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Golden Inc., headquartered in Phoenix, Arizona, is a leading international mining company of copper, gold, and molybdenum. Its revenues were over $20 billion with net
Golden Inc., headquartered in Phoenix, Arizona, is a leading international mining company of copper, gold, and molybdenum. Its revenues were over $20 billion with net income of nearly $4 billion in a recent year. Assume that in February Year 1, Golden paid $1,000,000 for a mineral deposit in Indonesia. During March, it spent $90,000 in preparing the deposit for exploitation. It was estimated that 1,000,000 total cubic yards could be extracted economically. During Year 1, 80,000 cubic yards were extracted. During January Year 2, the company spent another $10,000 for additional developmental work that increased the estimated productive capacity of the mineral deposit. Required: 1. Compute the acquisition cost of the deposit in year 1. 2. Compute depletion for year 1. 3. Compute the net book value of the deposit after payment of the January Year 2 developmental costs
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