On January 2, 2019, Whistler Company purchased land for $530,000, from which it is estimated that 360,000 tons of ore could be extracted. It estimates that the present value of the cost necessary to restore the land is $80,000, after which it could be sold for $26,000. During 2019, Whistler mined 88,000 tons and sold 72,000 tons. During 2020, Whistler mined 114,000 tons and sold 115,000 tons. At the beginning of 2021, Whistler spent an additional $110,000, which increased the reserves by 54,000 tons. In 2021, Whistler mined 147,000 tons and sold 141,000 tons. Whistler uses a FIFO cost flow assumption. Required: If required, round the depletion rate to the nearest cent and round the final answers to the nearest dollar. 1. Calculate the depletion included in the income statement and ending inventory for 2019, 2020, and 2021. 2019 Depletion deducted from income Depletion included in inventory 2020 Depletion deducted from income Depletion included in inventory 2021 Depletion deducted from income Depletion included in inventory
On January 2, 2019, Whistler Company purchased land for $530,000, from which it is estimated that 360,000 tons of ore could be extracted. It estimates that the present value of the cost necessary to restore the land is $80,000, after which it could be sold for $26,000. During 2019, Whistler mined 88,000 tons and sold 72,000 tons. During 2020, Whistler mined 114,000 tons and sold 115,000 tons. At the beginning of 2021, Whistler spent an additional $110,000, which increased the reserves by 54,000 tons. In 2021, Whistler mined 147,000 tons and sold 141,000 tons. Whistler uses a FIFO cost flow assumption. Required: If required, round the depletion rate to the nearest cent and round the final answers to the nearest dollar. 1. Calculate the depletion included in the income statement and ending inventory for 2019, 2020, and 2021. 2019 Depletion deducted from income Depletion included in inventory 2020 Depletion deducted from income Depletion included in inventory 2021 Depletion deducted from income Depletion included in inventory
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 2, 2019, Whistler Company purchased land for $530,000, from which it is estimated that 360,000 tons of ore could be extracted. It estimates that the present value of the cost necessary to restore the land is $80,000, after which it could be sold for $26,000.
During 2019, Whistler mined 88,000 tons and sold 72,000 tons. During 2020, Whistler mined 114,000 tons and sold 115,000 tons. At the beginning of 2021, Whistler spent an additional $110,000, which increased the reserves by 54,000 tons. In 2021, Whistler mined 147,000 tons and sold 141,000 tons. Whistler uses a FIFO cost flow assumption.
Required:
If required, round the depletion rate to the nearest cent and round the final answers to the nearest dollar.
1. Calculate the depletion included in the income statement and ending inventory for 2019, 2020, and 2021.
| 2019 | Depletion deducted from income | ||
| Depletion included in inventory | |||
| 2020 | Depletion deducted from income | ||
| Depletion included in inventory | |||
| 2021 | Depletion deducted from income | ||
| Depletion included in inventory |
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