A coal mine cost $1,005,000 and is estimated to hold 52,000 tons of coal. There is no residual value. During the first year of operations, 6,000 tons are extracted and sold. Calculate depletion perunit. (Round your answer to the nearest cent.)OA $19.33OB. $9.67OC. $4.83OD. $14.5***

Solution:Deprecation or depletion refers to the wear and tear cost of an asset. It means the loss in…

Answered: A coal mine cost $1,005,000 and is…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 6PA: Gimli Miners recently purchased the rights to a diamond mine. It is estimated that there are one...

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Underwoods Miners recently purchased the rights to a diamond mine. It is estimated that there are two million tons of ore within the mine. Underwoods paid $46,000,000 for the rights and expects to harvest the ore over the next fifteen years. The following is the expected extraction for the next five years. Year 1: 50,000 tons Year 2: 900,000 tons Year 3: 400,000 tons Year 4: 210,000 tons Year 5: 150,000 tons Calculate the depletion expense for the next five years and create the journal entry for year one.
An oil company using the successful-efforts method drilled two wells. The first, a dry hole, costP50,000. The second cost P100,000 and had estimated recoverable reserves of 25,000 barrels, ofwhich 10,000 were sold this year. What will be the total expense for the year related to theexploration and production from these two wells? a. P40,000 b. P60,000 c. P 90,000 d. P150,000
A company just purchased a new vehicle for $25,000. The vehicle's salvage value at EOY1 is 80% of the initial cost and decreases by 20% every year afterwards. The O&M cost in Year 1 is zero, but is $950 in Year 2 and increases by $950 annually. The company's MARR is 10%. The economic life of the vehicle is years. O A.6 OB.5 OC.7 OD.85 O E. 3 OF. 4
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?
A coal mine was purchased a cost of P102,154,536,61OB (1B is 1E9) and the estimated amount of coal that can be mined is 64,324,798M tonnes (1 tonne = 1000 kg). If the extraction rate per month is 446,521 tonnes. What is the depletion cost after the 7th year in pesos? Answer round off to two decimal places
11 A sand mixing device costs $48,000. At the end of 5 years, the salvage value is $18,000. Using straight-line depreciation, find out the how much is accumulated depreciation over the 5-year life of the machine? sut of O A. $35000 uestion O B. $30000 OC. $37000 13 A company bought a machine for BD 250,000 which has a useful life of 10 years and can be sold for BD50,000 at the end of its useful life. Determine the depreciation on the 8th year and book value at the end of 8th year using sinking fund if interest is 12%. ut of
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A new machine was bought for $9,000 with a life of six years and no salvage value. Its annual operating costs were as follows: $7,000, $7,350, $7,717.50, . . . , $8,933.97. If theMARR = 12%, what was the annual equivalent cost of the machine? (a) $7,809 (b) $41,106 (c) $9,998 (d) $2,190 (e) $9,895.
23 )
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A coal mine cost $1,005,000 and is estimated to hold 52,000 tons of coal. There is no residual value. During the first year of operations, 6,000 tons are extracted and sold. Calculate depletion per unit. (Round your answer to the nearest cent.) OA. $19.33 O B. $9.67 OC. $4.83 OD. $14.5 ←