Lifeloc Technologies, Inc
For the period ended Dec 31, 2025. Filed Mar 27, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 27, 2026
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What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-28.
0001079973-25-000507
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-27.
0001079973-26-000376
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 64 previous paragraphs and 71 current paragraphs.
39 unchanged; 18 reworded; 14 added; 7 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 0 previous and 2 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
SpinDetect™ Microfluidic Detection Platform
Current report
In 2016, we obtained the exclusive rights to develop and commercialize Sandia National Laboratories’ patented centrifugal microfluidic technology (formerly referred to as SpinDx™). Our commercialization effort was initially hampered by the pandemic; however, development has since advanced significantly. A first Lifeloc-owned utility patent application covering improvements to the system was filed in 2024. Under the license agreement, Sandia retains ownership of the foundational patents, while patentable enhancements developed by Lifeloc belong solely to us.
Current report
After several rounds of optimization, we have completed the design of the SpinDetect™ microfluidic disk, enabling the design to move into fabrication and validation. All analytical chemistry now occurs on the disk after introduction of the sample. This advancement completes the core system required for beta testing using our prototype reader. We expect commercial launch in 2026, with initial products designed to measure drugs of abuse in oral fluid, followed by expansion into additional drug panels.
Current report
The SpinDetect™ analyzer is designed to address key limitations in current drug-testing methods. The platform uses centrifugal forces and microfluidic flow paths to conduct multiple assays on a microliter-level sample, providing rapid, on-site, and quantitative results. The technology is capable of detecting extremely low concentrations of potent substances such as fentanyl, cocaine, and delta-9-THC, and can isolate psychoactive delta-9-THC from inactive metabolites. This separation supports more accurate assessments of recent use—an important distinction from traditional immunoassay-based devices that may report non-impairing metabolites. Development-stage work has demonstrated detection of delta-9-THC at concentrations as low as 5 ng/mL in laboratory settings.
Current report
Drug testing using oral fluid represents a sufficiently large unmet need to justify the SpinDetect™ investment. Existing systems lack the analytical specificity needed for accurate, impairment-relevant results. We already serve this market through our established sales channels, and the SpinDetect™ platform is designed to be customizable to various workplace and jurisdictional drug panels.
Current report
While oral-fluid drug testing is the initial application, the SpinDetect™ reader is designed to accept multiple disk formats, enabling analysis of different sample types on the same instrument. Potential future applications include human and veterinary blood, breath extract, and neonatal meconium. Each represents a significant problem area:
Current report
Beyond drug detection, the SpinDetect™ platform can support a broader range of biological and chemical analyses. The same microfluidic “lab-on-a-disk” architecture can be adapted to detect food-safety markers such as bacterial pathogensE. coli,Salmonella, andListeria; environmental contaminants; performance-enhancing drugs; and human or veterinary diagnostic targets. These applications will require additional research, regulatory clearances, and, in certain cases, expansion of our license rights. We are actively evaluating and negotiating potential amendments to enable the development of these non-drug-testing markets.
Current report
As we advance toward commercialization, SpinDetect™ prototype analyzers have been demonstrated at industry conferences, generating encouraging engagement from potential customers. The feedback we have received—including suggestions for new use cases—supports our belief that the SpinDetect™ platform can address substantial unmet needs in rapid, quantitative testing.
Current report
We expect an initial commercial release in 2026. Continued progress toward these milestones is dependent on timely access to capital to support fabrication, validation, regulatory preparation, and market introduction.
Current report
Sales and marketing expenses of $1,331,062 for the year ended December 31, 2025 were similar to the $1,358,211 spent in the same period a year ago.
Current report
On December 31, 2024 we issued a $750,000 debenture subordinated to obligations to the Company’s secured creditors holding a lien on all assets that calls for interest only at 8.25% payable quarterly in 2025, with monthly payments of $9,199 including principal and interest at 8.25% commencing on January 31, 2026. A balloon payment of $451,012 is due in full on December 31, 2030. In consideration of the lender providing this financing, the Company issued warrants which entitle the holder to purchase 62,500 shares of our common stock at $4.50 per share. The warrants have a life of 70 months. If the debenture is paid in full on or before December 31, 2029, the warrants will have a remaining life of 58 months.
