Ex 17.6 The Gloaming company incurred the following costs during a period in relation to a specific area of interest and wants to capitalise its E & E costs on an area of interest method.The following costs were incurred: Cash paid to acquire seismic study from government(GST exempt) 3,000 Cash paid to acquire exploration rights(GST exempt) 10,000 Cash paid to acquire fencing materials for an area-of-interest, including GST of $80 880 Contractor fees for labour to set up the fencing, including GST of $50550 Contractor fees for exploratory drilling, including GST $2,50027,500 Hire of drilling equipment for contractor use, including GST of $5005,500 Salary of project manager 60,000 Stationery and other office supplies, including GST $30 330 Gloaming company non executive directors fees paid 160,000 Required: Which of the above costs can be capitalised as E& E assets?
Ex 17.6 The Gloaming company incurred the following costs during a period in relation to a specific area of interest and wants to capitalise its E & E costs on an area of interest method.The following costs were incurred:
Cash paid to acquire seismic study from government(GST exempt) 3,000
Cash paid to acquire exploration rights(GST exempt) 10,000
Cash paid to acquire fencing materials for an area-of-interest, including GST of $80 880
Contractor fees for labour to set up the fencing, including GST of $50550
Contractor fees for exploratory drilling, including GST $2,50027,500
Hire of drilling equipment for contractor use, including GST of $5005,500
Salary of project manager 60,000
Stationery and other office supplies, including GST $30 330
Gloaming company non executive directors fees paid 160,000
Required:
Which of the above costs can be capitalised as E& E assets?
![](/static/compass_v2/shared-icons/check-mark.png)
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)