Reference no: EM13948523
Prepare the journal entries for all the following related transaction (all occurring within the current year). Assume all depletion and amortization for the full year. Also, assume all purchases were made with cash.
A. An exploration company purchased land with a valuable ore deposit
Estimated ore available in the deposit (in tons) 4,700,000
Acquisition price $3,500,000
Residual value of land once ore is fully depleted $500,000
Ore removed in the current year (in tons) 365,000
B. The exploration company developed a high-speed drill to use in its explorations.
Economic life of the drill (in years) 5
Costs incurred in the current year to develop the drill $550,000
Attorney fees incurred to protect the patient $15,000
C. The exploration company purchased Gosh en Hole Company
Acquisition price $3,250,600
Book Value of Gosh en Hole Company $2,415,960
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