Santa Fe purchased the rights to extract turquoise on a tract of land over a five-year...
Santa Fe purchased the rights to extract turquoise on a tract of land over a five-year period. Santa Fe paid $956,250 for extraction rights. A geologist estimates that Santa Fe will recover 11,250 pounds of turquoise. During the current year, Santa Fe extracted 3,375 pounds of turquoise, which it sold for $608,000. What is Santa Fe's cost depletion deduction for the current year?
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Santa Fe purchased the rights to extract turquoise on a tract of
land over a five-year...
esce Mineral Resources purchased mineral rights to land in the foothills of the Santa Cristo mountains. The cost of the...
esce 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. 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? a. What is the cost depletion factor R.? b. What is the depletion amount in year 1?...
On April 17, 2018, the Loadstone Mining Company purchased the rights to a coal mine. The...
On April 17, 2018, the Loadstone Mining Company purchased the rights to a coal mine. The purchase price plus additional costs necessary to prepare the mine for extraction of the coal totaled $4,750,000. The company expects to extract 950,000 tons of coal during a four-year period. During 2018, 245,000 tons were extracted and sold immediately. Required: 1. Calculate depletion for 2018.
On April 17, 2021, the Loadstone Mining Company purchased the rights to a coal mine. The purchase price plus additional costs necessary to prepare the mine for extraction of the coal totaled $6,540,000. The company expects to extract 1,090,000 tons of coa
On April 17, 2021, the Loadstone Mining Company purchased the rights to a coal mine. The purchase price plus additional costs necessary to prepare the mine for extraction of the coal totaled $6,540,000. The company expects to extract 1,090,000 tons of coal during a four-year period. During 2021, 259,000 tons were extracted and sold immediately. Required:1. Calculate depletion for 2021.2. Is depletion considered part of the product cost and included in the cost of inventory?
value 5.00 points On April 17,2016, the Loadstone Mining Company purchased the rights to a coal...
value 5.00 points On April 17,2016, the Loadstone Mining Company purchased the rights to a coal mine The purchase price plus additional costs necessary to prepare the mine for extraction of the coal totaled $2,790,000. The company expects to extract 930,000 tons of coal during a four year period. During 2016, 350,000 tons were extracted and sold immediately Required 1. Calculate depletion for 2016
32. Bevis Bag Co. purchased a tract of land on August 31 of the current year,...
32. Bevis Bag Co. purchased a tract of land on August 31 of the current year, paying $225,000. Prior to the sale, the seller paid property taxes of $18,000 on the property. The taxes covered the calendar year period January 1 through December 31. a. Will Bevis be allowed to deduct any portion of the property taxes paid by the seller prior to the sale? If so, how much? b. What will be Bevis' tax basis in the land? Personal...
On July 1 of the current year the Land Oil company pays $10,000,000 for the rights...
On July 1 of the current year the Land Oil company pays $10,000,000 for the rights to drill on an oil field with an estimates oil reserve of 5,000,000 barrels. It installed drilling equipment on August 1 costing $1,000,000 that has a 10 year life no salvage. Depreciation of the equipment is in proportion to the depletion of the oil reserve. The company drills and extracts 1,000,000 barrels of oil from Julyl to December 31, the company's year end. Prepare...
1. February 1, 2018, Salisbury Company purchased land for the future factory location at a cost...
1. February 1, 2018, Salisbury Company purchased land for the future factory location at a cost of $102,000. The dilapidated building that was on the property was demolished so that construction could begin on the new factory building. The new factory was completed on November 1, 2018. Costs incurred during this period were: Item Amount Demolition dilapidated building $2,000 Architect Fees $11,250 Legal Fees - for title search $1,400 Interest During Active Construction Period $5,025 Real estate transfer tax $1,050 Construction...
Comparing three depreciation methods Dexter Industries purchased packaging equipment on January 8 for $135,000. The equipment...
Comparing three depreciation methods Dexter Industries purchased packaging equipment on January 8 for $135,000. The equipment was expected to have a useful life of three years, or 27,000 operating hours, and a residual value of $5,400. The equipment was used for 10,800 hours during Year 1, 8,100 hours in Year 2, and 8,100 hours in Year 3. Required: 1. Determine the amount of depreciation expense for the three years ending December 31, by (a) the straight-line method, (b) the units-of-activity...
