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Vaughn Paper Products purchased 11,500 acres of forested timberland in March 2020. The company paid $1,955 per acre for this land, which was above the $920 per acre most farmers were paying for cleared land. During April, May, June, and July 2020, Vaughn cut enough timber to build roads using moveable equipment purchased on April 1, 2020. The cost of the roads was $287,500, and the cost of the equipment was $258,750; this equipment was expected to have a $10,350 salvage value and would be used for the next 15 years. Vaughn selected the straight-line method of depreciation for the moveable equipment. Vaughn began actively harvesting timber in August and by December had harvested and sold 621,000 board feet of timber of the estimated 7,762,500 board feet available for cutting. In March 2021, Vaughn planted new seedlings in the area harvested during the winter. Cost of planting these seedlings was $138,200. In addition, Vaughn spent $9,200 in road maintenance and $6,900 for pest spraying during calendar-year 2021. The road maintenance and spraying are annual costs. During 2021, Vaughn harvested and sold 890,100 board feet of timber of the estimated 7,417,500 board feet available for cutting. In March 2022, Vaughn again planted new seedlings at a cost of $172,500, and also spent $17,250 on road maintenance and pest spraying. During 2022, the company harvested and sold 747,500 board feet of timber of the estimated 7,475,000 board feet available for cutting. Compute the amount of depreciation and depletion expense for each of the 3 years (2020, 2021, and 2022). Assume that the roads are usable only for logging and therefore are included in the depletion base. (Round intermediate calculations to 5 decimal places e.g. 1.08541 and final answers to 0 decimal places, e.g. 45,892.) 2021 2022 2020 Depletion Expense $ Depreciation Expense $ Click f you would like to Show Work for this question: Open Show Work $ $ $

Vaughn Paper Products purchased 11,500 acres of forested timberland in March 2020. The company paid $1,955 per acre for this land, which was above the $920 per acre most farmers were paying for cleared land. During April, May, June, and July 2020, Vaughn cut enough timber to build roads using moveable equipment purchased on April 1, 2020. The cost of the roads was $287,500, and the cost of the equipment was $258,750; this equipment was expected to have a $10,350 salvage value and would be used for the next 15 years. Vaughn selected the straight-line method of depreciation for the moveable equipment. Vaughn began actively harvesting timber in August and by December had harvested and sold 621,000 board feet of timber of the estimated 7,762,500 board feet available for cutting. In March 2021, Vaughn planted new seedlings in the area harvested during the winter. Cost of planting these seedlings was $138,200. In addition, Vaughn spent $9,200 in road maintenance and $6,900 for pest spraying during calendar-year 2021. The road maintenance and spraying are annual costs. During 2021, Vaughn harvested and sold 890,100 board feet of timber of the estimated 7,417,500 board feet available for cutting. In March 2022, Vaughn again planted new seedlings at a cost of $172,500, and also spent $17,250 on road maintenance and pest spraying. During 2022, the company harvested and sold 747,500 board feet of timber of the estimated 7,475,000 board feet available for cutting. Compute the amount of depreciation and depletion expense for each of the 3 years (2020, 2021, and 2022). Assume that the roads are usable only for logging and therefore are included in the depletion base. (Round intermediate calculations to 5 decimal places e.g. 1.08541 and final answers to 0 decimal places, e.g. 45,892.) 2021 2022 2020 Depletion Expense $ Depreciation Expense $ Click f you would like to Show Work for this question: Open Show Work $ $ $

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter7: Operating Assets
Section: Chapter Questions
Problem 65E
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Problem 11-07 Vaughn Paper Products purchased 11,500 acres of forested timberland in March 2020. The company paid $1,955 per acre for this land, which was above the $920 per acre most farmers were paying for cleared land. During April, May, June, and July 2020, Vaughn cut enough timber to build roads using moveable equipment purchased on April 1, 2020. The cost of the roads was $287,500, and the cost of the equipment was $258,750; this equipment was expected to have a $10,350 salvage value and would be used for the next 15 years. Vaughn selected the straight-line method of depreciation for the moveable equipment. Vaughn began actively harvesting timber in August and by December had harvested and sold 621,000 board feet of timber of the estimated 7,762,500 board feet available for cutting. In March 2021, Vaughn planted new seedlings in the area harvested during the winter. Cost of planting these seedlings was $138,200. In addition, Vaughn spent $9,200 in road maintenance and $6,900 for pest spraying during calendar-year 2021. The road maintenance and spraying are annual costs. During 2021, Vaughn harvested and sold 890,100 board feet of timber of the estimated 7,417,500 board feet available for cutting. In March 2022, Vaughn again planted new seedlings at a cost of $172,500, and also spent $17,250 on road maintenance and pest spraying. During 2022, the company harvested and sold 747,500 board feet of timber of the estimated 7,475,000 board feet available for cutting. Compute the amount of depreciation and depletion expense for each of the 3 years (2020, 2021, and 2022). Assume that the roads are usable only for logging and therefore are included in the depletion base. (Round intermediate calculations to 5 decimal places e.g. 1.08541 and final answers to 0 decimal places, e.g. 45,892.) 2020 Depletion Expense Depreciation Expense Click if you would like to Show Work for this question: Open Show Work $ 2021 $ 2022
Transcribed Image Text:Problem 11-07 Vaughn Paper Products purchased 11,500 acres of forested timberland in March 2020. The company paid $1,955 per acre for this land, which was above the $920 per acre most farmers were paying for cleared land. During April, May, June, and July 2020, Vaughn cut enough timber to build roads using moveable equipment purchased on April 1, 2020. The cost of the roads was $287,500, and the cost of the equipment was $258,750; this equipment was expected to have a $10,350 salvage value and would be used for the next 15 years. Vaughn selected the straight-line method of depreciation for the moveable equipment. Vaughn began actively harvesting timber in August and by December had harvested and sold 621,000 board feet of timber of the estimated 7,762,500 board feet available for cutting. In March 2021, Vaughn planted new seedlings in the area harvested during the winter. Cost of planting these seedlings was $138,200. In addition, Vaughn spent $9,200 in road maintenance and $6,900 for pest spraying during calendar-year 2021. The road maintenance and spraying are annual costs. During 2021, Vaughn harvested and sold 890,100 board feet of timber of the estimated 7,417,500 board feet available for cutting. In March 2022, Vaughn again planted new seedlings at a cost of $172,500, and also spent $17,250 on road maintenance and pest spraying. During 2022, the company harvested and sold 747,500 board feet of timber of the estimated 7,475,000 board feet available for cutting. Compute the amount of depreciation and depletion expense for each of the 3 years (2020, 2021, and 2022). Assume that the roads are usable only for logging and therefore are included in the depletion base. (Round intermediate calculations to 5 decimal places e.g. 1.08541 and final answers to 0 decimal places, e.g. 45,892.) 2020 Depletion Expense Depreciation Expense Click if you would like to Show Work for this question: Open Show Work $ 2021 $ 2022
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