Assume an ore deposit contains 2,000,000 tons, costs $24,000,000, and has $0 residual value. In year...

 

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Assume an ore deposit contains 2,000,000 tons, costs $24,000,000, and has $0 residual value. In year one 125,000 tons are mined and in year two 175,000 tons are mined. Calculate the depletion rate in step 1. Then, calculate the DEPLETION EXPENSE for year 1 and 2 in step 2. Estimated Depletion Rate (Cost - Residual Value) Total Units $ - $0) Actual DEPLETION ACCUM. Depletion. Rate Year Units EXPENSE DEPLETION Book Value $ 1 125,000 X $ = $ $ 2 175,000 X $ = $ $ %24 %24 Assume an ore deposit contains 2,000,000 tons, costs $24,000,000, and has $0 residual value. In year one 125,000 tons are mined and in year two 175,000 tons are mined. Calculate the depletion rate in step 1. Then, calculate the DEPLETION EXPENSE for year 1 and 2 in step 2. Estimated Depletion Rate (Cost - Residual Value) Total Units $ - $0) Actual DEPLETION ACCUM. Depletion. Rate Year Units EXPENSE DEPLETION Book Value $ 1 125,000 X $ = $ $ 2 175,000 X $ = $ $ %24 %24

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Step 1 Cost 24000000 Residual Value 0 Estimated Total ... View the full answer