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Business, 25.02.2020 01:57 bezar77

Alpha Mining Company recognizes $2 of depletion for each ton of ore mined. During 2016, 850,000 tons of ore were mined and 725,000 tons were sold. Using this information, how much should be recorded for FY 2016 for the following accounts:
1.accumulated Depletion
2.inventory
3.cost of Goods Sold

Answers

ansver
Answer from: riri95

1. $1,700,000

2. $250,000

3. $1,450,000

Explanation:

Given that,

Depletion for each ton of ore mined = $2

Ore mined during 2016 = 850,000 tons

Ore sold during 2016 = 725,000 tons

1. Accumulated depletion:

= Ore mined during 2016 × Depletion for each ton of ore mined

= 850,000 tons × $2

= $1,700,000

2. Inventory:

= (Ore mined during 2016 - Ore sold during 2016) × Depletion for each ton of ore mined

= (850,000 tons - 725,000 tons) × $2

= 125,000 tons × $2

= $250,000

3. Cost of goods sold:

= Ore sold during 2016 × Depletion for each ton of ore mined

= 725,000 tons × $2

= $1,450,000

ansver
Answer from: Quest
Ithink its opportunity cost but not sure hope it .
ansver
Answer from: Quest

answer///a coalition;

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Alpha Mining Company recognizes $2 of depletion for each ton of ore mined. During 2016, 850,000 tons...