Rick Purchased a Uranium Interest for $10,000,000 on January 3

question 23

Essay

Rick purchased a uranium interest for $10,000,000 on January 3, 2017, when recoverable reserves were estimated at 200,000 units. A total of 10,000 units were extracted in 2017 and 7,000 units were sold in 2017. Gross income from the property was $2,800,000 and taxable income without the allowance for depletion was $1,000,000. Determine the depletion deduction for 2017.

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Definitions:

Occipital Lobe

The region of the cerebral cortex located at the back of the brain, responsible for processing visual information.

Parietal Lobe

A region of the cerebral cortex involved in processing sensory information regarding the location of parts of the body as well as interpreting visual information and processing language and mathematics.

Frontal Lobe

Part of the brain located at the front of each cerebral hemisphere, responsible for voluntary movement, expressive language, and managing higher level executive functions.

Brain Stem

The posterior part of the brain, adjoined to the spinal cord, that controls basic life functions such as heartbeat, breathing, and blood pressure.