COMMITMENTS AND CONTINGENCIES

6 Months Ended

Nov. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 5 – COMMITMENTS AND CONTINGENCIES

On March 9, 2018, the Company entered into a sublease agreement for office space in Las Vegas, NV, with United Power, a related party. The lease is considered an operating lease, requires monthly payments of $15,000 and expires March 8, 2023. We have accounted for the lease under ASU 842 Leases, as follows.

	Balance Sheet Classification	November 30, 2019
Asset
Operating lease asset	Right of use asset	$	477,363
Total lease asset		$	477,363
Liability
Operating lease liability – current portion	Current operating lease liability	$	133,940
Operating lease liability – noncurrent portion	Long-term operating lease liability		343,423
Total lease liability		$	477,363

Lease obligations at November 30, 2019 consisted of the following:

For the year ended May 31:
2020	$	90,000
2021		180,000
2022		180,000
2023		135,000
Total payments	$	585,000
Amount representing interest	$	(107,637	)
Lease obligation, net		477,363
Less current portion		(133,940	)
Lease obligation – long term	$	343,423

The lease expense for the three months ended November 30, 2019 was $45,000, which consisted of amortization expense of $34,493 and interest expense of $10,507 after the adoption of the new lease standard on January 1, 2019.

The cash paid under this operating lease during three months ended November 30, 2019 was $45,000. We have used a discount rate of 8%.

The lease expense for the six months ended November 30, 2019 was $90,000, which consisted of amortization expense of $68,305 and interest expense of $21,695 after the adoption of the new lease standard on January 1, 2019.

The cash paid under this operating lease during six months ended November 30, 2019 was $90,000. We have used a discount rate of 8%.