Property, Plant & Equipment

3 Months Ended

Mar. 31, 2021

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT & EQUIPMENT

3. PROPERTY, PLANT & EQUIPMENT

The Company’s property, plant and equipment at March 31, 2021 and December 31, 2020 consisted of the following:

	Estimated Useful Life	March 31, 2021			December 31, 2020
Land		$	278,325		$	278,325
Building and improvements	30 years		9,563,406			9,563,406
Manufacturing and warehouse equipment	6-20 years		12,052,901			11,959,563
Office equipment and furniture	3-5 years		1,889,210			1,880,387
Leasehold improvements	10-15 years		587,183			587,183
Finance leases – right to use	5 years		113,741			113,741
Vehicles	3 years		10,020			10,020
Construction in process			1,277,941			464,203
Property, plant and equipment, gross			25,772,727			24,856,828
Less accumulated depreciation			(15,036,395	)		(14,754,866	)
Property, plant and equipment, net		$	10,736,332		$	10,101,962

The Company’s wholly owned subsidiary, Kinpak Inc. (“Kinpak”), has been engaged since 2017 in a project involving the expansion of its manufacturing, warehouse and distribution facilities in Montgomery, Alabama, as well as the purchase and installation of associated machinery and equipment (the “Expansion Project”). Kinpak has completed the construction of, and placed into service, an approximately 85,000 square foot addition to the facilities and an expansion of a tank farm to accommodate an additional 500,000 gallons of tank capacity. The final phase of the Expansion Project entails the evaluation, purchase and installation of additional equipment. The Company is financing the Expansion Project through a $4,500,000 industrial development bond, which is described in Note 7. At March 31, 2021, the Company had unused proceeds from the industrial development bond of approximately $318,000 in a custodial account restricted for the use of funding additional capital improvements. The Company intends to utilize the remaining proceeds to purchase machinery and equipment to expand production capacity.

Depreciation expense totaled $281,529 (of which $257,140 is included in cost of goods sold and $24,389 is included in selling and administrative expenses) and $254,308 (of which $230,966 is included in cost of goods sold and $23,342 is included in selling and administrative expenses) for the three months ended March 31, 2021 and 2020, respectively.