Montana Mining Company pays $3,478,510 for an ore deposit containing 1,560,000 tons. The company installs machinery in the mine costing $239,200. Both the ore and machinery will have no salvage value after the ore is completely mined. Montana mines and sells 169,200 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

Montana Mining Company pays $3,478,510 for an ore deposit containing 1,560,000 tons. The company installs machinery in the mine costing $239,200. Both the ore and machinery will have no salvage value after the ore is completely mined. Montana mines and sells 169,200 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

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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A financial analyst is studying the income statement eff ect of two alternative depreciationmethods for a recently acquired piece of equipment. She gathers the following information about the equipment’s expected production life and use:Year 1 Year 2 Year 3 Year 4 Year 5 TotalUnits of production 2,000 2,000 2,000 2,000 2,500 10,500Compared with the units-of-production method of depreciation, if the company uses thestraight-line method to depreciate the equipment, its net income in Year 1 will most likely be:A. lower.B. higher.C. the same
How was the accumulated depreciation expense for the truck calculated?
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