Brief Exercise 11-9 Grouper Corporation acquires a coal mine at a cost of $436,0

Question

Brief Exercise 11-9 Grouper Corporation acquires a coal mine at a cost of $436,000. Intangible development costs total $109,000. After extraction has occurred, Grouper must restore the property (estimated fair value of the obligation is $87,200), after which it can be sold for $174,400. Grouper estimates that 4,360 tons of coal can be extracted. If 763 tons are extracted the first year, prepare the journal entry to record depletion. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit

Explanation / Answer

Depletion per ton=(436000+109000+87200-174400)/4360= 105 Depletion expense 80115 =763*105          Accumulated depletion 80115

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