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Franklin Oil Company has an account titled Oil and Gas Properties. Franklin paid $6, 700,000 for oil reserves holding an estimated 400,000 barrels of oil. Assume the company paid $560,000 for additional geological tests of the property and $420,000 to prepare for drilling. During the first year. Franklin removed and sold 80,000 barrels of oil. Record all of Franklin's transactions, including depletion for the first yea. (Record debits first, then credits. Explanations will appear on the last line of the journal entry table.) Franklin paid $6, 700,000 for oil reserves holding an estimated 400,000 barrels of oil. Record the payment for the oil reserves. Do not record payment for any additional costs associated with the oil reserves (geological testing and/or drilling). We will do this in the following entry. Assume the company paid $560,000 for additional geological tests of the property and $420,000 to prepare for drilling. Record the payment for additional geological tests of the property and for preparing the property for drilling. (Record a single compound journal entry.) During the first year. Franklin removed and sold 80,000 barrels of oil. Record the depletion expense for the first year. (Assume no residual value. Round interim calculations to the nearest cent and your final answers to the nearest whole dollar.)

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