Freeport-McMoran is a natural resources company involved in the exploration, development, and extraction of natural resources. Annual revenues exceed $1 billion. Assume that in February 2003, Freeport-McMoran paid $700,000 for a mineral deposit in Wyoming. During March, it spent $65,000 in preparing the deposit for exploitation. It was estimated that 900,000 total cubic yards could be extracted economically. During 2003, 60.000 cubic yards were extracted. During January 2004, the company spent another $6,000 for additional developmental work. After conclusion of the latest work, the estimated remaining recovery was increased to 1,200,000 cubic yards over the remaining life. During 2004, 50,000 cubic yards were extracted.

Required: 1. Compute the acquisition cost of the deposit in 2003. 2. Compute depletion for 2003. 3. Compute the acquisition cost of the deposit after payment of the January 2004 developmental costs.