Note 13 - Sales-type Leases

9 Months Ended

Aug. 31, 2020

Notes to Financial Statements

Lessor, Sales-type Leases [Text Block]

13 ) Sales-Type Leases

The Company accounts for leases of modular buildings to certain customers as sales-type leases. These leases have terms of up to

36

months and are collateralized by a security interest in the related modular building. The lessee has a bargain purchase option available at the end of the lease term. A minimum lease receivable is recorded net of unearned interest income and profit on sale at the time the Company's obligation to the lessee is complete. Profit related to the sale of the building is recorded upon fulfillment of the Company's obligation to the lessee.

Modular buildings held for lease by the Modular Buildings segment are recorded at cost. Amortization of each modular building is calculated over the useful life of the building. Estimated useful life is

three

to

five

years. Lease revenue is accounted for on a straight-line basis over the term of the related lease agreement. Lease income for modular buildings is included in sales on the consolidated statements of operations.

The components related to sales-type leases at

August 31, 2020

and

November 30, 2019

are as follows:

	August 31, 2020			November 30, 2019
Minimum lease receivable, current	$	49,352		$	162,425
Unearned interest income, current		(1,498	)		(14,420	)
Net investment in sales-type leases, current	$	47,854		$	148,005
Minimum lease receivable, long-term	$	-		$	5,851
Unearned interest income, long-term		-			(69	)
Net investment in sales-type leases, long-term	$	-		$	5,782

There was

no

sales activity related to sales-type leases for the

three

and

nine

months ended

August 31, 2020

and

August

31,2019.

Future minimum lease receipts from sales-type leases are as follows:

Year Ending November 30,	Amount
2020		43,500
2021		5,852
Total	$	49,352