At the beginning of current year, Nilli company purchased a coal mine for P30,000,000. Removable coal is estimated at 1,500,000 tons. The entity is required to restore the land at an estimated cost of 3,600,000. The land is estimated to have a value of P3,150,000 after restoration. The entity incurred P7,500,000 of development cost preparing the mine for production. During the current year, 450,000 tons were removed and 300,000 tons were sold. What total amount of depletion should be recorded in the cost of goods sold for the current year?
At the beginning of current year, Nilli company purchased a coal mine for P30,000,000. Removable coal is estimated at 1,500,000 tons. The entity is required to restore the land at an estimated cost of 3,600,000. The land is estimated to have a value of P3,150,000 after restoration. The entity incurred P7,500,000 of development cost preparing the mine for production. During the current year, 450,000 tons were removed and 300,000 tons were sold. What total amount of depletion should be recorded in the cost of goods sold for the current year?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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At the beginning of current year, Nilli company purchased a coal mine for P30,000,000. Removable coal is estimated at 1,500,000 tons. The entity is required to restore the land at an estimated cost of 3,600,000. The land is estimated to have a value of P3,150,000 after restoration. The entity incurred P7,500,000 of development cost preparing the mine for production. During the current year, 450,000 tons were removed and 300,000 tons were sold. What total amount of depletion should be recorded in the cost of goods sold for the current year?
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