In 2020, Tableta Company paid P4,000,000to purchase a land containing a totalestimated 160,000 tons of extractablemineral deposits. The estimated value of theproperty after the mineral has been removedis P800,000. Extraction activities began in2021 and by the end of the year, 20,000tons had been recovered and sold. In 2022,geological studies indicated that the totalamount of mineral deposits had beenunderestimated by 60,000 tons. During 202,30,000 tons were extracted, and 28,000tons were sold.What is the depletion rate in 2022?12.7320.0014.0015.56

Depletion rate per Ton = ( Land value - Salvage value ) / Number of tons

In 2020, Tableta Company paid P4,000,000 to purchase a land containing a total estimated 160,000 tons of extractable mineral deposits. The estimated value of the property after the mineral has been removed is P800,000. Extraction activities began in

In 2020, Tableta Company paid P4,000,000 to purchase a land containing a total estimated 160,000 tons of extractable mineral deposits. The estimated value of the property after the mineral has been removed is P800,000. Extraction activities began in

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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On June 1, 2021, ABC Company purchased rights to a mine for P30,000,000, of which, P3,000,000 was allocable to the land. Estimated reserves were 2,250,000 tons. ABC expected to extract and sell 37,500 tons per month. ABC purchased mining equipment on September 30, 2021 for P12,000,000. The mining equipment had a useful life of nine years. However, after all the resource is removed, the equipment will be of no use and will be sold for P750,000. ANSWER THE QUESTION: What is the depletion for 2021?
On July 1, 2015, Lam Company, a calendar year corporation, purchased the rights to mine. The total purchase price was P16,400,000, of which P2,000,000 was allocated to the land. Estimated reserves were 1,800,000 tons. The entity expects to extract and sell 25,000 tons per month. The entity purchased new equipment on July 1, 2015 for P7,500,000. The equipment had a useful life of 8 years. However, after all the resources is removed, the equipment would be of no use and could be sold for P300,000.What amount should be recorded as depreciation of the mining equipment for 2015?
Barton Corporation acquires a coal mine at a cost of $1,800,000. Intangible development costs total $360,000. After extraction has occurred, Barton must restore the property (estimated fair value of the obligation is $180,000), after which it can be sold for $210,000. Barton estimates that 5,000 tons of coal can be extracted. What is the amount of depletion per ton? a. $426 b. $384 c. $468 d. $360
A coal mine contains approximately 900,000 tons of this material. The mine cost $13' 500, 000 million. The extraction during 2021, the first year of operations, was 120,000 tons. a) How much is the depletion in 2021? b) Suppose that in 2022 100,000 tons were extracted, what would be the net book value? c) Make the table of the depreciation calculation by the method that corresponds and is adequate to solve this exercise. Could you explain step by step and in detail?, please
On January 2, 2018, ABC Company purchased land for ₱450,000, from which it estimated that 400,000 tons of ore could be extracted. It estimates that it will cost ₱80,000 to restore the land after which it could be sold for ₱30,000. During 2018, the company mined 80,000 tons and sold 50,000 tons. During 2019, the company mined 100,000 tons and sold 120,000 tons. At the beginning of 2020, the company spent an additional ₱100,000, which increased the reserves by 60,000 tons. In 2020, the company mined 140,000 tons and sold 130,000 tons. The company uses a FIFO cost flow assumption. Depletion for 2019_______
At the beginning of January 2018, Rock Limited acquired a mine for sh34,000,000. Of this amount, sh. 4,000,000 was ascribed to the land value and the remaining portion to the minerals in the mine. Surveys conducted by geologists have indicated that approximately 480,000,000 units of a precious ore appear to be in the mine. Rock incurred sh. 5,000,000 of development costs associated with this mine prior to any extraction of minerals and estimates that it will require sh. 1,600,000 to prepare the land for an alternative use when all the ore has been removed. During 2018, 40,000,000 units of ore were extracted and 16,000,000 of these units were sold. Compute the total amount of depletion and the cost of the minerals sold in 2018.
On July 1, 2022, Trisha Company purchased the rights to a mine for P13,200,000, of which P1,200,000 was allocable to the land. Estimated reserves were 1,500,000 tons. The entity expects to extract and sell 25,000 tons per month. The entity purchased mining equipment on July 1, 2022 for P9,500,000. The mining equipment had a useful life of 8 years. However, after all the resource is removed, the equipment will be of no use and will be sold for P500,000. 1. What is the depletion for 2022? A. 2,400,000 B. 1,200,000 C. 2,640,000 D. 1,320,000 2. What is the depreciation for 2022? A. 1,800,000 B. 1,125,000 C. 900,000 D. 562,500
Schefter Mining operates a copper mine in Wyoming. Acquisition, exploration, and development costs totaled $7.5 million. Extraction activities began on July 1, 2024. After the copper is extracted in approximately six years, Schefter is obligated to restore the land to its original condition, including constructing a park. The company's controller has provided the following three cash flow possibilities for the restoration costs: 1. 2. 3. Cash Flow $ 630,000 730,000 830,000 Probability 30% 30% 40% The company's credit-adjusted, risk-free rate of interest is 4%, and its fiscal year ends on December 31. Note: Use appropriate factor(s) from the tables provided. Round other intermediate calculations to the nearest whole dollar. Enter your answers in whole dollars. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Required: 1. What is the initial cost of the copper mine? 2. How much accretion expense will Schefter report in its 2024 income statement? 3. What is the book…
In January 2022, Proton Mining Corporation purchased a mineral mine for P4,200,000 with removable ore estimated by geological surveys at 2,500,000 tons. The property has an estimated value of P400,000 after the ore has been extracted. Proton incurred P1,150,000 of development costs preparing the property for the extraction of ore. During 2022, 340,000 tons were removed and 300,000 tons were sold. For the year ended December 31, 2022, Proton should record what amount of depletion for the current year? O P594,000 O P456,000 O P673,200 O P516,800