Answer :
Answer:
Depletion expense=$342,000
Explanation:
Total cost of purchasing the ore mine;
Total cost=Purchase cost+access cost
where;
Purchase cost=$2,380,000
Access cost=$666,400
replacing;
Total cost=(2,380,000+666,400)=$3,046,400
Net cost=Total cost-estimated value of land
where;
Total cost=$3,046,400
Estimated value of land=$340,000
replacing;
Net cost=3,046,400-340,000=$2,706,400
Depletion expense=Cost per unit×number of units sold
where;
Cost per unit=(2,706,400/1,700,000)=$1.592 per tonne
Number of units sold=215,000 tons
replacing;
Depletion expense=(1.592×215,000)=$342,000
Depletion expense=$342,000