I-11.04 Out Back Mining purchased land for $100,000,000. The land is believed to contain significant zinc deposits. Preliminary estimates indicate that 250,000 metric tons will be available for extraction over a ten-year period. The anticipated selling price over the ten-year period is estimated at $1,000 per metric ton. Labor and operating expenses, exclusive of depreciation and depletion, is typically 30% of revenue. At the cessation of mining, $25,000,000 must be spent to restore the mining operations area. The land will then be donated to the area government as a wildlife and natural area. The investment in mining equipment will involve $5,000,000 of excavation equipment with no salvage value at the end of the mining operation. This category of equipment will be abandoned at the conclusion of the ten-year period. An additional $10,000,000 will be expended on hauling equipment with a 20-year life and $2,000,000 salvage value. This particular equipment will be relocated to a new mining operation after the zinc mine is
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