Question
Green Resources Company acquired a tract of land containing an extractable mineral resource. Green is required by its purchase contract to restore the land to
Green Resources Company acquired a tract of land containing an extractable mineral resource. Green is required by its purchase contract to restore the land to a condition suitable for recreational use after it has extracted the mineral resource. Geological surveys estimate that the recoverable reserves will be 2,000,000 tons, and that the land will have a value of P1,200,000 after restoration. Relevant cost information follows: Land P9,000,000 Estimated restoration costs 1,800,000
If Green maintains no inventories of extracted material, what should be the charge to depletion expense per ton of extracted material? Group of answer choices P3.90 P5.40 P4.50 P4.80
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