Question

"On January 1, 2012, Brown Company purchased a mine for $100,000. On this same date, it was estimated that the mine contained 1,000 tons of ore. During 2012, 300 tons of ore were extracted from the mine. The amount of depletion expense for 2012 would be:"

Answer 1

Options:

$1,000

$100,000

$30,000

$3,000

Answer:

The amount of depletion expense for 2012 would be =$30000.

Explanation:

Amount of depletion expense for 2012 = ($100000/1000 ton)*300 ton  

= $30000