3. Agata Mining Ventures, one of the largest mining company, purchased 20 acres of land for P60,000,000 in 2020. The company expected to extract 5 million tons of mine from this land over the next 20 years at which time, residual value shall be P3,000,000. The following costs were also incurred related to the mining activities during 2020: Successful exploration cost, P5,000,000 and cost of P800,000 for dry wells. Operations started in the year 2021, during the first 2 years of the mine's operations, 300,000 tons and 400,000 tons were mined and sold for P80 per ton. Required: a) Entries to record the purchase of the land and other costs related to the mining activities in the year 2020. b) Entries to record the depletion expense for the year 2021 and 2022.

3. Agata Mining Ventures, one of the largest mining company, purchased 20 acres of land for P60,000,000 in 2020. The company expected to extract 5 million tons of mine from this land over the next 20 years at which time, residual value shall be P3,000,000. The following costs were also incurred related to the mining activities during 2020: Successful exploration cost, P5,000,000 and cost of P800,000 for dry wells. Operations started in the year 2021, during the first 2 years of the mine's operations, 300,000 tons and 400,000 tons were mined and sold for P80 per ton. Required: a) Entries to record the purchase of the land and other costs related to the mining activities in the year 2020. b) Entries to record the depletion expense for the year 2021 and 2022.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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2019 1. A company must prepare an HGB financial statement as of December 31, t1. The company is legally obliged to clean up contaminated sites caused by 2.3.t1.This contaminated site remediation is to be carried out by a third-party company on 6.7.t2; You have received a cost estimate from the third-party company for this in the gross amount of EUR 357,000.a) Go into detail about the creation of provisions in the present case as of December 31, t1, and, if necessary, also state the posting. Assume that no provision was recognized for the facts stated in the balance sheet as of 12/31/t0! b) Why is a provision and not a liability to be recognized under a)?c) On 6.7.t2 the third-party company will carry out the remediation of contaminated sites. The bill is presented on the same day in the amount of 357 T€ gross and you pay it immediately in cash. How to book?
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Several expenditures are listed below. Indicate whether or not each expenditure would be included in the cost of acquisition for each item below. The answer box provides two options, Yes (if the expenditure would be included ) or No, (if the expenditure would not be included.) Cost testing materials and labor in testing a purchased machine Yes before use Compensation for injury to No construction worker Cost of overhaul to a used Yes machine purchased before initial use Cost of tearing down a building Yes on newly acquired land Repairs to a new machine Yes damaged while moving it into > > > > >
Gallon Auto purchased a neighboring lot for a new building and parking lot. Indicate whether each of the following expenditures is properly charged to (a) Land, (b) Land Improvements, or (c) Buildings:a. Paving costsb. Architects’ fee for building designc. Cost of clearing the propertyd. Cost of the propertye. Building construction costsf. Lights around the propertyg. Building permith. Interest on the construction loan
The Home Depot financial statements appear in Appendix A at the end of this textbook. Use thesestatements to answer the following questions and indicate where in the financial statements youfound the information. a. What depreciation method does Home Depot use for buildings, furniture, fixtures, and equip-ment? What are the useful lives over which these assets are depreciated? b. From the notes to Home Depot ’s financial statements, what can you learn about the company’spolicy regarding impairment of plant assets?c. Locate Home Depot ’s balance sheet and find the section entitled “Property and Equipment, atcost.” As of January 31, 2010, determine the amount of the company’s investment in propertyand equipment and the amount of depreciation taken to date on those assets. Are these assets,taken as a whole, near the beginning or end of their estimated useful lives? Explain your answer.
Trinkle Company made several purchases of long-term assets during the year. The details of each purchase are presented here. New Office Equipment 1. List price: $42,600; terms: 2/10, n/30; paid within the discount period. 2. Transportation-in: $880. 3. Installation: $400. 4. Cost to repair damage during unloading: $630. 5. Routine maintenance cost after eight months: $150. Basket Purchase of Copier, Computer, and Scanner for $52,500 with Fair Market Values 1. Copier, $23,421. 2. Computer, $12,027. 3. Scanner, $27,852. Land for New Warehouse with an Old Building Torn Down 1. Purchase price, $83,800. 2. Demolition of building, $4,760. 3. Lumber sold from old building, $1,780. 4. Grading in preparation for new building, $7,900. 5. Construction of new building, $279,000.
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
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Do your research on 5 depreciation methods. Identify the appropriate applications, advantages, and disadvantages of each method.
(b) Examine in detail about various methods of Depreciation calculations. Please give detailed HAND NDWRITTEN ANSWER
We will continue our discussion from Module 6 on depreciation. Please read the article: Bumblauskas, D., Igou, A, Bumblauskas, P., Vaske, B., & Hahn, K. (2021). The Fixed Asset Life Cycle ChallengeLinks to an external site.. SF Magazine.com. Select ONE talking point from the article that you found interesting. Support your position by stating why you believe your point is relevant to accounting for depreciation.
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