Perez Company acquires an ore mine at a cost of $3,640,000. It incurs additional costs of $1,019,200 to access the mine, which is estimated to hold 2,600,000 tons of ore. 260,000 tons of ore are mined and sold the first year. The estimated value of the land after the ore is removed is $520,000. 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. Depletion Expense General Journal Calculate the depletion expense from the information given. (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 Complete this question by entering your answers in the tabs below. Depletion Expense General Journal Prepare the entry to record the cost of the ore mine and year-end adjusting entry. Journal entry worksheet Record the cost of the ore mine in cash. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Journal entry worksheet Record the year-end adjusting entry for the depletion expense of ore mine. Note: Enter debits before credits. Transaction General Journal Debit Credit 2

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 6PB: Underwoods Miners recently purchased the rights to a diamond mine. It is estimated that there are...

See similar textbooks

Related questions

Question

Perez Company acquires an ore mine at a cost of $3,640,000. It incurs additional costs of $1,019,200 to access the mine, which is estimated to hold 2,600,000 tons of ore. 260,000 tons of ore are mined and sold the first year. The estimated value of the land after the ore is removed is $520,000. 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.

Depletion Expense
General Journal

Calculate the depletion expense from the information given. (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

Complete this question by entering your answers in the tabs below.

Depletion Expense
General Journal

Prepare the entry to record the cost of the ore mine and year-end adjusting entry.

Journal entry worksheet

Record the cost of the ore mine in cash.

Note: Enter debits before credits.

Transaction	General Journal	Debit	Credit
1

Journal entry worksheet

Record the year-end adjusting entry for the depletion expense of ore mine.

Note: Enter debits before credits.

Transaction	General Journal	Debit	Credit
2

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions