Sure Thing Oil Companys internal land department incurred costs of ($150,000) in acquiring leases. Of the one

Question:

Sure Thing Oil Company’s internal land department incurred costs of $$150,000$ in acquiring leases. Of the one million acres of prospects, only 450,000 acres were leased.

a. How much, if any, of the $$150,000$ incurred by the land department should be capitalized?

b. If capitalized, what account(s) should be debited?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

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

See More Books

Question Posted: May 29, 2024 08:01 AM

See More Questions

Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
Consider the following information: Rate of Return if State Occurs State of Economy Boom :57 Bust of Economy .66 .34 Probability of State Stock A .09 .13 Stock B Stock C .03 .19 .24 -.04 a. What is...
Question: What as the average weekly safety inventory level of refined sugar from the beginning January 2022 to the end of July 2022? A. 512,465.9691 metric tons per week B. 316,002.1474 metric tons...
Consider a static (one-period), closed economy with one representative consumer, one rep- resentative firm, and a government. The level of capital K and government expenditures G in the economy are...
Using only the periodic table, arrange each set of atoms in order from largest to smallest: (a) K, Li, Cs; (b) Pb, Sn, Si; (c) F, O, N
The weights of the various components of the truck are shown. Replace this system of forces by an equivalent resultant force and specify its location measured from B. B 3 ft 3500 lb 8 5500 lb A -14...
6. How well do you think you would fit into either company?
Should the project manager give the final manpower loading curves to the functional managers? If so, at what point in time?
Question 23 When the accountant Sandhill Company prepared the bank reconciliation on May 31, 2021, there were three outstanding cheques: #690 for $310, 2693 for $180, and #694 for $270. There were no...
Shut-In Oil Company obtained shooting rights only for $$10,000$ on 5,000 acres owned by Mr. Q and shooting rights coupled with an option to lease for $$12,000$ on 4,000 acres owned by Mr. S. The...
Given the following data for Gravity Oil Company: a. Give the entries to record the abandonment of both Lease A and Lease B. b. Give the entries assuming instead that both Lease A and Lease B were...
A retailer has yearly sales of $900,000. Inventory on January 1 is $360,000 (at cost). During the year, $660,000 of merchandise (at cost) is purchased. The ending inventory is $325,000 (at cost)....
Convex Productions produces full-length motion pictures for distribution worldwide. Convex has just purchased the rights to a movie script entitled Native Sun, which it intends to develop as its next...
You are visiting the Engineering Office of Denton Hospital, as part of a consulting project. You notice some charts on one wall which look familiar to you: One of the employees notices you reading...
Richmond Clinic has obtained the following estimates for its costs of debt and equity at different capital structures: What is the firms optimal capital structure? (Hint: Calculate its corporate cost...
Suppose a sample yields estimates $\widehat{\theta}_{1}=5, \widehat{\theta}_{2}=3$, se $\left[\widehat{\theta}_{1} ight]=2$, and se $\left[\widehat{\theta}_{2} ight]=1$ and the correlation...
Helium expands in a nozzle from $0.8 \mathrm{MPa}, 500 \mathrm{~K}$, and negligible velocity to $0.1 \mathrm{MPa}$. Calculate the throat and exit areas for a mass flow rate of \(0.34 \mathrm{~kg}...
What is the role of information systems in helping people working in a group make decisions more efficiently? 1. Define a group decision- support system (GDSS) and explain how it differs from a DSS....
Smiths Family Fashions implemented a balanced scorecard performance measurement system several years ago. Smiths is a locally owned clothing retailer with fashions for men, women, teens, and...
Deacon Company is a merchandising company that is preparing a budget for the three - month period ended June 3 0 th . The following information is available Deacon Company Balance Sheet March 3 1...
Mango Company applies overhead based on direct labor costs. For the current year, Mango Company estimated total overhead costs to be $460,000, and direct labor costs to be $230,000. Actual overhead...
Which of the following do we expect to be the horizon growth rate for a company (long term growth rate- say 30-50 years)? A) Inflation B) Industry Average C) Zero D) Market Beta

Sure Thing Oil Companys internal land department incurred costs of ($150,000) in acquiring leases. Of the one

Question:

Step by Step Answer:

Fundamentals Of Oil And Gas Accounting

Students also viewed these Business questions