Required information Skip to question [The followinginformation applies to the questions displayed below.]On July 23 of the current year, Dakota Mining Companypays $8,247,600 for land estimated to contain9,480,000 tons of recoverable ore. It installs and paysfor machinery costing $1,706,400 on July 25. Thecompany removes and sells 487, 500 tons of ore duringits first five months of operations ending on December31. Depreciation of the machinery is in proportion tothe mine's depletion as the machinery will beabandoned after the ore is mined. Required: Prepareentries to record the following. (a) The purchase of theland. (b) The cost and installation of machinery. (c) Thefirst five months' depletion assuming the land has a netsalvage value of zero after the ore is mined. (d) The firstfive months' depreciation on the machinery.

(a) To record the purchase of the landDateAccountDebitCreditJuly 23Mineral deposit$8,247,600 Cash…

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Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter7: Fixed Assets, Natural Resources, And Intangible Assets

Section: Chapter Questions

Problem 4SEQ

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Underwoods Miners recently purchased the rights to a diamond mine. It is estimated that there are two million tons of ore within the mine. Underwoods paid $46,000,000 for the rights and expects to harvest the ore over the next fifteen years. The following is the expected extraction for the next five years. Year 1: 50,000 tons Year 2: 900,000 tons Year 3: 400,000 tons Year 4: 210,000 tons Year 5: 150,000 tons Calculate the depletion expense for the next five years and create the journal entry for year one.
Required information [The following information applies to the questions displayed below.) On July 23 of the current year, Dakota Mining Co. pays $7.075.200 for land estimated to contaln 8,040,000 tons of recoverable ore. It Installs and pays for machinery costing $804,000 on July 25. The company removes and sells 412,750 tons of ore during Its first five months of operations ending on December 31. Depreclation of the machinery Is In proportion to the mine's depletlon as the machinery wll be abandoned after the ore is mined. (e) If the machine will be used at another site when extraction is complete, how would we depreciate this machine? Depreciated
! Required information [The following information applies to the questions displayed below.] On July 23 of the current year, Dakota Mining Company pays $8,027,760 for land estimated to contain 9,672,000 tons of recoverable ore. It installs and pays for machinery costing $773,760 on July 25. The company removes and sells 499,500 tons of ore during its first five months of operations ending on December 31. Depreciation of the machinery is in proportion to the mine's depletion as the machinery will be abandoned after the ore is mined. Required: Prepare entries to record the following. (a) The purchase of the land. (b) The cost and installation of machinery. (c) The first five months' depletion assuming the land has a net salvage value of zero after the ore is mined. (d) The first five months' depreciation on the machinery. Complete this question by entering your answers in the tabs below. Required A Required B Required C1 Required C2 Required D1 Required D2 Prepare the journal entry to…
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Montana Mining Co. pays $3,721,000 for an ore deposit containing 1,525,000 tons. The company installs machinery in the mine costing $213,500. Both the ore and machinery will have no salvage value after the ore is completely mined. Montana mines and sells 166,200 tons of ore during the year. Prepare the yearend entries to record both the ore deposit depletion and the mining machinery depreciation. Mining machinery depreciation should be in proportion to the mine’s depletion.
Montana Mining Co. pays $3,926,550 for an ore deposit containing 1,572,000 tons. The company installs machinery in the mine costing $152,400, which will be abandoned when the ore is completely mined. Montana mines and sells 145,700 tons of ore during the year. Prepare the year-end entries to record both the ore deposit depletion and the mining machinery depreciation. Mining machinery depreciation should be in proportion to the mine's depletion. (Do not round intermediate calculations. Round your final answers to the nearest whole number.) View transaction list Journal entry worksheet es Record the year-end adjusting entry for the depletion expense of ore mine. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Vlew general Journal Record entry Clear entry < Prev 7 of 7 Next aw MacBook Air
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On July 23 of the current year, Dakota Mining Co. pays $4,715,000 for land estimated to contain 5,125,000 tons of recoverable ore. It installs and pays for machinery costing $410,000 on July 25. The company removes and sells 480,000 tons of ore during its first five months of operations ending on December 31. Depreciation of the machinery is in proportion to the mine’s depletion as the machinery will be abandoned after the ore is mined. Required Prepare entries to record (a) the purchase of the land, (b) the cost and installation of machinery, (c) the first five months’ depletion assuming the land has a net salvage value of zero after the ore is mined, and (d) the first five months’ depreciation on the machinery. Analysis Component (e) If the machine will be used at another site when extraction is complete, how would we depreciate this machine?
The Weber Company purchased a mining site for $674,927 on July 1. The company expects to mine ore for the next 10 years and anticipates that a total of 87,066 tons will be recovered. During the first year the company extracted 4,680 tons of ore. The depletion expense is a.$36,270.00 b.$62,964.00 c.$33,844.61 d.$45,287.00
On February 19 of the current year, Quartzite Co. pays $5,400,000 for land estimated to contain 4 million tons of recoverable ore. It installs and pays for machinery costing $400,000 on March 21. The company removes and sells 254,000 tons of ore during its first nine months of operations ending on December 31. Depreciation of the machinery is in proportion to the mine’s depletion as the machinery will be abandoned after the ore is mined. Required Prepare entries to record (a) the purchase of the land, (b) the cost and installation of the machinery, (c) the first nine months’ depletion assuming the land has a net salvage value of zero after the ore is mined, and (d) the first nine months’ depreciation on the machinery. Analysis Component (e) If the machine will be used at another site when extraction is complete, how would we depreciate this machine?
Weber Company purchased a mining site for $525,247 on July 1. The company expects to mine ore for the next 10 years and anticipates that a total of 85,242 tons will be recovered. The estimated residual value of the property is $49,377. During the first year, the company extracted 4,550 tons of ore. The depletion expense is Oa. $47,587.00 Ob. $25,400.72 Oc. $28,036.34 Od. $49,377.00
12. On July 23 of the current year, Dakota Mining Company pays $7,398,720 for land estimated to contain 8,808,000 tons of recoverable ore. It installs and pays for machinery costing $968,880 on July 25. The company removes and sells 451,000 tons of ore during its first five months of operations ending on December 31. Depreciation of the machinery is in proportion to the mine's depletion as the machinery will be abandoned after the ore is mined. Required:Prepare entries to record the following.(a) The purchase of the land.(b) The cost and installation of machinery.(c) The first five months' depletion assuming the land has a net salvage value of zero after the ore is mined.(d) The first five months' depreciation on the machinery.

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