Question 21 Choose the correct answer from the choices. Transcribed Image Text: On July 1, 2017, Jungkook Mining Company purchased the rights to a mine. The total purchase price was

Question 21 Choose the correct answer from the choices. Transcribed Image Text: On July 1, 2017, Jungkook Mining Company purchased the rights to a mine. The total purchase
price was P7,920,000 of which P240,000 was allocated to land. Estimated reserves were
1,600,000 tons. Jungkook expects to extract and sell 25,000 tons per month. Jungkook
purchased new equipment on July 1, 2017. The equipment cost P3,960,000 and have a useful
life of 8 years. However, after all the resources are removed, the equipment will be of no use
and will be sold for P120,000.
If sales and production conformed to expectations, what amount of depletion should the
company recognize in 2017? * O
O 1,400,000
O 1,440,000
O 720,000
O 700,000

Do you need us to help you on this or any other assignment?


Make an Order Now