Intangible assets and liabilities other than goodwill
|12 Months Ended|
Dec. 31, 2020
|Intangible Assets, Net (Excluding Goodwill) [Abstract]|
|Intangible assets and liabilities other than goodwill||Intangible Assets and Liabilities Other Than Goodwill
We did not capitalize any product certification costs during the years ended December 31, 2020 and 2019, respectively. Also included in intangible assets are the costs incurred by us to acquire certain patents. These patents, once in service, are amortized on a straight-line basis over the estimated economic life of the associated product, which range from approximately 7-10 years. We capitalized $43,252 and $106,539 of patent-related costs during the years ended December 31, 2020 and 2019, respectively. We capitalized $0 and $4,144 in trademarks during the years ended December 31, 2020 and 2019, respectively. We capitalized $80,000 and $0 in favorable contract obligations in the years ended December 31, 2020 and 2019, respectively.
Intangible assets and liabilities at December 31, 2020 and 2019 consist of the following:
The aggregate amortization expense related to intangible assets exclusive of contract related intangibles was $113,723 and $92,209 during the years ended December 31, 2020 and 2019, respectively. The net credit to cost of sales related to the amortization of the contract related intangible asset and liability for the years ended December 31, 2020 and 2019 was $400,404 and $502,729, respectively. We abandoned certain patent applications in the year ended December 31, 2020 and recorded a non-cash charge of $205,345 as long-lived asset impairment in the Consolidated Statement of Operations.
Contract Asset and Liability
The favorable contract asset and unfavorable contract liability in the foregoing table represent the fair value of ADGE's customer contracts (both positive for favorable contracts and negative for unfavorable contracts) which were acquired by us on May 18, 2017 (see Note 4. "Acquisition of American DG Energy Inc."), reduced by those sold during Q1 2019. See Note 5."Sale of Energy Producing Assets and Goodwill Impairment".
During the year ended December 31, 2020, we determined that certain of the ADGE customer contracts terminated due to the customers failure to perform their obligations pursuant to the contractual agreements and accordingly reversed $478,411 of unfavorable contract liability related to these contacts. The adjustments are included in the Consolidated Statement of Operations for the year ended December 31, 2020, as non-cash benefits within long-lived asset impairment.
Amortization of intangibles including contract related amounts is calculated using the straight line method over the remaining useful life or contract term and charged against cost of sales in the accompanying consolidated statement of operations. Aggregate future amortization over the next five years is estimated to be as follows:
The entire disclosure for all or part of the information related to intangible assets.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef