Sands company purchased mining rights for $500,000. they expect to harvest 1 million tons of ore over the next five years. during the current year, sands mined 350,000 tons of ore. the entry to record the depletion would include

Given the cost and the expected harvest, therefore the depletion cost per ton of ore is:

Depletion cost per ton = $500,000 / 1,000,000 tons

Depletion cost per ton = $0.5 / ton

Since during that year, harvest is 350,000 tons of ore, therefore:

Depletion cost that year = ($0.5 / ton) (350,000 tons)

Depletion cost that year = $175,000

Therefore, the entry should be:

A debit to Depletion Expense for $175,000

answer; buying the bill at a discount from the face value to be received at maturity;

answerindividual preferences are not revealed in the market for the good;