LEASES

12 Months Ended

Dec. 31, 2023

Leases

LEASES

10. LEASES

The Company had entered into an operating lease agreement for factories located in Taiwan, and two financing leases agreements for vehicles.

	As of December 31,
	2022		2023
Operating lease right-of-use assets, net	$	182,764	$	125,009
Operating lease liabilities, current		58,203		61,099
Operating lease liabilities, non-current		124,561		63,910
Total operating lease liabilities	$	182,764	$	125,009

	As of December 31,
	2022		2023
Financing lease right-of-use assets, net	$	46,058	$	8,523
Finance lease liabilities, current		47,244		-
Total financing lease liabilities	$	47,244	$	-

The components of lease expense were as follows within the consolidated statements of comprehensive loss:

	For the years ended December 31,
	2022		2023
Operating lease:
Operating lease expense	$	67,290	$	64,361
Short-term lease expense		938		1,204
Total operating lease expenses	$	68,228	$	65,565
Financing leases:
Amortization expense	$	26,463	$	25,150
Interest expense		2,850		1,299
Total financing lease expenses	$	29,313	$	26,449
Total lease expenses	$	97,541	$	92,014

For the years ended December 31, 2022 and 2023, cash paid for operating leases were US$67,290 and US$64,361, and financing leases were US$29,038 and US$18,398, respectively. The disposal gain was nil and US$18,994 for the years ended December 31, 2022 and 2023, respectively.

MKDWELL TECH INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(In U.S. dollars, except share and per share data)

10. LEASES - Continued

Supplemental balance sheet information related to leases was as follows:

	As of December 31,
	2022			2023
Weighted average discount rate:
Operating lease		4.51	%		4.51	%
Financing lease		4.65	%		-
Weighted average remaining lease term:
Operating lease		36 months			24 months
Financing lease		8 months			*

As of December 31, 2023, the future minimum rent payable under non-cancelable operating and financing leases were:

For the fiscal years ended December 31,	Amount
2024	$	65,480
2025		65,480
thereafter		-
Total lease payments		130,961
Less: imputed interest		(5,952	)
Total operating and financing lease liabilities, net of interest	$	125,009