Company: SISI
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001493152-25-006895
Chunk: 31

Company: SHINECO, INC.
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 1
Chunk 31
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 provide an implicit rate, the Company uses its incremental borrowing rate based on
the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also
includes any lease payments made and excludes lease incentives and includes initial direct costs incurred. The Company’s lease
terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.
Lease expenses for minimum lease payments are recognized on a straight-line basis over the lease term. All operating lease ROU assets
are reviewed for impairment annually. For the six and three months ended December 31, 2024 and 2023, the Company did not recognize any
impairment of its ROU assets.

    13

Lessor accounting

The Company rents out its office to a
third party, which is classified as an operating lease in accordance with Topic 842. The revenue from an operating lease is recognized
in other income in the unaudited condensed consolidated statements of income (loss) and comprehensive income (loss) on a straight-line
basis over the term of the lease.

Property and Equipment, Net

Property and equipment are stated at
cost, less accumulated depreciation and amortization. Expenditures for additions, major renewals, and betterments are capitalized, and
expenditures for maintenance and repairs are charged to expense as incurred. Depreciation is provided on a straight-line basis, less
estimated residual value, if any, over an asset’s estimated useful life. Farmland leasehold improvements are amortized over the
shorter of lease term or estimated useful lives of the underlying assets. The estimated useful lives of the Company’s property
and equipment are as follows:

 SCHEDULE
OF ESTIMATED USEFUL LIVES OF PROPERTY AND EQUIPMENT

    Estimated useful lives

    Buildings
     
    5-50 years
  
    Machinery and equipment
     
    3-10 years
  
    Motor vehicles
     
    5-15 years
  
    Office equipment
     
    3-10 years
  
    Farmland leasehold improvements
     
    12-18 years
  
    Fixture and furniture
     
    3 years

Construction in progress includes property
and equipment in the course of construction for production or for its own use purposes. Construction in progress is carried at cost less
any recognized impairment loss. Construction in progress is classified to the appropriate category of property and equipment when completed
and ready for intended use. Dep