Alaska Mining Co. acquired mineral rights for $24,992,000. The mineral deposit is estimated at 113,600,000 tons. During the current year, 17,050,000 tons were mined and sold. A. Determine the amount of delpletion expense for the current year. Round the depletion rate to two decimal rates. B. Journalize the adjacent entry on December 31 to recognize the depletion expenses. If an amount box does not require an entry, leave blank
Alaska Mining Co. acquired mineral rights for $24,992,000. The mineral deposit is estimated at 113,600,000 tons. During the current year, 17,050,000 tons were mined and sold. A. Determine the amount of delpletion expense for the current year. Round the depletion rate to two decimal rates. B. Journalize the adjacent entry on December 31 to recognize the depletion expenses. If an amount box does not require an entry, leave blank
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Alaska Mining Co. acquired mineral rights for $24,992,000. The mineral deposit is estimated at 113,600,000 tons. During the current year, 17,050,000 tons were mined and sold.
A. Determine the amount of delpletion expense for the current year. Round the depletion rate to two decimal rates.
B. Journalize the adjacent entry on December 31 to recognize the depletion expenses. If an amount box does not require an entry, leave blank.
Expert Solution
Step 1
Depletion rate = Total cost of mining rights/Estimated tons
Depletion expense = Depletion rate*Tons mined and sold
Step by step
Solved in 2 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education