In 2013, A MINING Corp. purchased property with natural resources for P 12,400,000 The property was relatively close to a large city and had an expected residual value of P 3,000,000 However, P 1,200,000 will have to be spent to restore the land for use. The following information relates to the use of the property: a) In 2013, A MINING Corp. spent P 800,000 in development costs and P 600,000 in buildings on the property. A MINING Corp. does not anticipate that the buildings will have any utility after the natural resources are depleted. b) In 2014 and 2016, P 600,000 and P 1,600,000, respectively, were spent for additional developments on the mine. c) The tonnage mined and estimated remaining tons for years 2013-2017 are as follows: Year /Tons Extracted remaining/Estimated Tons 2013 2014 1,500,000 2015 1,800,000 2016 1,700,000 2017 900,000 5,000,000 3,500,000 2,000,000 900,000 Required: 1. Prepare necessary journal entries in 2014 up to 2017 2. Determine the following: 2.a Depletion and depreciation for 2014 2.b Depletion and depreciation for 2015 2.c Depletion and depreciation for 2016 2.d Depletion and depreciation for 2017

In 2013, A MINING Corp. purchased property with natural resources for P 12,400,000 The property was relatively close to a large city and had an expected residual value of P 3,000,000 However, P 1,200,000 will have to be spent to restore the land for use. The following information relates to the use of the property: a) In 2013, A MINING Corp. spent P 800,000 in development costs and P 600,000 in buildings on the property. A MINING Corp. does not anticipate that the buildings will have any utility after the natural resources are depleted. b) In 2014 and 2016, P 600,000 and P 1,600,000, respectively, were spent for additional developments on the mine. c) The tonnage mined and estimated remaining tons for years 2013-2017 are as follows: Year /Tons Extracted remaining/Estimated Tons 2013 2014 1,500,000 2015 1,800,000 2016 1,700,000 2017 900,000 5,000,000 3,500,000 2,000,000 900,000 Required: 1. Prepare necessary journal entries in 2014 up to 2017 2. Determine the following: 2.a Depletion and depreciation for 2014 2.b Depletion and depreciation for 2015 2.c Depletion and depreciation for 2016 2.d Depletion and depreciation for 2017

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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