On June 6 2011 Wood Co bought timber rights for the followin

On June 6, 2011, Wood Co. bought timber rights for the following stand of timber:

Cost				5,000,000
Cost to develop site			100,000
Estimated lumber in board feet		1,500,000

During 2011, 780,000 board feet of lumber was cut and sold. Depletion expense
for 2011 would be:

A.	2,597,400
B.	2,652,000
C.	5,100,000
D.	780,000

On June 6, 2011, Wood Co. bought timber rights for the following stand of timber:

Cost				5,000,000
Cost to develop site			100,000
Estimated lumber in board feet		1,500,000

During 2011, 780,000 board feet of lumber was cut and sold. Depletion expense
for 2011 would be:

A.	2,597,400
B.	2,652,000
C.	5,100,000
D.	780,000

Depletion expense= (5100000/1500000)*780000= 2652000 (B)