Maroon Logging and Lumber Company owns 3,000 acres of timberland on the north side of Mount...

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Maroon Logging and Lumber Company owns 3,000 acres of timberland on the north side of Mount Volcano, which was purchased in 19X8 (15 years ago) at a cost of $500 per acre. In 20X3, Maroon began selectively logging this timber tract. In May of 20X3, Mount Volcano erupted, burying the timberland of Maroon under a foot of ash. All of the timber on the Maroon tract was downed. In addition, the logging roads, built at a cost of $150,000, were destroyed, as well as the logging equipment, with a net book value of $300,000. At the time of the eruption, Maroon had logged 20% of the estimated 500,000 board feet of timber. Prior to the eruption, Maroon estimated the land to have a value of $200 per acre after the timber was harvested. Maroon includes the logging roads in the depletion base but not the machinery since it can be used at other logging sites. Maroon estimates that it will take 3 years to salvage the downed timber at a cost of $700,000. The timber can be sold for pulp wood at an estimated price of $3 per board foot. The value of the land is unknown, but must be considered nominal due to future uncertainties. REQUIRED: (1) How sho Using the attached form, compute the depletion cost per board foot for the timber harvested prior to the eruption of Mount Volcano. Round your answer Timbe to two decimal places. (2) Using the attached form, prepare the journal entry to record the depletion prior to the eruption. Omit explanation. (3) If this tract represents approximately half of the timber holdings of Maroon, using the attached form, determine the amount of the estimated loss and show how the losses of roads, machinery, and timber and the salvage of the timber should be reported in the financial statements of Maroon for the year ending December 31, 20X3. (1) Cost of timberland MAROON LOGGING AND LUMBER COMPANY CALCULATION OF DEPLETION COST PER UNIT Less: Salvage value of timberland Depletable base amount of timberland Divided by estimated number of units to be removed Depletion cost per unit (3) Date MAROON LOGGING AND LUMBER COMPANY GENERAL JOURNAL FOR YEAR 20X3 Explanation Debit Credit MAROON LOGGING AND LUMBER COMPANY CALCULATION OF GAIN OR LOSS ON ERUPTION FOR YEAR 20X3 Estimated Sales Value of Timber Remaining Less: Cost To Salvage Timber Net Realizable Value of Timber Remaining Less: Book Value of Timberland and Roads at Time of Eruption Loss on Timber and Roads Loss on Equipment (net book value at time of eruption) Total Loss Due to Eruption How should it be reported in the financial statements? Maroon Logging and Lumber Company owns 3,000 acres of timberland on the north side of Mount Volcano, which was purchased in 19X8 (15 years ago) at a cost of $500 per acre. In 20X3, Maroon began selectively logging this timber tract. In May of 20X3, Mount Volcano erupted, burying the timberland of Maroon under a foot of ash. All of the timber on the Maroon tract was downed. In addition, the logging roads, built at a cost of $150,000, were destroyed, as well as the logging equipment, with a net book value of $300,000. At the time of the eruption, Maroon had logged 20% of the estimated 500,000 board feet of timber. Prior to the eruption, Maroon estimated the land to have a value of $200 per acre after the timber was harvested. Maroon includes the logging roads in the depletion base but not the machinery since it can be used at other logging sites. Maroon estimates that it will take 3 years to salvage the downed timber at a cost of $700,000. The timber can be sold for pulp wood at an estimated price of $3 per board foot. The value of the land is unknown, but must be considered nominal due to future uncertainties. REQUIRED: (1) How sho Using the attached form, compute the depletion cost per board foot for the timber harvested prior to the eruption of Mount Volcano. Round your answer Timbe to two decimal places. (2) Using the attached form, prepare the journal entry to record the depletion prior to the eruption. Omit explanation. (3) If this tract represents approximately half of the timber holdings of Maroon, using the attached form, determine the amount of the estimated loss and show how the losses of roads, machinery, and timber and the salvage of the timber should be reported in the financial statements of Maroon for the year ending December 31, 20X3. (1) Cost of timberland MAROON LOGGING AND LUMBER COMPANY CALCULATION OF DEPLETION COST PER UNIT Less: Salvage value of timberland Depletable base amount of timberland Divided by estimated number of units to be removed Depletion cost per unit (3) Date MAROON LOGGING AND LUMBER COMPANY GENERAL JOURNAL FOR YEAR 20X3 Explanation Debit Credit MAROON LOGGING AND LUMBER COMPANY CALCULATION OF GAIN OR LOSS ON ERUPTION FOR YEAR 20X3 Estimated Sales Value of Timber Remaining Less: Cost To Salvage Timber Net Realizable Value of Timber Remaining Less: Book Value of Timberland and Roads at Time of Eruption Loss on Timber and Roads Loss on Equipment (net book value at time of eruption) Total Loss Due to Eruption How should it be reported in the financial statements?