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Sierra Mountain Mining paid $902,000 for the right to extract mineral assets...

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Accounting

Sierra Mountain Mining paid $902,000 for the right to extract mineral assets from a 450,000-ton deposit. In addition to the purchase price, Sierra also paid a
$1,200 filing fee, a $1,800 license fee to the state of Nevada, and $85,000 for a geological survey of the property. Because Sierra purchased the rights to the
minerals only and did not purchase the land, it expects the asset to have zero residual value. During the first year, Sierra removed and sold 60,000 tons of the
minerals. Make journal entries to record (a) purchase of the minerals (debit Minerals),(b) payment of fees and other costs, and (c) depletion for the first year.
(Record debits first, then credits. Select the explanation on the last line of the journal entry table.)
Begin by journalizing (a) the purchase of the minerals (debit Mineral asset).(Do not record payment for any additional costs associated with the minerals. We will
do this in entry b.)
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