During the current year, Puppy Company incurred P4,000,000 in exploration cost for each 15 oil sells drilled in the current year. Of the 15 wells drilled, 10 were dry holes. Th entity used the successful effort method of accounting. The entity deleted 30% of the oil discovered in the current year. What amount of exploration cost would be reported in the year- end statement of financial position? a. 42,000,000 b. 14,000,000 c. 20,000,000 d. 6,000,000
Q: Early in the current year, Tokay Co. purchased the Silverton Mine at a cost of $15,500,000. The mine…
A: Computation for the book value of the mine at year end is as follows:First we need to calculate the…
Q: ugular Company started construction on a building on January 1 of the current year and completed…
A: A note payable account seems to be a liability account in which a borrower registers a written…
Q: EL Corporation, an entity under the mining industry, incurred a total of ₱20,000,000 on March 31,…
A: Depletion expense is the expense charged on the use of the natural resources during the accounting…
Q: n July 1, Lethargic Company, a calendar year entity. archased the rights to a mine. The total…
A: The depreciation expense is charged on fixed assets as reduced value of the fixed asset with usage…
Q: CHB, Inc. purchased equipment for $540,000 on May 1, 20X1. The estimated service life is five years…
A: Depreciation refers to the fall in the historical value of an asset each year. Depreciable amount is…
Q: EL Corporation, an entity under the mining industry, incurred a total of ₱20,000,000 on March 31,…
A: The systemic redistribution of costs related to extracting or obtaining natural resources from a…
Q: Amount paid to the contractor for the building constructed P13,000,000 Building permit fee 120,000…
A: 1. Statement showing the cost of the land that should be capitalized: Particulars Amount(P)…
Q: On July 1, Twin Pines Co., a water distiller, acquired new bottling equipment with a list price…
A:
Q: On July 1, 20x1, Ewell Corporation purchased factory equipment for ₱100,000. Residual value was…
A: Depreciation is charged to allocate cost of the asset over the useful life of asset. This is charged…
Q: Colorado Mining paid $495,000 to acquire a mine with 45,000 tons of coal reserves. The following…
A: Depletion charge per unit is calculated by deducting the residual value from the cost of the asset…
Q: The Weber Company purchased a mining site for $510,498 on July 1. The company expects to mine ore…
A: Calculation of Depletion rate per tonne Depletion rate per tonne = Purchase price of mining site/…
Q: On December 31, Strike Company sold one of its batting cages for $10,952. The equipment had an…
A: Depreciation is an expense of the business which occurs due to wear and tear of the asset due to…
Q: Banana Co. incurred P 350,000 of research and development costs to develop a product for which a…
A: Patent: It is the right that is granted to an inventor that excludes others for making and selling…
Q: Required information [The following information applies to the questions displayed below.) On July…
A: Depreciation is defined as the reduction of the recorded cost of a fixed asset in a systematic…
Q: Roxanne Co. purchased equipment for P500,000. The equipment had an estimated 10-year service life.…
A: Depreciation rate = Straight line depreciation rate x 150% = (100/10 years) x 150% = 15%
Q: During the current year, Mine View Company incurred P2,000,000 in exploration cost for each of the…
A: Oil exploration expense reported in the income statement for the current year=Number of dry…
Q: On December 31, Strike Company sold one of its batting cages for $23,561. The equipment had an…
A: 1. BOOK VALUE : = INITIAL COST - ACCUMULATED DEPRECIATION 2. GAIN OR LOSS : = SALE VALUE - BOOK…
Q: ALPHA Company purchased equipment on 1/1/N with an invoice price of $80,000. Purchase taxes $16,000.…
A: Depreciation may be defined as that type of expense which occurs due to decrease in the value of…
Q: Galali mining company on April 30, paid BD 1,400,000 for a an ore with a capacity 1,400,000 tonnes…
A: The Numerical has covered the concept of Depletion Expenses. Depletion expense charge on the use of…
Q: Novak Corp.purchased for $5.8292 million a mine that is estimated to have 44.84 million tons of ore…
A: Novak corp purchased mine for $ 5829200 Estimated tons of ore = 44840000 First year ore extracted…
Q: Golden Sales has bought $135,000 in fixed assets on January 1st associated with sales equipment. The…
A: Introduction: Depreciation: Decreasing value of fixed assets over its useful life period. Example:…
Q: The Weber Company purchased a mining site for $534,246 on July 1. The company expects to mine ore…
A: Wasting assets: These are the assets which will have only a limited useful life and the value of…
Q: EzTech, a calendar year accrual basis corporation, generated $994,300 ordinary income from its…
A: PART A 1)EzTech profit and loss from the sale of company assets are calculated and classified as…
Q: The following nominal accounts apply to a primary beneficiary company and a VIE:…
A:
Q: ABC Company reported net income of P4,360,000 for the current year. The net income included…
A: The cash flow from investing activities includes the cash flow from sale purchase of investment,…
Q: A concern has a total income of $950,000 /year, and all expenses except depreciation amount to…
A: As per the straight-line method, the depreciation is charged by an equal amount over the useful life…
Q: Ana Inc. provided the following information for the current year: Current asserts, January 1…
A: The accounting equation states that assets equals to sum of liabilities and shareholders equity.
