Suppose you bought a timber tract for $850,000, and the land was worth as much as $250,000.

Question:

Suppose you bought a timber tract for $850,000, and the land was worth as much as $250,000. An estimated 6.8 million board feet (MBF) of standing timber was in the tract. If you cut 1.5 MBF of timber for this fiscal year, determine your depletion allowance for the year.