Exercise 8-19 (Algo) Depletion of natural resources LO P3 Montana Mining Company pays $4,001,070 for an ore deposit containing 1,551,000 tons. The company installs machinery in the mine costing $211,500. Both the ore and machinery will have no salvage value after the ore is completely mined. Montana mines and sells 184,500 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. Note: Do not round intermediate calculations. Round your final answers to the nearest whole number. View transaction list Journal entry worksheet < 1 2 Record the year-end adjusting entry for the depletion expense of ore mine. Note: Enter debits before credits. Date December 31 General Journal Debit Credit > View general journal Record entry Clear entry

Exercise 8-19 (Algo) Depletion of natural resources LO P3 Montana Mining Company pays $4,001,070 for an ore deposit containing 1,551,000 tons. The company installs machinery in the mine costing $211,500. Both the ore and machinery will have no salvage value after the ore is completely mined. Montana mines and sells 184,500 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. Note: Do not round intermediate calculations. Round your final answers to the nearest whole number. View transaction list Journal entry worksheet < 1 2 Record the year-end adjusting entry for the depletion expense of ore mine. Note: Enter debits before credits. Date December 31 General Journal Debit Credit > View general journal Record entry Clear entry

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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Required information Problem 10-7A (Algo) Natural resources LO P3 (The following information applies to the questions displayed below.) On July 23 of the current year, Dakota Mining Company pays $6,929,280 for land estimated to contain 9,624,000 tons of recoverable ore. It instals and pays for machinery costing $577,440 on July 25. The company removes and sells 496,750 tons of ore during its first five months of operations ending on December 31, Depreciation of the machinery is in proportion to the mine's depletion as the machinery will be abandoned after the ore is mined. Problem 10-7A (Algo) Part 1-4 Required: Prepare entries to record the following (a) The purchase of the land. (b) The cost and installation of machinery. (c) The first five months' depletion assuming the land has a net salvage value of zero after the ore is mined. (d) The first five months' depreciation on the machinery.
Exercise 10-17 (Algo) Disposal of assets LO P2 Diaz Company owns a machine that cost $127,000 and has accumulated depreciation of $93,500. Prepare the entry to record the disposal of the machine on January 1 in each separate situation. 1. The machine needed extensive repairs and was not worth repairing. Diaz disposed of the machine, receiving nothing in return.2. Diaz sold the machine for $16,000 cash.3. Diaz sold the machine for $33,500 cash.4. Diaz sold the machine for $41,000 cash.
Exercise 8-19A (Static) Computing and recording depletion expense LO 8-9 Colorado Mining paid $600.000 to acquire a mine with 40.000 tons of coal reserves. The financial statements model in Required B reflects Colorado Mining's financial condition just prior to purchasing the coal reserves. The company extracted 15.000 tons of coal in year 1 and 18.000 tons in year 2 Required: a. Compute the depletion charge per ton b. 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. Required A Required 8 Compute the depletion charge per ton person Cesta Required>
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Domestic
Exercise 10-13 (Algo) Revising depreciation LO C2 Apex Fitness Club uses straight-line depreciation for a machine costing $21,050, with an estimated four-year life and a $2,250 salvage value. At the beginning of the third year, Apex determines that the machine has three more years of remaining useful life, after which it will have an estimated $1,800 salvage value. 1. Compute the machine's book value at the end of its second year. 2. Compute the amount of depreciation for each of the final three years given the revised estimates. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the machine's book value at the end of its second year. Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar. Book Value at the End of Year 2: Cost Accumulated depreciation 2 years Book value at point of revision $ 0
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Problem 8-2A (Algo) Depreciation methods LO P1 A machine costing $213,800 with a four-year life and an estimated $17,000 salvage value is installed in Luther Company's factory on January 1. The factory manager estimates the machine will produce 492,000 units of product during its life. It actually produces the following units: 122,300 in Year 1, 123,600 in Year 2, 120,400 in Year 3, 135,700 in Year 4. The total number of units produced by the end of Year 4 exceeds the original estimate-this difference was not predicted. Note: The machine cannot be depreciated below its estimated salvage value. Required: Compute depreciation for each year (and total depreciation of all years combined) for the machine under each depreciation method. (Round your per unit depreciation to 2 decimal places. Round your answers to the nearest whole dollar.) Complete this question by entering your answers in the tabs below. Straight Line Units of Production Compute depreciation for each year (and total…
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Question 20 of 20 0. View Policies Show Attempt History Current Attempt in Progress X Your answer is incorrect. If a mining company extracts 1540000 tons in a period but only sells 1120000 tons, O a separate accumulated depletion account is set up to record depletion on the 420000 tons extracted but not sold. O depletion is recognized on the 1540000 tons extracted. O total depletion on the mine is based on the 1120000 tons. O depletion is recognized on the 1120000 tons extracted and sold. eTextbook and Media Assistance Used Save for Later Attempts: 1 of 2 used Submit Answer & * 6 7 t y A LO