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Fundamentals of Oil & Gas Accounting 5th Edition by Rebecca Gallun, Charlotte Wright
Edition 5ISBN: 9781630181031Fundamentals of Oil & Gas Accounting 5th Edition by Rebecca Gallun, Charlotte Wright
Edition 5ISBN: 9781630181031 Exercise 14
Critic Oil Company purchased three leases as follows: 
All the leases are classified as individually significant.
a. On December 31, 2014, Lease A is determined to be 25% impaired. Lease B and
Lease C are not impaired.
b. On December 31, 2015, Lease A is determined to be impaired a total of 75%, and
Lease C, 60%. Lease B is not impaired.
c. On December 31, 2016, 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.
Prepare journal entries for all of the transactions except the initial purchase.
All the leases are classified as individually significant.a. On December 31, 2014, Lease A is determined to be 25% impaired. Lease B and
Lease C are not impaired.
b. On December 31, 2015, Lease A is determined to be impaired a total of 75%, and
Lease C, 60%. Lease B is not impaired.
c. On December 31, 2016, 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.
Prepare journal entries for all of the transactions except the initial purchase.
Explanation
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a.Lease A determined to be impaired by 2...
Fundamentals of Oil & Gas Accounting 5th Edition by Rebecca Gallun, Charlotte Wright
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