Property, Plant and Equipment

9 Months Ended

Sep. 30, 2011

Notes to Financial Statements

Property, Plant and Equipment

4.  Property, Plant and Equipment   

		September 30,			December 31,
		2011			2010
		($000’s omitted)
Land	$	25		$	25
Buildings		7,138			7,060
Machinery, equipment and tooling (including capital lease)		12,799			12,444
		19,962			19,529
Less accumulated depreciation and amortization		(13,863	)		(13,370	)
Total property, plant and equipment	$	6,099		$	6,159

Property, plant and equipment includes land and building in Elma, New York, under a $5,000,000 capital lease which can be purchased for a nominal amount at the end of the lease term. As of September 30, 2011 and December 31, 2010, accumulated amortization on the building amounted to approximately $2,390,000 and $2,293,000, respectively. Amortization expense amounted to $32,000 and $31,000 for the three month periods ended September 30, 2011 and 2010, respectively, and amounted to $97,000 and $98,000 for the nine month periods ended September 30, 2011 and 2010, respectively. The associated current and long-term liabilities are discussed in Note 5, Long-Term Debt, of the accompanying consolidated financial statements. Property, plant and equipment also includes machinery and equipment under a $588,000 capital lease with related party. As of September 30, 2011 and December 31, 2010, accumulated amortization on the machinery and equipment amounted to approximately $161,000 and $98,000, respectively. Amortization expense amounted to $21,000 for the three month periods ended September 30, 2011 and 2010, respectively, and amounted to $63,000 for the nine month periods ended September 30, 2011 and 2010, respectively. The associated current and long-term liabilities are discussed in Note 6, Capital Lease – Related Party, of the accompanying consolidated financial statements.

Depreciation expense amounted to $108,000 and $105,000 for the three month periods ended September 30, 2011 and 2010, respectively, and amounted to $332,000 and $316,000 for the nine month periods ended September 30, 2011 and 2010, respectively. The combined depreciation and amortization expense were $163,000 and $159,000 for the three month periods ended September 30, 2011 and 2010, respectively, and amounted to $498,000 and $483,000 for the nine month periods ended September 30, 2011 and 2010, respectively. The Company believes that it maintains property and casualty insurance in amounts adequate for the risk and nature of its assets and operations and which are generally customary in its industry.