Current report
On March 1, 2025 we issued a $75,000 debenture subordinated to obligations to the Company’s secured creditors holding a lien on all assets that calls for interest only at 8.25% payable quarterly in 2025, with monthly payments of $920 including principal and interest at 8.25% commencing on January 31, 2026. A balloon payment of $45,707 is due in full on December 31, 2030. In consideration of the lender providing this financing, the Company issued warrants which entitle the holder to purchase 6,250 shares of our common stock at $4.50 per share. The warrants have a life of 70 months. If the debenture is paid in full on or before December 31, 2029, the warrants will have a remaining life of 58 months.
Current report
As of December 31, 2025, cash and cash equivalents were $746,001, trade accounts receivable were $772,380 and current liabilities were $836,870 resulting in net liquid assets of $681,511. We believe our core breathalyzer business has remained fundamentally sound and, together with the anticipated commercialization of SpinDetect™, provides a reasonable basis for a return to profitability. However, if revenues from our core business do not grow as expected, if the commercialization of SpinDetect™ is delayed or requires more capital than anticipated, or if general economic conditions deteriorate, we may be required to seek additional sources of capital and/or to implement further cost reduction measures, as necessary.
Current report
As the SpinDetect™ disk design nears completion, we expect our outside contractor expenses to decrease materially beginning in Q2 2026. Our outstanding subordinated debentures require combined monthly payments of approximately $10,100 commencing January 2026, with balloon payments not due until December 2030. We believe that our cash and receivables position, combined with cash generated from ongoing product sales, cost reductions already implemented, and the availability of additional financing if needed, are sufficient to fund our operations and meet our financial obligations for the foreseeable future.
Removed paragraphs (7)
Previous report
In addition, with the October 2014 purchase of our corporate headquarters and certain adjacent property, we added a new reporting segment focused on the ownership and rental of real property through existing commercial leases.
Previous report
SpinDx
Previous report
In August 2016 we entered into an exclusive patent license agreement with Sandia Corporation pursuant to which we acquired the exclusive rights to develop, manufacture and market Sandia's patented SpinDx™ technology for the detection of drugs of abuse. We believe this license agreement represents the beginning of a relationship that will become material to the Company in the near future. A prototype was built by Sandia under our Cooperative Research and Development Agreement and received in 2018, after which we commenced work on commercializing the device.
Previous report
Sales and marketing expenses of $1,358,211 for the year ended December 31, 2024 were up by $132,830 (or 11%) from the $1,225,381 spent in the same period a year ago as a result of expanded marketing efforts, including attending trade shows and additional personnel following the decline of the pandemic and resolution of supply chain issues.
Previous report
On December 31, 2024 we issued an unsecured $750,000 subordinated debenture bearing interest at 8.25%, including 62,500 warrants exercisable for six years into 62,500 shares of our common stock at a price of $4.50 per share. Using the Black Scholes model, the fair market value of these warrants resulted in deferred financing cost of $120,000, which is included in our balance sheet at December 31, 2024 and which resulted in an increase to capital of $120,000. In addition to the stated interest of 8.25%, this deferred financing cost will be a charge against income of $20,000 per year for 6 years starting in 2025. The interest of 8.25% will be paid in quarterly increments in 2025, and will be included in monthly payments of $9,199 including principal, starting in 2026.
Previous report
As of December 31, 2024, cash and cash equivalents were $1,243,746, trade accounts receivable were $732,541 and current liabilities were $743,575 resulting in net liquid assets of $1,232,712. We believe that the diminishing of the Covid-19 pandemic, the resolution of supply chain issues, and the introduction of several new products during the last several years, along with new and on-going customer relationships will allow Lifeloc to operate profitably. If the revenue levels prior to 2020 do not continue to increase in a timely manner, if inflationary pressures are not contained, or if the development and market acceptance of SpinDx™ takes longer than expected, we may be required to seek additional sources of capital and/or to implement further cost reduction measures, as necessary.
