Required information For the last 10 years, Am-Mex Coal has used the cost depletion factor of $2,500 per 100 tons to write off the investment of $38 million in its Pennsylvania anthracite coal mine. Depletion thus far totals $24.8 million. A new study to appraise mine reserves indicates that no more than 910,000 tons of salable coal remains. The estimated gross income is expected to be $8.8 million on a production level of 72,000 tons. NOTE: This is a multi-part question. Once an answer is submitted, you will be unable to return to this part. Determine next year's depletion amount. The percentage depletion allowance is 10%. (Enter your answer in dollars and not in millions.)

Required information For the last 10 years, Am-Mex Coal has used the cost depletion factor of $2,500 per 100 tons to write off the investment of $38 million in its Pennsylvania anthracite coal mine. Depletion thus far totals $24.8 million. A new study to appraise mine reserves indicates that no more than 910,000 tons of salable coal remains. The estimated gross income is expected to be $8.8 million on a production level of 72,000 tons. NOTE: This is a multi-part question. Once an answer is submitted, you will be unable to return to this part. Determine next year's depletion amount. The percentage depletion allowance is 10%. (Enter your answer in dollars and not in millions.)

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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