80.2K

Verified Solution

Link Copied!

Required information Problem 10-75 (LO 10-5) (Algo) [The following information applies to the questions displayed below.] Last Chance Mine (LCM) purchased a coal deposit for $1,654,350. It estimated it would extract 13,450 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross recelpts of $1.35 million, $6.25 million, and $5.2 million for years 1 through 3 , respectively. During years 13, LCM reported net income (loss) from the coal deposit activity in the amount of ($16,400),$705,000, and $577,500, respectively. In years 1-3, LCM extracted 14,450 tons of coal as follows: Note: Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. Problem 10.75 Part a (Algo) a. What is LCM's cost depletion for years 1,2 , and 3 ? Required information Problem 10-75 (LO 10-5) (Algo) [The following information applies to the questions displayed below.] Last Chance Mine (LCM) purchased a coal deposit for $1,654,350. It estimated it would extract 13,450 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1.35 million, $6.25 million, and $5.2 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 ($16,400),$705,000, and $577,500, respectively. In years 13,LCM extracted 14,450 tons of coal as follows: Note: Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. Problem 10-75 Part b (Algo) b. What is LCM's percentage depletion for each year (the applicable percentage for coal is 10 percent)? Required information Problem 10-75 (LO 10-5) (Algo) [The following information applies to the questions displayed below.] Last Chance Mine (LCM) purchased a coal deposit for $1,654,350. It estimated it would extract 13,450 tons of coal from the deposit. LCM mined the coal and sold it, reporting gross receipts of $1.35 million, $6.25 million, and $5.2million for years 1 through 3 , respectively. During years 13, LCM reported net income (loss) from the coal deposit activity in the amount of ($16,400),$705,000, and $577,500, respectively. In years 13, LCM extracted 14,450 tons of coal as follows: Note: Leave no answer blank. Enter zero if applicable. Enter your answers in dollars and not in millions of dollars. 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

Answer & Explanation Solved by verified expert

See Answer