raded Help Save & E Che Exercise 10-18 Depletion of natural resources LO P1, P3

Question

raded Help Save & E Che Exercise 10-18 Depletion of natural resources LO P1, P3 On April 2, 2017, Montana Mining Co. pays $3,197090 for an ore deposit containing 1,539,000 tons. The company installs machinery in the mine costing $194,800, with an estimated seven-year life and no salvage value. The machinery will be abandoned when the ore is of 2017 completely mined. Montana begins mining on May 1, 2017, and mines and sells 187.300 tons of ore during the remaining eight months Prepare the December 31, 2017, entries to record both the ore deposit depletion and the mining machinery depreciation. Mining machinery depreciation should be in proportion to the mine's depletion. (Do not round intermediate calculations. Round your final answers to the nearest whole number.) View transaction list X: Record the year-end adjusting entry for the depletion expense of ore mine. 1 mine. Record the year-end adjusting entry for the depreciation expense of the mining machinery 2 Prex 8 of 9 Next> 9 search

Explanation / Answer

Date General Journal Debit Credit 31-Dec Depletion expense—Mineral deposit 389,094 =3197090/1539000*187300 Accumulated depletion—Mineral deposit 389,094 Dec. 31 Depreciation expense—Machinery 23,708 =194800/1539000*187300 Accumulated depreciation—Machinery 23,708

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