Problem 8-52 (LO. 8) Wes acquired a mineral interest during the year for $10,000,000. A geological survey estimated that 250,000 tons of the mineral remained in the deposit. During the year, 80,000 tons were mined and 45,000 tons were sold for $12,000,000. Other related expenses amounted to $5,000,000. Assume the mineral depletion rate is 22%. a. What is the taxable income before the deduction for depletion? A 000'000'z b. Under cost depletion, what is the amount of the deduction? C. Under percentage depletion, what is the amount of the deduction? A 000'ov9'z d. Wes's lowest taxable income after the depletion deduction is $ A 000'09E'

Problem 8-52 (LO. 8) Wes acquired a mineral interest during the year for $10,000,000. A geological survey estimated that 250,000 tons of the mineral remained in the deposit. During the year, 80,000 tons were mined and 45,000 tons were sold for $12,000,000. Other related expenses amounted to $5,000,000. Assume the mineral depletion rate is 22%. a. What is the taxable income before the deduction for depletion? A 000'000'z b. Under cost depletion, what is the amount of the deduction? C. Under percentage depletion, what is the amount of the deduction? A 000'ov9'z d. Wes's lowest taxable income after the depletion deduction is $ A 000'09E'

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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