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  • Depletion IFRS Vs ASPE Simple Demo

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    nishit
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    The document outlines the accounting for depletion of a mine asset under ASPE and IFRS standards. It provides the costs to acquire and develop the mine totaling $1,000,000 under ASPE and $950,000 under IFRS. It then calculates the depletion cost per unit of production as $90/unit under ASPE and $85/unit for mining costs plus $5/unit for asset retirement costs under IFRS. In year 1, 2,000 units are depleted at these per unit rates, resulting in $180,000 of depletion expense under both standards.

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    IFRS vs APSE

    Original Title

    Depletion IFRS vs ASPE Simple Demo

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    The document outlines the accounting for depletion of a mine asset under ASPE and IFRS standards. It provides the costs to acquire and develop the mine totaling $1,000,000 under ASPE and $950,000 under IFRS. It then calculates the depletion cost per unit of production as $90/unit under ASPE and $85/unit for mining costs plus $5/unit for asset retirement costs under IFRS. In year 1, 2,000 units are depleted at these per unit rates, resulting in $180,000 of depletion expense under both standards.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    9 views4 pages

    Depletion IFRS Vs ASPE Simple Demo

    Uploaded by

    nishit
    The document outlines the accounting for depletion of a mine asset under ASPE and IFRS standards. It provides the costs to acquire and develop the mine totaling $1,000,000 under ASPE and $950,000 under IFRS. It then calculates the depletion cost per unit of production as $90/unit under ASPE and $85/unit for mining costs plus $5/unit for asset retirement costs under IFRS. In year 1, 2,000 units are depleted at these per unit rates, resulting in $180,000 of depletion expense under both standards.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 4

    Depletion

    Mine Cost $750,000


    Other Costs $200,000
    ARO Costs $50,000
    Total Costs $1,000,000
    Salvage Value $100,000
    Units of Production 10,000
    Year 1 Units 2,000

    ASPE and IFRS:


    Inventory cost /unit Mine Cost Other Costs ARO Costs Salvage Value
    $750,000 $200,000 $50,000 ($100,000) = $90
    10,000
    Units of Production

    IFRS:
    Accumulated Depletion/ unit:
    Mine Cost Other Costs
    $750,000 $200,000 ($100,000) = $85
    10,000
    Units of Production

    Asset Retirement Obligation/ unit:


    ARO Costs
    $50,000 = $5
    10,000

    IFRS
    Mine $950,000
    Cash $950,000

    To record acquisition of mine

    Mine Asset:
    Mine Cost $750,000
    Other Costs $200,000
    Total $950,000

    Year 1 Depletion
    Inventory 180,000
    Accumulated Depletion $170,000
    Asset Retirement Obligation $10,000
    To record depletion of mine
    Inventory Year 1 Units 2,000
    x $90
    180,000

    Accumulated Depletion Year 1 Units 2,000


    x $85
    $170,000

    Asset Retirement Obligation Year 1 Units 2,000


    x $5
    $10,000
    /unit

    /unit

    /unit

    ASPE
    Mine $1,000,000
    Asset Retirement Obligation $50,000
    Cash $950,000
    To record acquisition of mine

    Mine Asset:
    Mine Cost $750,000
    Other Costs $200,000
    ARO Costs $50,000
    Total $1,000,000

    Year 1 Depletion
    Inventory 180,000
    Accumulated Depletion 180,000

    To record depletion of mine


    Inventory Year 1 Units 2,000
    x $90
    180,000

    Accumulated Depletion Year 1 Units 2,000


    x $90
    180,000

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