On january 1, year 1, gemstone mining company (gmc) paid $10,500,000 cash to purchase a stone pit estimated to hold 50,000 tons of useable material. gmc extracted 10,000 tons of stone in year 1. the rights to the surface pit were expected to have a $500,000 salvage value at the end of year 3. based on this information, the journal entry necessary to recognize depletion expense for year 1 is?

Cost of Mining Stone pit = $10,500,000

Salvage value at the end of third year = $500,000

Total expected mining during the life = 50,000 tonnes

Depletion per tonne = (cost - salvage) ÷ total expected mining

                                 = (10,500,000 - 500,000) ÷ 50,000

                                 = $200 per tonne

Stone extracted during the year = 10,000 tonnes

Depletion expense of Year 1 = 10,000 tonnes @ 200 per tonne

                                                = $2,000,000

JOURNAL ENTRY:

Depletion expense A/c  Dr.                        $2,000,000

To  Accumulated Depletion- Mining rights                    $ 2,000,000

(To record depletion expense for Year 1)

answer; communities of interest; i believe this is correct, plz check first good luck;