Previous report
Rental income from space leased to our tenants is recognized in the month in which it is due.
Reworded paragraphs (18)
Previous wording
Lifeloc incorporated in Colorado in December 1983. We filed a registration statement on Form 10 with the Securities and Exchange Commission, which became effective on May 31, 2011. Our fiscal year end is December 31. Our principal executive offices are located at 12441 West 49th Avenue, Unit 4, Wheat Ridge, Colorado 80033-3338. Our telephone number is (303) 431-9500. Our websites are www.lifeloc.com and www.stsfirst.com. Information contained on our websites does not constitute part of this Form 10-K.
Current wording
Lifeloc incorporated in Colorado in December 1983. We filed a registration statement on Form 10 with the Securities and Exchange Commission, which became effective on May 31, 2011. Our fiscal year end is December 31. Our principal executive offices are located at 12441 West 49th Avenue, Unit 4, Wheat Ridge, Colorado 80033-3338. Our telephone number is (303) 431-9500. Our websites are www.lifeloc.com and www.lifelocuniversity.com. Information contained on our websites does not constitute part of this Form 10-K.
Previous wording
Research and Development Expenses. We expect to increase our research and development expenses to support refinements to our products, and the development of additional new products.
Current wording
Research and Development Expenses. We expect to continue to incur research and development expenses as we near completion of the first phase of SpinDetect™ and to update our base products.
Previous wording
In 2024 we purchased SpinDx related test and other equipment totaling $667,738, compared with $0 spent in 2023. We are optimistic about the results of the work to date and expect market introduction via extensive beta testing and validation through 2025 and commercialization in 2026. SpinDx™ uses a centrifugal disk with micro fluidic flow paths allowing multiple tests to be carried out on a single small sample. The SpinDx™ platform has the potential to revolutionize real-time screening for a panel of high abuse drugs, with the ability to quickly and quantitatively measure very low concentrations of drugs such as cocaine, heroin, methamphetamine and others. We intend to use this technology, sometimes referred to as "Lab on a Disk", to develop devices and tests that could be used at roadside, emergency rooms and in workplace testing to get a rapid and quantitative measure for a panel of such drugs of abuse. We have detected delta-9-THC (the primary psychoactive component of marijuana) down to concentrations of 5 nanograms per milliliter in our laboratory. This includes resolving the psychoactive delta-9-THC from its inactive metabolites. Resolving the psychoactive levels from metabolites is an important step in establishing impairment. We completed the upgrade of our base breathalyzer platform in 2019 (the LX9), and we remain committed to combining it with the SpinDx technology. If successful, this combination will result in a marijuana breathalyzer.
Current wording
In 2025 we purchased SpinDetect™ related test and other equipment totaling $354,381 compared with $667,738 spent in 2024.
Previous wording
On March 8, 2017, we entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Track Group Inc., a Delaware corporation. Pursuant to the terms and conditions of the Asset Purchase Agreement, we acquired certain assets comprised of: (1) handheld hardware device technology (the “R.A.D.A.R.® Mobile Devices”), designed to measure breath alcohol content of the user; and (2) software technology called R.A.D.A.R.® (Real-time Alcohol Detection and Reporting) Reporting Center designed to allow the Device to be configured and to capture and manage the data being returned from the Device (together with the Device, the “R.A.D.A.R.® Assets”). We purchased the assets of R.A.D.A.R. 100 knowing the product needed significant upgrading, which was essentially completed and released for sale in 2022 as R.A.D.A.R. 200. This product met with little market acceptance as a result of the underperformance of one feature, generating nominal revenue in 2022 and none in subsequent years. In 2023, we outsourced the development of R.A.D.A.R. 300 to a third party, but that effort is currently on hold as a result of focusing all of our effort on SpinDx.
