Depletion: Calculating and Journalizing Mineral Works Co. acquired a salt mine at a cost of $1,700,000, with no expected salvage value. The estimated number of units available for production from the mine is 3,400,000 tons. a. During the first year, 200,000 tons are mined and sold. b. During the second year, 600,000 tons are mined and sold. Required: 1. Calculate the amount of depletion expense for both years. Year 1 Year 2

Depletion: Calculating and Journalizing Mineral Works Co. acquired a salt mine at a cost of $1,700,000, with no expected salvage value. The estimated number of units available for production from the mine is 3,400,000 tons. a. During the first year, 200,000 tons are mined and sold. b. During the second year, 600,000 tons are mined and sold. Required: 1. Calculate the amount of depletion expense for both years. Year 1 Year 2

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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A machine with a cost of $68,856 has an estimated residual value of $5,301 and an estimated life of 3 years or 15,143 hours. It is to be depreciated by the units-of-activity method. What is the amount of depreciation for the second full year, during which the machine was used 4,595 hours? Do not round your intermediate calculations. a. $21,185.00 b. $42,370.00 c. $19,285.16 d. $20,893.70
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