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Frank Oil Company acquired the following three unexplored leases: July 1, 2018: Lease A $400,000 August 15, 2018: Lease
Posted: Wed Mar 16, 2022 9:13 am
by answerhappygod
- Frank Oil Company Acquired The Following Three Unexplored Leases July 1 2018 Lease A 400 000 August 15 2018 Lease 1 (42.25 KiB) Viewed 62 times
Frank Oil
Company acquired the following three unexplored leases: July 1, 2018: Lease A $400,000 August 15, 2018: Lease B 200,000 October 10, 2018: Lease C 300,000 All the leases are classified as individually significant. a. On December 31, 2018, Lease A is determined to be 40% impaired. Lease B and Lease C are not impaired. b. On December 31, 2019, Lease A is determined to be impaired a total of 70%, and Lease C, 60%. Lease B is not impaired. c. On December 31, 2020, Lease A is considered to be 100% impaired and is abandoned. Lease B is 30% impaired, and a well on Lease C found proved reserves REQUIRED: Prepare journal entries for all of the above transactions except the initial purchase.