Leases

3 Months Ended

Mar. 31, 2024

Leases

Leases

NOTE 9 - Leases

The Company had four operating leases (Flywheel’s office leases in Taiwan) as of March 31, 2024. The leased assets in Flywheel are presented as operating lease right-of-use assets.

The table below reconciles the fixed component of the undiscounted cash flows for each of the first five years and the total remaining years to the operating lease liabilities recorded in the statements of financial position as of March 31, 2024:

	Flywheel			Flywheel			Flywheel			Flywheel
	June 2022			August 2022			February 2023			March 2024
Initial lease term	to May 2024			to July 2024			to March 2025			to June 2025
Initial recognition of operating lease right-of-use assets	$	105,632		$	147,547		$	28,652		$	123,107
Weighted-average remaining lease term at March 31, 2024		0.17			0.33			0.92			1.25
Weighted-average discount rate at March 31, 2024		8.11	%		2.50	%		3.20	%		3.20	%

Operating lease liabilities-current as of March 31, 2024 and December 31, 2023 were $144,288 and $82,269, respectively. Operating lease liabilities-non-current as of March 31, 2024 and December 31, 2023 were $23,995 and $2,363, respectively. The operating lease right-of-use assets balance as of March 31, 2024 and December 31, 2023, were $159,983 and $83,946, respectively.

For the three months ended March 31, 2024 and 2023, the amortization of the operating lease right-of-use asset was $42,892 and $95,635, respectively. These amounts were recorded in general and administrative expenses. Additionally, for the three months ended March 31, 2024 and 2023, the Company made lease payments of $35,175 and $101,723, respectively, which were included in the operating cash flows statement.

The future minimum lease payment schedule for all operating leases as of March 31, 2024, is as disclosed below.

For the Period Ending March 31	Amount
2024	$	119,159
2025		52,164
2026		-
2027		-
2028		-
2029 and thereafter		-
Total minimum lease payments		171,323
Less: effect of discounting		(3,040	)
Present value of the future minimum lease payment		168,283
Less: operating lease liabilities-current		(144,288	)
Total operating lease liabilities-non-current	$	23,995

HOUR LOOP, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS