(Depletion ComputationsTim Hernandez Timber Company owns 9,000 acres Of timberland purchased in Iggg at a cost Of $1,400 per acre. At the time Of purchase the land without the timber was valued at $400 per acre. In 2000, Hernandez built fire lanes and roads, with a life Of 30 years, at a cost Of $87,000. Every year Hernandez sprays to prevent disease at a cost Of $3,000 per year and spends $7,000 to maintain the fire lanes and roads. During 2001, Hernandez selectively logged and sold 700,000 board feet Of timber, Of the estimated 3,000,000 board feet. In 2002, Hernandez planted new seedlings to replace the trees Cut at a cost of $100,000. (a) Determine the depreciation expense and the cost Of timber sold related to depletion for 2001. Depreciation expense Cost Of timber sold $2,900 (b) Hernandez has not logged since 2001. [f Hernandez logged and sold goo,ooo board feet Of timber in 2012, when the timber Cruise (appraiser) estimated 5,000,000 board feet, determine the cost Of timber sold related to depletion for 2012. $1,260,000 (a) Depreciation Expense $2,900 per year 30 years cost of timber sold: $1,400 - $400 $1,000 $1,000 x g,ooo acres = of value of timber + 3,000,000 bd. ft.) x 700,000 bd. ft. - $2,100,000 (b) cost of timber sold: - $2,100,000 + $100,000 = + 5,000,000 bd.ft.) x 900,000 bd. ft. $1,260,000 NOW The spraying costs as well as the costs to maintain the fire lanes and roads are expensed each period and are not part Of the depletion base.