Castle Company purchased land containing an estimated 2.5 million tons of ore for a cost of $4,400,000. The land without the ore is estimated to be worth $250,000. During its first year of operation, the company mined and sold 375,000 tons of ore. Compute the depletion charge per ton. Compute the depletion expense that Castle should record for the year.  You need to show how much per ton in your computations.

Q: Perez Company acquires an ore mine at a cost of $1,400,000. It incurs additional costs of $400,000…

A: Req-1   Cost ($1400000 + $400000) $18,00,000 Salvage $2,00,000 Amount subjected to depletion…

Q: Khamsah Mining Company has purchased a tract of mineral land for $900,000. It is estimated that this…

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Q: Maggie Company expects to extract 20 million tons of coal from a mine that cost $12 million. If no…

A: The depletion expense is charged on mines that are extracted naturally.

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

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A: The cost of ore mine will include cost of purchase plus cost incurred to access the mine.

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

Q: Vesco Mineral Resources purchased mineral rights to land in the foothills of the Santa Cristo…

A: Depletion per ton  = (Cost of mineral rights to land - Residual value) / Estimated tons of mineralss…

Q: Three years ago, you purchased woodworking equipment for your hobby activities and side-line…

A: Depreciation under unit of production can be calculated by dividing cost of assts by number of hours…

Q: On the first day of the fiscal year, Alpha Corporation purchased a machine with a cost of s65,000.…

A: Straight line method In straight line method, value of a fixed asset is decreased gradually over its…

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A: Depreciation means decrease in the value of tangible fixed asset. It is provided due to the ware and…

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A: Straight-Line depreciation method :  = (Value of the asset - Salvage value) / No of useful life…

Q: If 40,000 units were produced in 20X1 and 60,000 were produced in 20X2, what amount of accumulated…

A: The correct option is  C. $150,000

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

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A: Depletion is charged to natural resources as depreciation is charged to fixed assets.

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…

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A: Annual Depreciation (straight line method) = (Cost of the assets - Residual value) / Expected life…

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A: Wasting assets: These are the assets which will have only a limited useful life and the value of…

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Q: Salter Mining Company purchased the Northern Tier Mine for $75 million cash. The mine was estimated…

A: Depletion is an accounting concept which is similar to depreciation but it is mostly used in…

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A: A) Depreciable cost = Cost of Equipment - Residual value =$60040 - $5500 =$54540   Depreciable cost…

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A: Depletion is an expense which represent the fall in value of natural resources or assets.

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Q: Laramie Company has acquired a property that included both land and a building for $600,000. The…

A: Given: Cost of land and building = $600,000 Market value of land = $370,000 Market value of building…

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

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

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

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A: Formula: Depreciation rate (units of output method) = Depreciable cost / Estimated output where,…

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A:

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…

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A: The depreciation as per the unit-of-output method is calculated using the below given formula:…

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A: Depletion Expense: The cost allocation method used for natural resources like mining deposits,…

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Q: In connection with your audit of the ABC Mall Corporation for the year ended December 31, 20X1, you…

A: We are required by the question to calculate the cost of inventory. We have been given details of…

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A: The cost of an asset include all the cost incurred till the asset are ready for intended use. After…

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

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

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

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A: Depreciation: It refers to a fall in the value of the fixed asset because of obsolescence,…

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A: The question is based on the concept of Business Accounting.