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on july 23 of the current year dakota mining co pays 6 009 360 for land estimated to 4277982

 

On July 23 of the current year, Dakota Mining Co. pays$6,009,360 for land estimated to contain 8,232,000 tons ofrecoverable ore. It installs machinery costing $1,811,040 that hasa 10-year life and no salvage value and is capable of mining theore deposit in eight years. The machinery is paid for on July 25,seven days before mining operations begin. The company removes andsells 421,000 tons of ore during its first five months ofoperations ending on December 31. Depreciation of the machinery isin proportion to the mine's depletion as the machinery will beabandoned after the ore is mined

a. to record the purchase of the land

b. to record the cost and installation of machinery

c. To record the first five months' depletion assuming the landhas a net salvage value of zero after the ore is mined. Record theyear-end adjusting entry for the depletion expense of ore mine.

d. To record the first five months' depreciation on themachinery. Record the year-end adjusting entry for the depreciationexpense of the machinery.

 

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