Quarterly report pursuant to Section 13 or 15(d)

Leases

v3.19.2
Leases
6 Months Ended
Jun. 30, 2019
Leases [Abstract]  
LEASES
6. LEASES

 

We determine if a contract contains a lease at inception. Our material operating leases consist of retail and warehouse locations as well as office space. Our leases generally have remaining terms of 1- 5 years, most of which include options to extend the leases for additional 3-5 year periods. Generally, the lease term is the minimum of the noncancelable period of the lease or the lease term inclusive of reasonably certain renewal periods.

 

Operating lease assets and liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent our right to use an underlying asset and are based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, we estimate incremental secured borrowing rates corresponding to the maturities of the leases. Our leases typically contain rent escalations over the lease term. We recognize expense for these leases on a straight-line basis over the lease term.

 

We elected this expedient to account for lease and non-lease components as a single component for our entire population of operating lease assets.

 

We have elected the short-term lease recognition exemption for all applicable classes of underlying assets. Short-term disclosures include only those leases with a term greater than one month and 12 months or less, and expense is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less, that do not include an option to purchase the underlying asset that we are reasonably certain to exercise, are not recorded on the balance sheet.

 

    June 30,  
    2019  
Right to use assets, operating lease assets   $ 5,461,196  
         
Current lease liability   $ 1,550,349  
Non-current lease liability     3,993,403  
    $ 5,543,752  

 

    June 30,  
    2019  
Weighted average remaining lease term     3.75 years  
Weighted average discount rate     7.6 %
         
Operating lease assets obtained for operating lease liabilities   $ 3,050,164  

 

Maturities of lease liabilities      
2019   $ 942,200  
2020     1,839,700  
2021     1,775,300  
2022     1,270,700  
2023     774,300  
2024     61,900  
Total lease payments     6,664,100  
Less: Imputed interest     (1,120,348 )
Lease Liability June 30, 2019   $ 5,543,752