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Lease
 12 Months Ended
Dec. 31, 2019
Leases [Abstract]  
Lease

10.Lease

 

(a)Prepaid Land Use Rights, net

 

 

Prepaid land use rights as of December 31, 2018 and 2019 consisted of the followings:

 

   December 31,   December 31, 
   2018   2019 
Prepaid land use rights  $8,167,587   $                  - 
Accumulated amortization   (721,470)   - 
   $7,446,117   $- 
Less: Classified as current assets   (163,352)   - 
   $7,282,765   $- 

 

Prepaid land use rights  $8,167,587 
Accumulated amortization   (721,470)
   $7,446,117 
Less: Classified as right-of-use assets upon application of ASC 842   (7,446,117)
At January 1, 2019 and December 31, 2019  $- 

 

Pursuant to a land use rights acquisition agreement dated August 10, 2014, the Company acquired the rights to use a piece of land with an area of 153,832m2 in Dalian Economic Zone for 50 years up to August 9, 2064, at a total consideration of $7,621,715 (RMB53.1 million). Other incidental costs incurred totaled $446,541 (RMB3.1 million).

 

Amortization expenses of the prepaid land use rights were $169,516 for the year ended December 31, 2018.

 

(b)Right-of-use assets

 

   Prepaid land lease payments 
Balance as of January 1, 2019  $7,446,117 
Amortization charge for the year   (162,666)
Foreign exchange adjustment   (89,256)
Balance as of December 31, 2019  $7,194,195 

 

Lump sum payments was made upfront to acquire the leased land from the owners with lease period for 50 years up to August 9, 2064, and no ongoing payments will be made under the terms of these land leases.