During 2016 the longhorn oil company incurred 4800000 in, Ask an Expert

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During 2016, the Longhorn Oil Company incurred $4,800,000 in exploration costs for each of 20 oil wells drilled in 2016 in west Texas. Of the 20 wells drilled, 13 were dry holes. Longhorn uses the successful efforts method of accounting. Assuming that none of the oil found is depleted in 2016, what oil exploration expense would Longhorn charge for this activity in its 2016 income statement?

$0
$33.6 million
$62.4 million
$96.0 million

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91756840

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