Current wording
On March 8, 2017, we entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Track Group Inc., a Delaware corporation. Pursuant to the terms and conditions of the Asset Purchase Agreement, we acquired certain assets comprised of: (1) handheld hardware device technology (the “R.A.D.A.R.® Mobile Devices”), designed to measure breath alcohol content of the user; and (2) software technology called R.A.D.A.R.® (Real-time Alcohol Detection and Reporting) Reporting Center designed to allow the Device to be configured and to capture and manage the data being returned from the Device (together with the Device, the “R.A.D.A.R.® Assets”). We purchased the assets of R.A.D.A.R. 100 knowing the product needed significant upgrading, which was essentially completed and released for sale in 2022 as R.A.D.A.R. 200. This product met with little market acceptance as a result of the underperformance of one feature, generating nominal revenue in 2022 and none in subsequent years. In 2023, we outsourced the development of R.A.D.A.R. 300 to a third party, but that effort is currently on hold.
Previous wording
Our product sales for the year ended December 31, 2024 were $8,470,985, a decrease of 8% from $9,228,843 for the same period a year ago. This decrease is primarily attributable to having satisfied pent up demand in later 2023 and the first part of 2024. In addition, inflationary pressures on customers’ budgets also played a role. When royalties of $34,382 and rental income of $32,778 are included, total revenues of $8,538,145 decreased by $791,421, or 9%, for the year ended December 31, 2024 when compared to the same 12 months a year ago. Rental income decreased by $35,646 due to electing not to renew or replace a lease for a portion of the space formerly occupied by a tenant, and royalties increased by $2,083 due to an increase in sales by royalty-paying customers.
Current wording
Our product sales for the year ended December 31, 2025 were $8,958,672, an increase of 6% from $8,470,985 for the same period a year ago. This increase is primarily attributable to new customer acquisitions and expansion within existing customer accounts including fleet refresh activity. When royalties of $51,634 and rental income of $16,632 are included, total revenues of $9,026,938 increased by $488,793, or 6%, for the year ended December 31, 2025 when compared to the same 12 months a year ago. Rental income decreased by $16,146 due to electing not to renew or replace a lease for a portion of the space formerly occupied by a tenant, and royalties increased by $17,252 due to an increase in sales by royalty-paying customers.
Previous wording
Gross profit for the year ended December 31, 2024 of $3,446,099 represented a decrease of 15% from total gross profit of $4,039,670 for the year ended December 31, 2023, primarily as a result of lower product sales and rental income, and the inflationary effect on costs. Cost of product sales decreased from $5,260,338 in the year ended December 31, 2023 to $5,066,779 in the same period in 2024, a decrease of $193,559 (4%). Gross profit margin on products decreased to 40% in the year ended December 31, 2024 from 43% in the year ended December 31, 2023 primarily as a result of the sales mix.
Current wording
Total gross profit for the year ended December 31, 2025 of $3,642,045 represented an increase of 6% from total gross profit of $3,446,099 for the year ended December 31, 2024, primarily as a result of higher product sales. Cost of product sales, excluding rental segment costs, increased from $5,066,779 in the year ended December 31, 2024 to $5,375,787 in the same period in 2025, an increase of $309,008 (6%). Gross profit margin on products was 40% in the year ended December 31, 2025 and 40% in the year ended December 31, 2024.
Previous wording
Research, development and sustaining engineering expenses continued at the high level of $2,242,869 for the year ended December 31, 2024, representing an increase of $407,705 (22%) over the $1,835,164 in the same period a year ago. This increase resulted primarily from the addition of personnel, materials and outside contractors needed for our dedication of resources to SpinDx™. In 2025 we expect to pay $487,300 to a third party contractor for additional work required to complete a portion of the SpinDx development.
Current wording
Research, development and sustaining engineering expenses continued at the high level of $2,152,843 for the year ended December 31, 2025, representing a decrease of $90,026 (4%) over the $2,242,869 in the same period a year ago. This decrease resulted primarily from a reduction of payments to outside contractors needed for development of SpinDetect™. In 2026 we expect to continue work on SpinDetect™.
