PROPERTY AND EQUIPMENT

3 Months Ended

Mar. 31, 2018

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

Property and equipment, net consisted of the following (in thousands):

	March 31,			December 31,
	2018			2017
Land	$	377		$	377
Building	3,076			2,868
Machinery and equipment	38,759			38,432
Leasehold and building improvements	8,662			8,156
Construction in progress	2,588			3,531
	53,462			53,364
Less accumulated depreciation	(36,604		)	(36,033		)
Total property and equipment, net	$	16,858		$	17,331

The Company has subscription agreements whereby its instruments in inventory may be placed in a customer's location on a rental basis. The cost of these instruments is transferred to machinery and equipment and depreciated, typically over a five-to-seven year period depending on the circumstance under which the instrument is placed with the customer.

Depreciation expense was $1.1 million and $1.0 million for the three months ended March 31, 2018 and 2017, respectively.

Our cost of instruments under operating leases as of March 31, 2018 and December 31, 2017, was $10.6 million and $10.8 million, before accumulated depreciation of $5.4 million and $5.0 million, and the net book value was $5.2 million and $5.8 million, respectively.