Company: GURE
Filing Date: 2025-04-11
Form Type: 10-K
Source: 0001193805-25-000461
Chunk: 569

Company: GULF RESOURCES, INC.
Filing Date: 2025-04-11
Form: 10-K
Item: Item 8
Chunk 569
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ensed as incurred.

Mineral rights are recorded at
cost less accumulated depreciation and any impairment losses. Mineral rights are amortized ratably over the term of the lease, or the
equivalent term under the units of production method, whichever is shorter.

Construction in process primarily
represents direct costs of construction of property, plant and equipment. Costs incurred are capitalized and transferred to property,
plant and equipment upon completion and depreciation will commence when the completed assets are placed in service.

The Company’s depreciation
and amortization policies on property, plant and equipment, other than mineral rights and construction in process, are as follows:

Basis of Presentation and Summary of
Significant Accounting Policies - Schedule of Property, Plant and Equipment Useful Life

    Minimum Maximum
    Useful life
                                                                               (in years)
  
    Buildings (including salt pans)
    8 - 20
  
    Plant and machinery (including protective shells, transmission channels and ducts)
    3 - 8
  
    Motor vehicles Motor Vehicles
    5
  
    Furniture, fixtures and equipment
    3 - 8

Property, plant and equipment
under the finance lease are depreciated over their expected useful lives on the same basis as owned assets, or where shorter, the term
of the lease, which is 20 years.

Producing oil and gas properties
are depreciated on a unit-of-production basis over the proved developed reserves. Common facilities that are built specifically to service
production directly attributed to designated oil and gas properties are depreciated based on the proved developed reserves of the respective
oil and gas properties on a pro-rata basis. Common facilities that are not built specifically to service identified oil and gas properties
are depreciated using the straight-line method over their estimated useful lives. Costs associated with significant development projects
are not depreciated until commercial production commences and the reserves related to those costs are excluded from the calculation of
depreciation.

(k)      Asset Retirement Obligation

The Company follows Financial
Accounting Standards Board Accounting Standards Codification (“FASB ASC”), which established a uniform methodology for accounting
for estimated reclamation and abandonment costs. FASB ASC 410 requires the fair value of a liability for an asset retirement obligation
to be recognized in the period in which the legal obligation associated with the retirement of the long-lived asset is incurred. When
the liability is initially recorded, the offset is capitalized by increasing the carrying amount of the related long-lived asset. Over
time, the liability is