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Mineral Mine Financial Overview and Costs

1) The document contains information about 5 different mineral mining operations including the mineral mine size, removable ore, development costs, ore sold, and total costs. 2) For the second operation, the deplation rate per unit is calculated as 9,360,000/4,320,000 tons of removable ore which equals 2.16. The deplation amount is calculated as 2 times the removable ore sold of 540,000 tons. 3) The fifth operation calculates the deplation rate for a land restoration project as the total cost of 9,500,000 divided by the recoverable value of 2,500,000 which equals 3.8.

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Kiminosunoo Lel
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103 views3 pages

Mineral Mine Financial Overview and Costs

1) The document contains information about 5 different mineral mining operations including the mineral mine size, removable ore, development costs, ore sold, and total costs. 2) For the second operation, the deplation rate per unit is calculated as 9,360,000/4,320,000 tons of removable ore which equals 2.16. The deplation amount is calculated as 2 times the removable ore sold of 540,000 tons. 3) The fifth operation calculates the deplation rate for a land restoration project as the total cost of 9,500,000 divided by the recoverable value of 2,500,000 which equals 3.8.

Uploaded by

Kiminosunoo Lel
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

1.

) Deplation rate per unit


Mineral mine 2,640,000 (3,180,000/1,200,000)
Removable ore 1,200,000 tons = 2.65
Restoration 180,000 Deplation
Sell 300,000 (2.65*60,000)
Development Cost 360,000 = 159000
Remove & sold 60,000 tons

Mineral mine 2,640,000


Restoration 180,000
Development Cost 360,000
Total Cost 3,180,000

4.)
Cash dividend 800,000
Less: Retained Earnings 600,000
Liquidating dividend 200,000
ate per unit 2.)
0/1,200,000) Mineral mine 7,200,000 Deplation rate per un
Removable ore 4,320,000 tons (9,360,000/4,320,000)
Estimated value 720,000 =
Development Cost 2,160,000 Deplation
Removable ore 540,000 tons (2*540,000)
Sold tons 480,000 tons 1080000
Cost of good sold
Mineral mine 7,200,000 (480,000*2)
Development Cost 2,160,000 960000
Total Cost of natural resources 9,360,000

5.) Land
Land 9,000,000 Restoration
Restoration 1,500,000 Land after restoration
Recoverable 2,500,000 Total Cost
Value of land
1,000,000
after restoration Deplation Rate
(9,500,000/2,500,000)
= 3.8
Deplation rate per unit
(9,360,000/4,320,000)
2.1666667
Deplation
(2*540,000)
1080000
Cost of good sold
(480,000*2)
960000

9,000,000
1,500,000
-1,000,000
9,500,000

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