Note 8 – Property and Equipment

Construction in progress consists of costs incurred to build out our manufacturing facilities in Texas, along with the construction of our freeze driers. These costs will be capitalized as Leasehold Improvements and Machinery, respectively, upon completion.

As of September 30, 2025, the Company reclassified a candy-making machine and accessories with a carrying amount of $713,256 from construction in progress to assets held for sale on our balance sheets. The reclassification was made in accordance with ASC 360-10-45, Property, Plant, and Equipment — Other Presentation Matters, as management committed to a plan to sell the asset, initiated an active program to locate a buyer, and determined that the sale was probable within one year. The asset is presented separately on the consolidated balance sheet at the lower of its carrying amount or estimated fair value less costs to sell.

Depreciation of property and equipment was $268,281 and $216,164 for the three months ended September 30, 2025 and 2024, respectively, of which $259,697 and $207,580 was allocated to cost of goods sold, respectively.

Depreciation of property and equipment was $786,993 and $582,948 for the nine months ended September 30, 2025 and 2024, respectively, of which $761,242 and $559,888 was allocated to cost of goods sold, respectively. During the three and nine month periods ended September 30, 2025, the Company disposed of leasehold improvements with a costs basis of $32,882, and related accumulated deprecation of $8,193.