Instructions

Backwoods Mining Co$.$ acquired mineral rights for $$28,050,000.$ The mineral deposit is estimated at $16,500,000$ tons. During the current year, $1,540,000$ tons were mined and sold.

Required:

a$.$ Determine the amount of depletion expense for the current year.

b$.$ Journalize the adjusting entry on December $31$ to recognize the depletion expense. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for joumal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.