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10. Lawrence Pipeline Company purchased 300 barrels of oil from Stout Oil Company. The gross value of the oil was $30,000. The severance tax rate is 5%. Give the journal entry to record revenue and severance taxes for Stout, assuming Lawrence disbursed the royalty and remitted all taxes, and assuming a division order as follows: Stout Oil Company: Interest 0.75 Royalty Owner: Interest 0.25

10. Lawrence Pipeline Company purchased 300 barrels of oil from Stout Oil Company. The gross value of the oil was $30,000. The severance tax rate is 5%. Give the journal entry to record revenue and severance taxes for Stout, assuming Lawrence disbursed the royalty and remitted all taxes, and assuming a division order as follows: Stout Oil Company: Interest 0.75 Royalty Owner: Interest 0.25

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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10. Lawrence Pipeline Company purchased 300 barrels of oil from Stout Oil Company. The gross value of the oil was $30,000. The severance tax rate is 5%. Give the journal entry to record revenue and severance taxes for Stout, assuming Lawrence disbursed the royalty and remitted all taxes, and assuming a division order as follows: Stout Oil Company: Interest 0.75 Royalty Owner: Interest 0.25
Transcribed Image Text:10. Lawrence Pipeline Company purchased 300 barrels of oil from Stout Oil Company. The gross value of the oil was $30,000. The severance tax rate is 5%. Give the journal entry to record revenue and severance taxes for Stout, assuming Lawrence disbursed the royalty and remitted all taxes, and assuming a division order as follows: Stout Oil Company: Interest 0.75 Royalty Owner: Interest 0.25
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