Natural Resources The Hollister Company acquires a silver mine at the cost of $1,300,000 on January 1. Along with the purchase price Hollister pays additional costs associated with development of $50,000. Hollister expects the mine will have a salvage value of $100,000 once all the silver has been mined. Best estimates are that the mine contains 250,000 tons of ore. Required a. Prepare the entry to record the purchase of the silver mine. b. Prepare the December 31 year-end adjusting entry to record depletion is 60,000 tons of ore are mined and all the ore is sold. c. Prepare the December 31 year-end adjusting entry to record depletion is 60,000 tons of ore are mined but only 15,000 tons of the ore are sold. Description Credit a. b. + To record depletion on silver mine. C. Silver inventory + + Purchase of silver mine + Check 수 To record depletion on silver mine. Debit 0 0 0 0 0 0 0 0 0 0 0 0 0 0 99

Natural Resources The Hollister Company acquires a silver mine at the cost of $1,300,000 on January 1. Along with the purchase price Hollister pays additional costs associated with development of $50,000. Hollister expects the mine will have a salvage value of $100,000 once all the silver has been mined. Best estimates are that the mine contains 250,000 tons of ore. Required a. Prepare the entry to record the purchase of the silver mine. b. Prepare the December 31 year-end adjusting entry to record depletion is 60,000 tons of ore are mined and all the ore is sold. c. Prepare the December 31 year-end adjusting entry to record depletion is 60,000 tons of ore are mined but only 15,000 tons of the ore are sold. Description Credit a. b. + To record depletion on silver mine. C. Silver inventory + + Purchase of silver mine + Check 수 To record depletion on silver mine. Debit 0 0 0 0 0 0 0 0 0 0 0 0 0 0 99

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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Lipaopao Corporation acquires a coal mine at a cost of p 5,000,000. Intangible development costs total P 1,200,000. After extraction has occurred, Lipaopao must restore the property (estimated fair value of the obligation is P600,000), after which can be sold for P 1,700,000. Baton estimates that 50,000 tons of coal can be extracted. If 9,000 tons were extracted during the first year, which of the following would be included in the journal entry to record depletion? a. Debit to Accumulated Depletion for P 918,000 b. Debit to inventory for P 918,000 c. Credit to inventory for P 900,000 d. Credit to Accumulated Depletion for P 1,530,000
Nevada Gold Company (LLC) purchased a gold deposit for $1,500,000. It estimated it would extract 500,000 ounces of gold from the deposit. The company mined the gold and sold it, reporting gross receipts of $1.8 million, $2.5 million, and $2 million for Years 1 through 3, respectively. During Years 1 through 3, Nevada Gold reported net income (loss) from the gold deposit activity in the amount of ($100,000), $400,000, and $100,000, respectively. In Years 1 through 3, the company actually extracted 300,000 ounces of gold as follows: Ounces of Gold extracted per year Year 1 Year 2 Year 3 50,000 150,000 100,000 What is Nevada Gold's depletion deduction for Year 2 if the applicable percentage depletion for gold is 15 percent? Question 8 options: $450,000. $400,000. $375,000. $200,000.
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 38% 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…
Current Attempt in Progress Marigold Corp. acquires land for $100000 cash. Additional costs are as follows: Removal of shed Filling and grading Residual value of lumber from shed Paving of parking lot Closing costs Type here to search $430 $104890. O $100000. O$104460. O $120690. 3300 Marigold will record the cost of the land as 150 15500 1310 C P 5 59 -4°C Clear 4) ENG 10: 2022
4 02:59:09 Perez Company acquires an ore mine at a cost of $2,240,000. It incurs additional costs of $627,200 to access the mine, which is estimated to hold 1,600,000 tons of ore. 210,000 tons of ore are mined and sold the first year. The estimated value of the land after the ore is removed is $320,000. Calculate the depletion expense from the information given. 1. & 2. Prepare the entry to record the cost of the ore mine and year-end adjusting entry. Complete this question by entering your answers in the tabs below. eBook Depletion Expense General Journal Calculate the depletion expense from the information given. Note: Round "Depletion per unit" to 3 decimal places. Cost Salvage Amount subject to depletion Total units of capacity Depletion per unit Units extracted and sold in period Depletion expense Help Save &
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Required information [The following information applies to the questions displayed below.] Last Chance Mine (LCM) purchased a coal deposit for $750,000. It estimated it would extract 12.000 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1 million, $3 million, and $2 million for years 1 through 3, respectively. During years 1-3, LCM reported net income (loss) from the coal deposit activity in the amount of ($20,000). $500,000, and $450,000, respectively. In years 1-3, LCM actually extracted 13,000 tons of coal as follows: (Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars.) (3) Tons of Coal 12,000 Year 1 2 3 Depletion (2) (2)/(1) Basis Rate $750,000 $62.50 Tons Extracted per Year Year 1 Year 21 Year 3 2,000 7,200 3,800 b. What is LCM's percentage depletion for each year (the applicable percentage for coal is 10 percent)? Percentage Depletion
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Natural Resources The Hollister Company acquires a silver mine at the cost of $2,100,000 on January 1. Along with the purchase price Hollister pays additional costs associated with development of $50,000, Hollister expects the mine will have a salvage value of $300,000 once all the silver has been mined. Best estimates are that the mine contains 250,000 tons of ore. Required a: Prepare the entry to record the purchase of the silver mine. b. Prepare the December 31 year-end adjusting entry to record depletion is 60,000 tons of ore are mined and all the ore is sold, c. Prepare the December 31 year-end adjusting entry to record depletion is 60,000 tons of ore are mined but only 15,000 tons of the are are sold Description Credit 4 # Purchase of silver mine # = To record depletion on silver mine Siver inventory To record depletion on silver mine Debit
Subject: accounting
2. Mark Company
Hidden Hollow Mining Co. acquired mineral rights for $69,000,000. The mineral deposit is estimated at 60,000,000 tons. During the current year, 13,200,000 tons were mined and sold. a. Determine the depletion rate. If required, round your answer to two decimal places. Sfill in the blank d39a0a00ffc1f93_1 per ton