Problem 1: True or False __1. Exploration for and evaluation of mineral resources is the search for mineral resources before the entity has obtained legal rights to explore in a specific area. __2. PFRS 6 temporarily exempts an entity from applying the hierarchy of reporting standards under PAS 8. __3. At initial recognition, exploration and evaluation assets are measured at cost. __4. PFRS 6 requires an entity to capitalize exploration and evaluation costs. __5. After initial recognition, exploration and evaluation assets are measured using either the cost model or the revaluation model. __ 6. According to PFRS 6, an entity shall classify exploration and evaluation assets as intangible or intangible according to the nature of the assets acquired and apply the classification consistently. __7. Intangible development costs from part of the cost of a natural resource, subject to depletion. __8. Restoration costs are capitalized as part of the cost of natural resource to the extent the entity has a present obligation to restore the property. The amount included in the depletion base is the fair value of the obligation to restore the property after extraction. __9. In accounting parlance, depletion means the decrease in the economic life or value of a wasting asset due to extraction of mineral resources. __10. Entity X acquires a mine for P1M. Entity X estimates that the mine contains 1,000 units of extractable mineral resources. During the period, entity X extracts 100 units of mineral resources. The depletion for the period is computed as P1M x 100/1,000.