Exercise 10-19 Depletion of natural resources P3 Montana Mining Co. pays $3,721,000 for an ore deposit containing 1,525,000 tons. The company installs machinery in the mine costing $213,500. Both the ore and machinery will have no salvage value after the ore is completely mined. Montana mines and sells 166,200 tons of ore during the year. Prepare the December 31 year-end entries to record both the ore deposit depletion and the mining machinery depreciation. Mining machinery depreciation should be in proportion to the mine's depletion.

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Exercise 10-19 Depletion of natural resources P3
Montana Mining Co. pays $3,721,000 for an ore deposit containing 1,525,000 tons. The company installs machinery in the mine costing
$213,500. Both the ore and machinery will have no salvage value after the ore is completely mined. Montana mines and sells 166,200 tons
of ore during the year. Prepare the December 31 year-end entries to record both the ore deposit depletion and the mining machinery
depreciation. Mining machinery depreciation should be in proportion to the mine's depletion.
Transcribed Image Text:Exercise 10-19 Depletion of natural resources P3 Montana Mining Co. pays $3,721,000 for an ore deposit containing 1,525,000 tons. The company installs machinery in the mine costing $213,500. Both the ore and machinery will have no salvage value after the ore is completely mined. Montana mines and sells 166,200 tons of ore during the year. Prepare the December 31 year-end entries to record both the ore deposit depletion and the mining machinery depreciation. Mining machinery depreciation should be in proportion to the mine's depletion.
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