PROPERTY AND EQUIPMENT

12 Months Ended

Dec. 31, 2011

NOTE 3 - PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

	December 31,			December 31,
	2011			2010
Permit of land use	$	442,978		$	426,007
Building		2,397,286			2,305,445
Plant, machinery and equipment		6,184,254			5,734,222
Motor vehicle		145,300			139,733
Office equipment		204,552			124,817
Construction in progress		351,571			338,103
Total		9,725,941			9,068,327
Less: accumulated depreciation		(3,391,124	)		(2,695,840	)
Property and Equipment, net	$	6,334,817		$	6,372,487

Construction in progress consists of machinery and construction supplies that have been paid for, but are not yet completed and placed into production. Once the machinery is working or the facility is in use, it is moved into plant, machinery and equipment and depreciated. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets as follows:

Asset		Life - years
Permit of land use		40 - 70
Building		20 - 35
Plant, machinery and equipment		10
Motor vehicle		5 - 10
Office equipment		3-5

Depreciation relating to office equipment was included in general and administrative expenses, while all other depreciation was included in cost of revenue. For the years ended December 31, 2011 and 2010, depreciation expense was $578,297 and $591,562, respectively.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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