Calculate the amount of amortization

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On Feb 1, 2002, Miyasawa Mining Company purchased a mine for a value of $80 million, which is estimated to have 250,000 tonnes of ore and a residual value of $3 million. The cost of restoration at the end of the useful life is estimated at $8 million. During the first year, 5 million tonnes were mined.

a) calculate the amount of amortization that should be recorded on December 31, 2002.

b) Calculate the amount of amount of the restoration liability.

c) Show journal entry for December 31, 2002.

Reference no: EM13135305

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