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The present value of the estimated cost of restoring the land after the resource is extracted is P450, 000.
The land will have a value of P650, 000 after it is restored for suitable use.
Tunnels, bunk houses and other fixed installations are constructed at a cost of P8, 000,000 and such
expenditures are charged to mine improvements.
Operations began on January 1, 2019 and resources removed totaled 600,000 tons. During 2020, a
discovery was made indicating that available resource after 2020 will total 1,875,000 tons.
At the beginning of 2020, additional bunk houses were constructed in the amount of P770, 000. In 2020,
only 400,000 tons were mined because of a strike.
2,000,000.0
divided by : est. extraction 0 (1,875,000+400,000) 2,275,000.00
1,560,000.0
Depreciation for 2019 0 Depletion for 2020 640,000.00
8,000,000.0
Mine Improvements 0 Mine Improvements 8,000,000.00
2,000,000.0 Additional
divided by : est. extraction 0 resources: 770,000.00
(1,875,000+400,000) 2,275,000.00
Rate 2.80