Last Chance Mine (LCM) purchased a coal deposit for $1,108,250. It estimated it would extract 17,050 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1.28 million, $6.7 million, and $5.1 million for years 1 through 3, respectively. During years 1-3, LCM reported net income (loss) from the coal deposit activity in the amount of ($21,000), $685,000, and $490,000, respectively. In years 1-3, LCM extracted 18,050 tons of coal as follows: (1) Tons of Coal 17,050 Depletion Tons Extracted per Year Year 2 (2) Basis (2)/(1) Rate $1,108,250 $65.00 9,400 Note: Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. Year 1 Year 2 Year 3 Year 1 4,350 Problem 10-75 Part c (Algo) c. Using the cost and percentage depletion computations from parts (a) and (b), what is LCM's actual depletion expense for each year? Depletion Expense Year 3 4,300

Last Chance Mine (LCM) purchased a coal deposit for $1,108,250. It estimated it would extract 17,050 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1.28 million, $6.7 million, and $5.1 million for years 1 through 3, respectively. During years 1-3, LCM reported net income (loss) from the coal deposit activity in the amount of ($21,000), $685,000, and $490,000, respectively. In years 1-3, LCM extracted 18,050 tons of coal as follows: (1) Tons of Coal 17,050 Depletion Tons Extracted per Year Year 2 (2) Basis (2)/(1) Rate $1,108,250 $65.00 9,400 Note: Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. Year 1 Year 2 Year 3 Year 1 4,350 Problem 10-75 Part c (Algo) c. Using the cost and percentage depletion computations from parts (a) and (b), what is LCM's actual depletion expense for each year? Depletion Expense Year 3 4,300

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 6PB: Underwoods Miners recently purchased the rights to a diamond mine. It is estimated that there are...

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