Previous wording
General and administrative expenses of $1,253,236 for the year ended December 31, 2024 versus $1,170,260 for the year ended December 31, 2023 were higher by $82,976 (7%) as a result of the effects of inflation.
Current wording
General and administrative expenses of $1,388,160 for the year ended December 31, 2025, versus $1,253,236 for the year ended December 31, 2024 were higher by $134,924 (11%) primarily as a result of public company and legal expense attributable to our S-4 filings.
Previous wording
Interest income decreased from $70,062 a year ago to $42,867 in 2024 as a result of less funds available. Interest expense of $40,145 in the year ended December 31, 2024 was down slightly from $41,566 in the previous year as a result of the decrease in the interest rate on our new loan on our building. The total decrease as a result of the above items in the year ended December 31, 2024 was $25,774, or 90%, from the year ended December 31, 2023.
Current wording
Interest income decreased from $42,867 a year ago to $38,010 in 2025, a decrease of $4,857, as a result of less funds available. Interest expense of $119,190 in the year ended December 31, 2025 was up $79,045 from $40,145 in the previous year as a result of the increase in the interest and amortization of debt issuance costs on our debentures. Combined, these changes resulted in a total expense increase of $83,902, or 3082%, in the year ended December 31, 2025 from the year ended December 31, 2024.
Previous wording
We realized a net loss of $1,052,948 for the year ended December 31, 2024 compared to net income of $205,614 for the year ended December 31, 2023. This decrease of $1,258,562 was the result of the changes in gross profit, operating expenses and other income discussed above, which resulted in a loss before taxes of $1,405,495 or a decrease of $1,242,856 from the loss before taxes of $162,639 in 2023. After the benefit from taxes of $352,547 (versus a benefit from taxes of $368,253 a year ago), we realized a net loss of $(1,052,948) compared to a net income of $205,614 in 2023. The benefit from taxes of $352,547 resulted in an increase to our deferred tax asset from $806,652 at December 31, 2023 to $1,159,199 at December 31, 2024.
Current wording
We realized a net loss of $2,470,399 for the year ended December 31, 2025 compared to a net loss of $1,052,948 for the year ended December 31, 2024. This increase in loss of $1,417,451 was the result of the changes in gross profit, operating expenses and other income discussed above, which resulted in a loss before taxes of $1,311,200 in 2025, or a decrease of $94,295 from the loss before taxes of $1,405,495 in 2024. After the provision for valuation allowance from deferred taxes of $1,159,199 in 2025 versus a benefit from taxes of $352,547 a year ago, we realized a net loss of $2,470,399 in 2025 compared to a net loss of $1,052,948 in 2024. The benefit from taxes of $352,547 in 2024 resulted in an increase to our deferred tax asset from $806,652 at December 31, 2023 to $1,159,199 at December 31, 2024. The deferred tax asset reserve was increased by $1,159,199 in 2025 which resulted in a net deferred asset of $0 in 2025.
Previous wording
Revenues in the year 2024 were lower compared to revenues in 2023. We believe that continued increased sales efforts, together with the expected availability of SpinDx™ for sale in 2026 may result in improved revenues in 2026 and beyond. Revenues in 2025 may be similar to revenues in 2024. Inflationary pressures have affected our business in a number of ways, including increasing the cost of raw materials, labor, and freight. Our actions to mitigate the impact of inflation, including pre-ordering components in higher than usual quantities, sourcing new vendors and increasing prices have been somewhat successful.
Current wording
Revenues in the year 2025 were higher compared to revenues in 2024. We believe that continued increased sales efforts, together with the expected availability of SpinDetect™ for sale in 2026 may result in modest improved revenues in 2026 and beyond. Inflationary pressures have affected our business in a number of ways, including increasing the cost of raw materials, labor, and freight. Our actions to mitigate the impact of inflation, including pre-ordering components in higher than usual quantities, sourcing new vendors and increasing prices have been somewhat successful.
