After a big fight with Alaska natives and Greenpeace, Messy Oil Company finally was able to purchase the right to drill on 2,000 acres of land in Alaska at a cost of $100,000. The exploration costs for the discovered oil deposit are $200,000, and development costs in constructing and drilling the well are $800,000. When the well is pumped dry, the cost to restore the site to pristine wilderness is estimated to be $100,000. Geologists anticipate that the well will produce 1,000,000 barrels of oil all together.

Instructions Calculate the cost of goods sold during the first year if 500,000 barrels of oil are extracted (depleted) but only 300,000 barrels are sold during the year. Show your work.