Last Chance Mine (LC) purchased a coal deposit for $750,000. It estimated it would extract 12,000 tons of coal from the deposit. LC mined the coal and sold it reporting gross receipts of $1 million, $3 million, and $2 million for years 1 through 3, respectively. During years 1 – 3, LC reported net income (loss) from the coal deposit activity in the amount of ($20,000), $500,000, and $450,000, respectively. In years 1 – 3, LC actually extracted 13,000 tons of coal as follows:
|
| Depletion | Tons extracted per year | |||
| (1) Tons of Coal | (2) Basis | (2)/(1) Rate | Year 1 | Year 2 | Year 3 |
| 12,000 | $750,000 | $62.50 | 2,000 | 7,200 | 3,800 |
a. What is Last Chance’s cost depletion for years 1, 2, and 3?
b. What is Last Chance’s percentage depletion for each year (the applicable percentage for coal is 10 percent)?
Using the cost and percentage depletion computations from the previous parts, what is Last Chance’s actual depletion expense for each year?
Economic Debate- Progressive Income Tax For this Economic Debate, we are going to discuss the…
TOPIC: Going Global Discussion Thread 1 (initial post due Wednesday for full credit) Please note:…
Assignment Topic This week will culminate in the creation of a narrated PowerPoint to create…
The Assignment must be submitted on Blackboard (WORD format only) via allocated folder. Assignments submitted…
you need to post your 2-page information flier to share with your Final Project Group.…
discussion: Discuss the methods used at your company to measure and ensure quality products and…