1. The Cross-Oil Corporation incurred the following costs and had the following other transactions for the years 2018 and 2019. The company uses the Successful efforts method of accounting. Prepare journal entries for the Cross-Oil Corporations transactions for 2018 and 2019:

2018

1. Paid $100,00 for G&G costs during the year
2. Leased acreage in three individually significant areas as follows

*Jones lease 1,000 acres @$60 per acre, and other acquisition costs of $3,000

*Batch lease 800 acres @ a lease bonuses of $70 per acre, and other acquisition costs of $10,000

*Highland lease 600 acres @ $60 per acre bonus, and other acquisition costs of $8,000

3. The company also leased 20 individual tracts for a total cost of $80,000. These leases are considered to be individually insignificant and are the first insignificant unproved properties acquired by Cross.
4. Paid $5,000 in costs to maintain lease and land records in 2018. Also paid $30,000 to successfully defend a title suit concerning the Batch lease.
5. Paid the following costs in connection with Batch #1, a successful exploratory well:

G&G costs to locate a well site $5,000

Location and road preparation prior to spudding-in the well $6,000

Surface damages $16,000

Surface casing $6,000

Drilling contractor fee (daywork rate) $200,000

Equipment rentals $100,000

Drilling fluids $40,000

Fuel $10,000

Drill bits $20,000

Cementing services $5,000

Roustabout labor $9,000

Hauling & transportation $8,000

Production casing $36,000

Tank battery $11,000

Flow lines & connections $5,000

Pumping unit motor & accessories $50,000

Casing head & connections $7,000

Tubing $13,000

Separating and treating equipment $12,000

Measuring equipment $1,000

Downhole pump and rods $4,000

Testing and acidizing $11,000

6. An exploratory well was drilled on the Highland lease in 2018 on a turnkey basis to 8,000 feet. The contractors charge of $400,000 was paid. The charge included $60,000 for casing. At the end of 2018, a decision had not been made to complete or abandon the well. Both criteria for delaying classification of the well were met. At the end of 2018, the Jones lease was impaired 60%, and the Highland lease by 30%. The companys policy is to maintain an allowance for impairment at 70% of the cost of insignificant leases.