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Colorado Mining paid $616,000 to acquire a mine with 44,000 tons of coal reserves. The financial statements model shown on the last tab reflects Colorado Mining's financial condition just prior to purchasing the coal reserves. The company extracted 23,100 tons of coal in year 1 and 19,800 tons in year 2 Required a. Compute the depletion charge per unit b-1. Compute the depletion expense for years 1 and 2 in a financial statements. b-2. Record the acquisition of the coal reserves and the depletion expense for years 1 and 2 in a financial statements model Req A Req B1 Reg B2

Colorado Mining paid $616,000 to acquire a mine with 44,000 tons of coal reserves. The financial statements model shown on the last tab reflects Colorado Mining's financial condition just prior to purchasing the coal reserves. The company extracted 23,100 tons of coal in year 1 and 19,800 tons in year 2 Required a. Compute the depletion charge per unit b-1. Compute the depletion expense for years 1 and 2 in a financial statements. b-2. Record the acquisition of the coal reserves and the depletion expense for years 1 and 2 in a financial statements model Req A Req B1 Reg B2

FINANCIAL ACCOUNTING
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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Colorado Mining paid $616,000 to acquire a mine with 44,000 tons of coal reserves. The financial statements model shown on the last tab reflects Colorado Mining's financial condition just prior to purchasing the coal reserves. The company extracted 23,100 tons of coal in year 1 and 19,800 tons in year 2 Required a. Compute the depletion charge per unit b-1. Compute the depletion expense for years 1 and 2 in a financial statements. b-2. Record the acquisition of the coal reserves and the depletion expense for years 1 and 2 in a financial statements model Req A Req B1 Compute the depletion charge per unit. Depletion charge per unit Year 1 Year 2 Req A Req B2 Compute the depletion expense for years 1 and 2 in a financial statements. Depletion Expense Assets Cash Coal Reserves Acquisition of coal reserves 712,400 + Depletion for Year 1 Req B1 Depletion for Year 2 Req B2 Balance Sheet Liabilities per ton Stockholders' Equity Common Stock 712,400+ Income Statement Retained Revenue Expenses Earnings < Req B1 Net Income Statement of Cash Flows
Transcribed Image Text:Colorado Mining paid $616,000 to acquire a mine with 44,000 tons of coal reserves. The financial statements model shown on the last tab reflects Colorado Mining's financial condition just prior to purchasing the coal reserves. The company extracted 23,100 tons of coal in year 1 and 19,800 tons in year 2 Required a. Compute the depletion charge per unit b-1. Compute the depletion expense for years 1 and 2 in a financial statements. b-2. Record the acquisition of the coal reserves and the depletion expense for years 1 and 2 in a financial statements model Req A Req B1 Compute the depletion charge per unit. Depletion charge per unit Year 1 Year 2 Req A Req B2 Compute the depletion expense for years 1 and 2 in a financial statements. Depletion Expense Assets Cash Coal Reserves Acquisition of coal reserves 712,400 + Depletion for Year 1 Req B1 Depletion for Year 2 Req B2 Balance Sheet Liabilities per ton Stockholders' Equity Common Stock 712,400+ Income Statement Retained Revenue Expenses Earnings < Req B1 Net Income Statement of Cash Flows
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