An Oil Well Cost $2,050,000 and Is Calculated to Hold

question 161

Multiple Choice

An oil well cost $2,050,000 and is calculated to hold 290,000 barrels of oil.There is no residual value.Which journal entry is needed to record the expense for the extraction of 53,000 barrels of oil during the year? All 53,000 barrels were sold during the year.(Round any intermediate calculations to the nearest cent,and your final answer to the nearest dollar.)

• A) \[\begin{array} { | c | r | r | }
• \hline \text { Depletion Expense - Oil Reserve } & 374,710 & \\
• \hline \text { Accumulated Depletion - Oil Reserve } & & 374,710 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | l | l | l | }
• \hline \text { Depletion Expense - Oil Reserve } & 374,710 & \\
• \hline \text { Oil Revenue } & & 374,710 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | c | l | l | }
• \hline \text { Cost of Goods Sold - Oil Reserve } & 374,710 & \\
• \hline \text { Accumulated Depletion - Oil Reserve } & & 374,710 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | c | l | l | }
• \hline \text { Oil Reserve Inventory } & 374,710 & \\
• \hline \text { Accumulated Depletion - Oil Reserve } & & 374,710 \\
• \hline
• \end{array}\]

---

Definitions:

Triarchic Theory

A theory of intelligence proposing that human intelligence comprises analytical, creative, and practical components.

Multiple Intelligences

A theory proposed by Howard Gardner, suggesting that individuals have different kinds of intelligences, such as linguistic, mathematical, musical, and spatial.

Emotional Intelligence

The ability to understand, use, and manage one's own emotions in positive ways to relieve stress, communicate effectively, empathize with others, and overcome challenges.

Thurstone

Refers to L.L. Thurstone, a pioneering psychologist known for his contributions to psychometrics and the theory of intelligence.