Use the Following Information for Questions

question 113

Multiple Choice

Use the following information for questions.
On January 1, 2011, Edmondton Inc.purchased equipment with a cost of €4,500,000, a useful life of 12 years and no salvage value.The Company uses straight-line depreciation.At December 31, 2011, the company determines that impairment indicators are present.The fair value less cost to sell the asset is estimated to be €3,850,000.The asset's value-in-use is estimated to be €3,500,000.There is no change in the asset's useful life or salvage value.
-In January, 2010, Yoder Corporation purchased a mineral mine for $3,400,000 with removable ore estimated by geological surveys at 2,000,000 tons.The property has an estimated value of $200,000 after the ore has been extracted.The company incurred $1,000,000 of development costs preparing the mine for production.During 2010, 500,000 tons were removed and 400,000 tons were sold.What is the amount of depletion that Yoder should expense for 2010?

• A)$640,000
• B)$800,000
• C)$840,000
• D)$1,120,000

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Definitions:

Sample Size

The number of observations or individuals included in a sample from a population for the purpose of statistical analysis.

Type II Error

A statistical error that occurs when a false null hypothesis is not rejected, also known as a false negative.

Not Guilty

A legal declaration that a defendant has not been proven to have committed the charges against them beyond a reasonable doubt.

Hypothesis Test

A method in statistics to determine whether there is enough evidence in a sample of data to infer that a certain condition is true for the entire population.