Note 4 - Property and Equipment

12 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Property, Plant and Equipment Disclosure [Text Block]

4. Property and Equipment

Property and equipment is summarized as follows:

	2022			2021
Production assets	$	1,849,808		$	1,616,308
Computer equipment and software		809,038			647,852
Lab equipment		3,965,189			103,427
Office furniture and fixtures		1,044,858			51,354
Leasehold improvements		123,109			123,109
Construction work in progress		207,027			63,750
		7,999,029			2,605,800
Less accumulated depreciation		(2,900,932	)		(1,578,488	)
	$	5,098,097		$	1,027,312

Depreciation expense was $1,357,571 and $371,435 for the years ended December 31, 2022 and 2021, respectively.

Impairment of Long-Lived Assets

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the asset’s carrying amount  may not be recoverable.  The Company conducts its long-lived asset impairment analyses in accordance with ASC 360-10, Property, Plant, and Equipment.  ASC 360-10 requires the Company to group assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and evaluate the asset group against the sum of the undiscounted future cash flows.  If the undiscounted cash flows do not indicate the carrying amount of the asset is recoverable, an impairment charge is measured as the amount by which the carrying amount of the asset group exceeds its fair value based on discounted cash flow analysis or appraisals.

In fiscal 2022, the Company concluded the undiscounted future cash flows associated with certain of its long-lived assets, specifically mask sets used in the production of a small subset of Company products and information technology equipment, indicated the carrying amount of those items was not recoverable.  As a result, the Company reviewed the long-lived assets for impairment and recorded a $20 thousand impairment charge included in General and Administrative expenses on the consolidated statement of operations.  The impairment was measured under an income approach utilizing forecasted discounted cash flows to determine fair values of the impairment assets.  The inputs utilized in the analyses are classified as Level 3 inputs within the fair value hierarchy as defined in ASC 820, Fair Value Measurement.

At  December 31, 2022, the Company concluded it did not have any other triggering events requiring assessment of impairment of its long-lived assets.