Assume the following data for the following wells commingled production tanks on the Wilmington Ranch located in LaVaca County, Texas. Measured production is 2,228 barrels from Lease C and 2,280 barrels from Lease D. After treatment at the central tank battery, 4,500 barrels are sold. Lease C Wells 24-Hr Test (bbl) Days Produced Well 1 30 28 Well 2 40 30 Lease D Wells 24-Hr Test (bbl) Days Produced Well 1 20 30 Well 2 35 30 Well 3 50 26 Current Spot Oil Price Severance Tax Rate Working Interest $46.00/bbl 5% 100% 1/8th Royalty interest Prepare entries recognizing revenue at time of sale if the OPERATOR assumes the responsibility of distributing severance taxes and royalty. What amount of gross revenue, royalty, severance taxes and net revenue should the Operator record for each well (Lease C- Well 1 & Well 2 and Lease D - Well 1, Well 2, & Well 3)?

Assume the following data for the following wells commingled production tanks on the Wilmington Ranch located in LaVaca County, Texas. Measured production is 2,228 barrels from Lease C and 2,280 barrels from Lease D. After treatment at the central tank battery, 4,500 barrels are sold. Lease C Wells 24-Hr Test (bbl) Days Produced Well 1 30 28 Well 2 40 30 Lease D Wells 24-Hr Test (bbl) Days Produced Well 1 20 30 Well 2 35 30 Well 3 50 26 Current Spot Oil Price Severance Tax Rate Working Interest $46.00/bbl 5% 100% 1/8th Royalty interest Prepare entries recognizing revenue at time of sale if the OPERATOR assumes the responsibility of distributing severance taxes and royalty. What amount of gross revenue, royalty, severance taxes and net revenue should the Operator record for each well (Lease C- Well 1 & Well 2 and Lease D - Well 1, Well 2, & Well 3)?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter8: Standard Cost Accounting—materials, Labor, And Factory Overhead

Section: Chapter Questions

Problem 3P: Zippy Inc. manufactures a fuel additive, Surge, which has a stable selling price of 44 per drum. The...

