12. Capital Lease Obligations Payable

9 Months Ended

Sep. 30, 2014

Leases, Capital [Abstract]

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 following 46 months.

Lease #2 – 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 $17,855 and $134,800 at September 30, 2014 and December 31, 2013, respectively. Accumulated amortization of the leased equipment was $2,678 and $124,087 at September 30, 2014 and December 31, 2013, 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 September 30, 2014, are as follows:

Nine Months Ending September 30,	Amount
2015	$	7,196
2016		428
Total minimum payments	$	7,624
Less: amount representing interest		(593	)
Present value of net minimum lease payments		7,031
Less: Current maturities of capital lease obligations		(7,031	)
Long-term capital lease obligations	$	–