Note 3 - Operating Leases - Right-of-Use Assets and Lease Liability Obligations

The Company has three non-cancelable operating leases, for office and warehousing space, that expires in January 2027 and February 2027, respectively. Rent expense for these operating leases is recognized over the term of the lease on a straight-line basis.

Below is a summary of the Company's Operating Right-of-Use Assets and Operating Lease Liabilities as of March 31, 2026 and December 31, 2025:

		2026			2025
Assets
Operating lease ROU assets	$	262,967		$	342,413
Liabilities
Operating lease liabilities, current	$	262,967		$	309,019
Operating lease liabilities, net of current portion		-			33,394
Total operating lease liabilities	$	262,967		$	342,413

 

During the three months ended March 31, 2026 and 2025 the Company recognized operating lease expenses amounting to $78,409 and $71,502, respectively, which are included in office lease and expenses in the Company's consolidated statements of operations and comprehensive income. Generally, the Company's lease agreements do not specify an implicit rate. Therefore, the Company estimates the incremental borrowing rate, which is defined as the interest rate the Company would pay to borrow on a collateralized basis, considering such factors as length of lease term and the risks of the economic environment in which the leased asset operates.

As of March 31, 2026 and December 31, 2025 the following disclosures for the remaining lease terms and incremental borrowing rates were applicable:

Supplemental disclosure	March 31, 2026	December 31, 2025
Weighted average remaining lease term	0.77 years	1.00 years
Weighted average discount rate	3.80%	3.80%

Maturities of lease liabilities as of March 31, 2026 were as follows:

Year ending December 31,		Amounts under Operating Leases
Remaining of 2026		262,683
2027		33,907
Total minimum lease payments	$	296,590
Less: amount representing interest	$	(33,623	)
Total operating lease liabilities	$	262,967

Supplemental cash flow information for the nine months ended March 31, 2026 and 2025 are as follows:

		Three months ended March 31, 2026			Year ended December 31, 2025
Cash paid for operating leases	$	86,997		$	323,611
Right-of-use assets obtained in exchange for lease obligations	$	-		$	82,317