Cantor Co. purchased a coal mine for $2,000,000. It cost $500,000 to prepare the coal mine for the extraction of the coal. It was estimated that 750,000 tons of coal would be extracted from the mine during its useful life. Cantor planned to sell the property for $100,000 at the end of its useful life. During the current year, 15,000 tons of coal were extracted and sold. What would Cantor's depletion amount be per ton for the current year? Multiple choice question A) $2.50 B) $2.60 C) $3.20 D) $3.30
Cantor Co. purchased a coal mine for $2,000,000. It cost $500,000 to prepare the coal mine for the extraction of the coal. It was estimated that 750,000 tons of coal would be extracted from the mine during its useful life. Cantor planned to sell the property for $100,000 at the end of its useful life. During the current year, 15,000 tons of coal were extracted and sold. What would Cantor's depletion amount be per ton for the current year? Multiple choice question A) $2.50 B) $2.60 C) $3.20 D) $3.30
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Cantor Co. purchased a coal mine for $2,000,000. It cost $500,000 to prepare the coal mine for the extraction of the coal. It was estimated that 750,000 tons of coal would be extracted from the mine during its useful life. Cantor planned to sell the property for $100,000 at the end of its useful life. During the current year, 15,000 tons of coal were extracted and sold.
What would Cantor's depletion amount be per ton for the current year?
Multiple choice question
A) $2.50
B) $2.60
C) $3.20
D) $3.30
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