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Last Chance Mine ( LCM ) purchased a coal deposit for $ 7 5 0 , 0 0 0 . It estimated it would extract

Last Chance Mine (LCM) purchased a coal deposit for $750,000. It estimated it would extract 12,000 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1 million, $3 million, and $2 million for years 1 through 3, respectively. During years 13, LCM reported net income (loss) from the coal deposit activity in the amount of ($20,000), $500,000, and $450,000, respectively. In years 13, LCM extracted 13,000 tons of coal as follows: (Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars.)
(1) Tons of Coal (2) Basis Depletion (2)/(1) Rate Tons Extracted per Year
Year 1 Year 2 Year 3
12,000 $ 750,000 $ 62.502,0007,2003,800
a. What is LCM's cost depletion for years 1,2, and 3?

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