Note 5: Leases

The Company has both finance and operating leases. Finance leases are primarily for transportation equipment and are generally 60-84 months in duration with maturities through September 2031. The Company's one operating lease is for a storage lot and has a maturity date in 2026.

The following table summarizes the future minimum payments under lease liabilities as of December 31, 2024:

For the Fiscal Year Ending Sept. 30,		Finance Leases			Operating Lease
2025 (9 months)	$	130,000		$	36,000
2026		162,000			32,000
2027		154,000			-
2028		154,000			-
2029		131,000			-
Thereafter		107,000			-
Total future minimum payments		838,000			68,000
Less amount representing interest		(211,000	)		(6,000	)
Total lease obligations		627,000			62,000
Less current portion of lease obligations		(108,000	)		(43,000	)
Lease obligations, net of current portion	$	519,000		$	19,000

The following table summarizes the components of the lease cost for the three months ended December 31, 2024 and 2023 (unaudited):

		Three months ended December 31,
		2024		2023
Finance lease cost:
Amortization of right-of-use assets	$	34,000	$	12,000
Interest on lease liabilities		17,000		1,000
Total finance lease cost	$	51,000	$	13,000

Operating lease cost	$	14,000	$	-

Supplemental balance sheet information related to leases as of December 31, 2024 and September 30, 2024 is as follows:

		December 31,			September 30,
		2024			2024
		(unaudited)
Right-of-use assets, gross	$	836,000		$	836,000
Accumulated amortization		(243,000	)		(210,000	)
Net asset value included in property and equipment, net	$	593,000		$	626,000

The following table summarizes the weighted-average remaining lease term and weighted-average discount rate as of December 31, 2024 and September 30, 2024:

		December 31,	September 30,
		2024	2024
		(unaudited)
Weighted-average remaining lease term
	Finance leases	5.3 years	4.5 years
	Operating lease	1.5 years	1.75 years


Weighted-average discount rate
	Finance leases	11.3%	8.68%
	Operating lease	12.0%	12.0%