Problem 10-75 (LO 10-5) (Algo) [The following information applies to the questions displayed below.] Last Chance Mine (LCM) purchased a coal deposit for $1,223,950. It estimated it would extract 13,450 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1.22 million, $8 million, and $6.5 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 ($12,200), $655,000, and $537,500, respectively. years 1-3, LCM extracted 14,450 tons of coal as follows: (1) Tons of Coal 13,450 Depletion Tons Extracted per Year (2) Basis (2)/(1) Rate $1,223,950 $91.00 Year 1 2,250 Year 2 7,700 Note: Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. Problem 10-75 Part c (Algo) c. Using the cost and percentage depletion computations from parts (a) and (b), what is LCM's actual depletion expense for each year? Year 1 Year 2 Year 3 Year 3 4,500 Depletion Expense

Problem 10-75 (LO 10-5) (Algo) [The following information applies to the questions displayed below.] Last Chance Mine (LCM) purchased a coal deposit for $1,223,950. It estimated it would extract 13,450 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1.22 million, $8 million, and $6.5 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 ($12,200), $655,000, and $537,500, respectively. years 1-3, LCM extracted 14,450 tons of coal as follows: (1) Tons of Coal 13,450 Depletion Tons Extracted per Year (2) Basis (2)/(1) Rate $1,223,950 $91.00 Year 1 2,250 Year 2 7,700 Note: Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. Problem 10-75 Part c (Algo) c. Using the cost and percentage depletion computations from parts (a) and (b), what is LCM's actual depletion expense for each year? Year 1 Year 2 Year 3 Year 3 4,500 Depletion Expense

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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