Tishimingo Sand and Gravel paid $800,000 to acquire 1,200,000 cubic yards of sand reserves The following statements model reflects Tishimingos financial condition just prior to purchasing the sand reserves The company extracted 650,000 cubic yards of sand in year 1 and 450,000 cubic yards in year 2...

a Depletion charge per unit 800000 1200000 cubic yds 67 per cubic yd ro ...

Tishimingo Sand and Gravel paid $800,000 to acquire 1,200,000 cubic yards of sand reserves. The following statements

Question:

Tishimingo Sand and Gravel paid $800,000 to acquire 1,200,000 cubic yards of sand reserves. The following statements model reflects Tishimingoâ€™s financial condition just prior to purchasing the sand reserves. The company extracted 650,000 cubic yards of sand in year 1 and 450,000 cubic yards in year 2.

Required
a. Compute the depletion charge per cubic yard.
b. Record the acquisition of the sand reserves and the depletion expense for years 1 and 2 in a financial statements model like the preceding one.
c. Prepare the general journal entries to record the depletion expense for years 1 and2.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...