Company: BIAF
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001641172-25-001840
Chunk: 789

Company: bioAffinity Technologies, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 7
Chunk 789
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 a major part of its remaining economic life.

The
lease agreements generally do not provide an implicit borrowing rate. Therefore, the Company used a benchmark approach as of the date
of inception of the leases to derive an appropriate incremental borrowing rate to discount remaining lease payments. The Company benchmarked
itself against other companies of similar credit ratings and comparable quality and derived imputed interest rates ranging from 7.41%
to 8.03% for the lease term lengths.

Leases
with an initial term of 12 months or less are not recorded on the consolidated balance sheets. There are no material residual guarantees associated
with any of the Company’s leases, and there are no significant restrictions or covenants included in the Company’s lease
agreements. Certain leases include variable payments related to common area maintenance and property taxes, which are billed by the landlord,
as is customary with these types of charges for office space. The Company has not entered into any lease arrangements with related parties,
and the Company is not the sublessor in any arrangement.

The
Company’s existing leases contain escalation clauses and renewal options. The Company has evaluated several factors in assessing
whether there is reasonable certainty that the Company will exercise a contractual renewal option. For leases with renewal options that
are reasonably certain to be exercised, the Company included the renewal term in the total lease term used in calculating the right-of-use
asset and lease liability.

The
components of lease expense, which are included in selling, general and administrative expense and depreciation and amortization for
the year ended December 31, 2024, and 2023 are as follows:

SCHEDULE OF COMPONENTS OF LEASE EXPENSE

    Components
    of lease expense: 
    2024  
    2023 
  
    Amortization of right-of-use assets
    - finance lease 
    $384,971  
    $128,324 
  
    Interest on lease liabilities - finance lease 
     83,041  
     33,838 
  
    Operating lease cost 
     93,029  
     39,887 
  
    Total lease cost 
    $561,041  
    $202,049 

    Cash paid for amounts included in the measurement
    of lease liabilities: 

    Operating cash flows from finance leases 
    $361,181  
    $93,238 
  
    Operating cash flows from operating leases 
     133,605  
     32,489