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What is the total capitalized cost of the mine

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Reference no: EM132736981

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Q1. Zooey's Catering purchased a new commercial stove for $8,000 on August 1, 2019. The company uses the double-declining-balance method to depreciate its fixed assets. Partial-year depreciation is calculated based on the number of months the asset is in service. The estimated useful life of the stove is 5 years and the residual value is $2,000.

What is depreciation expense for 2019?

A. $3,200.

B. $1,600.

C. $ $1,333.

D. $2,400.

E. None of the answers are correct.

Q2. The capitalized cost of equipment excludes:

A. Purchase Price.

B. None of the answers are correct.

C. Annual Maintenance.

D. Installation.

E. Shipping.

Q3. Brazell Corporation mines minerals out of the ground. They purchased rights to explore land in Montana which cost $1,200,000. Exploration and development costs were $1,150,000. After mining the minerals, Brazell has a legal obligation to restore the land to its original state. The cost of this restoration is estimated to be $3,000,000, and the present value of this restoration cost using the credit-adjusted risk free interest rate is $2,381,490. What is the total capitalized cost of the mine?

A. $2,350,000

B. None of the answers are correct.

C. $5,350,000

D. $7,731,490

E. $4,731,490

Reference no: EM132736981

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