A firm purchased an oil well costing $2,600,000, which is expected to produce five million barrels of

Question:

A firm purchased an oil well costing $2,600,000, which is expected to produce five million barrels of oil. The well can probably be sold for $100,000 after all the oil is extracted. If 500,000 barrels of oil were extracted and sold this year, what is the depletion expense?

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