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Can anyone help me with these accounting 101 problems?
In 20XX Mining Company A purchased a mineral deposit for 13,500,000. its estimated that 19,000,000 tons can be extracted from the mine. Calculate depletion expense for 20xx when 800,000 tons were extracted and sold.
Also:
Land and a building were purchased for 386,000. The appraised values of the land and building are 50,000 and 300,200 respectively. Cost allocated to the building should be?
Last edited by Colddiamond102; 07-29-2009 at 02:14 PM..
Can anyone help me with these accounting 101 problems?
In 20XX Mining Company A purchased a mineral deposit for 12,000,000. its estimated that 15,000,000 tons can be extracted from the mine. Calculate depletion expense for 20xx when 700,000 tons were extracted and sold.
If I recall my accounting, to find the depletion expense for a given period you divide the depletable expense / units of resource to get the per unit depletion.
Then simply multiply the per unit depletion by the units sold in the period.
12,000,000/15,000,000 = .80 p/unit * 700,000 units sold = $560,000
(But I suggest you check your book for the correct calculation, I'm rusty )
If I recall my accounting, to find the depletion expense for a given period you divide the depletable expense / units of resource to get the per unit depletion.
Then simply multiply the per unit depletion by the units sold in the period.
12,000,000/15,000,000 = .80 p/unit * 700,000 units sold = $560,000
(But I suggest you check your book for the correct calculation, I'm rusty )
Thanks! Book is stupid and doesnt have answer keys.
Maybe not an answer key, but doesn't it describe the method to arrive at depletion expense?
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