Property and Equipment

9 Months Ended

Sep. 30, 2013

NOTE 4 - PROPERTY AND EQUIPMENT

At September 30, 2013 and December 31, 2012, property and equipment consisted of the following:

	Useful Life	September 30, 2013			December 31, 2012
Office equipment and furniture	5 Years	$	253,404		$	222,853
Manufacturing equipment	5 – 10 Years		67,477,040			56,916,700
Vehicles	5 Years		128,518			125,167
Construction in progress	-		1,578,728			28,785
Building and building improvements	20 Years		21,342,118			20,785,597
			90,779,808			78,079,102
Less: accumulated depreciation			(24,080,717	)		(18,643,002	)
		$	66,699,091		$	59,436,100

For the three months ended September 30, 2013 and 2012, depreciation expense amounted to $1,661,740 and $1,627,258, respectively, of which $1,552,088 and $1,253,362, respectively, is included in cost of revenues and the remainder is included in operating expenses. For the nine months ended September 30, 2013 and 2012, depreciation expense amounted to $4,882,899 and $4,719,769, respectively, of which $4,421,360 and $3,597,337, respectively, is included in cost of revenues and the remainder is included in operating expenses. Depreciation is not taken during the period of construction or equipment installation. Upon completion of the installation of manufacturing equipment or any construction in progress, construction in progress balances will be classified to their respective property and equipment category.

- Definition

The entire disclosure for long-lived, physical assets used in the normal conduct of business and not intended for resale. Includes, but is not limited to, accounting policies and methodology, roll forwards, depreciation, depletion and amortization expense, including composite depreciation, accumulated depreciation, depletion and amortization expense, useful lives and method used, income statement disclosures, assets held for sale and public utility disclosures.

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