3. Agata Mining Ventures, one of the largest mining company, purchased 20 acres of land for P60,000,000 in 2020. The company expected to extract 5 million tons of mine from this land over the next 20...


Answer the required part:


a. Entries to record the purchase of the land and other costs related to the mining activities in the year 2020.


b. Entries to record the depletion expense for the years 2021 and 2022.


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3. Agata Mining Ventures, one of the largest mining company, purchased 20 acres of land for P60,000,000 in 2020. The<br>company expected to extract 5 million tons of mine from this land over the next 20 years at which time, residual value<br>shall be P3,000,000. The following costs were also incurred related to the mining activities during 2020: Successful<br>exploration cost, P5,000,000 and cost of P800,000 for dry wells. Operations started in the year 2021, during the first 2<br>years of the mine's operations, 300,000 tons and 400,000 tons were mined and sold for P80 per ton.<br>Required:<br>a) Entries to record the purchase of the land and other costs related to the mining activities in the year 2020.<br>b) Entries to record the depletion expense for the year 2021 and 2022.<br>

Extracted text: 3. Agata Mining Ventures, one of the largest mining company, purchased 20 acres of land for P60,000,000 in 2020. The company expected to extract 5 million tons of mine from this land over the next 20 years at which time, residual value shall be P3,000,000. The following costs were also incurred related to the mining activities during 2020: Successful exploration cost, P5,000,000 and cost of P800,000 for dry wells. Operations started in the year 2021, during the first 2 years of the mine's operations, 300,000 tons and 400,000 tons were mined and sold for P80 per ton. Required: a) Entries to record the purchase of the land and other costs related to the mining activities in the year 2020. b) Entries to record the depletion expense for the year 2021 and 2022.

Jun 09, 2022
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