Previous wording
We expect our quarter-to-quarter revenue fluctuations to continue, due to the unpredictable timing of large orders from customers and the size of those orders in relation to total revenues. Going forward, we intend to focus our development efforts on products we believe offer the best prospects to increase our intermediate and near-term revenues, with particular emphasis on completing SpinDx™.
Current wording
We expect our quarter-to-quarter revenue fluctuations to continue, due to the unpredictable timing of large orders from customers and the size of those orders in relation to total revenues. Going forward, we intend to focus our development efforts on products we believe offer the best prospects to increase our intermediate and near-term revenues, with particular emphasis on launching SpinDetect™ into the market.
Previous wording
Our 2025 operating plan is focused on growing sales, increasing gross profits, and increasing research and development efforts on new products, including SpinDx™, for long-term growth. We cannot predict with certainty the expected sales, gross profit, net income or loss, or usage of cash and cash equivalents for 2025. However, we believe that cash resources will be sufficient to fund our operations for the next twelve months under our current operating plan. If we are unable to manage the business operations in line with our budget expectations, it could have a material adverse effect on business viability, financial position, results of operations and cash flows. Further, if we are not successful in sustaining profitability and remaining at least cash flow break-even, additional capital may be required to maintain ongoing operations.
Current wording
Our 2026 operating plan is focused on growing sales of our base products, and on bringing SpinDetect to market, thereby increasing gross profits. We cannot predict with certainty the expected sales, gross profit, net income or loss, or usage of cash and cash equivalents for 2026. However, we believe that cash resources will be sufficient to fund our operations for the next twelve months under our current operating plan. If we are unable to manage the business operations in line with our budget expectations, it could have a material adverse effect on business viability, financial position, results of operations and cash flows. Further, if we are not successful in regaining profitability and achieving at least cash flow break-even, additional capital may be required to maintain ongoing operations.
Previous wording
We have traditionally funded working capital needs through product sales and close management of working capital components of our business. Historically, we have also received cash from private offerings of our common stock, warrants to purchase shares of our common stock, and notes. In July, 2024 we completed a private placement of 210,000 shares of our common stock at $3.80 per share for a total raise of $798,000 with a related party. On December 31, 2024 we completed the issuance of a six year unsecured subordinated debenture for $750,000 with a third party. In our earlier years, we incurred quarter to quarter operating losses to develop current product applications, utilizing a number of proprietary and patent-pending technologies. Although we have been profitable in recent years except 2020, 2022 and 2024, we can provide no assurances that operating losses will not occur in the future. Should that situation arise, we may not be able to obtain working capital funds necessary in the time frame needed and at satisfactory terms, if at all.
Current wording
We have traditionally funded working capital needs through product sales and close management of working capital components of our business. Historically, we have also received cash from private offerings of our common stock, warrants to purchase shares of our common stock, and notes. In July, 2024 we completed a private placement of 210,000 shares of our common stock at $3.80 per share for a total raise of $798,000 with a related party. On December 31, 2024 we completed the issuance of a six year unsecured subordinated debenture for $750,000 with a third party. On March 1, 2025 we completed the issuance of a 70 month unsecured subordinated debenture for $75,000 with a third party. In our earlier years, we incurred quarter to quarter operating losses to develop current product applications, utilizing a number of proprietary and patent-pending technologies. Between 2002 and 2020, we were consistently profitable, due to stabilization and then growth in our core breathalyzer products. Our recent net losses in 2024 and 2025 reflect a deliberate investment in the development of our SpinDetect™ platform rather than a deterioration of our core breathalyzer business, which has remained stable. We believe our core product and services business, at current revenue levels, is capable of supporting ongoing operations on a cost-reduced basis. We intend to continue managing costs carefully while advancing SpinDetect™ toward its anticipated commercial launch later in 2026. If the development or market acceptance of SpinDetect™ takes longer than expected, or if we require additional capital to support commercialization, we may seek additional financing through equity or debt offerings.
