Natural resource and intangible accounting

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Reference no: EM131294992

Natural Resource and Intangible Accounting

McLeansboro Oil Company acquired a small oil company with only three assets during a recent year. The assets were acquired for $1,350,000 cash.

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1. Prepare the entry to record this acquisition in McLeansboro's journal. (Hint: Record the cost in excess of fair value as goodwill.) If an amount box does not require an entry, leave it blank.

2. If McLeansboro pumps and sells 11,000 barrels of oil in 1 year, compute the amount of depletion. Do not round intermediate calculations. $

3. Prepare journal entries to record depletion for the 11,000 barrels of oil pumped and sold. First record depletion and then record the sale of the oil. Do not round intermediate calculations.

Reference no: EM131294992

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