McCabeMcCabe

Oil Company has an account titled Oil and gas properties.

McCabe

paid

$6,200,000

for oil reserves holding an estimated 500,000 barrels of oil. Assume the company paid

$510,000

for additional geological tests of the property and

$490,000

to prepare for drilling. During the first year,

McCabeMcCabe

removed

90,000

barrels of oil, which it sold on account for

$39

per barrel. Operating expenses totaled

$ 850 comma 000$850,000,

all paid in cash.

Requirement

1.Record all of

McCabeMcCabe's

transactions, including depletion for the first year.

Journal Entry
Date		Accounts	Debit	Credit