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Question - Fargo, Inc. purchased an oil field for $26,000,000. It cost $2,000,000 to prepare the field for drilling. It was estimated that 800,000 barrels of oil would be extracted over the field's useful life. Fargo plans to sell the land for $1,000,000 at the end of its useful life. During the current year, 40,000 barrels of oil were extracted and sold. What is Fargo's depletion expense for the current year?
A. $1,250,000
B. $1,300,000
C. $1,350,000
D. $1,400,000
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