9. Capital Lease Obligations Payable

3 Months Ended

Mar. 31, 2013

Leases, Capital [Abstract]

Capital Lease Obligations Payable

Note 9 – Capital Lease Obligations Payable

The Company leases certain equipment under agreements that are classified as capital leases as follows:

Lease #1 - Commenced on March 12, 2010 with monthly lease payments of $2,455 and two months paid in advance, and the remaining payments paid over the next 43 months.

Lease #2 – Commenced on March 16, 2010 with monthly lease payments of $2,258 over the following 36 months.

Lease #3 – Commenced on January 12, 2012 with monthly lease payments of $480 over the next 48 months, and a bargain purchase price of $1 at the end of the lease.

The cost of equipment under capital leases is included in the Balance Sheets as property and equipment and was $134,800 and $134,800 at March 31, 2013 and December 31, 2012, respectively. Accumulated amortization of the leased equipment at March 31, 2013 and December 31, 2012 was $116,292 and $108,090, respectively. Amortization of assets under capital leases is included in depreciation and amortization expense.

The future minimum lease payments required under the capital leases and the present value of the net minimum lease payments as of March 31, 2013, are as follows:

Twelve Months
Ending
March 31,	Amount
2014	$	35,783
2015		5,757
2016		4,750
Total minimum payments	$	54,715
Less: amount representing interest		(8,053	)
Present value of net minimum lease payments		38,237
Less: Current maturities of capital lease obligations		(28,928	)
Long-term capital lease obligations	$	9,309