Quarterly report pursuant to Section 13 or 15(d)

Intangible Assets and Liabilities Other Than Goodwill

v3.19.3
Intangible Assets and Liabilities Other Than Goodwill
 9 Months Ended
Sep. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets and Liabilities Other Than Goodwill
Intangible Assets and Liabilities Other Than Goodwill

As of September 30, 2019 and December 31, 2018 the Company had the following amounts related to intangible assets and liabilities other than goodwill:
 
 
September 30, 2019
 
December 31, 2018
Intangible assets
 
Cost
 
Accumulated Amortization
 
Total
 
Cost
 
Accumulated Amortization
 
Total
Product certifications
 
$
726,159

 
$
(386,344
)
 
$
339,815

 
$
726,159

 
$
(345,658
)
 
$
380,501

Patents
 
971,830

 
(202,497
)
 
769,333

 
910,569

 
(188,239
)
 
722,330

Developed technology
 
240,000

 
(104,000
)
 
136,000

 
240,000

 
(92,000
)
 
148,000

Trademarks
 
26,146

 
—

 
26,146

 
22,752

 
—

 
22,752

In Process R&D
 
263,936

 
—

 
263,936

 
263,936

 
—

 
263,936

Favorable contract asset
 
274,858

 
(262,059
)
 
12,799

 
1,561,739

 
(232,099
)
 
1,329,640

TTcogen intangible assets
 
29,607

 
(5,551
)
 
24,056

 
—

 
—

 
—

 
 
$
2,532,536

 
$
(960,451
)
 
$
1,572,085

 
$
3,754,762

 
$
(860,772
)
 
$
2,893,990

 
 
 
 
 
 
 
 
 
 
 
 
 
Intangible liability
 
 
 
 
 
 
 
 
 
 
 
 
Unfavorable contract liability
 
$
4,689,025

 
$
(2,044,367
)
 
$
2,644,658

 
$
7,912,275

 
$
(1,619,676
)
 
$
6,292,599


The aggregate amortization expense related to intangible assets and liabilities exclusive of contract related intangibles for the three and nine months ended September 30, 2019 and 2018 was $22,951 and $70,699 and $25,981 and $77,357, respectively. The net credit to cost of sales related to the amortization of contract related intangible assets and liabilities for the three and nine months ended September 30, 2019 and 2018 was $107,998 and $394,731 and $211,876 and $656,042, respectively.

Favorable/Unfavorable Contract Assets and Liabilities

The favorable contract asset and unfavorable contract liability in the foregoing table represent the estimated fair value of American DG Energy's customer contracts (both positive for favorable contracts and negative for unfavorable contracts) which were acquired by the Company in May 2017.

Amortization of intangibles including contract related amounts is calculated using the straight-line method over the remaining useful life or contract term. Aggregate future amortization over the next five years is estimated to be as follows:
Year 1
 
$
(167,577
)
Year 2
 
(203,431
)
Year 3
 
(211,868
)
Year 4
 
(143,920
)
Year 5
 
(91,852
)