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Big Sky Mining Co. acquired mineral rights for $41,449,000. The mineral deposit is estimated at 18,100,000 tons. During the current year, 1,500,000 tons were mined
Big Sky Mining Co. acquired mineral rights for $41,449,000. The mineral deposit is estimated at 18,100,000 tons. During the current year, 1,500,000 tons were mined and sold.
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A. | Determine the amount of depletion expense for the current year. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
B. | Journalize the adjusting entry to recognize the depletion expense. Refer to the Chart of Accounts for exact wording of account titles. (Note: The company makes all adjusting entries on December 31.)
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