On January 1, 2018, Nickel Co. purchased a land for P12,000,000. The company expected to extract 2,000,000 tons of mine from this land over the next 20 years at which time, the residual value of the asset shall be zero. During 2018 and 2019 operations, 60,000 tons were mined each year and sold for P80 per ton. The estimate of the remaining lifetime capacity of the mine was raised to 2,400,000 tons at the start of 2020 and the residual value was to be P960,000. How much should be recognized as depletion in 2020 if the total production for 2020 is 100,000 tons? *

Q: On January 1, 2018, Nickel Co. purchased a land for P12,000,000. The company expected to extract…

A: Year 2018 Purchase price of land = P12,000,000 Expected minerals to be extracted = 2,000,000…

Q: On January 1, 2021, the Allegheny Corporation purchased equipment for $187,000. The estimated…

A: GIVEN   On January 1, 2021, the Allegheny Corporation purchased equipment for $187,000 The estimated…

Q: e Fairy Company purchased a site for limestone quarry for P 100,000 on January 2,2020. It estimates…

A: a) The depletion cost per ton.   Cost of quarry = P100,000 Asset retirement obligation value =…

Q: On April 17, 2021, the Loadstone Mining Company purchased the rights to a coal mine. The purchase…

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

Q: In January 2019, Straw Corporation purchased a mineral mine for P9,800,000 with removable ore…

A: Depletion expense is the exploration cost and the development cost charged to the income statement.…

Q: On July 1, 2017, Jungkook Mining Company purchased the rights to a mine. The total purchase price…

A: Value of mine = Total purchase price -  Amount allocated to land = P7,920,000 - P240,000 =…

Q: XYZ Company purchased land for P6,000,000. The company expected to extract 1 milion tons of mine…

A: The company's income statement is prepared for arriving at the profits generated by the company…

Q: On January 1, 2020, Sapphire Mining Company purchased land with valuable natural ore deposits for…

A: The depletion expense refers to the decrease in the value of the natural resource used in the…

Q: 6. On July 1, 2020, FREESIA Company purchased the rights to a mine for ₱13,200,000, of which…

A: Depletion is charged in books in order to record reduction in value of natural resources over the…

Q: Sergei Company purchases land for $4,000,000 from which it expects to extract 2,000,000 tons of…

A: Introduction: Depletion: Decreasing value of assets called as Depletion. Depletion is calculated on…

Q: On January 2020, Mina Company paid the national government a fee in the amount of P129,000,000 for…

A: Government Fees P12,90,00,000 Present value of restoration cost (P10000000 * 0.385) P38,50,000…

Q: In January 2019, Straw Corporation purchased a mineral mine for P9,800,000 with removable ore…

A: Depletion is an accounting concept used by the timber, oil and gas and mining industries to account…

Q: In January 2018, HUKAY Mining Corporation purchased a mineral mine for P7,200,000 with removable ore…

A: Depletion can be defined as the method that is used to determine and allocate the cost of extracting…

Q: 5. In 2018, IRIS Company paid ₱4,000,000 to purchase land containing a total estimated 160,000 tons…

A: Given information: Cost = ₱4,000,000 Residual value = ₱800,000 Expected tons to be extracted =…

Q: On July 1, 2021, Lambda Company, a calendar year entity purchased the rights to a mine. The total…

A: Cost of right = P14,000,000 - P2,000,000 = P12,000,000 Reserves used during the year = 25,000 tons x…

Q: Gomez Corporation purchased land for P 6,000,000. The company expected to extract 1,000,000 tons of…

A: The question is multiple choice question. Required  Choose the Correct Option.

Q: On July 4, 2020, ZY Company purchased the mineral rights to a granite deposit for 2,400,000. It is…

A: The depletion expense is charged on minerals with extraction and minerals sold during the period.

Q: On July 1,2021, Phantom Corporation purchased the rights to a mine for a total purchase price of…

A: The depreciation expense is charged on fixed assets as reduction in the value of fixed assets with…

Q: On July 1, 2020, FREESIA Company purchased the rights to a mine for ₱13,200,000, of which ₱1,200,000…

A: Depreciation is charged to record reduction in value of asset over the period of time.

Q: On January 1, 2020 Universal Company paid P5,400,000 for property containing natural resource of…

A: Wasting assets refers to the resources containing oil, natural gas, ores, mines quarry etc. In these…

Q: On January 2, 2018, ABC Company purchased land for ₱450,000, from which it estimated that 400,000…

A: Cost of Sales : It is the amount of cost that made the goods available for sale which typically will…

Q: On January 1, 2018, Lam Company, a calendar year corporation, purchased the rights to a mine. The…

A: Compute the mine value as follows: Mine for depletion=Total purchase price-Allocation to…

Q: In 2017, a company acquired a silver mine for P50,000. In 2018, the company constructed a road to…

A: A slow decrease of the asset value which is tangible is depreciation and depletion is such decrease…

