NOTE 3 - LEASE

6 Months Ended

Jun. 30, 2019

Notes

NOTE 3 - LEASE

NOTE 3 – LEASE

On April 1, 2019, we entered into a lease agreement with Colin Gibson, director, for the lease of an automobile. The lease is considered an operating lease, requires monthly payments of $350, and has a term of six years. We have accounted for the lease under ASU 842 Leases, as follows:

	Balance Sheet Classification	June 30, 2019
Asset
Operating lease asset	Right of use asset	$	16,199
Total lease asset		$	16,199
Liability
Operating lease liability – current portion	Current operating lease liability	$	2,312
Operating lease liability – noncurrent portion	Long-term operating lease liability		13,887
Total lease liability		$	16,199

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

For the year ended December 31:
2019	$	2,100
2020		4,200
2021		4,200
2022		4,200
2023		4,200
Thereafter		5,250
Total payments	$	24,150
Amount representing interest	$	(7,951)
Lease obligation, net		16,199
Less current portion		(2,312)
Lease obligation – long term	$	13,887

The lease expense for the three and six months ended June 30, 2019, was $1,050 and $1,050, respectively, which consisted of amortization expense of $550 and interest expense of $500. The cash paid under our operating lease during the three months ended June 30, 2019, was $1,050. We have used a discount rate of 8%.