Big John Oil Company, located in Southern California, has been operating for three years. Big John uses full-cost accounting and excludes all possible costs from the amortization base. The following account balances are as of the end of 2010:

REQUIRED: Give any entries necessary for the following events and transactions.

a. Lease A was abandoned on March 20, 2011.

b. Lease B was proved on May 13.

c. Insignificant leases costing \($80,000\) were acquired during 2011.

d. Lease E was abandoned early in July.

e. Lease F was proved October 21.

f. At December 31, Big John decides that Lease D should be impaired an additional \($150,000.\)

g. At December 31, Big John decides to continue its policy of maintaining an allowance for impairment equal to 60% of unproved insignificant leases.

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Insignificant Leases Cost Significant Leases Total Impairment Cost Impairment Lease A $ 50,000 Lease D $400,000 $100,000 Lease B 60,000 Lease E 300,000 200,000 Lease C 30,000 Lease F 600,000 400,000 $140,000 $84,000