Previous wording
Equipment expenditures, consisting of updated production equipment and SpinDx related equipment, during FY 24 were $667,738 compared to $6,811 for FY 23, an increase of $660,927. We incurred patent application costs in preparation for filing of $21,708 in 2024 versus $1,404 in 2023. No expired or fully amortized patents were removed from our financial statements in 2024 or 2023. As development of SpinDx progresses, and as normal wear and tear of equipment occurs, we expect to incur outlays for equipment and patent filings in 2025 and beyond.
Current wording
Equipment expenditures, consisting of updated production equipment and SpinDetect™ related equipment, during FY 25 were $354,381 compared to $667,738 for FY 24, a decrease of $313,357. We incurred patent application costs in preparation for filing of $0 in 2025 versus $21,708 in 2024. Fully depreciated equipment of $510,767 was removed from our balance sheet in 2025 vs. none in 2024. Fully amortized patents of $2,821 were removed from our balance sheet in 2025 vs. none in 2024. As development of SpinDetect progresses, and as normal wear and tear of equipment occurs, we expect to incur outlays for equipment and patent filings in 2026 and beyond.
Previous wording
We generally provide a standard one-year limited warranty on materials and workmanship to our customers. We provide for estimated warranty costs at the time product revenue is recognized. Warranty costs are included as a component of cost of goods sold in the accompanying statements of operations. For the year ended December 31, 2024 and for the year ended December 31, 2023, warranty costs were not deemed significant.
Current wording
We generally provide a standard one-year limited warranty on materials and workmanship to our customers. We provide for estimated warranty costs at the time product revenue is recognized. Warranty costs are included as a component of cost of goods sold in the accompanying statements of loss. For the year ended December 31, 2025 and for the year ended December 31, 2024, warranty costs were not deemed significant.
Previous wording
We have concluded that we have two operating segments, including our primary business which is as a developer, manufacturer and marketer of portable hand-held breathalyzers and related accessories, supplies and education, and a second segment consisting of renting portions of our building to existing tenants.
Current wording
We have concluded that we have one operating segment consisting of our primary business which is as a developer, manufacturer and marketer of portable hand-held breathalyzers and related accessories, supplies and education.
Previous wording
Property and equipment are stated at cost, with depreciation computed over the estimated useful lives of the assets, generally five years (three years for software and technology licenses). We use the declining method of depreciation for property, including space modifications, and the straight line method for software and technology licenses. We purchased all of the assets of STS, an online education company, in 2014, which consisted of training courses that are amortized over 15 years using the straight line method. In October 2014, we purchased our building. A majority of the cost of the building is depreciated over 39 years using the straight line method. In addition, based on the results of a third party analysis, a portion of the cost was allocated to components integral to the building. Such components are depreciated over 5 and 15 years, using the declining method. The R.A.D.A.R.® software and patents that were purchased in March 2017 were originally set to amortize over 15 years using the straight line method, but in 2022 we accelerated the amortization of the remaining cost to fully amortize the assets by December 31, 2024. Maintenance and repairs are expensed as incurred and major additions, replacements and improvements are capitalized.
Current wording
Property and equipment are stated at cost, with depreciation computed over the estimated useful lives of the assets, generally five years (three years for software and technology licenses). We use the declining method of depreciation for property, including space modifications, and the straight-line method for software and technology licenses. We purchased all of the assets of STS, an online education company, in 2014, which consisted of training courses that are amortized over 15 years using the straight line method. In 2025, we accelerated the amortization of the remaining cost and fully amortized the asset by December 31, 2025. In October 2014, we purchased our building. A majority of the cost of the building is depreciated over 39 years using the straight line method. In addition, based on the results of a third party analysis, a portion of the cost was allocated to components integral to the building. Such components are depreciated over 5 and 15 years, using the declining method. The R.A.D.A.R.® software and patents that were purchased in March 2017 were originally set to amortize over 15 years using the straight line method, but in 2022 we accelerated the amortization of the remaining cost to fully amortize the assets by December 31, 2025. Maintenance and repairs are expensed as incurred and major additions, replacements and improvements are capitalized.