424 FUNDAMENTALS OF OIL & GAS ACCOUNTING 24. Longhorn Company (70% WI) and Aggie Company (30% WI) own a joint working interest in the Dowling Field. There is a 1/8 royalty owner. The 1/8 royalty is shared proportionally by Longhorn and Aggie. Longhorn and Aggie agree that Longhorn's purchaser will take March's gas production and Aggie's purchaser will take April's production. Gas allocations will be equalized in Mal Ignore severance taxes. Gross production and gas prices were as follows: March April May Production 300,000 Mcf 200,000 Mef 220,000 Mcf Price $10/Mcf 10/Mcf 9/Mcf Each working interest owner receives payment only for gas delivered to his purchaser REQUIRED: a. Prepare a gas balance report. b. Prepare entries for the three-month period for both parties assuming both companies use the entitlement method for both revenue and royalty. 424 FUNDAMENTALS OF OIL & GAS ACCOUNTING 24. Longhorn Company (70% WI) and Aggie Company (30% WI) own a joint working interest in the Dowling Field. There is a 1/8 royalty owner. The 1/8 royalty is shared proportionally by Longhorn and Aggie. Longhorn and Aggie agree that Longhorn's purchaser will take March's gas production and Aggie's purchaser will take April's production. Gas allocations will be equalized in Mal Ignore severance taxes. Gross production and gas prices were as follows: March April May Production 300,000 Mcf 200,000 Mef 220,000 Mcf Price $10/Mcf 10/Mcf 9/Mcf Each working interest owner receives payment only for gas delivered to his purchaser REQUIRED: a. Prepare a gas balance report. b. Prepare entries for the three-month period for both parties assuming both companies use the entitlement method for both revenue and royalty