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Two companies, X and Y, each have net operating income, being revenue less production costs, of $40 million before exploration expenses. During the year, each

Two companies, X and Y, each have net operating income, being revenue less production costs, of $40 million before exploration expenses. During the year, each company drills 10 wells at a cost of $5,000,000 each. Company X has three successful wells and discovers 30 million barrels of oil. Company Y has only one successful well but discovers 60 million barrels.

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Calculate the profit/(loss) for the year for Company X and Company Y using both the successful efforts and full cost methods.

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