Depletion

Down Deep Mining Co. acquired mineral rights for $97,500,000. The mineral deposit is estimated at 65,000,000 tons. During the current year, 19,500,000 tons were mined and sold.

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a. Determine the depletion rate. If required, round your answer to two decimal places.

b. Determine the amount of depletion expense for the current year.

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c. Journalize the adjusting entry on December 31 to recognize the depletion expense. If an amount box does not require an entry, leave it blank.

Dec. 31