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SOLVING:In 20x1, BUCOLIC RURAL Co. acquired land for a total cost of 40,000,000 to be₱ used to quarry marble, limestone, and construction aggregates. Costs incurred to obtain legal right to explore the property amounted to 8,000,000. Expenditures₱ incurred in the exploration for and evaluation of mi...

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SOLVING:

In 20x1, BUCOLIC RURAL Co. acquired land for a total cost of ₱40,000,000 to be used to quarry marble, limestone, and construction aggregates. Costs incurred to obtain legal right to explore the property amounted to ₱8,000,000. Expenditures incurred in the exploration for and evaluation of mineral resources before technical feasibility

and

commercial

viability

of

extracting

a

mineral

resource

are

demonstrable totaled ₱12,000,000. Intangible development costs of drilling, tunnels, shafts, and wells before the actual production totaled ₱20,000,000. BUCOLIC Co. estimates that total recoverable reserves are 100,000,000 units. Furthermore, BUCOLIC Co. expects to sell the land for ₱4,800,000 after resource is depleted. However, no buyer will pay this price unless the mine is drained, filled and leveled, a process that will cost ₱800,000. It is BUCOLIC’s policy to capitalize all exploration costs.

Actual units quarried in 20x1 through 20x4 totaled 30,000,000 units. On January 1, 20x5, BUCOLIC Co. estimated that the remaining recoverable reserves are only 25,000,000 units and after the reserves are exhausted, the land will be sold for ₱3,200,000. Costs of disposal are estimated at ₱1,200,000. Actual units quarried in 20x5 totaled 6,000,000 units. 1. Howmuchi st hedepl et i onchar gei n20x5? Answer :13, 248, 000

2. Whati st hecar r yi ngamountoft hewast i ngassetonDecember31,20x5? Answer :43, 952, 000...