Q: At the beginning of the year, Big Time Tires acquired a patent for $730,000, and a trademark for…
A: Given: Patent = $730,000 Trademark = $260,000 Total = $730,000+260,000 = $990,000 Service life = 5…
Q: On July 1, An entity purchased a machine worth 21,000, 000 subject to a 2% cash discount if paid…
A: Note: No discount will be available since payment is made after 120 days.
Q: The Bailand Company purchased a building for P 210,000 that had an estimated residual value of…
A: Journal entries are prepared to record the financial and non financial transactions of the business…
Q: Donahue Oil has an account titled Oil and Gas Properties. Donahue paid $6,700,000 for oil reserves…
A: Depletion means the fall in value of reserve when some reserves has been extracted from mines.…
Q: ABC, whose reporting period is the 12 months ended 31 December, has charged depreciation monthly at…
A: The depreciation expense is charged on fixed assets as reduction in the value of the fixed assets…
Q: Congress Corporation's accumulated depreciation—equipment account increased by $5,000, while $3,200…
A: OPERATING ACTIVITIES OF CASH FLOW EXPLAIN THE SOURCES AND USES OF CASH FROM ONGOING BUSINESS…
Q: he retained earnings and liquidated capital of ABC Mining Corporation are P5,000,000 and P1,000,000…
A: Step 1 Maximum amount of dividend is declared is the free profits and retained earnings available to…
Q: Tick-Tock Corporation purchased equipment on January 1 at a cost of $75,000. The equipment has an…
A: Annual Depreciation = [Original Cost - Residual Value] / Useful Life Annual Depreciation = [$75,000…
Q: Billings Corporation acquires a coal mine at a cost of $2,000,000. Intangible development costs…
A: Depletion cost per ton = (Cost of the Coal mine - Residual value) / Estimated quantity of coal…
Q: a) Sum-of-the-years' method for 20x2 (1/1/x2 ~ 12/31/x2) b) Double-declining balance method for 20x3…
A: Cost of the asset = $225000 Useful life = 7 years Residual value = $5000 Depreciable value = $220000…
Q: EL Corporation, an entity under the mining industry, incurred a total of ₱20,000,000 on March 31,…
A: Depreciation is the amortization of the asset's cost over its useful life which will be debited to…
Q: Tacloban Company incurred the following costs at the beginning of the current year: cost of land,…
A:
Q: Eastlund Corporation's accumulated depreciation—equipment account increased by $6,320, while $2,450…
A: Net cash flow from operating activities = Net income + Depreciation expense + Amortization expense -…
Q: Kingston Corporation's accumulated depreciation—equipment account increased by $6,600, while $4,300…
A: Cash flow operating activities are primarily derived from the principle revenue generating…
Q: The Bailand Company purchased a building for P 210,000 that had an estimated residual value of…
A: Depreciation represents the reduction in the value of long-term assets for the useful life of the…
Q: gain or loss from this sale
A: Annual depreciation under straight line method = (Cost - Residual value)/Estimated life in years…
Q: Dow Deep Mining Co acquired mineral rights for $56,000,000. The mineral deposit is estimated at…
A: Formula: Depletion rate per ton = Total mineral rights acquired cost / Estimated Tons
Q: At the beginning of the current year, Red Co. reported P1,750,000 of appropriated retained earnings…
A: The question is based on the concept of Financial Accounting.
