Contemporary Engineering Economics 6th Edition by Chan Park

تمرين 56

A gold mine with an estimated deposit of 500,000 ounces of gold is purchased for $80 million. The mine has a gross income of $48,365,000 for the year, obtained from selling 52,000 ounces of gold. Mining expenses before depletion equal $22,250,000. Compute the percentage depletion allowance. Would it be advantageous to apply cost depletion rather than percentage depletion