Problem 11-7 (Static) Depletlon; change In estimate [LO11-3, 11-5] In 2021, the Marion Company purchased land containing a mineral mine for $1,600,000. Additional costs of $600,000 were Incurred to develop the mine. Geologists estimated that 400,000 tons of ore would be extracted. After the ore is removed, the land will have a resale value of $100,000. To ald In the extraction, Marion bull various structures and small storage bulldings on the site at a cost of $150,000. These structures have a useful lfe of 10 years. The structures cannot be moved after the ore has been removed and will be left at the slte. In addition, new equipment costing $80,000 was purchased and Installed at the site. Marlon does not plan to move the equipment to another site, but estimates that it can be sold at auction for $4,000 after the mining project is completed. In 2021, 50,000 tons of ore were extracted and sold. In 2022, the estimate of total tons of ore in the mine was revised from 400,000 to 487,500 . During 2022,80,000 tons were extracted, of which 60,000 tons were sold. Required: 1. Compute depletion and depreclation of the mine and the mining facilitles and equipment for 2021 and 2022 Marlon uses the unitsof-production method to determine depreciation on mining facilitles and equipment. 2. Compute the book value of the mineral mine, structures, and equipment as of December 31,2022. Complete this question by entering your answers in the tabs below. Compute depletion and depreciation of the mine and the mining facilities and equipment for 2021 and 2022. Marion uses the units-of-production method to determine depreciation on mining facilities and equipment. (Do not round intermediate calculations.) In 2021, the Marion Company purchased land containing a mineral mine for $1,600,000. Additional costs of $600,000 were Incurred to develop the mine. Geologists estimated that 400,000 tons of ore would be extracted. After the ore is removed, the land will have a resale value of $100,000. To ald in the extraction, Marion built varlous structures and small storage bulldings on the slte at a cost of $150,000. These structures have a useful lfe of 10 years. The structures cannot be moved after the ore has been removed and will be left at the site. In addition, new equipment costing $80,000 was purchased and Installed at the site. Marlon does not plan to move the equlpment to another site, but estimates that it can be sold at auction for $4,000 after the mining project is completed. In 2021, 50,000 tons of ore were extracted and sold. In 2022 , the estimate of total tons of ore in the mine was revised from 400,000 to 487,500 . During 2022,80,000 tons were extracted, of which 60,000 tons were sold. Required: 1. Compute depletion and depreclation of the mine and the mining facillties and equipment for 2021 and 2022 Marion uses the unitsof-production method to determine depreciation on mining facilitles and equipment. 2 Compute the book value of the mineral mine, structures, and equipment as of December 31,2022. Complete this question by entering your answers in the tabs below. Compute the book value of the mineral mine, structures, and equipment as of December 31, 2022. (Do not round intermediate calculations.)
