16 Problem 07-36 (Algo) [LO 7-10] points A&Z incurred $452,500 of capitalized costs to develop a uranium mine. The corporation's geologists estimated that the mine would produce 905,000 tons of ore. During the year, 181,000 tons were extracted and sold. A&Z's gross revenues from the sales totaled $579,200, and its operating expenses for the mine were $173,760. Required: Calculate A&Z's depletion deduction. 5 Mc Graw Hill > Answer is complete but not entirely correct. Depletion deduction $ 90,500 × < Prev 16 of 20 Next > Return to question

16 Problem 07-36 (Algo) [LO 7-10] points A&Z incurred $452,500 of capitalized costs to develop a uranium mine. The corporation's geologists estimated that the mine would produce 905,000 tons of ore. During the year, 181,000 tons were extracted and sold. A&Z's gross revenues from the sales totaled $579,200, and its operating expenses for the mine were $173,760. Required: Calculate A&Z's depletion deduction. 5 Mc Graw Hill > Answer is complete but not entirely correct. Depletion deduction $ 90,500 × < Prev 16 of 20 Next > Return to question

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 6PB: Underwoods Miners recently purchased the rights to a diamond mine. It is estimated that there are...

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9. XYZ Company quarries limestone, crushes it, and sells it to be used in road building. XYZ paid P10,000,000 for a certain quarry. The property can be sold for P3,000,000 after production ceases. Estimated reserves 10,000,000; Tons quarried through December 31, 20X4 4,000,000; Tons quarried in 20X5 1,500,000. An engineering study performed in 20X5 indicated that as of January 1, 20X5, 7,500,000 tons of limestones were available. 30. Assume that the materials and labor cost incurred during 20X5 is 2,160,000 and that 1,000,000 tons were sold during the year at P5.00, Gross Profit for the year is?
14. In January 20X1, ABC Mining Corporation purchased a mineral mine for P7,200,000 with removable ore estimated by geological surveys at 4,320,000 tons. The property has an estimated value of P720,000 after the ore has been extracted. ABC incurred P2,160,000 of development costs preparing the property for the extraction of ore. During 20X1, 540,000 tons were removed and 480,000 tons were sold. For the year ended December 31, 20X1, ABC should include what amount of depletion chargeable to ore inventory?
7 The Piney Copper Company purchased an ore- bearing tract of land for $10.0M. The geologist for Piney estimated the recoverable copper reserves to be 500,000 tons. During the first year, 50,000 tons were mined and 40,000 tons were sold for $5.0M. Expenses (not including depletion allowances) were $3.0M. (a) What are the percentage depletion and the cost depletion allowances?
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10 A company's depletion base for a coal mine is $4,800,000, and this is recorded on the balance sheet in the coal mine asset account. The company expects to extract 120,000 tons of coal from the mine over the next 20 years. Which journal entry should the company record if it extracts 20,000 tons of coal during its first full year of operation? Debit cost of goods sold for $240,000; credit coal mine for $240,000 Debit coal mine for $800,000; credit inventory for $800,000 Debit inventory for $240,000; credit coal mine for $240,000 Debit inventory for $800,000; credit coal mine for $800,000
Problem 1Fool’s Gold, Inc. paid P5,000,000 for land having an ore body estimated to contain 2,000,000 tons of ore. The land will havea value of P400,000 after exhaustion of the mine. Other relevant costs paid were:Exploration cost P1,000,000Geological survey 500,000Development cost P1,500,000The entity installed heavy machinery costing P4,000,000, having a 10-year useful life and capable of exhausting the minein 8 years. The entity mined 300,000 tons of ore during the first six months of operations.Required:Prepare journal entries to record the following:1. Purchase of the ore property2. Payment for other relevant costs3. Installation of the heavy machinery4. Depletion for the first six months5. Depreciation for the first six months
4 02:59:09 Perez Company acquires an ore mine at a cost of $2,240,000. It incurs additional costs of $627,200 to access the mine, which is estimated to hold 1,600,000 tons of ore. 210,000 tons of ore are mined and sold the first year. The estimated value of the land after the ore is removed is $320,000. Calculate the depletion expense from the information given. 1. & 2. Prepare the entry to record the cost of the ore mine and year-end adjusting entry. Complete this question by entering your answers in the tabs below. eBook Depletion Expense General Journal Calculate the depletion expense from the information given. Note: Round "Depletion per unit" to 3 decimal places. Cost Salvage Amount subject to depletion Total units of capacity Depletion per unit Units extracted and sold in period Depletion expense Help Save &
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PROBLEM 24-4(IFRS)
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QS 10-13 (Algo) Natural resources and depletion LO P3 Perez Company acquires an ore mine at a cost of $3,500,000. It incurs additional costs of $980,000 to access the mine, which is estimated to hold 2,500,000 tons of ore. 255,000 tons of ore are mined and sold the first year. The estimated value of the land after the ore is removed is $500,000. Calculate the depletion expense from the information given. 1. & 2. Prepare the entry to record the cost of the ore mine and year-end adjusting entry.