Macon Oil Company paid ($500/acre) for a lease with a three-year primary term. During the next two

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Macon Oil Company paid \($500/acre\) for a lease with a three-year primary term. During the next two years Macon drilled three dry holes on the property. With one more year of the primary term left, Macon still intends to try one more time. Should any impairment be recognized on the property? What if the current going rate for leases near Macon’s lease is \($600\)/acre?


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Fundamentals Of Oil And Gas Accounting

ISBN: 9780878147939

4th Edition

Authors: Rebecca A. Gallun, Ph.D. Wright, Charlotte J, Linda M. Nichols, John W. Stevenson

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