(c)If Ayayai plants five seedlings at a cost of $5 per seedling for each tree cut, how should Ayayai treat the reforestation?Ayayai shouldthe cost of$4 Ayayai Company owns a 7,500-acre tract of timber purchased in 2006 at a cost of $1,534 per acre. At the time of purchase, the landwas estimated to have a value of $354 per acre without the timber. Ayayai Company has not logged this tract since it was purchased.In 2020, Ayayai had the timber cruised. The cruise (appraiser) estimated that each acre contained 9,440 board feet of timber. In 2020,Ayayai built 10 miles of roads at a cost of $7,800 per mile. After the roads were completed, Ayayai logged and sold 4,130 treescontaining 1,003,000 board feet.(a)Your answer is correct.Determine the cost of timber sold related to depletion for 2020. (Round answer to O decimal places, e.g. 5,125.)Cost of timber sold24125375eTextbook and Media

In this case, Ayayai has planted 5 seedlings at cost of $ 5 for each tree cut. Ayayi should treat…

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If Ayayai plants five seedlings at a cost of $5 per seedling for each tree cut, how should Ayayai treat the reforestation? Ayayai should the cost of %24

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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Concept explainers

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.

Question

(c)
If Ayayai plants five seedlings at a cost of $5 per seedling for each tree cut, how should Ayayai treat the reforestation?
Ayayai should
the cost of
$4

Ayayai Company owns a 7,500-acre tract of timber purchased in 2006 at a cost of $1,534 per acre. At the time of purchase, the land
was estimated to have a value of $354 per acre without the timber. Ayayai Company has not logged this tract since it was purchased.
In 2020, Ayayai had the timber cruised. The cruise (appraiser) estimated that each acre contained 9,440 board feet of timber. In 2020,
Ayayai built 10 miles of roads at a cost of $7,800 per mile. After the roads were completed, Ayayai logged and sold 4,130 trees
containing 1,003,000 board feet.
(a)
Your answer is correct.
Determine the cost of timber sold related to depletion for 2020. (Round answer to O decimal places, e.g. 5,125.)
Cost of timber sold
24
125375
eTextbook and Media

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