• On January 1, 2019 Land Landy purchased a mineral mine for $2,640,000 with removable ore estimated at 1.2 million tons.
• After it has extracted all the ore, Land Landy will be required by law to restore the land to its original condition at an estimated cost of $180,000.
• Land Landy believes it will be able to sell the property afterwards for $300,000.
• During 2019, Land Landy incurred $360,000 of development costs preparing the mine for production and removed and sold 100,000 tons of ore.

Requirements

1. Prepare the entry on January 1, 2019 for the purchase of the mineral mine
2. Record the depletion expense for 2019