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What is the depletion expense

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Question - Diamond Drilling estimated that the oil reserve that it acquired on January 1, 2019 would produce 6,000,000 barrels of oil over the next 8 years. The company extracted 400,000 barrels in 2019 and 450,000 barrels in 2020. Diamond paid $72,200,000 for the oil reserve. The land is estimated to have a residual value of $200,000 once the oil is depleted. What is the depletion expense for 2020?

Reference no: EM132607841

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