Property and Equipment

6 Months Ended

Jun. 30, 2013

5.	Property and Equipment

Major classes of property and equipment consisted of the following for each of the periods presented below:

	JUNE 30,			DECEMBER 31,
	2013			2012
	(Unaudited)
Land and building	$	677,054		$	677,054
Computer hardware and software		1,776,661			1,544,233
Furniture and fixtures		216,947			214,000
Leasehold improvements		368,596			368,596
Automobile		2,400			2,400
Gross property and equipment		3,041,658			2,806,283
Less: accumulated depreciation and amortization		(1,566,662	)		(1,377,960	)

Property and equipment, net	$	1,474,996		$	1,428,323

There were no changes in the estimated useful life used to depreciate property and equipment for each of the three or six month periods ended June 30, 2013 or 2012. For each of the three month periods ended June 30, 2013 and 2012, property and equipment depreciation expense recorded was approximately $99,900 and $109,900, respectively. For the six month periods ended June 30, 2013 and 2012, property and equipment depreciation expense recorded was approximately $188,700 and $201,100, respectively. For each of the three and six month periods ended June 30, 2013 and 2012, there were no material sales or disposals of owned property and equipment.

Included in property and equipment are certain equipment purchases acquired under capital lease arrangements. For each of the three and six month periods ended June 30, 2013, the Company did not enter into any capital lease arrangements. See Note 7 for additional information about historical capital lease obligations. Total capitalized cost of equipment under capital leases at June 30, 2013 and December 31, 2012 was approximately $477,500, respectively. For the three month periods ended June 30, 2013 and 2012 depreciation expense for leased equipment was approximately $14,700 and $22,600, respectively. For the six month periods ended June 30, 2013 and 2012 depreciation expense for leased equipment was approximately $29,400 and $35,300, respectively. Accumulated depreciation for leased equipment at June 30, 2013 and December 31, 2012 was approximately $379,600 and $350,200, respectively. For the three month periods ended June 30, 2013 and 2012, there were no disposals of leased equipment. Total net book value of assets under capital leases at June 30, 2013 and December 31, 2012 was approximately $97,900 and $127,300, respectively.

- Definition

The entire disclosure for long-lived, physical assets used in the normal conduct of business and not intended for resale. Includes, but is not limited to, accounting policies and methodology, roll forwards, depreciation, depletion and amortization expense, including composite depreciation, accumulated depreciation, depletion and amortization expense, useful lives and method used, income statement disclosures, assets held for sale and public utility disclosures.

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