Vesco 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. However, further exploration during the second year of operation revealedthat a total of 280,000 tons could be economically removed. 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?

Q: Darling Paper Container, Inc. purchased several machines at a total cost of $300,000. The…

A: Depreciable cost = $300000+$25000 = $325000

Q: Sergei Company purchases land for $4,000,000 from which it expects to extract 2,000,000 tons of…

A: Given that, Cost of land = $4,000,000  Estimated residual value = $400,000  Expected extract tons of…

Q: Early in the current year, Tokay Co. purchased the Silverton Mine at a cost of $15,500,000. The mine…

A: Computation for the book value of the mine at year end is as follows:First we need to calculate the…

Q: Mareos Company purchased for $3,800,000 a mine estimated to contain 3,000,000 tons of ore. When the…

A: Depreciation per ton (Units of production method) =(cost of Asset - salvage value )  / Estimated…

Q: Sergei Company purchases land for $4,000,000 from which it expects to extract 2,000,000 tons of…

A: Unit depletion rate = (Cost of the coal mine - residual value) / Estimated tons of coal

Q: A new year had begun, JK Company, a mining institute, purchased a mineral mine for P56,000,000 with…

A: Depletion refers to the reduction in value. It is the non-cash expense of the business recorded by…

Q: Larkspur Mining Company purchased land on February 1, 2017, at a cost of $1,210,800. It estimated…

A: (a)

Q: For $42,950,000, Wesco Developers purchased land which their experts believe to contain 28.5 million…

A: Formula: Depletion expense per unit = ( Asset cost - Salvage value ) / Estimated Tons

Q: Weber Company purchased a mining site for $585,330 on July 1. The company expects to mine ore for…

A: Depletion per tons = (Purchased Cost of mining site - estimated residual value) / anticipated tons =…

Q: In 20X1, ABC Co. paid P1M to purchase a land containing a total estimated 160,000 tons of…

A: Depletion rate per ton: = [Purchase cost - salvage value] / capacity of extraction Purchase…

Q: Tamarisk Corporation acquires a coal mine at a cost of $464,000. Intangible development costs total…

A: Depletion expense = (Cost - Salvage value) * coal extracted / Total coal estimated to be available =…

Q: The Weber Company purchased a mining site for $510,498 on July 1. The company expects to mine ore…

A: Calculation of Depletion rate per tonne Depletion rate per tonne = Purchase price of mining site/…

Q: PILAK Mining Company has a copper mine in Marinduque. The company is subject to the pronouncements…

A: Journal: It is the first step of recording financial transactions. It is used to prepare the…

Q: Weber Company purchased a mining site for $690,727 on July 1. The company expects to mine ore for…

A: b.$44,598.37

Q: In 2016, the Marion Company purchased land containing a mineral mine for $1,600,000. Additional…

A: 1.

Q: For $18,048,000, R.R. Michaels Refining purchased land which their experts believe to contain 18.8…

A: Introduction: Depreciation: A decrease in the value of fixed assets of the company because of usage,…

Q: . Five years ago, a company in New Jersey installed a diesel-electric unit costing $50,000 at a…

A: Capital budgeting is a way to evaluate profitability of the new projects or investment by using…

Q: Stumped, Inc., purchased the timber rights for $7,000,000. It is expected to produce a total of…

A: Depletion is an accrual accounting technique used to allocate the cost of extracting natural…

Q: In January, 2004, Nixon Corporation purchased a mineral mine for P6,800,000 with removable ore…

A: Depletion Expense: Depletion expense is determined to record the exhaustion of natural resources. It…

Q: During 2004, Bolton Corporation acquired a mineral mine for P3,000,000 of which P400,000 was…

A: As per the information provided :  Mineral mine acquired for - P3,000,000 Ascribed to Land value -…

Q: f 18,000 tons were extracted during the first year, which of the following would be included in the…

A: Journal refers to the process of recording all the monetary transactions which shows all the credit…

Q: What is the net present value of the project if the required rate of return is 10 percent

A: Net Present Value is the difference between cash inflow and outflow. When, cash inflow is greater…

Q: Castle Company purchased land containing an estimated 2.5 million tons of ore for a cost of…

A: Depletion charge per ton = (Cost of land containing ore - Cost of land without ore) / Estimated tons…

Q: Sunset Mountain Mining paid $362,300 for the right to extract mineral assets from a 350,000​-ton…

A: Step 1 Journal is the part of the book keeping.

