Affogato owned a 20% royalty interest in an oil well. Affogato received royalty payments on January 31 for the oil sold between the previous June 1 and November 30, and on July 31 for oil between December 31 and May 31. Production revealed the following sales: June 1, 2020 – November 30, 2020 P3,000,000 December 1. 2020 – December 31, 2020 December 1, 2020 - May 31, 2021 500,000 4,000,000 June 1, 2021 - November 30, 2021 3,250,000
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What amount should be reported as royalty revenue for 2021?
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- Seoli owned a 20% royalty interest in an oil well. Seoli received royalty payments on January 31 for the oil sold between the previous June 1 and November 30, an on July 31 for oil between December 31 and May 31. Production revealed the following sales: June 1, 2019 - November 30, 2019 3,000,000December 1, 2019 - December 31, 2019 500,000December 1, 2019 - May 31, 2020 4,000,000June 1, 2020 - November 30, 2020 3,250,000December 1, 2020 - December 31, 2020 700,000What amount should be reported as royalty revenue for 2020?Smile owned a 20% royalty interest in an oil well. Smile received royalty payments on January 31 for the oil sold between the previous June 1 and November 30, an on July 31 for oil between December 31 and May 31. Production revealed the following sales: June 1, 2019-November 30, 20193,000,000 December 1, 2019-December 31, 2019500,000 December 1, 2019-May 31, 20204,000,000 June 1, 2020-November 30, 20203,250,000 December 1, 2020-December 31, 2020700,000 What amount should be reported as royalty revenue for 2020?Mattson Company receives royalties on a patent It developed several years ago. Royalties are 4% of net sales, to be received on September 30 for sales from January through June and receivable on March 31 for sales from July through December. The patent rights were distributed on July 1, 2023, and Mattson accrued royalty revenue of $57,000 on December 31, 2023, as follows: General Journal Receivable-royalty revenue Royalty revenue 57,000 Mattson received royalties of $61,700 on March 31, 2024, and $77,000 on September 30, 2024. In December, 2024, the patent user Indicated to Mattson that sales subject to royalties for the second half of 2024 should be $770,000. View transaction list Required: 1. Prepare any Journal entries Mattson should record during 2024 related to the royalty revenue. Note: If no entry is required for a transaction/event, select "No Journal entry required" in the first account field. Journal entry worksheet < Debit 57,000 1 2 3 Credit Record the entry related to the…
- Louisiana Oil Company (LOC) paid $3,000,000 for an oil reserve estimated to hold 50,000 barrels of oil. Oil production is expected to be 10,000 barrels in year 1, 30,000 barrels in year 2, and 10,000 barrels in year 3. LOC expects to begin selling barrels from its oil inventory in year 2. Required: Assuming these estimates are accurate, determine the book value of oil reserves at the end of year 1.During 2020, Prospect Company incurred P4,000,000 in exploration cost for each of the 15 oil wells drilled in 2020. Of the 15 wells drilled, 10 were dry holes. The entity used the successful effort method of accounting. The entity depleted 30% of the oil discovered in 2020. What amount of exploration cost should be reported in the December 31, 2020 statement of financial position? a.42,000,000b.14,000,000c.20,000,000d.6,000,000A Ltd buys a machine on 1 June 19.1 the cost price of which is R1 000 000. A Ltd provides for depreciation on machinery at 20% per annum according to the straight-line method. The SA Revenue Service allows a wear-and-tear allowance of 25% per annum according to the straight-line method. The year-end of A Ltd is 31 May. Assume a taxation rate of 40%. Assume that A Ltd maintains a profit before provision for depreciation of R500 000 each year. Identify the amount for accounting profit before tax, after depreciation provision for the year ended 31 May 19.2.
- A company’s policy is to charge depreciation on plant and machinery @20% per year on cost, with proportional depreciation for items purchased during the year and no depreciation on items sold. The company’s Plant and machinery at cost account for the year ended 30 Sept 2019 is as below: Plant and Machinery 2018 £ 2019 01-Oct balance 200,000 30-Jun Disposal 40,000 2019 01-Apr Bank 50,000 30-Sep 210,000 250,000 250,000 Required: Calculate the depreciation charge for the plant and machinery for the year ended 30 September 2019 a. £50,000 b. £37,000 c. £42,000 d. £40,000Johnson Company receives royalties on a patent it developed several years ago. Royalties are 5% of net sales, to be received on September 30 for sales from January through June and receivable on March 31 for sales from July through December. The patent rights were distributed on July 1, 2020, and Johnson accrued royalty revenue of $50,000 on December 31, 2020, as follows: Receivable-royalty revenue Royalty revenue 50,000 Required: 50,000 Johnson received royalties of $65,000 on March 31, 2021, and $90,000 on September 30, 2021. December, 2021, the patent user indicated to Johnson that sales subject to royalties for the second half of 2021 should be $600,000. Prepare any journal entries Johnson should record during 2021 related to the royalty revenue.A Ltd buys a machine on 1 June 19.1 the cost price of which is R1 000 000. A Ltd provides for depreciation on machinery at 20% per annum according to the straight-line method. The SA Revenue Service allows a wear-and-tear allowance of 25% per annum according to the straight-line method. The year-end of A Ltd is 31 May. Assume a taxation rate of 40%. Assume that A Ltd maintains a profit before provision for depreciation of R500 000 each year. Identify the current tax for the year ended 31 May 19.2. Select one: a. R180 000 b. R20 000 c. R100 000 d. R120 000
- Ltd buys a machine on 1 June 19.1 the cost price of which is R1 000 000. A Ltd provides for depreciation on machinery at 20% per annum according to the straight-line method. The SA Revenue Service allows a wear-and-tear allowance of 25% per annum according to the straight-line method. The year-end of A Ltd is 31 May. Assume a taxation rate of 40%. Assume that A Ltd maintains a profit before provision for depreciation of R500 000 each year. Identify the amount for taxable profit for the year ended 31 May 19.2. Select one: a. R300 000 b. R250 000 c. R80 000Ltd buys a machine on 1 June 19.1 the cost price of which is R1 000 000. A Ltd provides for depreciation on machinery at 20% per annum according to the straight-line method. The SA Revenue Service allows a wear-and-tear allowance of 25% per annum according to the straight-line method. The year-end of A Ltd is 31 May. Assume a taxation rate of 40%. Assume that A Ltd maintains a profit before provision for depreciation of R500 000 each year. Identify the depreciation amount that would be deducted to arrive at the profit for year for accounting purposes at 31 May 19.2. Select one: a. R20 000 b. R200 000 c. R50 000 d. R250 000On January 10, 2021, Halo-Halo Enterprises had an equipment with a carrying amount of P2,000,000. On the same day, the entity classified the equipment as held for sale with an estimated selling price of P1,900,000 and disposal cost of P100,000. The remaining life of the equipment is for 5 years. On December 31, 2021, the estimated selling price of the equipment had increased to P2,200,000 with estimated selling costs of P50,000. What amount should be reported as gain on reversal of impairment in 2021?