Property and Equipment

9 Months Ended

Sep. 30, 2022

Property, Plant and Equipment [Abstract]

Property and Equipment

NOTE 7 - Property and Equipment

As of September 30, 2022 and December 31, 2021, the balances of property and equipment were as follows:

	September 30, 2022			December 31, 2021
	(Unaudited)
Ground station equipment	$	1,854,027		$	1,854,027
Computer software and equipment		569,626			340,122
Satellite equipment		275,410			275,410
Vehicle		378,603			378,603
Leasehold improvement		83,721			83,721
Furniture and fixture		36,382			36,382
		3,197,769			2,968,265
Accumulated depreciation		(2,330,422	)		(1,923,438	)
Net		867,347			1,044,827
Prepayments - land		35,861,589			35,861,589
Prepaid equipment		17,889			17,889
Total	$	36,746,825		$	36,924,305

On July 10, 2018, the Company and Aerkomm Taiwan entered into a real estate sale contract (the “Land Purchase Contract”) with Tsai Ming-Yin (the “Seller”) with respect to the acquisition by Aerkomm Taiwan of a parcel of land located in Taiwan. The land is expected to be used to build a satellite ground station and data center. Pursuant to the terms of the Land Purchase Contract, and subsequent amendments on July 30, 2018, September 4, 2018, November 2, 2018 and January 3, 2019, the Company paid to the seller in installments refundable prepayments of $34,474,462 in total. As of September 30, 2022 and December 31, 2021, the estimated commission payable for the land purchase in the amount of $1,387,127 was recorded to the cost of land and the payment to be paid after the full payment of the Land acquisition price no later than September 30, 2022. According to the amended Land Purchase Contract dated on November 10, 2020, the transaction may be terminated at any time by both the buyer and the seller and agreed by all parties if the Company is unable to obtain the qualified satellite license issued by Taiwan authority before July 31, 2021. As of December 20, 2022, the license applications are still in progress.

Depreciation expense was $118,351 and $133,331 for the three-month periods ended September 30, 2022 and 2021, respectively, and $406,984 and $401,815 for the nine-month periods ended September 30, 2022 and 2021, respectively.