Q: AAA Corporation, a retailer, has a gross sales of P1,400,000,000.00 with a cost of sales of…
A: Allowable deductions : To ascertain the accounting income, the expenses are deducted…
Q: In December 20x8, the Aliz Co. purchased land for P300,000. The land was held until December 20x9,…
A: Profit on Sale of Asset: When an asset is sold for more than its carrying value, a gain on the sale…
Q: NOS Corp. purchased equipment for $180,000. They sold the equipment at the end of three years for…
A: Depreciation is a way to reduce the cost of asset over a period of time due to usage, wear &…
Q: Tullahoma Company purchased equipment for $27,500. It depreciated the equipment over a fiveyear life…
A: Double declining rate is a method in which the asset is depreciated according to accelerated…
During the current year, Puppy Company incurred P4,000,000 in exploration cost for each 15 oil sells drilled in the current year. Of the 15 wells drilled, 10 were dry holes. Th entity used the successful effort method of accounting. The entity deleted 30% of the oil discovered in the current year.
What amount of exploration cost would be reported in the year- end
a. 42,000,000
b. 14,000,000
c. 20,000,000
d. 6,000,000
Step by step
Solved in 2 steps
- Quavo Mining Co. acquired mineral rights for $16,500,000. The mineral deposit is estimated at 36,500,000 tons. During the current year, 10,037,500 tons were mined and sold. a. Determine the amount of depletion expense for the current year. Do not round intermediate calculation and round your answer to nearest whole value.$fill in the blank 1 b. Illustrate the effects on the accounts and financial statements of the depletion expense. For decreases in accounts or outflows of cash, enter your answers as negative numbers. If no account or activity is affected, select "No effect" from the dropdown and leave the corresponding number entry box blank. Balance Sheet Assets = Liabilities + Stockholders' Equity - Accumulated depletion + No effect = No effect + Retained earnings fill in the blank 6 fill in the blank 7 fill in the blank 8 fill in the blank 9 Statement of Cash Flows Income Statement No effect fill in the blank 11 Depletion expense…Glick Company purchased an oil reserve on July 1, Year 1 for $2,720,000. A total of 200,000 barrels of oil are expected to be extracted over the asset's life. During Year 1, 46,000 barrels are extracted and sold., The depletion charge for Year 1 would cause: Note: Do not round intermediate calculations. Multiple Choice an increase in stockholders' equity of $460,000. a decrease in assets of $625,600. a decrease in stockholders' equity of $200,000. a decrease in assets of $665,600.Quavo Mining Co. acquired mineral rights for $21,477,500. The mineral deposit is estimated at 69,500,000 tons. During the current year, 6,950,000 tons were mined and sold. a. Determine the amount of depletion expense for the current year. Round intermediate calculations to two decimal places and use rounded amounts in subsequent calculations. Round your answer to the nearest dollar. 2,154,500 b. Illustrate the effects on the accounts and financial statements of the depletion expense. Enter account decreases, cash outflows, and the income statement effects that decrease net income as negative amounts. However, for contra asset accounts, enter account increases as a negative value. If no account or activity is affected, select "No effect" from the dropdown and leave the corresponding number entry box blank. Financial Statement Effects Balance Sheet Assets Liabilities + Stockholders' Equity Mineral rights Accumulated depletion No effect + Retained earnings -2,154,500 X 2,154,500 X…
- Intra-Spect Mining Co. acquired mineral rights for $52,000,000. The mineral deposit is estimated at 40,000,000 tons. During the current year, 9,200,000 tons were mined and sold. Question Content Areaa. Determine the depletion rate. If required, round your answer to two decimal places.$fill in the blank 6865550bc008074_1 per ton b. Determine the amount of depletion expense for the current year.