1. Assume Dylon Oil & Gas owns 100% of the working interest in the lease. During December 2019, 2,500 Mcf of gas was delivered to Tyler Oil Company. The sales price was $8.00/MMBtu and the state severance tax is 8%. Based on gas analysis the heating content is 1.03 Btu.  

• What is the value of gas sales?
• What is the amount of revenue Dylon Oil & Gas should record?
• What amount should Dylon Oil & Gas record for royalties payable based on the Land Lease Agreement?

Answer rating: 100% (QA)

1 Amount of gas delivered to Tyler Oil Company 2500 Mcf Selling price8 MMbt... View the full answer