Question

Question 7 View Policies Current Attempt In Progress Bridgeport Mining Company purchased land on February 1, 2020, at a cost of $1,031,100. It estimated that a total of 54,000 tons of mineral was available for mining. After it has removed all the natural resources, the company will be required to restore the property to its previous state because of strict environmental protection laws. It estimates the fair value of this restoration obligation at $99,900. It believes it will be able to sell the property afterwards for $111.000. It incurred developmental costs of $222,000 before it was able to do any mining. In 2020, resources removed totaled 27,000 tons. The company sold 19,800 tons. Compute the following information for 2020. (a) Per unit mineral cost (b) Total material cost of December 31, 2020, Inventory (c) Total material cost in cost of goods sold at December 31, 2020 $

Answer 1

a) Der unit material cost = (1,031,100 + 999000 -111,000+222,000) 54000 = $23 b) Total material cost december 31, Inventory = 23 x (27000-19800) E (165600] in cost of Total material cost goods sold → 23 X 19800 = 1455400