Montana Mining Co. pays $3,721,000 for an ore deposit containing 1,525,000 tons. The company installs machinery in the mine costing $213,500. Both the ore and machinery will have no salvage value after the ore is completely mined. Montana mines and sells 166,200 tons of ore during the year. Prepare the yearend 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.

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A: Calculation of the depreciation rate is shown below:

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A: Depreciation is considered as an expense charge on the value of the Asset. It can be calculated by…

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

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A: Introduction: Journal: Recording of a business transactions in a chronological order. First step in…

Q: Required information [The following information applies to the questions displayed below.) On July…

A: Depreciation is defined as the reduction of the recorded cost of a fixed asset in a systematic…

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A: b.$44,598.37

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A: Solution:- Calculation of Depletion note per ton as follows;- =($863,800+$221,000+$93,000-$120,000)…

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A: Introduction: Depreciation: Decreasing value of fixed assets over its useful life period called as…

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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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A: Depletion expense = Cost * Extracted for the year / Total Extraction from the mine

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Q: On April 2, 2015, Montana Mining Co. pays $4,170,260 for an ore deposit containing 1,438,000 tons.…

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

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A:

Q: On February 19 of the current year, Quartzite Co. pays $5,400,000 for land estimated to contain 4…

A: Since there are multiple sub parts in the question, answer will be given for first three sub parts…

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Q: Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the…

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Q: Required information [The following information applies to the questions displayed below.] On July…

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Q: Your client, Hazelton Mining, recently entered Into an agreement to obtain the rights to operate a…

A: Working note:

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A: Hi student Since there are multiple sub parts, we will answer only first three sub parts.

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Q: Compute depreciation for each year (and total depreciation for all years combined) for the machine…

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