A Company Purchased a Mineral Deposit for $800,000

Multiple Choice

A company purchased a mineral deposit for $800,000. It expects this property to produce 120,000 tons of minerals and to have a salvage value of $50,000. In the current year, the company mined and sold 9,000 tons of minerals. Its depletion expense for the current period equals:

A) $60,000.
B) $139,500.
C) $150,000.
D) $56,250.
E) $15,000.