Homework Answers
The journal entries are provided below. Please refer
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On July 1 of the current year the Land Oil company pays $10,000,000 for the rights...
On January 1, 2019, Devour & Engulf Co. paid $1,657,500 for the mineral rights to an...
On January 1, 2019, Devour & Engulf Co. paid $1,657,500 for the mineral rights to an oil shale deposit containing an estimated 390,000 barrels of oil. The company also installed equipment on the site at a cost of $1,150,500 with no expected salvage value, capable of removing the oil shale in six years. The equipment will be abandoned when the oil shale is completed depleted. The company chooses to use a "Units of Production" approach to depreciate its PPE assets...
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
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.RequiredPrepare entries to record (a)...
On July 23 of the current year, Dakota Mining Co. pays $7,390,320 for land estimated to contain 8,904,000 tons of recoverable ore
On July 23 of the current year, Dakota Mining Co. pays $7,390,320 for land estimated to contain 8,904,000 tons of recoverable ore. li installs machinery costing $801,360 that has a 10 -year life and no salvage value and is capable of mining the ore deposit in eight years. The machinery is paid for on July 25 , seven days before mining operations begin. The company removes and sells 458,250 tons of ore during its first five months of operations ending...
On July 23 of the current year, Dakota Mining Co. pays $6,645,600 for land estimated to contain 8.520,000 tons of recoverable ore
On July 23 of the current year, Dakota Mining Co. pays $6,645,600 for land estimated to contain 8.520,000 tons of recoverable ore. It installs machinery costing $681.600 that has a 10-year life and no salvage value and is capable of mining the ore deposit in eight years. The machinery is paid for on July 25, seven days before mining operations begin. The company removes and sells 437,500 tons of ore during its first five months of operations ending on December...
An oil well cost $2,030,000 and is calculated to hold 350,000 barrels of oil. There is...
An oil well cost $2,030,000 and is calculated to hold 350,000 barrels of oil. There is no residual value. Which journal entry is needed to record the expense for the extraction of 47,000 barrels of oil during the year? All 47,000 barrels were sold during the year. (Round any intermediate calculations to the nearest cent and your final answer to the nearest dollar.) 272,600 272,600 272,600 272,600 O A. Depletion Expense - Oil Reserve Oil Revenue O B. Cost of...
on July 23 of the current year, Dakota Mining Co. pays $5,961,600 for land estimated to...
on July 23 of the current year, Dakota Mining Co. pays $5,961,600 for land estimated to contain 8,280,000 tons of recoverable ore. It installs and pays for machinery costing $828,000 on July 25. The company removes and sells 426,500 tons of ore during its first five months of operations ending 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.
a. Timber rights on atract of land were purchased for $700,000 on February 16. The stand...
a. Timber rights on atract of land were purchased for $700,000 on February 16. The stand of timber is estimated at 5,000,000 board feet. During the current year, 1,400,000 board feet of timber were cut and sold. b. On December 31, the company determined that $850,000 of goodwill was impaired c. Governmental and legal costs of $5,000,000 were incurred on April 3 in obtaining a patent with an estimated economic life of 15 years. Amortization is to be for three...
Data related to the acquisition of timber rights and intangible assets during the current year ended...
Data related to the acquisition of timber rights and intangible assets during the current year ended December 31 are as follows: A. Timber rights on a tract of land were purchased for $1,600,000 on February 22. The stand of timber is estimated at 5,000,000 board feet. During the current year, 1,100,000 board feet of timber were cut and sold. B. On December 31, the company determined that $3,750,000 of goodwill was impaired. C. Governmental and legal costs of $6,600,000 were...
Data related to the acquisition of timber rights and intangible assets during the current year ended...
Data related to the acquisition of timber rights and intangible assets during the current year ended December 31 are as follows: A. Timber rights on a tract of land were purchased for $2,442,370 on February 22. The stand of timber is estimated at 5,957,000 board feet. During the current year, 1,013,900 board feet of timber were cut and sold. B. On December 31, the company determined that $3,385,000 of goodwill was impaired. C. Governmental and legal costs of $6,426,000 were...
Calculate the NPV for the following investment with 6 years life time assuming a discount rate...
Calculate the NPV for the following investment with 6 years life time assuming a discount rate of 20% per year: The investor is a Non-integrated petroleum company Total producible oil in the reserve is estimated to be 2,400,000 barrels Production rate will be 400,000 barrels of oil per year from year 1 to year 6 Mineral rights acquisition cost for the property will be $1,600,000 at time zero Intangible drilling cost (IDC) is expected to be $7,000,000 at time zero...
On July 23 of the current year, Dakota Mining Co. pays $7,390,320 for land estimated to contain 8,904,000 tons of recoverable ore. li installs machinery costing $801,360 that has a 10 -year life and no salvage value and is capable of mining the ore deposit in eight years. The machinery is paid for on July 25 , seven days before mining operations begin. The company removes and sells 458,250 tons of ore during its first five months of operations ending...
On July 23 of the current year, Dakota Mining Co. pays $6,645,600 for land estimated to contain 8.520,000 tons of recoverable ore. It installs machinery costing $681.600 that has a 10-year life and no salvage value and is capable of mining the ore deposit in eight years. The machinery is paid for on July 25, seven days before mining operations begin. The company removes and sells 437,500 tons of ore during its first five months of operations ending on December...
An oil well cost $2,030,000 and is calculated to hold 350,000 barrels of oil. There is no residual value. Which journal entry is needed to record the expense for the extraction of 47,000 barrels of oil during the year? All 47,000 barrels were sold during the year. (Round any intermediate calculations to the nearest cent and your final answer to the nearest dollar.) 272,600 272,600 272,600 272,600 O A. Depletion Expense - Oil Reserve Oil Revenue O B. Cost of...
a. Timber rights on atract of land were purchased for $700,000 on February 16. The stand of timber is estimated at 5,000,000 board feet. During the current year, 1,400,000 board feet of timber were cut and sold. b. On December 31, the company determined that $850,000 of goodwill was impaired c. Governmental and legal costs of $5,000,000 were incurred on April 3 in obtaining a patent with an estimated economic life of 15 years. Amortization is to be for three...
Data related to the acquisition of timber rights and intangible assets during the current year ended December 31 are as follows: A. Timber rights on a tract of land were purchased for $2,442,370 on February 22. The stand of timber is estimated at 5,957,000 board feet. During the current year, 1,013,900 board feet of timber were cut and sold. B. On December 31, the company determined that $3,385,000 of goodwill was impaired. C. Governmental and legal costs of $6,426,000 were...
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