Question

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Please answer the question below.

prepare the journal entries for all the following related transaction (all occurring within the current year). Assume all depletion and amoritization for the full year. Also, assume all purchases were made with cash.

A. An exploration company purchased land with a valuable ore deposit

     Estimated ore available in the deposit (in tons)                      4,700,000

     Acquisition price                                                                    $3,500,000

     Residual value of land once ore is fully depleted                        $500,000

     Ore removed in the current year (in tons)                                     365,000

B. The exploration company developed a high speed drill to use in its explorations.

      Economic liffe of the drill (in years)                                              5

     Costs inccurred in the current year to develop the drill                 $550,000

     Attorney fees incured to protect the patent                                    $15,000

C. The exploration company purchased Goshen Hole Company

         Acquisition price                                                                         $3,250,600

         Book Value of Goshen Hole Company                                       $2,415,960

Answer 1