Poppy Corporation was formed three years ago.Poppy's E&P history is as follows: $$\begin{array} { | c | c | c | }
\hline \text { Year } & \text { Current E\&P } & \text { Distributions } \
\hline 2005 & \$ 6,000 & \$ 4,000 \
2006 & 5,000 & 1,000 \
2007 & 1,000 & 0 \
\hline
\end{array}$$ Poppy Corporation's accumulated E&P on January 1 will be
A)$0.
B)$7,000.
C)$5,000.
D)$12,000.

Question

Poppy Corporation was formed three years ago.Poppy's E&P history is as follows: $$\begin{array} { | c | c | c | } 
\hline \text { Year } & \text { Current E\&P } & \text { Distributions } \
\hline 2005 & \$ 6,000 & \$ 4,000 \
2006 & 5,000 & 1,000 \
2007 & 1,000 & 0 \
\hline
\end{array}$$ Poppy Corporation's accumulated E&P on January 1 will be
A)$0.
B)$7,000.
C)$5,000.
D)$12,000.

Quizplus · Accepted Answer

The accumulated E&P on January 1 is calculated by adding the current E&P for each year and subtracting the distributions: ($6,000 - $4,000) + ($5,000 - $1,000) + $1,000 = $7,000.

Poppy Corporation Was Formed Three Years Ago Poppy Corporation's Accumulated E&P on January 1 Will Be A)$0

Poppy Corporation Was Formed Three Years Ago Poppy Corporation's Accumulated E&P on January 1 Will Be
A)$0