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On January 1, 2018 MGC Company paid P10,800,00 for property containing natural resources of 4,000,000 tons of ore. The estimated discounted amount of restoring the
On January 1, 2018 MGC Company paid P10,800,00 for property containing natural resources of 4,000,000 tons of ore. The estimated discounted amount of restoring the land after the resource is exhausted is P900,000 and thr land will have a value of P1,300,000 after it is restored for suitable use. Tunnels, bunks houses and other fixed installations are constructed in the amount of P16,000,000. Such expenditures are to be charged to mine improvements. Operations began on January 1, 2019 and resources removed totaled 1,200,000 tons. During 2016, a discovery was made indicating that available resources after 2020 will total 3,750,000 tons. At the beginning of 2020, additional bunk houses were constructed in the amount of P1,540,000. In 2020, only 800,000 tons were mined because of a strike. Required: Prepare all the pertinent entries for 2018, 2019 and 2020
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