Mareos Company purchased for $3,800,000 a mine estimated to contain 3,000,000 tons of ore. When the ore is completely extracted, it was expected that the land would be worth $200,000. A building and equipment costing $1,800,000 were constructed on the mine site, and they will be completely used up and have no salvage value when the ore is exhausted. During the first year, 750,000 tons of ore were mined, and $300,000 was spent for labor and other operating costs. Instructions Compute the total cost per ton of ore mined in the first year. Use two decimal places in your answer.
Mareos Company purchased for $3,800,000 a mine estimated to contain 3,000,000 tons of ore. When the ore is completely extracted, it was expected that the land would be worth $200,000. A building and equipment costing $1,800,000 were constructed on the mine site, and they will be completely used up and have no salvage value when the ore is exhausted. During the first year, 750,000 tons of ore were mined, and $300,000 was spent for labor and other operating costs. Instructions Compute the total cost per ton of ore mined in the first year. Use two decimal places in your answer.
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter18: Accounting For Long-term Assets
Section: Chapter Questions
Problem 6CE
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Mareos Company purchased for $3,800,000 a mine estimated to contain 3,000,000 tons of ore. When the ore is completely extracted, it was expected that the land would be worth $200,000. A building and equipment costing $1,800,000 were constructed on the mine site, and they will be completely used up and have no salvage value when the ore is exhausted. During the first year, 750,000 tons of ore were mined, and $300,000 was spent for labor and other operating costs.
Instructions
Compute the total cost per ton of ore mined in the first year. Use two decimal places in your answer.
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