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Goryan [66]
3 years ago
8

Coal Miner Co. acquired coal rights for $100,000,000. It is estimated that there are 2,500,000 tons of the resource, and during

the current year 500,000 tons were mined and sold. What is the amount of depletion for the current year?
a. $2,500,000
b. $10,000,000
c. $20,000,000
d. $2,000,000
Business
2 answers:
Nina [5.8K]3 years ago
6 0

Answer:

C

Explanation:

To estimate the amount of depletion for the current year?

We need to know the rate of depletion which

$100,000,000/2,500,000 = $40/ton

The amount of depletion for the current year will be

$40/ton x 500,000 tons = $20,000,000

defon3 years ago
3 0

Answer:

Correct answer is C, $20,000,000

Explanation:

Computation of depletion expense of natural resources has similar concept with depreciation of fixed asset. To calculate the depletion expense, we have to deduct first the salvage value (if there is) from the cost of an asset divided by the total estimated units available multiplied by the units extracted.

FORMULA:

(TOTAL COST - SAVAGE VALUE) / TOTAL ESTIMATED UNITS AVAILABLE x UNITS EXTRACTED

($100,000,000 - 0 ) / 2,500,000 x 500,000 = $20,000,000

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Answer:

1). Direct.

2). Indirect.

3). Intermediaries.

Explanation:

1). Direct Channel: This is explained to be the shortest and simplest channel of direct distribution of goods from manufacturer to customers.

It is called as zero level channel of distribution as it does not involve any intermediary.

2. Indirect Channel: When a manufacturer employs one or more intermediaries to sell and distribute their product to the customers it is called as indirect selling. In this, goods move from the point of production to the point of consumption through a distribution network.

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3 years ago
A subsidy will increase consumer and producer surplus in a market and will increase the quantity of trades. A subsidy (such as a
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Explanation:

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5 0
3 years ago
The optimal capital structure is the one where the percentages of debt, preferred stock, and common equity minimize the firm's v
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This is false that The optimal capital structure is the one where the percentages of debt, preferred stock, and common equity minimize the firm's value.

The best combination of debt and equity financing that increases market value while lowering a company's cost of capital is known as an optimal capital structure. One strategy for aiming for the lowest cost mix of financing is to minimize the weighted average cost of capital (WACC).

Financial management greatly benefits from having the ideal capital structure. It enables a business to efficiently raise the required capital from a variety of sources. The ratio of debt to equity in the ideal capital structure will maximize the firm's wealth. The market price per share is at its highest and the cost of capital is at its lowest with this capital structure.

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Answer:

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5 0
3 years ago
Which of the following correctly describes a production isoquant?
evablogger [386]

Answer:

An isoquant is a curve that shows the least-cost combinations of inputs that can produce a given level of output.

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