Exercise 8-18 Depletion of natural resources LO P1, P3 On April 2, 2017, Montana Mining Co. pays $3,760,810 for an ore deposit containing 1,411,000 tons. The company installs machinery in the mine costing $183,900, with an estimated seven-year life and no salvage value. The machinery will be abandoned when the ore is completely mined. Montana begins mining on May 1, 2017, and mines and sells 187,800 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. (Do not round intermediate calculations. Round your final answers to the nearest whole number.) View transaction list Journal entry worksheet 2 Record the year-end adjusting entry for the depletion expense of ore mine. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Journal entry worksheet 2 Record the year-end adjusting entry for the depreciation expense of the mining machinery. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31
Exercise 8-18 Depletion of natural resources LO P1, P3 On April 2, 2017, Montana Mining Co. pays $3,760,810 for an ore deposit containing 1,411,000 tons. The company installs machinery in the mine costing $183,900, with an estimated seven-year life and no salvage value. The machinery will be abandoned when the ore is completely mined. Montana begins mining on May 1, 2017, and mines and sells 187,800 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. (Do not round intermediate calculations. Round your final answers to the nearest whole number.) View transaction list Journal entry worksheet 2 Record the year-end adjusting entry for the depletion expense of ore mine. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Journal entry worksheet 2 Record the year-end adjusting entry for the depreciation expense of the mining machinery. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31
Accounting (Text Only)
26th Edition
ISBN:9781285743615
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter10: Fixed Assets And Intangible Assets
Section: Chapter Questions
Problem 10.3CP: Effect of depreciation on net income Tuttle Construction Co. specializes in building replicas of...
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