Mining Ltd has incurred the following costs during the period in relation to a specific area of interest. Its accounting policy is to capitalise all E&E costs on an area of interest basis.

Required

Determine the amount of the E&E asset to be capitalised by Mining Ltd in relation to the area of interest. (LO7)

Cash paid to acquire seismic study from government that is selling exploration rights for the area (GST exempt) Cash paid to acquire exploration rights for the area from government (GST exempt) Cash paid to acquire fencing materials to mark out the area of interest, including GST of $80 Contractor fees for labour to set up the fencing, including GST of $50 Contractor fees for exploratory drilling, including GST of $2500 Hire of drilling equipment for contractor use, including GST of $500 Salary of project manager hired specifically to manage E&E activities in the area Stationery and other office supplies used by the project manager, including GST of $30 Mining Ltd non-executive directors' fees paid during the period $ 3000 10000 880 550 27500 5500 60000 330 160000