Property, Plant and Equipment, net

9 Months Ended

Sep. 30, 2021

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment, net

8. Property, Plant and Equipment, net

Property, plant and equipment as of December 31, 2020 and September 30, 2021 consisted of the following:

	December 31,			September 30,
	2020			2021
Buildings	$	28,150,137		$	28,531,939
Machinery and equipment		32,753,952			33,979,680
Office equipment		258,458			467,293
Motor vehicles		197,790			330,801
Leasehold improvements		-			1,216,573
		61,360,337			64,526,286
Impairment		(8,980,020	)		(9,063,579	)
Accumulated depreciation		(11,339,947	)		(13,412,118	)
Carrying amount	$	41,040,370		$	42,050,589

During the three months ended September 30, 2020 and 2021, the Company incurred depreciation expense of $695,950 and $604,201, respectively

During the nine months ended September 30, 2020 and 2021, the Company incurred depreciation expense of $1,838,357 and $1,993,929, respectively

The Company has not yet obtained the property ownership certificates of the buildings in its Dalian manufacturing facilities with a carrying amount of $24,611,468 and $24,349,395 as of December 31, 2020 and September 30, 2021, 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. However, since 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 nine months ended September 30, 2020 and 2021.