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Lewis & Clark Oil and Gas Exploration Company paid $18.9 million to acquire the rights to extract resources from a natural gas deposit. They estimate
Lewis & Clark Oil and Gas Exploration Company paid $18.9 million to acquire the rights to extract resources from a natural gas deposit. They estimate that they will extract 9.0 million cubic feet of natural gas during a six-year period. The actual amount of natural gas extracted during years 1 and 2 were 900,000 and 1,700,000 cubic feet, respectively. Assuming that Louis & Clark uses the units-of-production method, determine the total depletion for years 1 and 2.
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