Final answer:
The cost of timber sold related to depletion for 2025 is $1,018,600,000. The cost of timber sold related to depletion for Marigold Company in 2025 is calculated by determining the depletion expense per board foot and then multiplying it by the number of board feet sold. The depletion cost for the timber sold in 2025 is $481,520.
Step-by-step explanation:
The cost of timber sold related to depletion for 2025 can be calculated by determining the number of board feet of timber sold and multiplying it by the cost per board foot. In this case, Marigold sold 926,000 board feet of timber. To find the cost of timber sold for 2025, we need to multiply the number of board feet by the cost per board foot.
The cost per acre of timber can be calculated by subtracting the estimated value per acre (without timber) from the initial cost per acre. In this case, the initial cost per acre was $1,417 and the estimated value per acre (without timber) was $317. So, the cost per acre of timber is $1,417 - $317 = $1,100.
To determine the cost of timber sold related to depletion, we can multiply the number of board feet of timber sold (926,000) by the cost per board foot. So, the cost of timber sold related to depletion for 2025 is $926,000 * $1,100 = $1,018,600,000.
The cost of timber sold related to depletion for Marigold Company in 2025 is calculated by determining the depletion expense per board foot and then multiplying it by the number of board feet sold. The depletion cost for the timber sold in 2025 is $481,520.
To determine the cost of timber sold related to depletion for the year 2025 for the Marigold Company, we need to calculate the depletion expense per board foot and then use this rate to find the total depletion cost for the timber that was sold. First, we calculate the total cost of the timber on the land, excluding the value of the land itself. The purchase price was $1,417 per acre, and there are 7,000 acres, so the total timber value at the time of purchase was $9,919,000.
Next, the timber cruise in 2025 indicated an estimate of 2,720 board feet of timber per acre. Multiplying by the total acres gives us 19,040,000 board feet for the entire tract. The depletion expense per board foot is calculated by dividing the total timber value by the total board feet, which gives us approximately $0.52 per board foot (9,919,000 / 19,040,000 board feet).
In 2025, Marigold Company sold 3,815 trees consisting of 926,000 board feet. To find the cost of timber sold, we multiply the number of board feet sold by the depletion expense per board foot. So, the depletion cost for the sold timber is $481,520 (926,000 board feet × $0.52 per board foot).