Critic Oil Company purchased three leases as follows:

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.

For a, b, and c, identify the accounts affected and by what amount. Ignore recording the initial purchase transaction.

Transcribed Image Text:

July 1, 2014 August 15, 2014 October 10, 2014 Lease A Lease B Lease C $100,000 200,000 300,000 July 1, 2014 August 15, 2014 October 10, 2014 Lease A Lease B Lease C $100,000 200,000 300,000

Answer rating: 100% (QA)

a Lease A impaired expense of 100000 x 25 25000 Dr Lease A impairment Expense 2500... View the full answer