An oil company in New Brunswick has a licence to operate an oil well that has just started producing. The company expects to extract 424,400 barrels of oil this year and the total oil reserves are estimated to be 4,244,000 barrels. Their capitalized costs for the licence are $12,732,000.

Using units-of-production method, calculate how much of this expense they will report this year(amortization expense)?

Answer rating: 100% (QA)

To calculate the amortization expense using the unitsofproduction method you ne... View the full answer