Question

Answer both please.

1. The Weber Company purchased a mining site for $687,720 on July 1. The company expects to mine ore for the next 10 years and anticipates that a total of 83,228 tons will be recovered. During the first year the company extracted 4,678 tons of ore. The depletion expense is

a.$38,640.28

b.$53,292.00

c.$63,442.80

d.$35,659.32

2. Periodic inventory by three methods; cost of goods sold

The units of an item available for sale during the year were as follows:

Jan. 1	Inventory	40 units at $100
Mar. 10	Purchase	70 units at $108
Aug. 30	Purchase	30 units at $114
Dec. 12	Purchase	60 units at $120

There are 80 units of the item in the physical inventory at December 31. The periodic inventory system is used.

Determine the ending inventory cost and the cost of goods sold by three methods. Round interim calculations to one decimal and final answers to the nearest whole dollar.

Cost of Ending Inventory and Cost of Goods Sold
Inventory Method	Ending Inventory	Cost of Goods Sold
First-in, first-out (FIFO)	$fill in the blank 1	$fill in the blank 2
Last-in, first-out (LIFO)	fill in the blank 3	fill in the blank 4
Weighted average cost	fill in the blank 5	fill in the blank 6

Answer 1

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1.

Correct option is: a. $38,640.28
Workings:
Depletion Cost per unit	=	(Cost of the asset - Resale value) / Estimated number of units
	=	($687720 - $0) / 83228
	=	$                                                                                                                     8.26
Depletion expense (First year)	=	Depletion Cost per unit X Number of units extracted
	=	$8.26 X 4678 tons
	=	$                                                                                                          38,640.28

2.

	Ending inventory	Cost of goods sold
FIFO	$                     9,480	$       12,700
LIFO	$                     8,320	$       13,860
Weighted Average	$                     8,872	$       13,308