Bonita corporation acquires a coal mine at a cost of $480,000. intangible development costs total $120,000. after extraction has occurred, bonita must restore the property (estimated fair value of the obligation is $96,000), after which it can be sold for $192,000. bonita estimates that 4,800 tons of coal can be extracted.

With the given data, I can only solve for the depletion cost per unit.

Depletion cost per unit = (Total cost - Salvage Value) / Total Estimated Units available

Total Cost includes the following:
Acquisition: 480,000
intangible development cost: 120,000
restoration cost: 96,000

Salvage value is the amount it can be sold: 192,000

Total estimated units available is the 4,800 tons of coal.

Depletion cost per unit = (480,000 + 120,000 + 96,000 - 192,000) / 4,800
Depletion cost per unit = 504,000 / 4,800
Depletion cost per unit = 105 per ton

In the event that there is a given figure of units extracted, simply multiply the depletion cost per unit by the number of units extracted to get the depletion cost on the extraction.

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