Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Two leases in Eastern Wyoming are being combined to form the Eastern Field Unit. Lease WI RI Acreage Contributed Estimated Net Recoverable bbls Lease 1

Two leases in Eastern Wyoming are being combined to form the Eastern Field Unit.

Lease

WI

RI

Acreage Contributed

Estimated Net Recoverable bbls

Lease 1

100% Mountain Company

1/6 Jane Smith, 1/8 Alan Green

400 acres

180,000 bbls

Lease 2

60% River Corp, 40% Hilltop

1/5 Karen White

250 acres

220,000 bbls

Requirement:
 a. Determine the participation factors for each party assuming the participation factors are based on the acreage contributed.
 b. Determine the participation factors for each party assuming the participation factors are based on the net recoverable barrels contributed.
 c. Determine the participation factors for each party assuming the participation factors are based on the acreage contributed weighted 30% and the net recoverable barrels weighted 70%.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamental Accounting Principles

Authors: Larson Kermit, Tilly Jensen

Volume I, 14th Canadian Edition

71051503, 978-1259066511, 1259066517, 978-0071051507

More Books

Students also viewed these Accounting questions