Reference no: EM132488442

Question 1: Frederick Mining Company owns a large parcel of land which costs $1,100,000. It is estimated to contain 1,700,000 tons of recoverable ore. It is estimated that the recovery of the ore will take 10 years and that after the ore is fully depleted the land will be sold for a market value of $100,000. In 2018, Frederick extracted and sold 125,000 tons of ore. What is the amount of depletion that should be recorded? Round total to the nearest whole dollar.

Question 2: On January 2, 2019, Adelphi Company purchased a patent for $150,000 plus $8,000 in legal fees. On that date, the patent had a remaining legal life of 13 years. Adelphi Company expects to use the patent for 7 years after which time it will be worthless. How much is the annual amortization expense for 2019? Round to nearest whole dollar.

Question 3: Annapolis Company was recently sold for $460,000. Annapolis had assets & liabilities appraised at the time of the sale in the amounts of:

Item                                                             Amount

Accounts Receivable assumed by buyer   $102,000

Inventory                                           $255,000

Property, Plant & Equipment (net)           $510,000

Notes Payable assumed by buyer              $665,000

Using this information, how much should be recorded as Goodwill for this transaction?