Chapter 30 - Depletion Question 1-2. At the beginning of the year 2021, Wise Corp. purchased a mineral mine for P30,000,000 with removable ore estimated at 1,500,000 tons. After it has extracted all the ore, the entity will be required by law to restore the land to the original conditions at an estimated cost of P2, 500,000. The present value of the estimated restoration cost is P1,800,000. The estimated residual value of the property is P3,000,000 During the current year, the entity incurred P3, 800,000 of cost in developing the property and preparing the mine for production and removed 90,000 tons and sold 70,000 tons of ore. Q1. What amount should be depletable and at what rate per unit? 33,000,000 30.00 per unit b. 27,800,000 : 29.67 per unit 32,600,000 21.73 per unit d. 30,000,000 : 18.97 per unit a. C. Q2. What amount should be reported as depletion for the current year? a. 2,495,700 b. 3,000,000 C. 32,600,000 d. 1,941,000

Chapter 30 - Depletion Question 1-2. At the beginning of the year 2021, Wise Corp. purchased a mineral mine for P30,000,000 with removable ore estimated at 1,500,000 tons. After it has extracted all the ore, the entity will be required by law to restore the land to the original conditions at an estimated cost of P2, 500,000. The present value of the estimated restoration cost is P1,800,000. The estimated residual value of the property is P3,000,000 During the current year, the entity incurred P3, 800,000 of cost in developing the property and preparing the mine for production and removed 90,000 tons and sold 70,000 tons of ore. Q1. What amount should be depletable and at what rate per unit? 33,000,000 30.00 per unit b. 27,800,000 : 29.67 per unit 32,600,000 21.73 per unit d. 30,000,000 : 18.97 per unit a. C. Q2. What amount should be reported as depletion for the current year? a. 2,495,700 b. 3,000,000 C. 32,600,000 d. 1,941,000

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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