Acct 3333 Cost Accounting by vwi13045

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									Energy Accounting
Problem 11-15

(a)                       Gusher #1                      Gusher #2
                       Working Revenue                Working
                       Interest Interest              Interest
Shamrock                 0.5000    0.4375               0.6667
Diamond                  0.2500    0.2188               0.0000
Heart                    0.2500    0.2188               0.3333

Royalty Owner           ______     0.1250              ______

Total                    1.0000    1.0000               1.0000

(b)
                       August September October November
Sales in bbls            8,000   12,000  15,000   20,814
Price per bbl            20.00    19.00    18.00   20.00
Gross sales            160,000 228,000 270,000 416,280
WI Percent               0.875    0.875    0.875   0.875
WI Revenue             140,000 199,500 236,250 364,245
LOE                     25,000   40,000  50,000   75,000
Net to WI              115,000 159,500 186,250 289,245

Revenue to Shamrock:
To Shamrock              76,667   106,333   124,167    192,830
Shamrock's share         57,500    79,750    93,125    144,623
Diamond pd by S'rock     19,167    26,583    31,042     48,208

Payout
Cost of well            250,000
Diamond's share            0.25
Diamond's share in $     62,500
Shamrock's portion of
 Diamond's share          0.666667
                             41,667
Penalty                       300%
Recoverable by S'rock      125,000

Amount to be recovered     125,000
Recovered in August         19,167
Balance to be recovered    105,833
Recovered in September      26,583
Balance to be recovered     79,250
Recovered in October        31,042
Balance to be recovered     48,208
Recovered in November       48,208
Balance to be recovered          0


(c) August entry
                                       DR       CR
Cash                                  160,000
  Royalty payable                               20,000
  A/P - Heart                                   46,667
  Oil revenue                                   93,333
Gusher #2
      Revenue
       Interest
         0.5834
         0.0000
         0.2916

        0.1250

        1.0000

								
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