See similar textbooks

Similar questions

Lord Company purchased a machine on January 2, Year 1, for $70,000. The machine had an expected residual value of $10,000, an expected life of 8 years or 24,000 hours, and a capacity to produce 100,000 units. During Year 1, Lord produced 12,000 units in 2,500 hours. In Year 2, Lord produced 15,000 units in 3,000 hours. Required: Question Content Area 1 a. Prepare a schedule showing depreciation expense for Year 1 and Year 2 and the book value of the asset at the end of Year 1 and Year 2 for the Straight-line method. LORD COMPANY Deprecation Schedule Straight-line Beginning Book Value Depreciation Ending Book Value Year 1 $fill in the blank fc5106fc9014fdd_1 $fill in the blank fc5106fc9014fdd_2 $fill in the blank fc5106fc9014fdd_3 Year 2 $fill in the blank fc5106fc9014fdd_4 $fill in the blank fc5106fc9014fdd_5 $fill in the blank fc5106fc9014fdd_6
Iraq Inc. makes recyclable pots for plants and uses JIT to manage inventories and production. The following are standards for a typical 1-gallon pot: Annual Material Standards 32 ounces of Component X* $0.02 2 ounces of Component Y * $0.05 $0.64 0.10 $0.74 Current Material Standards 27 ounces of Component X* $0.02 . 4 ounces of Component Y* $0.05 $0.54 0.20 $0.74 In-house experiments indicated that changing the material standard would make the pots stronger, so the company issued an engineering change order for the product in February; this ECO established the current material standards. March production was 8,000 pots. Usage of raw material (all purchased at standard price) in March was 220,000 ounces of Component X and 31,000 ounces of Component Y. Required: a. Calculate the material quantity variance. b. Calculate the ECO variance. c. Summarize the company's effectiveness in managing March production costs. d. Comment on the circumstances in which a company would institute an ECO…
The Camino Real Landfill was required to install a plastic liner to prevent leachate from migrating into the groundwater. The fill area was 47,000 m² and the installed liner cost was $8 per m2. In order to recover the investment, the owner charges to unload at the rates of $17 per pickup, $25 per dump truck, and $70 per compactor truck load. The fill area is adequate for 4 years. If the annual traffic is estimated to be 2500 pickup loads, 650 dump-truck loads, and 1200 compactor-truck loads, what rate of return will the landfill owner make on the investment? The rate of return that will be made by the landfill owner is % per year.
batch are as TOROWS! Chemical Echol Protex Benz CT-40 Total Echol Protex Benz CT-40 Total Denz CT-40 Total Chemical Echol The quantities of chemicals purchased and used during the current production period are shown in the following schedule. A total of 120 batches of Gas Gain were manufactured during the current production period. Energy Products determines its cost and chemical usage variations at the end of each production period, Chemical Quantity Used 22,800 sters 11,040 32,400 6,480 72,720 liters Protex Benz CT-40 Total 200 liters 100 Mix 250 Usage variance Mix variance 50 Yield variance 600 liters Required: Compute the total direct materials usage variance, and then break down this variance into its mix and yield components. Do not round intermediate computations and round final answers to the nearest cent. (CMA adapted) 250 50 $0.200 600 liters SP 0.425 0.150 0.300 0.150 0.300 The quantities of chemicals purchased and used during the current production period are shown in the…
Disregard the 9.7 in the box at the bottom
Answer the questions correctly. 5.
ournal Entries Use the data in Exhibit 14.5. On October 7, Schmidt Machinery Company purchased 720 pounds of PVC at $41.00 per pound. On October 9, Schmidt’s production departmentused 720 pounds of PVC for the 780 units of XV-1 it manufactured.Required Make the necessary journal entries to record the purchase and usage of PVC during October.(Round all amounts to nearest whole dollar.)
Resource Usage and Supply, Activity Rates, Service OrganizationEcoBrite Labs performs tests on water samples supplied by outside companies to ensure thattheir waste water meets environmental standards. Customers deliver water samples to the laband receive the lab reports via the Internet. The EcoBrite Labs facility is built and staffed tohandle the processing of 100,000 tests per year. The lab facility cost $160,000 to build and isexpected to last 10 years and will have no salvage value. Processing equipment cost $250,000 and has a life expectancy of five years and will have no salvage value. Both facility and equip-ment are depreciated on a straight-line basis. EcoBrite Labs has six salaried laboratory techni-cians, each of whom is paid $30,000. In addition to the salaries, facility, and equipment, EcoBrite Labs expects to spend $50,000 for chemicals and other supplies (assuming 100,000 testsare performed). Last year, 86,000 tests were performed.Required:1. Classify the resources…
A West Virginia coal mining operation has installed an in-shaft monitoring system for oxygen tank and gear readiness for emergencies. Based on maintenance patterns for previous systems, costs are minimal for the first few years, increase for a time period, and then level off. Maintenance costs are expected to be $150,000 in year 3, $175,000 in year 4, and amounts increasing by $25,000 per year through year 6 and remain constant thereafter for the expected 10-year life of this system. If similar systems will replace the current one, determine the perpetual equivalent annual maintenance cost at i = 10% per year. Solve using tabulated factors and a spreadsheet, as requested by your instructor.
A heavy construction firm has been awarded a contract to build a large concrete dam. It is expected that a total of 8 years will be required to complete the work. The firm will buy $600,000 worth of special equipment for the job. During the preparation of the job cost estimate, the following utilization schedule was computed for the special equipment:
Can you please look at this problem and tell me how i am getting the question with the x wrong and give me the solution Perdue Company purchased equipment on April 1 for $77,760. The equipment was expected to have a useful life of three years, or 7,560 operating hours, and a residual value of $2,160. The equipment was used for 1,400 hours during Year 1, 2,600 hours in Year 2, 2,300 hours in Year 3, and 1,260 hours in Year 4. Required: Determine the amount of depreciation expense for the years ended December 31, Year 1, Year 2, Year 3, and Year 4, by (a) the straight-line method, (b) units-of-activity method, and (c) the double-declining-balance method. Note: FOR DECLINING BALANCE ONLY, round the multiplier to four decimal places. Then round the answer for each year to the nearest whole dollar. a. Straight-line method Year Amount Year 1 $fill in the blank 1 Year 2 $fill in the blank 2 Year 3 $fill in the blank 3 Year 4 $fill in the blank 4 b. Units-of-activity method…
The following data shows the different sizes of pipes which a company wishes to use as a replacement for the old pipe system that they are using. Diameter = 100mm Cost of Pipe=P1800000 Annual Maintenance Cost3P88000 Operating cost/hour%3DP480 Diameter = 150mm Cost of Pipe=P1120000 Annual Maintenance Cost-P136000 Operating cost/hour=P500 Diameter = 250mm Cost of Pipe3P1000000 Annual Maintenance Cost-P60000 Operating cost/hour%3DP620 Total number of operating hours per year = 500 Replacement is done every 10 years Money is worth 10% annually. Compute the present worth cost of the 150mm pipe. Key in your answers in 2 decimal places. Do not upload any file. Do not use commas to separate place values and do not include a unit. Example, if your answer is P3,4201.8034 please type 34201.80