10. Leases

The Company complies with ASC 842, Leases, for lease accounting. Leases meeting the criteria are categorized as either operating or financing leases and appear on the consolidated balance sheet as Right-of-use ("ROU") assets and lease liabilities. These are determined by discounting fixed lease payments using either the implicit lease rate or the Company's incremental borrowing rate. Lease liabilities increase with interest and decrease with payments over time, while the ROU asset is amortized over the lease term. Operating leases result in straight-line rent expense over the term, and finance leases lead to front-loaded expenses. Variable lease costs are recorded when incurred.

On February 1, 2023, the Company renewed its office operating lease for 24 months, incurring a total lease payment of $41,625. This resulted in a liability and ROU of $38,701, recognized on the lease's inception date. The calculations employed a 7.0% incremental borrowing rate to discount future rent payments of approximately $1,734 per month over the two-year lease term.

For the year ended December 31, 2023, the Company expended cash of $18,563 in operating lease payments that were recorded in management and administrative expenses.

The table below displays the future operating lease payments and lease liability as of December 31, 2023, related to the Company's operating lease.

ROU asset Year Ending December 31,		Total Amount
2024		21,281
2025		1,781
Total		23,062
Less: Imputed Interest		(918	)
Total lease Liability		22,144
Less current portion		(18,612	)
Non-current lease liability	$	3,532

The Company's ROU asset decreased by the net amount of $17,072 for a total amount of $21,629, for the period ended December 31, 2023. The lease contains no renewal option.