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

تمرين 18

a. Wildcat Oil Corporation drills an exploratory well during 2016 that finds oil, but
not in commercially producible quantities at current oil prices. Since proved reserves
are not found, Wildcat expenses the cost of the well in 2016. Early in the next year,
but after Wildcat's financial statements have been published, the price of oil goes up
so that the reserves found by the exploratory well during 2016 become commercially
producible. Should the costs of the well be reinstated?
b. Assume the same situation except that the price of oil goes up early that next year
before Wildcat's financial statements are published. Should the costs of the well be
reinstated in this case?