Q: In 2016, the Marion Company purchased land containing a mineral mine for $1,600,000. Additional…

A: Depreciation means decline in the estimation of benefit inside its valuable life because of mileage…

Q: Five years ago, a company in New Jersey installed a diesel-electric unit costing $50,000 at a remote…

A: Net present value is the capital budgeting technique that can be used to evaluate various investment…

Q: The Weber Company purchased a mining site for $1,750,000 on July 1. The company expects to mine ore…

A: Depletion is a charge or expense on a fixed asset. It is similar to depreciation expense. The only…

Q: Weber Company purchased a mining site for $617,434 on July 1. The company expects to mine ore for…

A: Depreciation or depletion is a decrease in the value of an asset due to various reasons like wear…

Q: Vandeventer Corporation purchased land containing 25.4 million barrels of naphthenic crude oil for…

A: Annual depletion cost: It is the amount by which the cost of natural resource is depleted over an…

Q: The Weber Company purchased a mining site for $580,128 on July 1. The company expects to mine ore…

A: Given, Cost of machone = $580,128 Total tons = 85,978  Depletion expense per ton = (Cost - Salvage…

Q: Company I purchased a piece of land for its natural resources at a cost of $1,500,000. The land is…

A: Depletion expense per pound of timber = (Cost - Salvage value) / Estimated pounds of timber =…

Q: What are the estimated depletion and depreciation charges for the 7th year?   Depletion Depreciation…

A:

Q: ABC Corporation purchased an island that supposedly has commercially extractable oil. The purchase…

A: Depletion expense is determined on the basis of units of oil extracted. The total cost of island is…

Q: At the beginning of the current year, Nili company purchased a coal mine for 30,000,000.  Removable…

A: The depletion expense is charged on coal mine as reduction in value of mine with coal removed.

Q: The Weber Company purchased a mining site for $573,259 on July 1. The company expects to mine ore…

A: For the use of natural resources, depletion expenses is charged (against profits). It is most common…

Q: Salter Mining Company purchased the Northern Tier Mine for $50 million cash. The mine was estimated…

A: DEPLETION PER ORE = (COST - RESIDUAL VALUE) / NUMBER OF TOTAL TONS OF ORE  = ($50 MILLION - $1.5…

Q: Billings Corporation acquires a coal mine at a cost of $2,000,000. Intangible development costs…

A: Depletion cost per ton = (Cost of the Coal mine - Residual value) / Estimated quantity of coal…

Q: Salter Mining Company purchased the Northern Tier Mine for $21 million cash. The mine was estimated…

A: Depletion is an accounting concept similar to depreciation, but its uses are in industries that…

Q: MINA MINING CO. has acquired a tract of mineral land for P50,000,000. Mina Mining estimates  that…

A: "As per the policy of our company, we are allowed to answer only the first three sub-parts in case…

Q: In January, 2004, Nixon Corporation purchased a mineral mine for P6,800,000 with removable ore…

A: The depletion expense is charged on mines on the basis of units of mines extracted.

Q: 1. In 20X4, ABC Mining Inc. purchased land for P5,600,000 that had a natural resource supply…

A: Inventoriable Cost  It is the total direct expense incurred related to the purchase of inventory.…

Q: On January 1,2015, GOGO Company purchased land with valuable natural ore deposits for $20,000,000.…

A: Cost of mine = Purchase price + construction of road                       = 20,000,000 + 1,500,000…

Q: Pharoah Company purchased for $4,543,000 a mine that is estimated to have 45,430,000 tons of ore and…

A: Introduction: Depletion: Depletion expense to be recorded in Income statement. Depletion is…

Q: At the beginning of the current year, Handsome Company purchased a mineral mine for P36,000,000 with…

A: Total cost of  mineral mine = purchased costs + development costs  = P36,000,000 + P10,800,000  =…

Q: The Weber Company purchased a mining site for $674,927 on July 1. The company expects to mine ore…

A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…

Q: Sergei Company purchases land for $4,000,000 from which it expects to extract 2,000,000 tons of…

A: Introduction: Depletion: Decreasing value of assets over its useful life period called as Depletion.…

Q: At the beginning of current year, Nilli company purchased a coal mine for P30,000,000. Removable…

A: All natural resources that are being acquired by the business loses their value over the period of…

Q: Acme Energy, Inc. purchased land containing 28.1 million tons of lignite for $12.926.000. It cost…

A: Depreciation is the loss in the value of the asset caused due to its usage, wear and tear. There are…