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Big Oil Company acquired an interest in a lease by paying a lease bonus of $80,000. Big drilled a productive well and deducted the IDC.
Big Oil Company acquired an interest in a lease by paying a lease bonus of $80,000. Big drilled a productive well and deducted the IDC. An engineering report on January 1 estimated the reserves at 30,000 barrels of oil. During the year, 1,000 barrels of oil were produced and sold for $70,000. Big Oil expenses for the production of the oil were $32,000. What is Big Oil's allowable depletion?
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To calculate Big Oils allowable depletion we first need to determine the depletion rat...
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South Western Federal Taxation 2015 Essentials Of Taxation Individuals And Business Entities
Authors: James Smith, William Raabe, David Maloney, James Young
18th Edition
9781285438290, 1285439740, 1285438299, 978-1285439747
