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he retained earnings and liquidated capital of ABC Mining Corporation are P5,000,000 and P1,000,000 respectively as of the beginning of the year. During the year, it extracted 5,000 tons of ore but sold 5,200. The ending inventory is 300 tons. The depletion rate of its wasting asset is P250 per ton. It earned a net income of P1,500,000 during the year but declared P500,000 of dividends. If the accumulated depletion as of year-end is P2,250,000, how much is the maximum amount that ABC Mining Corporation can declare as dividend

he retained earnings and liquidated capital of ABC Mining Corporation are P5,000,000 and P1,000,000 respectively as of the beginning of the year. During the year, it extracted 5,000 tons of ore but sold 5,200. The ending inventory is 300 tons. The depletion rate of its wasting asset is P250 per ton. It earned a net income of P1,500,000 during the year but declared P500,000 of dividends. If the accumulated depletion as of year-end is P2,250,000, how much is the maximum amount that ABC Mining Corporation can declare as dividend

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The retained earnings and liquidated capital of ABC Mining Corporation are P5,000,000 and P1,000,000 respectively as of the beginning of the year. During the year, it extracted 5,000 tons of ore but sold 5,200. The ending inventory is 300 tons. The depletion rate of its wasting asset is P250 per ton. It earned a net income of P1,500,000 during the year but declared P500,000 of dividends. If the accumulated depletion as of year-end is P2,250,000, how much is the maximum amount that ABC Mining Corporation can declare as dividends? 

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