Payne Oil Company began operations during 2019. The following information is as of 12/31/19 and early 2020. Expense lifting costs as lease operating expense.

Payne Oil Company began operations during 2019. The following information is as of 12/31/19 and early 2020 . Expense lifting costs as lease operating expense. h. Assume on January 2 of the second year (2020) that disaster struck both Lease A and Lease B. Give the entries to record abandonment of Lease A and Lease B. Assume equipment costing $15,000 was salvaged from Lease A. Assume this is not a post-balance sheet event that would give rise to changes in the balance sheets or income statements of previous years. *May combine entries for different leases. REQUIRED: From the data, (1) prepare entries, and (2) prepare an income statement for Payne Oil Company for 2019, assuming revenue to the company from oil sales is $1,200,000. Payne Oil Company began operations during 2019. The following information is as of 12/31/19 and early 2020 . Expense lifting costs as lease operating expense. h. Assume on January 2 of the second year (2020) that disaster struck both Lease A and Lease B. Give the entries to record abandonment of Lease A and Lease B. Assume equipment costing $15,000 was salvaged from Lease A. Assume this is not a post-balance sheet event that would give rise to changes in the balance sheets or income statements of previous years. *May combine entries for different leases. REQUIRED: From the data, (1) prepare entries, and (2) prepare an income statement for Payne Oil Company for 2019, assuming revenue to the company from oil sales is $1,200,000