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From the Fundamentals of Oil and Gas Accounting; Which oil and gas assets are subject to impairment testing for successful effort companies?

ccounting 1). Intangible drilling costs are costs associated with drilling an oil and gas well to the point of completion. An Integrated Oil and Gas company is allowed to deduct these costs in what manner? a. Cost Depletion b. 100% Expensed c. 70% Expensed and 30% Capitalized & Amortized d. 100% Amortized

Explain the situation that a company (in the extractive industry) expenses all exploration and evaluation expenditure as incurred. Would the related financial reports provide ‘relevant’ information?

Tremendous Company is involved in the exploration for mineral resource. The accounting policy i to recognize and measure exploration asset initially at cost. During the current year, the entity incurred the following expenditures: Exploratory drilling for materials on site and related activities Roads and infrastructure to access exploratory site Expenditure relating to the subsequent development of the resources P 3,000,000 5,250,000 5,100,000 Ql. At what amount should exploration asset be initially recognized in the statement of financial position?

Which of the following is (are) acceptable valuation(s) for reporting of assets on the balance sheet? 1.   inventories at lower of cost or net realizable value. 2.   accounts receivable at net realizable value. 3.   plant and equipment at cost 4.   investments at acquisition cost   Select one: 1 and 4 1 and 3 1 and 2 2 and 4

For entities that report using IFRS, how are exploration and evaluation assets subsequently measured?   Question 18 options:   a)  Using the cost or revaluation model.   b)  Using the cost model or fair value model.   c)  Using the cost model.   d)  Using the cost model or depreciation model.

Hw.9.

Under IFRS, when an entity chooses the revaluation model as its accounting policy for measuring property, plant, and equipment, which of the following statements is correct?a. When an asset is revalued, the entire class of property, plant, and equipment (such as Land) to which that asset belongs must be revalued.b. When an asset is revalued, it is reported on the balance sheet at its current replacement cost.c. Revaluations of property, plant, and equipment must be made at least every three years.d. The revalued assets must be reported in a special section of the balance sheet separate from those assets measured using the cost model.

Discuss and explain If an entity is considering revaluing its exploration and evaluation assets, would the revaluation increase the ‘relevance’ of the information from the perspective of the readers of the financial statements? Further, provide explanation for capitalising the expenses at evaluation and exploration stage also restoration of a oil extraction project. Provide reference, if possible. please.

4. In full cost and successful efforts accounting, costs are amortized over either proved reserves (PR) or proved developed reserves (PDR). Fill in the following table to indicate which reserves (PR or PDR) should be used to amortize the costs under each accounting method. If the costs should not be amortized, put an X to indicate no amortization. Cost a. Proved property acquisition b. Unproved property acquisition c. Successful exploratory drilling d. Successful development drilling e. Unsuccessful exploratory drilling f. Unsuccessful development drilling g. G&G costs h. Wells-in-progress-proved property SE FC

King Mine Corp., a publicly accountable entity, is determining the technical feasibility of extraction of mineral resources. How would the company account for the costs incurred?   Question 14 options:   a)  Work is preliminary and experimental, so costs must be expensed.   b)  Costs can be capitalized as exploration and evaluation costs, or expensed.   c)  Costs must be capitalized as property, plant, and equipment.   d)  Costs must be capitalized as inventory.

Which of the following are considered intangible drilling costs (IDCs) for an oil and gas DPP? Equipment and fuel Wages and insurance Fuel and interest expenses Wages and equipment