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23 July, 10:51

The Weber Company purchased a mining site for $1,750,000 on July 1, 2014. The company expects to mine ore for the next 10 years and anticipates that a total of 400,000 tons will be recovered. The estimated residual value of the property is $150,000. During 2014 the company extracted 6,500 tons of ore. The depletion expense for 2014 isa. $15,000b. $17,500c. $26,000d. $16,000

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  1. 23 July, 12:39
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    c. $26,000

    Explanation:

    The computation of the depletion expense is shown below:

    = (Original cost - residual value) : estimated units or tons * number of tons extracted in a given year

    = ($1,750,000 - $150,000) : 400,000 tons * 6,500 tons

    = $26,000

    We simply subtract the residual value from the original cost and then divide it by total estimated tons. After that, multiply it with the extracted units
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Home » Business » The Weber Company purchased a mining site for $1,750,000 on July 1, 2014. The company expects to mine ore for the next 10 years and anticipates that a total of 400,000 tons will be recovered. The estimated residual value of the property is $150,000.
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