158	)
Long-term operating lease liabilities	$	20,672		$	16,150

Note 6 – Lessee Leases (continued)

Lease maturities were as follows:

Maturity of lease liabilities
12 months ending June 30,	Finance leases		Operating leases
2022	$	145,399	$	83,920
2023		143,929		20,672
2024		116,128		-
2025		99,870		-
2026		51,645		-
Total		556,971		104,592
Less: Current maturities		145,399		83,920
Long-term liability	$	411,572	$	20,672