5. Investments in equipment and leases, net:

The Company’s investment in leases consists of the following:


		Balance December 31, 2015		Additions		Depreciation/ Amortization Expense		Balance December 31, 2016
Net investment in operating leases	$	-	$	7,076,803	$	(310,876)	$	6,765,927
Initial direct costs, net of accumulated amortization of $27,725 at December 31, 2016		-		194,803		(27,725)		167,078
Total	$	-	$	7,271,606	$	(338,601)	$	6,933,005

The Company utilizes a straight-line depreciation method over the term of the equipment lease for equipment on operating leases currently in its portfolio. Depreciation expense on the Company’s equipment totaled $311 thousand for the year ended December 31, 2016. IDC amortization expense related to the Company’s operating and notes receivable totaled $28 thousand.

All of the Company’s lease asset purchases and capital improvements were made during the year 2016.

Operating leases:

Property on operating leases consists of the following:


		Balance December 31, 2015		Additions		Reclassifications or Dispositions		Balance December 31, 2016
Transportation, rail	$	-	$	1,956,195	$	-	$	1,956,195
Paper processing		-		1,057,551		-		1,057,551
Marine vessels		-		1,041,158		-		1,041,158
Containers		-		859,560		-		859,560
Agriculture		-		741,827		-		741,827
Materials handling		-		577,081		-		577,081
Aviation		-		461,950		-		461,950
Construction		-		284,782		-		284,782
Trucks/trailers		-		96,699		-		96,699
		-		7,076,803		-		7,076,803
Less accumulated depreciation		-		(310,876)		-		(310,876)
Total	$	-	$	6,765,927	$	-	$	6,765,927

The average estimated residual value for assets on operating leases was 48% of the assets’ original cost at December 31, 2016. There were no operating leases in non-accrual status at December 31, 2016.

At December 31, 2016, the aggregate amounts of future minimum lease payments receivable are as follows:


		Operating Leases
Year ending December 31, 2017	$	1,092,393
2018		1,092,393
2019		1,072,081
2020		890,825
2021		447,923
Thereafter		483,472
	$	5,079,087

The useful lives for each category of leases is reviewed at a minimum of once per quarter. As of December 31, 2016, the respective useful lives of each category of lease assets in the Company’s portfolio are as follows (in years):


Equipment category			Useful Life
Transportation, rail			35 - 40
Marine vessel			20 - 30
Containers			15 - 20
Aviation			15 - 20
Paper processing			10 - 15
Agriculture			7 - 10
Construction			7 - 10
Materials handling			7 - 10
Transportation			7 - 10