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At the beginning of 2021, Terra Lumber Company purchased a timber tract from Boise Cantor for $3,150,000. After the timber is cleared, the land will have a residual value of $710,000. Roads to enable logging operations were constructed and completed on March 30. 2021 The cost of the roads, which have no residual value and no alternative use after the tract is cleared, was $183,000. During 2021. Terra logged 610,000 of the estimated 6.1 million board feet of timber.
Required:
Problem 1: Calculate the 2021 depletion of the timber tract and depreciation of the logging roads assuming the units-of- goduction method is used for both assets (Do not round intermediate calculations. Enter values in whole dollars.)
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