Burnt Red Company Balance Sheet December 31, 20Y2 Assets Total current assets $350,000 Replacement Cost A...
Burnt Red Company Balance Sheet December 31, 20Y2 Assets Total current assets $350,000 Replacement Cost Accumulated Depreciation Book Value Property, plant, and equipment: Land $250,000 $50,000 $200,000 Buildings 450,000 160,000 290,000 Factory equipment 375,000 140,000 235,000 Office equipment 125,000 60,000 65,000 Patents 90,000 Goodwill 60,000 10,000 50,000 Total property, plant, and equipment $1,350,000 $420,000 $930,000 1. Fixed assets should be reported at 2. Land 3. Patents and goodwill should be 4, Goodwill should be Calculator eBook Chapter 10 Burnt Red...
SECTION A (40 marks): Answer ALL Questions in this section. QUESTION ONE a) Aseda Ltd incurred...
SECTION A (40 marks): Answer ALL Questions in this section. QUESTION ONE a) Aseda Ltd incurred the following cost in its manufacturing operations GH¢ Cost of material purchase 20,000 Import duties 400 Trade discount @10% of purchase cost Cash discount 500 Irrecoverable taxes 1,000 Salary of factory plant operator 2,500 Direct labour 5,000 Salary of factory supervisor 4,000 Cost of expected production losses 800 Administrative overhead (Note) 16,000 Cost of storage of raw material for further processing 2,000 Marketing cost...
esce 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. 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? a. What is the cost depletion factor R.? b. What is the depletion amount in year 1?...
value 5.00 points On April 17,2016, the Loadstone Mining Company purchased the rights to a coal mine The purchase price plus additional costs necessary to prepare the mine for extraction of the coal totaled $2,790,000. The company expects to extract 930,000 tons of coal during a four year period. During 2016, 350,000 tons were extracted and sold immediately Required 1. Calculate depletion for 2016
32. Bevis Bag Co. purchased a tract of land on August 31 of the current year, paying $225,000. Prior to the sale, the seller paid property taxes of $18,000 on the property. The taxes covered the calendar year period January 1 through December 31. a. Will Bevis be allowed to deduct any portion of the property taxes paid by the seller prior to the sale? If so, how much? b. What will be Bevis' tax basis in the land? Personal...
On July 1 of the current year the Land Oil company pays $10,000,000 for the rights to drill on an oil field with an estimates oil reserve of 5,000,000 barrels. It installed drilling equipment on August 1 costing $1,000,000 that has a 10 year life no salvage. Depreciation of the equipment is in proportion to the depletion of the oil reserve. The company drills and extracts 1,000,000 barrels of oil from Julyl to December 31, the company's year end. Prepare...
Comparing three depreciation methods Dexter Industries purchased packaging equipment on January 8 for $135,000. The equipment was expected to have a useful life of three years, or 27,000 operating hours, and a residual value of $5,400. The equipment was used for 10,800 hours during Year 1, 8,100 hours in Year 2, and 8,100 hours in Year 3. Required: 1. Determine the amount of depreciation expense for the three years ending December 31, by (a) the straight-line method, (b) the units-of-activity...
Burnt Red Company Balance Sheet December 31, 20Y2 Assets Total current assets $350,000 Replacement Cost Accumulated Depreciation Book Value Property, plant, and equipment: Land $250,000 $50,000 $200,000 Buildings 450,000 160,000 290,000 Factory equipment 375,000 140,000 235,000 Office equipment 125,000 60,000 65,000 Patents 90,000 Goodwill 60,000 10,000 50,000 Total property, plant, and equipment $1,350,000 $420,000 $930,000 1. Fixed assets should be reported at 2. Land 3. Patents and goodwill should be 4, Goodwill should be Calculator eBook Chapter 10 Burnt Red...
SECTION A (40 marks): Answer ALL Questions in this section. QUESTION ONE a) Aseda Ltd incurred the following cost in its manufacturing operations GH¢ Cost of material purchase 20,000 Import duties 400 Trade discount @10% of purchase cost Cash discount 500 Irrecoverable taxes 1,000 Salary of factory plant operator 2,500 Direct labour 5,000 Salary of factory supervisor 4,000 Cost of expected production losses 800 Administrative overhead (Note) 16,000 Cost of storage of raw material for further processing 2,000 Marketing cost...
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