Question

A coal mine cost $ 1 comma 001 comma 000and is estimated to hold 57 comma 000tons of coal. There is no residual value. During the first year of​ operations, 12 comma 000tons are extracted and sold. Calculate depletion expense for the first year.​ (Round any intermediate calculations to the nearest​ cent.)

Answer 1

Answer:

Depletion expenses for the first year is $210736.840

Explanation:

Depletion expenses= (Cost of coal mine - residual value) / Total tons of coal * tons extracted

=(1,001,000 - $0) / 57,000 tons * 12,000 tons

=$210736.8421

=$210736.840