Uranium Mining Company, founded in 1982 to mine and market uranium, purchased a mine in 1983 for $900 million. It estimated that the uranium had a market value of $150 per ounce. By 2010, the market value had increased to $300 per ounce. Records for 2010 indicate the following:Production ………….. 200,000 ouncesSales …………… 230,000 ouncesDeliveries ………….. 190,000 ouncesCash collection ………… 210,000 ouncesCosts of production including depletion* . $50,000,000Selling expense ………… $ 2,000,000Administrative expenses …….. $ 1,250,000Tax rate ……………. 50%Requireda. Compute the income for 2010, using each of the following bases:1. Receipt of cash2. Point of sale3. End of production4. Based on deliveryb. Comment on when each of the methods should be used. Which method should Uranium Mining Company use?View Solution:
Uranium Mining Company founded in 1982 to mine and market



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