Depletion allowance. Mareos Company purchased for $3,800,000 a mine estimated to contain 2.5 million...
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Depletion allowance. Mareos Company purchased for $ a mine estimated to contain million tons of ore. When the ore is completely extracted, it was expected that the land would be worth $ A building and equipment costing $ were constructed on the mine site, and they will be completely used up and have no salvage value when the ore is exhausted. During the first year, tons of ore were mined, and $ was spent for labor and other operating costs. Instructions Compute the total cost per ton of ore mined in the first year. Show computations by setting up a schedule giving cost per ton.
Depletion allowance.
Mareos Company purchased for $ a mine estimated to contain million tons of ore. When the ore is completely extracted, it was expected that the land would be worth $ A building and equipment costing $ were constructed on the mine site, and they will be completely used up and have no salvage value when the ore is exhausted. During the first year, tons of ore were mined, and $ was spent for labor and other operating costs.
Instructions
Compute the total cost per ton of ore mined in the first year. Show computations by setting up a schedule giving cost per ton.
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