Property, Plant and Equipment, Net

6 Months Ended

Jun. 30, 2019

Property, Plant and Equipment, Net [Abstract]

Property, Plant and Equipment, net

7. Property, Plant and Equipment, net

Property, plant and equipment as of December 31, 2018 and June 30, 2019 consisted of the following:

	December 31,			June 30,
	2018			2019
Buildings	$	23,626,924		$	28,627,067
Machinery and equipment		22,159,752			22,450,179
Office equipment		218,581			219,741
Motor vehicles		204,368			190,176
		46,209,625			51,487,163
Impairment		(1,840,596	)		(1,843,989	)
Accumulated depreciation		(5,460,526	)		(6,837,150	)
Carrying amount	$	38,908,503		$	42,806,024

During the three months ended June 30, 2018 and 2019, the Company incurred depreciation expense of $578,156 and $708,639, respectively.

During the six months ended June 30, 2018 and 2019, the Company incurred depreciation expense of $1,110,369 and $1,383,486, respectively

The Company has not yet obtained the property ownership certificates of the buildings in its Dalian manufacturing facilities with a carrying amount of $21,749,144 and $26,380,086 as of December 31, 2018 and June 30, 2019, respectively. The Company built its facilities on the land for which it had already obtained the related land use right. The Company has submitted applications to the Chinese government for the ownership certificates on the completed buildings located on these lands. However, the application process takes longer than the Company expected and it has not obtained the certificates as of the date of this report. The Company has obtained the land use right in relation to the land, the management believe the Company has legal title to the buildings thereon albeit the lack of ownership certificates.

During the course of the Company’s strategic review of its operations, the Company assessed the recoverability of the carrying value of the Company’s property, plant and equipment. The impairment charge, if any, represented the excess of carrying amounts of the Company’s property, plant and equipment over the estimated discounted cash flows expected to be generated by the Company’s production facilities. The Company believes that there was no impairment during the three and six months ended June 30, 2018 and 2019.