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Leases

12 Months Ended

Dec. 31, 2023

10. Leases

The Company’s leases consist primarily of leases for office and warehouse space. For leases with terms greater than twelve months, the related asset and obligation are recorded at the present value of the lease payments over the term. Many of these leases contain rental escalation clauses which are factored into the determination of the lease payments when appropriate. When available, the lease payments are discounted using the rate implicit in the lease; however, the Company’s current leases do not provide a readily determinable implicit rate. Therefore, the Company’s incremental borrowing rate is estimated to discount the lease payments based on information available at the lease commencement.

These leases contain both lease and non-lease components, which the Company has elected to treat as a single lease component. The Company elected not to recognize leases that have an original lease term, including reasonably certain renewal or purchase obligations, of twelve months or less in its consolidated balance sheets for all classes of underlying assets. Lease costs for such short-term leases are expensed on a straight-line basis over the lease term.

All lease assets denominated in a foreign currency are measured using the exchange rate at the commencement of the lease. All lease liabilities denominated in a foreign currency are remeasured using the exchange rate as of the consolidated balance sheet date.

Lease assets and liabilities

The following table presents the lease-related assets and liabilities and their respective classification on the consolidated balance sheets:


	December 31,		December 31,
	2023		2022
ASSETS
Current
Prepaid expenses and other current assets	$	110,541	$	35,624
Current assets of discontinued operations		—		7,979
Noncurrent
Operating lease right-of-use assets		2,135,446		2,058,384
Total lease right-of-use assets	$	2,245,987	$	2,101,987

LIABILITIES
Current
Current maturities of operating leases	$	456,865	$	546,851
Current liabilities of discontinued operations		—		7,361
Noncurrent
Noncurrent operating leases		1,827,302		1,590,542
Total lease liabilities	$	2,284,167	$	2,144,754

Weighted average remaining lease term:
Operating leases		6.1 years		6.6 years
Operating leases - discontinued operations		0.0 years		0.8 years

Weighted average discount rate:
Operating leases		5.67%		5.11%
Operating leases - discontinued operations		0.00%		4.96%

The components of lease costs were as follows:


	Year Ended December 31,
	2023		2022
Operating lease costs	$	751,261	$	692,404
Short-term lease costs		217,640		100,975
Lease costs - discontinued operations		45,979		40,021
Total lease costs	$	1,014,880	$	833,400

Supplemental cash flow information related to leases is as follows:

Future lease payments relating to the Company's operating lease liabilities from continuing operations as of December 31, 2023 are as follows:


Years ending December 31,	Total
2024	$	580,780
2025		462,990
2026		379,019
2027		336,597
2028		341,687
Thereafter		639,928
Total future lease payments		2,741,001
Less: imputed interest		(456,834)
Total lease obligations		2,284,167
Less: current obligations		(456,865)
Noncurrent lease obligations	$	1,827,302

Year Ended December 31,

Cash paid for amounts included in measurement of liabilities:

Operating cash outflows for operating leases

Operating cash outflows for operating leases - discontinued operations