Fortune Drilling Company Acquires a Mineral Deposit at a Cost

question 64

Multiple Choice

Fortune Drilling Company acquires a mineral deposit at a cost of $5,900,000.It incurs additional costs of $600,000 to access the deposit,which is estimated to contain 2,000,000 tons and is expected to take 5 years to extract.What journal entry would be needed to record the expense for the first year assuming 418,000 tons were mined?

• A)Debit Depletion Expense $1,233,100;credit Accumulated Depletion $1,233,100.
• B)Debit Amortization Expense $1,358,500;credit Accumulated Amortization $1,358,500.
• C)Debit Depreciation Expense $1,358,500;credit Accumulated Depreciation $1,358,500.
• D)Debit Depletion Expense $1,358,500;credit Accumulated Depletion $1,358,500.
• E)Debit Depreciation Expense $1,233,100;credit Accumulated Depreciation $1,233,100.

Recognize the role of government policies, including tax policies and the Patient Protection and Affordable Care Act (PPACA), in the healthcare system.

Understand the mechanisms through which managed-care organizations like HMOs and PPOs aim to reduce health care costs.

Acknowledge the significance of non-price rationing mechanisms and their application in health care cost containment in different countries.

Realize the implications of health care subsidies and the effects of the personal mandate provision under the PPACA.

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Definitions:

Oxytocin

A hormone and neurotransmitter involved in childbirth and lactation, also playing a role in social bonding and trust.

Prostaglandins

A group of physiologically active lipid compounds having diverse hormone-like effects, such as regulating inflammation and body temperature.

Cortisol

A steroid hormone, secreted by the adrenal cortex, that helps the body adjust to long-term stress; stimulates conversion of other nutrients to glucose in the liver, resulting in increased blood glucose concentration.

Progesterone

A steroid hormone secreted by the corpus luteum of the ovary and by the placenta, which acts to prepare the uterus for implantation of the fertilized egg.