Research Solutions, Inc. Leases Disclosure
Note 5. Lease Obligations
On December 30, 2016, the Company entered into a 48 month non-cancellable lease for its office facilities that will require monthly payments ranging from $10,350 to $11,475 through January 2021. In accounting for the lease, the Company adopted ASU 2016-02, Leases which requires a lessee to record a right-of-use asset and a corresponding lease liability at the inception of the lease initially measured at the present value of the lease payments. The Company classified the lease as an operating lease and determined that the value of the lease assets and liability at the inception of the lease was $463,000 using a discount rate of 3.75%. During the twelve months ended June 30, 2021, the Company made payments of $79,326 towards the lease liability. As of June 30, 2021 and 2020, lease liability amounted to $0 and $79,326, respectively. ASU 2016-02 requires recognition in the statement of operations of a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight-line basis. Rent expense, including real estate
taxes, for the years ended June 30, 2021 and 2020 was $39,658 and $111,746, respectively. The right of use asset at June 30, 2020 was $72,331. During the years ended June 30, 2021 and 2020, the Company reflected amortization of right of use asset of $72,331 and $119,914 related to this lease, respectively, resulting in a net asset balance of $0 as of June 30, 2021.
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2021 | Sep 23, 2021 | Showing above |
| 2020 | Sep 24, 2020 | |
| 2019 | Sep 19, 2019 | |
| 2018 | Sep 20, 2018 | |
| 2017 | Sep 18, 2017 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.