Colorado Mining paid $750,000 to acquire a mine with 50,000 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 26,250 tons of coal in year 1 and 22,500 tons in year 2. Required Compute the depletion charge per unit. b-1. Compute the depletion expense for years 1 and 2 in a financial statements.
Colorado Mining paid $750,000 to acquire a mine with 50,000 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 26,250 tons of coal in year 1 and 22,500 tons in year 2. Required Compute the depletion charge per unit. b-1. Compute the depletion expense for years 1 and 2 in a financial statements.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Colorado Mining paid $750,000 to acquire a mine with 50,000 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 26,250 tons of coal in year 1 and 22,500 tons in year 2.
Required
-
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.
![Complete this question by entering your answers in the tabs below.
Req A
Assets
Record the acquisition of the coal reserves and the depletion expense for years 1 and 2 in a financial statements model. (In the Cash Flow column, use OA to designate
operating activity, IA for investment activity, or FA for financing activity. If the element is not affected by the event, leave the cell blank. Enter any decreases to account
balances and cash outflows with a minus sign. Round final answers to the nearest whole dollar amount. Not all cells will require entry.)
Req B1
Coal
Reserves
Cash
Acquisition of coal reserves
708,400 +
Depletion for Year 1
Depletion for Year 2
Reg B2
Balance Sheet
Liabilities +
+
+
+
COLORADO MINING
Horizontal Statements Model
Stockholders' Equity
Common
Stock
708,400 +
+
Income Statement
< Req B1
Revenue Expenses =
Retained
Earnings
Net
Income
1-
Req B2 >
Statement of Cash
Flows
Show less](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1ece6948-a6ed-4917-9cc1-92918a1ca1a3%2F229c449c-ff12-4f1b-95f8-a64243c82330%2F3mnz1t_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Complete this question by entering your answers in the tabs below.
Req A
Assets
Record the acquisition of the coal reserves and the depletion expense for years 1 and 2 in a financial statements model. (In the Cash Flow column, use OA to designate
operating activity, IA for investment activity, or FA for financing activity. If the element is not affected by the event, leave the cell blank. Enter any decreases to account
balances and cash outflows with a minus sign. Round final answers to the nearest whole dollar amount. Not all cells will require entry.)
Req B1
Coal
Reserves
Cash
Acquisition of coal reserves
708,400 +
Depletion for Year 1
Depletion for Year 2
Reg B2
Balance Sheet
Liabilities +
+
+
+
COLORADO MINING
Horizontal Statements Model
Stockholders' Equity
Common
Stock
708,400 +
+
Income Statement
< Req B1
Revenue Expenses =
Retained
Earnings
Net
Income
1-
Req B2 >
Statement of Cash
Flows
Show less
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
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
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education