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Dmitrij [34]
3 years ago
8

A coal mine cost $1,004,000 and is estimated to hold 56,000 tons of coal. There is no residual value. During the first year of​

operations, 7,000 tons are extracted and sold. Calculate depletion expense for the first year.​
Business
1 answer:
Juliette [100K]3 years ago
4 0

Answer:

$125,500  

Explanation:

The initial cost of coal mine=$1,004,000

Estimated useful life=56,000 tons of coal

tons of coal extracted in the first year=7,000 tons

depletion expense=(cost of coal mine-residual value)*tons of coal extracted in the first year/estimated useful life

residual value =$0

depletion expense=($1,004,000-$0)*7000/56000

depletion expense=$1,004,000*7000/56000

depletion expense for first year=$125,500  

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Explanation:

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Answer:

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