Question

Exercise 11-21 Ivanhoe Company owns a 7,770-acre tract of timber purchased in 2003 at a cost of $1,443 per acre. At the time of purchase, the land was estimated to have a value of $333 per acre without the timber. Ivanhoe Company has not logged this tract since it was purchased. In 2017, Ivanhoe had the timber cruised. The cruise (appraiser) estimated that each acre contained 8,880 board feet of timber. In 2017, Ivanhoe built 10 miles of roads at a cost of $8,702 per mile. After the roads were completed, Ivanhoe logged and sold 3,885 trees containing 943,500 board feet. Your answer is correct. Determine the cost of timber sold related to depletion for 2017. (Round intermediate calculations to 5 decimal places, e.g. 1.24654 and final ansver to 0 decimal places, e.g. 5,125.) Cost of timber sold 117,938 SHOW SOLUTION ANSWER 凶Your answer is incorrect. Try again. If Ivanhoe depreciates the logging roads on the basis of timber cut, determine the depreciation expense for 2017. (Round intermediate calculations to 5 decimal places, e.g. 1.24654 and final answer to 0 decimal places, e.g. 5,125.) Depreciation expense LINK TO TEXT 凶Your answer is incorrect. Try again. If Ivanhoe plants five seedlings at a cost of $4 per seedling for each tree cut, howw should Ivanhoe treat the reforestation? Ivanhoe shouldk the cost of

Answer 1

Answer:

Answer No	Particular	Amount ($)
1	Cost of Timber sold( given)	$1,17,938
2	Depreciation expenses	$1,190
	87,020/(8,880*7,770)*943,500

If Ivanhoe plants five seedlings at a cost of $4 per seedling for each tree cut, how should Ivanhoe treat the reforestation?

3	Ivanhoe should Capitalize the cost of $ 77,700
	( 5 seedlings*$4*3,885 trees cut)

Please rate my answer...in case any doubt, post a comment and I will try to resolve the doubt ASAP…thank you