8.

On July 1, 2011, Lam Company, a

calen dar year corporation, purch ased
the rights to a mine. The total purchase
price was P7,000,000, of which
P1,000,000 was allocated to the land.
Estimated reserves were 1,500,000
tons. Lam expects to extract and sell
25,000 tons per month. Lam purchased
new equipment on July 1, 2011. The
equipment cost P4,000,000 and had a
useful life of 8 years. However, after all
the resource is removed, the equipment
will be of no use and will be sold for
P2 50 ,0 00. The d ep re ci at io n of th e
equipment for 2011 is____________

Your answer