Ex13: On April 2, 2017, G.O.A Mining Company pays $1,500,000 for an ore deposit containing 800,000 tons. The company installs machinery in the mine costing $120,000, with an estimated five-year life and no salvage value. The machinery will be abandoned when the ore is completely mined. G.O.A begins mining on May 1, 2017, and mines and sells 90,000 tons of ore during the remaining eight months of 2017. Prepare the December 31, 2017, entries to record both the ore deposit depletion and the mining machinery depreciation, Mining machinery depreciation should be in proportion to the mine's depletion. a) Depletion of mining company: Date Debit Credit b) Depreciation of machine: Date Debit Credit

Ex13: On April 2, 2017, G.O.A Mining Company pays $1,500,000 for an ore deposit containing 800,000 tons. The company installs machinery in the mine costing $120,000, with an estimated five-year life and no salvage value. The machinery will be abandoned when the ore is completely mined. G.O.A begins mining on May 1, 2017, and mines and sells 90,000 tons of ore during the remaining eight months of 2017. Prepare the December 31, 2017, entries to record both the ore deposit depletion and the mining machinery depreciation, Mining machinery depreciation should be in proportion to the mine's depletion. a) Depletion of mining company: Date Debit Credit b) Depreciation of machine: Date Debit Credit

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter10: Project Cash Flows And Risk

Section: Chapter Questions

Problem 4PROB

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