1. 2. Record all of Atlantic Energy's transactions for the year. Round depletion per unit to the closest cent. Prepare the company's single-step income statement for its iron ore operations for the first year. Evaluate the profitability of the company's operations. What balances should appear from these transactions on Atlantic Energy's balance sheet at the end of its first year of operations? 3. Atlantic Energy Company's balance sheet includes the asset Iron Ore Rights. Atlantic Energy paid $2.1 million cash for the right to work a mine that contained an estimated 180,000 tons of ore. The company paid $60,000 to remove unwanted buildings from the land and $70,000 to prepare the surface for mining. Atlantic Energy also signed a $20,000 note payable to a landscaping company to return the land surface to its original condition after the rights to work the mine end. During the first year, Atlantic Energy removed 30,000 tons of ore, of which it sold 22,800 tons on account for $30 per ton. Operating expenses for the first year totaled $240,000, all paid in cash. In addition, the company accrued income tax at the tax rate of 25%. Read the requirements Requirement 1. Record all of Atlantic Energy's transactions for the year. Round depletion per unit to the closest cent. (Record debits first, then credits. Exclude explanations from any journal entries. Enter amounts in dollars. Example: Enter an amount of $1.2 million as $1,200,000. Round depletion per ton to the nearest cent. Round all other amounts to the nearest dollar.) Begin by recording the entry for the acquisition of the lease. Paid $2,100,000 cash for the right to work a mine that contained an estimated 180,000 tons of ore. Journal Entry Date Accounts Debit Credit The company paid $60,000 to remove unwanted buildings from the land. Journal Entry Accounts Date Debit Credit The company paid $70,000 to prepare the surface for mining. Journal Entry Accounts Date Debit Credit Atlantic Energy also signed a $20,000 note payable to a landscaping company to return the land surface to its original condition after the lease ends. Journal Entry Accounts Date Debit Credit During the first year, Atlantic Energy removed 30,000 tons of ore. Record the entry for depletion. Journal Entry Accounts Date Debit Credit Atlantic Energy sold 22,800 tons of ore on account for $30 per ton. Begin by recording the sale. (Do not yet record the cost of goods sold related to this sale. We will do this in the following journal entry.) Journal Entry Date Accounts Debit Credit Now record the cost of sales. Journal Entry Accounts Date Debit Credit Operating expenses for the first year totaled $240,000, all paid in cash. Journal Entry Date Accounts Debit Credit The company accrued income tax at the tax rate of 25%. Journal Entry Date Accounts Debit Credit Requirement 2. Prepare the company's single-step income statement for its iron ore operations for the first year. Evaluate the profitability of the company's operations. Start by preparing the income statement. Atlantic Energy Company Income Statement-Iron Ore Operations Year 1 Net income (loss) Evaluate the profitability of the company's operations. The iron ore operations were as shown by the reported on the income statement. Requirement 3. What balances should appear from these transactions on Atlantic Energy's balance sheet at the end of its first year of operations? (For the purpose of this requirement, ignore the effect of the transactions on the cash account.) 1. 2. Record all of Atlantic Energy's transactions for the year. Round depletion per unit to the closest cent. Prepare the company's single-step income statement for its iron ore operations for the first year. Evaluate the profitability of the company's operations. What balances should appear from these transactions on Atlantic Energy's balance sheet at the end of its first year of operations? 3. Atlantic Energy Company's balance sheet includes the asset Iron Ore Rights. Atlantic Energy paid $2.1 million cash for the right to work a mine that contained an estimated 180,000 tons of ore. The company paid $60,000 to remove unwanted buildings from the land and $70,000 to prepare the surface for mining. Atlantic Energy also signed a $20,000 note payable to a landscaping company to return the land surface to its original condition after the rights to work the mine end. During the first year, Atlantic Energy removed 30,000 tons of ore, of which it sold 22,800 tons on account for $30 per ton. Operating expenses for the first year totaled $240,000, all paid in cash. In addition, the company accrued income tax at the tax rate of 25%. Read the requirements Requirement 1. Record all of Atlantic Energy's transactions for the year. Round depletion per unit to the closest cent. (Record debits first, then credits. Exclude explanations from any journal entries. Enter amounts in dollars. Example: Enter an amount of $1.2 million as $1,200,000. Round depletion per ton to the nearest cent. Round all other amounts to the nearest dollar.) Begin by recording the entry for the acquisition of the lease. Paid $2,100,000 cash for the right to work a mine that contained an estimated 180,000 tons of ore. Journal Entry Date Accounts Debit Credit The company paid $60,000 to remove unwanted buildings from the land. Journal Entry Accounts Date Debit Credit The company paid $70,000 to prepare the surface for mining. Journal Entry Accounts Date Debit Credit Atlantic Energy also signed a $20,000 note payable to a landscaping company to return the land surface to its original condition after the lease ends. Journal Entry Accounts Date Debit Credit During the first year, Atlantic Energy removed 30,000 tons of ore. Record the entry for depletion. Journal Entry Accounts Date Debit Credit Atlantic Energy sold 22,800 tons of ore on account for $30 per ton. Begin by recording the sale. (Do not yet record the cost of goods sold related to this sale. We will do this in the following journal entry.) Journal Entry Date Accounts Debit Credit Now record the cost of sales. Journal Entry Accounts Date Debit Credit Operating expenses for the first year totaled $240,000, all paid in cash. Journal Entry Date Accounts Debit Credit The company accrued income tax at the tax rate of 25%. Journal Entry Date Accounts Debit Credit Requirement 2. Prepare the company's single-step income statement for its iron ore operations for the first year. Evaluate the profitability of the company's operations. Start by preparing the income statement. Atlantic Energy Company Income Statement-Iron Ore Operations Year 1 Net income (loss) Evaluate the profitability of the company's operations. The iron ore operations were as shown by the reported on the income statement. Requirement 3. What balances should appear from these transactions on Atlantic Energy's balance sheet at the end of its first year of operations? (For the purpose of this requirement, ignore the effect of the transactions on the cash account.)