EcoPower Ventures owned the following unproved property as of the end of 1988.

Significant Leases		Insignificant Leases
Lease G	$480,000	Lease H	$90,000
Lease I	$340,000	Lease J	$50,000
Total	$820,000	Lease K	$40,000
		Lease L	$35,000
		Total	$215,000

Although no activity took place on Lease G during the year, EcoPower decided that Lease G was not impaired because there were still three years left in that lease’s primary term. Two dry holes were drilled on Lease I during the year; but because EcoPower intended to drill one more well on Lease I in the coming year, it decided that Lease I was only 50% impaired. With respect to the insignificant leases, past experience indicates that 68% of all unproved properties assessed on a group basis will eventually be abandoned. EcoPower’s policy is to provide at year-end an allowance equal to 65% of the gross cost of these properties. The allowance account had a balance of $27,000 at year end. Give the entries to record impairment, prepare the income statement and balance sheet, and calculate the current tax expense.