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3. PROPERTY AND EQUIPMENT
 6 Months Ended
Jun. 30, 2014
Property, Plant and Equipment [Abstract]  
PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

  

CHINA PHARMA HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

    June 30,     December 31,  
    2014     2013  
Permit of land use   $ 457,609     $ 460,964  
Building     2,476,466       2,494,623  
Plant, machinery and equipment     6,705,795       6,671,620  
Motor vehicle     150,567       151,670  
Office equipment     238,423       229,210  
Construction in progress     29,715,265       25,497,600  
Total     39,744,125       35,505,687  
Less: accumulated depreciation     (5,628,507 )     (5,264,350 )
Property and Equipment, net   $ 34,115,618     $ 30,241,337  

 

Construction in progress consists primarily of the construction of a new production facility and the acquisition of related equipment and capitalized interest during the construction period.  A reconciliation of total interest cost incurred to interest expense as recognized in the consolidated statement of operations is as follows:

 

    For the Three Months     For the Six Months  
    Ended June 30,     Ended June 30,  
    2014     2013     2014     2013  
Total interest cost incurred   $ 345,626     $ 92,049     $ 621,841     $ 174,494  
Interest cost capitalized     232,263       -       452,031       -  
Interest expense   $ 113,363     $ 92,049     $ 169,810     $ 174,494  

 

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

 

For the three and six months ended June 30, 2014 and 2013, depreciation expense was $201,580 and $215,962, $403,489 and $430,368 respectively.