Iroblem statement

24. Ramsey Company hires a drilling contractor to dram a we" to the depth of 8,000 feet at a cost of $300,000. The $300,000 cost includes $5,000 for surface casing. Any drilling to be completed after reaching the 8,000 foot depth is to paid at a day rate of $4,000 per day. The 8,000 foot depth is reached on Septernber 14, 2007. and the additional drilling to 10,000 feet is completed on 27, 2007. Ramsey incurred additional costs as shown on the attached REQUIRED: Complete the schedule showing whether the cost is IDC or L&WE. Description Amount IDC L&WE I. Rig drillingturnkey contract $ Rig drillingday rate . 3. Location and road preparation Drilling water . 5. wellsite . 6. Electric logging , B. Surface damages . 9. Mud (after 8,000') 10. Production casing .. II. Cementing services. 12. Casing crews 13. Tank battery . Flow lines and connections 5.000 15. Separators 2. 4. 14. 16. Cement. . 17. Installing separators . 18. Tubing. . . 19. Christmas tree 20. Measuring equipment 21. Installing Christmas tree . 22. Equipment rental . . . 22,400 1,200 . 6,300 . . 11,000 . 11,500 . 7,000 . . 48,000 . 4,800 . 30,000 20,000 . . 3,000 10,000 TO be determined from the information given in the prlem statement. 22 of 23