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xercise letion of Hat A company pays $912,000 cash to acquire an iron mine on January 1. At that same time, it incurs additional costs of $72,000 cash to access the mine, which is estimated to hold 120,000 tons of iron. The estimated value of the land after the iron is removed is $24,000. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 1. Prepare the January 1 entry to record the cost of the iron mine. 2. Prepare the December 31 year-end adjusting entry if 26,000 tons of iron are mined but only 22,000 tons are sold the first year. Answer is not complete. No Date General Journal Debit Credit 1 Jan 01 Accumulated depreciation-Iron Mine 984,000 O 984,000 2 Dec 31 Accumulated depletion-Iron Mine 192,000 x 192,000 X

xercise letion of Hat A company pays $912,000 cash to acquire an iron mine on January 1. At that same time, it incurs additional costs of $72,000 cash to access the mine, which is estimated to hold 120,000 tons of iron. The estimated value of the land after the iron is removed is $24,000. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 1. Prepare the January 1 entry to record the cost of the iron mine. 2. Prepare the December 31 year-end adjusting entry if 26,000 tons of iron are mined but only 22,000 tons are sold the first year. Answer is not complete. No Date General Journal Debit Credit 1 Jan 01 Accumulated depreciation-Iron Mine 984,000 O 984,000 2 Dec 31 Accumulated depletion-Iron Mine 192,000 x 192,000 X

Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter7: Operating Assets
Section: Chapter Questions
Problem 38BE
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Exercise 8-20 (Algo) Depletion of natural resources LO P3 A company pays $912,000 cash to acquire an iron mine on January 1. At that same time, it incurs additional costs of $72,000 cash to access the mine, which is estimated to hold 120,000 tons of iron. The estimated value of the land after the iron is removed is $24,000. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 1. Prepare the January 1 entry to record the cost of the iron mine. 2. Prepare the December 31 year-end adjusting entry if 26,000 tons of iron are mined but only 22,000 tons are sold the first year. Answer is not complete. No Date General Journal Debit Credit 1 Jan 01 Accumulated depreciation-Iron Mine 984,000 O 984,000 2 Dec 31 Accumulated depletion-Iron Mine 192,000 x 192,000 X
Transcribed Image Text:Exercise 8-20 (Algo) Depletion of natural resources LO P3 A company pays $912,000 cash to acquire an iron mine on January 1. At that same time, it incurs additional costs of $72,000 cash to access the mine, which is estimated to hold 120,000 tons of iron. The estimated value of the land after the iron is removed is $24,000. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 1. Prepare the January 1 entry to record the cost of the iron mine. 2. Prepare the December 31 year-end adjusting entry if 26,000 tons of iron are mined but only 22,000 tons are sold the first year. Answer is not complete. No Date General Journal Debit Credit 1 Jan 01 Accumulated depreciation-Iron Mine 984,000 O 984,000 2 Dec 31 Accumulated depletion-Iron Mine 192,000 x 192,000 X
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