Fundamentals of Oil & Gas Accounting 5th Edition by Rebecca Gallun, Charlotte Wright

تمرين 6

Lomax Company typically acquires a large number of individually insignificant
properties each year. In computing impairment, Lomax groups these properties by
year of acquisition. During 2015, Lomax acquired individually insignificant unproved
property costing a total of $400,000. In the past, Lomax has abandoned 30% of all
individually insignificant unproved properties without ever finding oil or gas. It takes
Lomax an average of three years to determine whether a property will be proved or
surrendered.
Give the entry to record impairment.