Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Last Chance Mine (LCM) purchased a coal deposit for $2,465,000. It estimated it would extract 17,000 tons of coal from the deposit. LCM mined the

image text in transcribed
image text in transcribed
image text in transcribed
Last Chance Mine (LCM) purchased a coal deposit for $2,465,000. It estimated it would extract 17,000 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1.43 million, $5.45 million, and $3.5million for years 1 through 3 , respectively. During years 13, LCM reported net income (loss) from the coal deposit activity in the amount of ($17,800), $625,000, and $560,000, respectively. In years 13. LCM extracted 18,000 tons of coal as follows: Note: Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. Problem 10.75 Part a (Algo) a. What is LCM's cost depletion for years 1,2 , and 3 ? Last Chance Mine (LCM) purchased a coal deposit for $2,465,000. It estimated it would extract 17,000 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1.43 million, $5.45 million, and $3.5 million for years 1 through 3 , respectively. During years 1-3, LCM reported net income (loss) from the coal deposit activity in the amount of ($17,800),$625,000, and $560,000, respectively. In years 13, LCM extracted 18,000 tons of coal as follows: Note: Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. Problem 10-75 Part b (Algo) b. What is LCM's percentage depletion for each year (the applicable percentage for coal is 10 percent)? Last Chance Mine (LCM) purchased a coal deposit for $2.465.000. It estimated it would extract 17,000 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1.43 million, $5.45 million, and $3.5 million for years 1 through 3 , respectively. During years 13, LCM reported net income (loss) from the coal deposit activity in the amount of ($17,800), $625,000, and $560,000, respectively. In years 13, LCM extracted 18,000 tons of coal as follows: Note: Leave no answer blank, Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. Problem 10.75 Part c (Algo) c. Using the cost and percentage depletion computations from parts (a) and (b), what is LCM's actual depletion expense for each year

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

World Class Internal Audit Tales From My Journey

Authors: Norman Marks

1st Edition

1500791962, 978-1500791964

More Books

Students also viewed these Accounting questions

Question

Identify the cause of a performance problem. page 363

Answered: 1 week ago