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PROPERTY AND EQUIPMENT | 12 Months Ended
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Dec. 31, 2014
PROPERTY AND EQUIPMENT |
PROPERTY AND EQUIPMENT | NOTE 5 - PROPERTY AND EQUIPMENT Property and equipment consisted of the following:
|  | December 31, |  |  | December 31, |
|  | 2014 |  |  | 2013 |
Permit of land use |  | $ | 458,853 |  |  | $ | 460,964 |
Building |  |  | 11,279,704 |  |  |  | 2,494,623 |
Plant, machinery and equipment |  |  | 28,358,694 |  |  |  | 6,671,620 |
Motor vehicle |  |  | 150,976 |  |  |  | 151,670 |
Office equipment |  |  | 268,521 |  |  |  | 229,210 |
Construction in progress |  |  | 5,848 |  |  |  | 25,497,600 |
Total |  |  | 40,522,596 |  |  |  | 35,505,687 |
Less: accumulated depreciation |  |  | (6,640,718 | ) |  |  | (5,264,350 | )
Property and Equipment, net |  | $ | 33,881,878 |  |  | $ | 30,241,337 |
Construction in progress consists primarily of the construction of a new production facility, the acquisition of related equipment and capitalized interest during the construction period. Once the building and machinery is in production and the facility is in use, the amount of construction in progress is moved into plant, machinery and equipment and depreciated. During the year ended December 31, 2014, an aggregate of approximately $25.5 million was reclassified from construction in progress to their respective property and equipment category as the assets were placed in service and depreciation commenced. A reconciliation of total interest cost incurred to interest expense as recognized in the consolidated statement of operations is as follows:
|  | For the Year |
|  | Ended December 31, |
|  | 2014 |  |  | 2013 |
Total interest cost incurred |  | $ | 1,244,346 |  |  | $ | 583,400 |
Interest cost capitalized |  |  | 458,542 |  |  |  | 234,704 |
Interest expense |  | $ | 785,804 |  |  | $ | 348,696 |
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 - 49
Plant, machinery and equipment |  | 5 - 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, 2014 and 2013, depreciation expense was $1,399,396 and $846,512, respectively.

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- 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. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6391035&loc=d3e2868-110229 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6391110&loc=d3e2921-110230 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1361-107760 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.13-14) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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