Question Conseco Oil Company owns and operates oil refinery. Conseco paid S6,000,000 to acquire the oil reserves including an estimated 500,000 barrels of oil. Assume the company paid S550,000 for additional geological tests of the property and $450,000 to prepare the oil field for drilling. Conseco expects that the oil field will have zero residual value. In addition to these, Conseco paid $100,000 for pipeline needed to extract the oil from the field. The pipeline is estimated to have zero residual value and it is depreciated on the basis of units-of- output method. In the first year of operations, 40,000 barrels of oil were extracted of which 30,000 barrels were sold. In the second year, on the other hand, 55,000 barrels of oil were extracted 12:45 . Not Secure fbemoodle.emu.edu.tr Required: Compute total depletion of the oil field in the first year. Answer: b Record in general journal total depletion of the oil field in the first year Answer: e Compute the cost of 30,000 barrels of oil sold in the first year Answer: d Compute depreciation expense of the pipeline for the second year Answer Record in general journal depreciation expense of the pipeline in the second year