Vesco Mineral Resources purchased mineral rights to land in the foothills of the Santa Cristo mountains. The cost of the purchase was $9 million. Vesco originally estimated that 200,000 tons of lignite coal was removable. However, further exploration during the second year of operation revealedthat a total of 280,000 tons could be economically removed. If the company sold 20,000 tons in year 1 and 30,000 tons in year 2, what are the depletion charges each year according to the cost depletion method?

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Vesco Mineral Resources purchased mineral rights to land in the foothills of the Santa Cristo mountains. The cost of the purchase was $9 million. Vesco originally estimated that 200,000 tons of lignite coal was removable. However, further exploration during the second year of operation revealed
that a total of 280,000 tons could be economically removed. If the company sold 20,000 tons in year 1 and 30,000 tons in year 2, what are the depletion charges each year according to the cost depletion method?

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