Home / Questions / Tishimingo Sand and Gravel paid $800000 to acquire 1200000 cubic yards of sand reserves Th...
Tishimingo Sand and Gravel paid $800,000 to acquire 1,200,000 cubic yards of sand reserves. The following statements model reflects Tishimingo’s financial condition just prior to purchasing the sand reserves. The company extracted 650,000 cubic yards of sand in year 1 and 450,000 cubic yards in year 2. Required a. Compute the depletion charge per cubic yard. b. Record the acquisition of the sand reserves and the depletion expense for years 1 and 2 in a financial statements model like the preceding one. c. Prepare the general journal entries to record the depletion expense for years 1 and2.
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