PROBLEMS 1 Archer Mining Limited (Archer) acquired a mining property in Western Australia called Calypso by paying $3720000fin cash. If a viable mineral resource deposit is found, state legislation will require the removal of any mine infrastructure and the rehabilitation of the mine site at the end of commercial production. Archer treats the Calypso property as an area of interest. During 2917 Archer undertook the following pre-production activities 180000 92000 Exploratory drilling Trenching and sampling In early 2018 the company judged that the Calypso area ofinterest would yield economically recoverable reserves totaling 12 milion tonnes of oe. Operationg are expected to last for rations are ex 18 years at the Calypso area of interest ance production commences. It is estimated that the Jand will have a residual value of $20000 after the ore deposit is exhaustd. Archer incurred the following costs during 2018: Development $405000 n addition to the development costs, the company undertook the following capital vestment in 2018: Estimated life Costs $415000 810000 260000 20 years 30 years 8 years Mine buildings 1 Railroad and associated equipment Other mine equipment economically removed from The buildings, railroad and associated equipment Canno? be the mine location, but the ther mine equipment can be removed and has alternative uses. On 31 December 2018 it is estimated that development and construction activities have resulted in $1010000 offuuestoration by the company as best reflecting the risk and commercial conditions associated with the Calypso area of interest. ration costs. A discount rate of6% is identified