Libby Oil Corporation, a successful efforts company, has capitalized costs on three leases as of 12/31/2019 as

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Libby Oil Corporation, a successful efforts company, has capitalized costs on three leases as of 12/31/2019 as follows:

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Libby has no other capitalized costs. The leases are located in different counties in Texas.

REQUIRED: If necessary, test the assets for impairment and make any necessary journal entries assuming taxes tripled on all three leases.

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Fundamentals Of Oil And Gas Accounting

ISBN: 9781593703639

6th Edition

Authors: Charlotte Wright

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Question Posted: Mar 08, 2024 10:01 AM

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Libby Oil Corporation, a successful efforts company, has capitalized costs on three leases as of 12/31/2019 as

Question:

Net capitalized costs Expected undiscounted future net cash flows Fair value (discounted future net cash flows) Lease A Lease B Lease C $ 500,000 $600,000 $700,000 700,000 500,000 550,000 685,000 480,000 610,000

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Fundamentals Of Oil And Gas Accounting

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