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In 2013, Rocky Mountain Mining Co. purchased a coal mine that contained an estimated 1,000,000 tons of coal for a cash price of $28,500,000

In 2013, Rocky Mountain Mining Co. purchased a coal mine that contained an estimated 1,000,000 tons of coal for a cash price of $28,500,000. The company mined 350,000 tons of coal in 2013.

Required:

a) What is the amount of depletion to be recorded per ton of coal?
b) What is the amount of depletion expense for 2013? 
 
 

158.In 2013, Harrogate Corporation Co. acquired a patent from a competitor for $175,000. At the time of purchase, it had 12 years of its legal life remaining; however, due to competition, Harrogate believes that the patent will only be useful for 8 years. Prepare the general journal entry to recognize amortization expense for 2013. 
 
 

159.On January 1, 2013, Flintstone Company purchased Rubble Company, paying $600,000 cash. The fair value of Rubble's assets was $540,000, and it had liabilities of $50,000.

Required:

a) Prepare Flintstone's journal entry to record the acquisition of Rubble Company.
b) At the end of 2015, Flintstone concluded that the value of its goodwill (associated with the acquisition of Rubble) had declined by $65,000. Prepare the journal entry to record this decrease in value. 

Jan 25 2020 View more View Less

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