Land value and the remaining portion to the minerals

Assignment Help Financial Accounting

Reference no: EM131295708

At the beginning of 2017, Waterway Company acquired a mine for $1,676,600. Of this amount, $110,000 was ascribed to the land value and the remaining portion to the minerals in the mine. Surveys conducted by geologists have indicated that approximately 12,840,000 units of ore appear to be in the mine. Waterway incurred $187,000 of development costs associated with this mine prior to any extraction of minerals. It also determined that the fair value of its obligation to prepare the land for an alternative use when all of the mineral has been removed was $44,000. During 2017, 2,353,000 units of ore were extracted and 2,006,000 of these units were sold.

Compute the following.

a) The total amount of depletion for 2017.

b) The amount that is charged as an expense for 2017 for the cost of the minerals sold during 2017.

Reference no: EM131295708

Questions Cloud

Record the income tax. : A company reports pretax accounting income of $10 million, but because of a single temporary difference, taxable income is only $8 million. No temporary differences existed at the beginning of the year, and the tax rate is 35%. Prepare the appropriat..

What is the covariance between hp and the market : (a) What is the covariance between HP and the market? (b) What is HP's beta? (c) What is the expected return of HP? (d) What percent of HP's total risk (variance) is idiosyncratic?

What decisions would you make in terms of staging : Write a pitch for a movie that discusses the story and one person or object that is symbolic. Explain the symbolic significance of your person or object. In your pitch, summarize the setting, main plot, at least two main characters, and the theme.

How would we find if a cost is a fixed cost or variable cost : What is the difference between explicit and implicit cost? Explain your answers. How would we determine if a cost is a fixed cost or a variable cost?

Land value and the remaining portion to the minerals : At the beginning of 2017, Waterway Company acquired a mine for $1,676,600. Of this amount, $110,000 was ascribed to the land value and the remaining portion to the minerals in the mine. The total amount of depletion for 2017. The amount that is charg..

Appropriate journal entry to record income tax provision : Lance Lawn Services reports warranty expense by estimating the amount that eventually will be paid to satisfy warranties on its product sales. For tax purposes, the expense is deducted when the cost is incurred. Prepare the appropriate journal entry ..

Write an argument paper about the turn of the screw : In a four page argumentative paper, take a position with respect to the debate concerning the governess. State your position clearly at the beginning of the paper and consider the evidence, using quotes and examples from the text of the novel to s..

Levels of access for processing transactions and maintenance : Sage 50 Accounting provides five levels of access for processing transactions and maintenance, but only full or no access for reports and forms. What is the reason for the limits on reports and forms?

Which of the given will increase the money supply : Which of the following will increase the money supply? A required reserve ratio of 12 percent gives rise to a simple deposit multiplier of. An "open market operation" is said to occur when the Fed.

User Account

All Pages