A Mine Is Purchased for $4,000,000

question 162

Multiple Choice

A mine is purchased for $4,000,000.There will be a salvage value of $300,000 when the land is restored after mining is completed.The mine has an estimated 250,000 tons of coal.During 2012,there were 35,000 tons of coal removed.What is the depletion expense for 2012?

• A) $518,000
• B) $466,550
• C) $560,000
• D) $300,000

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Definitions:

Standard Time

The predetermined amount of time allocated for the completion of a specific task, under normal working conditions.

Error Level

A measure of the frequency or magnitude of mistakes, inaccuracies, or deviations from a standard within a process or system.

Confidence

The feeling or belief that one can rely on someone or something; firm trust.

Sample Proportion

Sample proportion refers to the ratio of individuals in a statistical sample who have a particular attribute or characteristic, used in making inferences about a population.