$fill in the blank 6865550bc008074_2Question Content Areac. Journalize the adjusting entry on December 31 to recognize the depletion expense. If an amount box does not require an entry, leave it blank. Dec. 31 - Select -- Select - - Select -- Select - eBook Show Me How Question Content Area Impaired Goodwill and Amortization of Patent On April 1, a patent with an estimated useful economic life of 12 years was acquired for $115,200. In addition, on December 31, it was estimated that goodwill of $51,500 was impaired. Question Content Area a. Record the acquisition of patent. If…Accounting for natural resources Donahue Oil Incorporated has an account titled Oil and Gas Properties. Donahue paid $6,400,000 for oil reserves holding an estimated 400,000 barrels of oil. Assume the company paid $510,000 for additional geological tests of the property and $470.000 to prepare for drilling. During the first year, Donahue removed and sold 75.000 barrels of oil. Record all of Donahue’s transactions, including depletion for the first year.Solare Company acquired mineral rights for $287,200,000. The diamond deposit is estimated at 35,900,000 tons. During the current year, 3,660,000 tons were mined and sold. a. Determine the depletion rate.$fill in the blank 5df5b004305d067_1 per ton b. Determine the amount of depletion expense for the current year.$fill in the blank 5df5b004305d067_2 c. Journalize the adjusting entry to recognize the depletion expense. If an amount box does not require an entry, leave it blank. Dec. 31 fill in the blank 0ae001fa5fd7fc8_2 fill in the blank 0ae001fa5fd7fc8_3 fill in the blank 0ae001fa5fd7fc8_5 fill in the blank 0ae001fa5fd7fc8_6
- Hidden Hollow Mining Co. acquired mineral rights for $42,500,000. The mineral deposit is estimated at 50,000,000 tons. During the current year, 11,500,000 tons were mined and sold. a. Determine the depletion rate. If required, round your answer to two decimal places.$fill in the blank 91e68b00e031f88_1 per ton b. Determine the amount of depletion expense for the current year.$fill in the blank 91e68b00e031f88_2 c. Journalize the adjusting entry on December 31 to recognize the depletion expense. If an amount box does not require an entry, leave it blank. Dec. 31 fill in the blank 346c5df8f020fe0_2 fill in the blank 346c5df8f020fe0_3 fill in the blank 346c5df8f020fe0_5 fill in the blank 346c5df8f020fe0_6Alaska Mining Co. acquired mineral rights for $24,992,000. The mineral deposit is estimated at 113,600,000 tons. During the current year, 17,050,000 tons were mined and sold. A. Determine the amount of delpletion expense for the current year. Round the depletion rate to two decimal rates. B. Journalize the adjacent entry on December 31 to recognize the depletion expenses. If an amount box does not require an entry, leave blank.Solare Company acquired mineral rights for $285,300,000. The diamond deposit is estimated at 31,700,000 tons. During the current year, 4,700,000 tons were mined and sold. Question Content Area a. Determine the depletion rate. $fill in the blank b14fe7fa701ffba_1 per ton b. Determine the amount of depletion expense for the current year. $fill in the blank b14fe7fa701ffba_2 Question Content Area c. Journalize the adjusting entry to recognize the depletion expense. If an amount box does not require an entry, leave it blank. Dec. 31 - Select - - Select - - Select -
- Hidden Hollow Mining Co. acquired mineral rights for S69,000,000. The mineral deposit is estimated at 60,000,000 tons. During the current year, 13,200,000 tons were mined and sold. a. Determine the depletion rate. If required, round your answer to two decimal places. Sfill in the blank d39a0a00ffc1f93_1 per tonEarth's Treasures Mining Co. acquired mineral rights for $37,500,000. The mineral deposit is estimated at 30,000,000 tons. During the current year, 9,300,000 tons were mined and sold. Question Content Area a. Determine the depletion rate. If required, round your answer to two decimal places.fill in the blank 1 of 1$ per ton b. Determine the amount of depletion expense for the current year.fill in the blank 1 of 1$ Feedback Area Feedback Question Content Area c. Journalize the adjusting entry on December 31 to recognize the depletion expense. If an amount box does not require an entry, leave it blank. Date Account Debit Credit December 31Backwoods Mining Co. acquired mineral rights for $17,094,000. The mineral deposit is estimated at 122,100,000 tons. During the current year, 18,300,000 tons were mined and sold. Question Content Area a. Determine the amount of depletion expense for the current year. Round the depletion rate to two decimal places.$fill in the blank 512120f9bfd801e_1 Question Content Area b. Journalize the adjusting entry on December 31 to recognize the depletion expense. If an amount box does not require an entry, leave it blank. blank Depletion Expense Depletion Expense Accumulated Depletion Accumulated Depletion Feedback Area Feedback Similar to the journal entry to record depreciation, the journal entry to record depletion affects a contra asset account
