Rick purchased a uranium interest for $10,000,000 on January 3, 2017, when recoverable reserves were estimated at 200,000 units. A total of 10,000 units were extracted in 2017 and 7,000 units were sold in 2017. Gross income from the property was $2,800,000 and taxable income without the allowance for depletion was $1,000,000. Determine the depletion deduction for 2017.

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The Answer of Rick purchased a uranium interest for $10,000,000 on January 3, 2017, when recoverable reserves were estimated at 200,000 units. A total of 10,000 units were extracted in 2017 and 7,000 units were sold in 2017. Gross income from the property was $2,800,000 and taxable income without the allowance for depletion was $1,000,000. Determine the depletion deduction for 2017.

Rick Purchased a Uranium Interest for $10,000,000 on January 3