Note 7 - Property and Equipment

3 Months Ended

Mar. 31, 2022

Notes to Financial Statements

Property, Plant and Equipment Disclosure [Text Block]

Note 7. Property and Equipment

Property and equipment is stated at cost and depreciated using the straight-line method over the estimated useful life of the asset which varies from 10 to 30 years for land improvements; 5 to 50 years in the case of buildings and improvements; and from 3 to 10 years for machinery and equipment, vehicles and office furniture and equipment.

Major additions and improvements are charged to the property and equipment accounts while replacements, maintenance and repairs, which do not improve or extend the life of the respective asset, are expensed as incurred. The cost of assets retired or otherwise disposed of and the related accumulated depreciation is eliminated from the accounts in the year of disposal. Gains or losses resulting from the disposal of property and equipment are recorded in “Other income, net” in our Condensed Consolidated Statements of Operations.

Property and equipment at March 31, 2022 and December 31, 2021 consists of the following (in thousands):

	March 31, 2022			December 31, 2021
Land and land improvements	$	15,591		$	15,588
Buildings and improvements		48,843			48,603
Machinery and equipment		7,441			7,122
Office furniture and fixtures		8,888			8,773
Vehicles		791			791
Construction in progress		2,631			1,448
		84,185			82,325
Less accumulated depreciation and amortization		(29,689	)		(28,987	)
Property and equipment, net	$	54,496		$	53,338

At March 31, 2022, the Company did not have any significant fixed contractual commitments for construction projects.

Avalon reviews the carrying value of its long-lived assets whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. If indicators of impairment exist, Avalon would determine whether the estimated undiscounted sum of the future cash flows of such assets and their eventual disposition is less than its carrying amount. If less, an impairment loss would be recognized if, and to the extent that the carrying amount of such assets exceeds their respective fair value. Avalon would determine the fair value by using quoted market prices, if available, for such assets; or if quoted market prices are not available, Avalon would discount the expected estimated future cash flows. During the first three months of 2022 and 2021, no triggering events were present.