Check s On July 23 of the current year, Dakota Mining Co. pays $6,446,880 for la

Question

Check s On July 23 of the current year, Dakota Mining Co. pays $6,446,880 for land installs machinery costing $1,306,800 years. The machinery is paid for on July 25, seven days before mining operations begin. The company removes and sells 448,750 tons of ore during its first five months of operations ending on December 31. Depreclation of the machine mine's depletion as the machinery will be abandoned after the ore is mined. estimated to contain 8,712,000 tons of recoverable ore. It that has a 10-year life and no salvage value and is capable of mining the ore deposit in eight y is in proportion to the Required Prepare entries to record the following. (Do not round your intermediate calculations. Round "Depletion per ton" to two decimal places and round all other answers to the nearest whole dollar.) (a) To record the purchase of the land s (b) To record the cost and installation of machinery. (c) To record the first five months' depletion assuming the land has a net salvage value of zero after the ore is mined (d) To record the first five months' depreciation on the machinery Complete this question by entering your answers in the tabs below Required A Required B Required C1 Required C2 Required D1 Required D2 To record the purchase of the land. View transaction list Your Outlook account setti date. e to search

Explanation / Answer

Entries:

Depletion expense:

Ref Date General Journal Debit Credit 1 Jul.23 Ore deposits 6446880 Cash 6446880 [ Ore mine land purchased] 1 Jul.25 Machinery 1306800 Cash 1306800 [Machinery purchased] 1 Dec.31 Depletion expense 332075 Accummulated depletion 332075 [ Recorded depletion expense for the period] 1 Dec.31 Depreciation expense 67,312.50 Accummulated Depreciation 67312.5 [Depreciation on machinery till Dec.31]

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