Oriole Company purchased land on February 1, 2020, at a cost of $2,102,000. It estimated that a total of 53,000 tons of mineral was available for mining. After it has removed all the natural resources, the company will be required to restore the property to its previous state because of strict environmental protection laws. It estimates the fair value of this restoration obligation at $191,000. It believes it will be able to sell the property afterwards for $274,000. It incurred developmental costs of $525,000 before it was able to do any mining. In 2020, resources removed totaled 10,600 tons. The company sold 5,300 tons. Compute the following information for 2020. (a) Per unit mineral cost $ /ton (b) Total material cost of December 31, 2020, inventory $ +A (c) Total material cost in cost of goods sold at December 31, 2020 $

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter10: Property, Plant And Equipment: Acquisition And Subsequent Investments
Section: Chapter Questions
Problem 10MC
icon
Related questions
Question
Oriole Company purchased land on February 1, 2020, at a cost of $2,102,000. It estimated that a total of 53,000 tons of mineral was
available for mining. After it has removed all the natural resources, the company will be required to restore the property to its previous
state because of strict environmental protection laws. It estimates the fair value of this restoration obligation at $191,000. It believes
it will be able to sell the property afterwards for $274,000. It incurred developmental costs of $525,000 before it was able to do any
mining. In 2020, resources removed totaled 10,600 tons. The company sold 5,300 tons.
Compute the following information for 2020.
(a)
Per unit mineral cost
$
/ton
(b)
Total material cost of December 31, 2020, inventory
$
+A
(c)
Total material cost in cost of goods sold at December 31, 2020
$
Transcribed Image Text:Oriole Company purchased land on February 1, 2020, at a cost of $2,102,000. It estimated that a total of 53,000 tons of mineral was available for mining. After it has removed all the natural resources, the company will be required to restore the property to its previous state because of strict environmental protection laws. It estimates the fair value of this restoration obligation at $191,000. It believes it will be able to sell the property afterwards for $274,000. It incurred developmental costs of $525,000 before it was able to do any mining. In 2020, resources removed totaled 10,600 tons. The company sold 5,300 tons. Compute the following information for 2020. (a) Per unit mineral cost $ /ton (b) Total material cost of December 31, 2020, inventory $ +A (c) Total material cost in cost of goods sold at December 31, 2020 $
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
SWFT Comprehensive Volume 2019
SWFT Comprehensive Volume 2019
Accounting
ISBN:
9780357233306
Author:
Maloney
Publisher:
Cengage
CONCEPTS IN FED.TAX., 2020-W/ACCESS
CONCEPTS IN FED.TAX., 2020-W/ACCESS
Accounting
ISBN:
9780357110362
Author:
Murphy
Publisher:
CENGAGE L
Business Its Legal Ethical & Global Environment
Business Its Legal Ethical & Global Environment
Accounting
ISBN:
9781305224414
Author:
JENNINGS
Publisher:
Cengage
Individual Income Taxes
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT
SWFT Comprehensive Vol 2020
SWFT Comprehensive Vol 2020
Accounting
ISBN:
9780357391723
Author:
Maloney
Publisher:
Cengage