Q: Sunny Company paid 4,000,000 for property containing natural resources of 2,500,000 tons of ore. The…

A: Natural resources are gifts of nature without which survival is impossible. In order to fulfill the…

Q: On July 1, 2017, DOTA Company purchased the rights to a mine. The total purchase price was…

A: Depletion cost is charged on to the extractable resources and not to land or equipment, thus only…

Q: Sergei Company purchases land for $4,000,000 from which it expects to extract 2,000,000 tons of…

A: Introduction: Depletion rate per ton = ( Asset value - salvage value ) / Estimated Tons

Q: Questions: What is the depletion for 2020? * What is the depreciation for 2020? *

A: Tangible assets are depreciated where as intangible assets/ rights are depleted over the useful…

Q: In 2018, DAISY Company paid ₱4,000,000 to purchase land containing a total estimated 160,000 tons of…

A: Depletion is defined as the technique of accrual accounting which is used for assigning the…

Q: How much is the computed depletion rate in 2021?  How much is the depletion in 2022?  How much is…

A: Unit Depletion rate =  (Cost - Residual Value)/Expected Resource

Q: On July 1, 2022, ABC Company, (using a calendar year), purchased the rights to a mine. The total…

A: Depletion:   It is the cost a company spends in the process of mining natural resources from the…

Q: houses and other fixed installations are constructed at a cost of P8,000,000 and such expenditures…

A: Every natural resource will lose out its value over the period of time. Depletion is being charged…

Q: A company purchased land containing mineral deposits for $6,400,000 on January 1, 2021. The company…

A: The answer is stated below:

Q: On January 2, 2018, ABC Company purchased land for ₱450,000, from which it estimated that 400,000…

A: SOLUTION- DEPLETION IS A METHOD FOR ALLOCATING THE EXPENSE OF HARVESTING NATURAL PRODUCTS FROM EARTH…

Q: On May, 1, 2020, Star Mines Inc. purchased an ore mine for $2,400,000 to access an estimated…

A: Solution: The ore mine should be recorded at = Purchase cost of mine + Development cost + Present…

Q: On July 1, 2020, FREESIA Company purchased the rights to a mine for ₱13,200,000, of which ₱1,200,000…

A: Answer 1) Given: Depletion base =₱13,200,000-₱1,200,000=₱12000000Salvage value =0

Q: On January 1, 2018, Spring Co. purchased a land for $12,000,000. The company expected to extract…

A:

Q: On July 1, 2017, Jungkook Mining Company purchased the rights to a mine. The total purchase price…

A: Value of mine = Total purchase price -  Amount allocated to land = P7,920,000 - P240,000 =…

Q: In January, 2020, Swifty Corporation purchased a mineral mine for $4800000 with removable ore…

A: The company will use the assets for many years. Since the assets are used for many years in the…

Q: On January 2, 2019, Whistler Company purchased land for $450,000, from which it is estimated that…

A: The process by which financial transactions of the business are recorded and communicated with the…

Q: n July 1, 2020, FREESIA Company purchased the rights to a mine for ₱13,200,000, of which ₱1,200,000…

A: Solutions: 1) Depletion is charged in books in order to record reduction in value of natural…

Q: n July 1, 2015, Lam Company, a calendar year corporation, purchased the rights to mine. The total…

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

Q: Compute the depletion cost per ton. Round your answer to three decimal places. Compute the total…

A: Depletion:   It refers to the process of proportionately distributing the cost of the extracting…

Q: 7. On July 1, 2020, FREESIA Company purchased the rights to a mine for ₱13,200,000, of which…

A: Depreciation is charged to record reduction in value of asset over the period of time.

Q: On July 1, 2017, Jungkook Mining Company purchased the rights to a mine. The total purchase price…

A: Value of mine = Total purchase price -  Amount allocated to land = P7,920,000 - P240,000 =…

Q: how much should the company include as depletion in its cost of goods sold?

A: Depletion expenses are the expenses that are charged against the profit due to the usage of natural…

Q: On January 2, 2018, ABC Company purchased land for ₱450,000, from which it estimated that 400,000…

A: When fixed assets are purchased, they will be recorded at their purchase cost. When they are put…

Q: on July 1, 2022, Trisha Company purchased the rights to a mine for P13,200,000, of which P1,200,000…

A: The depreciation expense is charged on tangible assets of the business, the depletion is charged on…

Q: In January 2020, Fritz Mining Corporation purchased a mineral mine for $6,300,000 with removable ore…

A: Calculate the depletion cost per unit as follows: Depletion cost per unit = (Purchase cost - Ore…

Q: In January 2022, Proton Mining Corporation purchased a minera mine for P4,200,000 with removable ore…

A: Under the units-of-activity method of depreciation, the asset's cost (less any salvage value) is…

Q: On July 1, 2020, FREESIA Company purchased the rights to a mine for ₱13,200,000, of which ₱1,200,000…

A: Depletion is charged in books in order to record reduction in value of natural resources over the…