A company purchased a tract of land for its natural resources at a cost of $1,500,000....
A company purchased a tract of land for its natural resources at a cost of $1,500,000. It expects to mine 2,000,000 tons of ore from this land. The salvage value of the land is expected to be $250,000. If 150,000 tons of ore are mined during the first year, the journal entry to record the depletion is:
Debit Depletion Expense $93,750; credit Natural Resources $93,750.
Debit Depletion Expense $112,500; credit Accumulated Depletion $112,500.
Debit Cash $93,750; credit Accumulated Depletion $93,750.
Debit Cash $112,500; credit Natural Resources $112,500.
Debit Depletion Expense $93,750; credit Accumulated Depletion $93,750.
Homework Answers
| Depletion expense | 93,750 | |
| Accumulated depletion | 93,750 | |
| (1,500,000-250,000)/2,000,000*150,000 |
Option E is the answer
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A company purchased a tract of land
for its natural resources at a cost of $1,500,000....
MC Qu. 131 A company purchased a tract... A company purchased a tract of land for...
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Flannery Company engages In the exploration and development of many types of natural resources. In the...
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QS 10-10 Natural resources and depletion LO P3
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Exercise 10-18 Depletion of natural resources LO P1, P3 On April 2, 2017, Montana Mining Co....
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Exercise 10-18 Depletion of natural resources LO P1, P3 On April 2, 2017, Montana Mining Co....
Exercise 10-18 Depletion of natural resources LO P1,
P3
On April 2, 2017, Montana Mining Co. pays $4,977,890 for an ore
deposit containing 1,402,000 tons. The company installs machinery
in the mine costing $248,500, with an estimated seven-year life and
no salvage value. The machinery will be abandoned when the ore is
completely mined. Montana begins mining on May 1, 2017, and mines
and sells 165,800 tons of ore during the remaining eight months of
2017.
Prepare the December...
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.) The total cost of an asset less its accumulated depreciation is calle A) Historical cost. Book value. C) Present value D) Current (market) value. E) Replacement cost. 14) A company purchased a delivery yan for $28.000 with a salvag ased a delivery van for $2.00 with a salvage value of $3,000 on September 1, Year 1. It ha Year 1. It has an estimated useful life of 5 years. Using the how much depreciation expense should the company roce...
Flannery Company engages In the exploration and development of many types of natural resources. In the last two years, the company has engaged In the following activities Jan Year 1 Purchased for $28e,980 a silver mine estimated to contain 828,880 tons of silver ore July , Year 1 Purchased for $2,898,8ee cash a tract of land containing timber estimated to yield 3,848,8e8 board feet of lumber At the time of purchase, the land had an appraised of $179,88 Feb. 1,...
Exercise 10-18 Depletion of natural resources LO P1, P3 On April 2, 2017, Montana Mining Co. pays $4.755,880 for an ore deposit containing 1,518,000 tons. The company installs machinery in the mine costing $153,500, with an estimated seven-year life and no salvage value. The machinery will be abandoned when the ore is completely mined. Montana begins mining on May 1, 2017, and mines and sells 166,100 tons of ore during the remaining eight months of 2017 Hint Prepare the December...
Exercise 10-18 Depletion of natural resources LO P1,
P3
On April 2, 2017, Montana Mining Co. pays $4,977,890 for an ore
deposit containing 1,402,000 tons. The company installs machinery
in the mine costing $248,500, with an estimated seven-year life and
no salvage value. The machinery will be abandoned when the ore is
completely mined. Montana begins mining on May 1, 2017, and mines
and sells 165,800 tons of ore during the remaining eight months of
2017.
Prepare the December...
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