Property, Plant and Equipment, Net

12 Months Ended

Dec. 31, 2020

Property, Plant and Equipment, Net

Property, Plant and Equipment, Net

Note 5. Property, Plant and Equipment, Net

The components of our property, plant and equipment are summarized below (in thousands):

	December 31,		December 31,
	2020		2019
Property, plant and equipment:
Machinery and equipment, at cost	$	48,206	$	45,742
Less: accumulated depreciation and amortization		(37,832)		(37,115)
Building, at cost		94,567		38,837
Less: accumulated depreciation and amortization		(15,324)		(12,736)
Leasehold improvements, at cost		6,285		4,877
Less: accumulated depreciation and amortization		(4,616)		(4,035)
Construction in progress		24,539		61,833
	$	115,825	$	97,403

As of December 31, 2020, the balance of construction in progress was $24.5 million, of which $14.2 million was related to our buildings in our new Dingxing and Kazuo locations, $4.0 million was for manufacturing equipment purchases not yet placed in service and $6.3 million was from our construction in progress for our other consolidated subsidiaries. As of December 31, 2019, the balance of construction in progress was $61.8 million, of which $48.8 million was related to our buildings in our new Dingxing and Kazuo locations, $3.4 million was for manufacturing equipment purchases not yet placed in service and $9.6 million was from our construction in progress for our other consolidated subsidiaries. 

Depreciation and amortization expense was $4.3 million, $5.5 million and $4.9 million for the years ended December 31, 2020, 2019 and 2018, respectively.

From time to time we review our estimates of the useful lives of our property, plant and equipment. As a result of the review, we determined a portion of our manufacturing equipment was lasting longer than the estimate previously established for the respective useful lives. Where appropriate, we extended the useful life of the manufacturing equipment in our accounting records. In addition, the useful life of our buildings located in China was extended to better align with industry standards. The changes in our estimate of the useful life, effective January 1, 2020, were made in order to remain consistent with U.S. GAAP regarding management estimates. The effect of the change in the useful lives decreased our manufacturing costs for the year ended December 31, 2020 by approximately $1.4 million and increased our basic and diluted net income per share by approximately $0.03, respectively, as a result of lower depreciation expense.