The Jackson Mining Company paid $ 1 , 0 0 0 , 0 0 0 for the
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Question:
The Jackson Mining Company paid $ for the right to explore for a coal deposit on acres of land in Pennsylvania. Costs of exploring for the coal deposit totaled $ and intangible development costs incurred in digging and erecting the mine shaft were $ In addition, Jackson purchased new excavation equipment for the project at a cost of $ After the coal is removed from the site, the equipment will be sold.
Jackson is required by its contract to restore the land to a condition suitable for recreational use after it extracts the coal. The company has provided the following three cash flow possibilities A B and C for the restoration costs to be paid in three years, after extraction is completed:
Cash Outflow
Probability
A
$
B
C
The companys creditadjusted riskfree interest rate is PV Factor is
What is the total cost of natural resources?
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date: