Question
At the beginning of 2017, Larkspur Company acquired a mine for $1,965,400. Of this amount, $115,000 was ascribed to the land value and the remaining
At the beginning of 2017, Larkspur Company acquired a mine for $1,965,400. Of this amount, $115,000 was ascribed to the land value and the remaining portion to the minerals in the mine. Surveys conducted by geologists have indicated that approximately 11,010,000 units of ore appear to be in the mine. Larkspur incurred $195,500 of development costs associated with this mine prior to any extraction of minerals. It also determined that the fair value of its obligation to prepare the land for an alternative use when all of the mineral has been removed was $46,000. During 2017, 2,433,000 units of ore were extracted and 2,081,000 of these units were sold.
Compute The total amount of depletion for 2017
|
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started