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In 2019, ABC purchased a silver mine for $10,200,000 withremovable silver estimated at 1,000,000 tons. ABC is required tomitigate environmental damage after mining the silver and expectsto spend $5,105,126.25 five years from now in order to do so. ABC’scost of capital for similar investments is 5%. The property has anestimated value of $500,000 after the gold has been extracted. Thecompany incurred $2,500,000 of intangible development costs gettingthe mine up and running. During 2019, 200,000 tons were removed and150,000 tons were sold.What is the amount of depletion that ABC should expense for2019?
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