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Question 1: Journalize the following transactions for Everlasting Energy Company regarding a leased undeveloped land.
a. On January 1, Year 1, the company acquired a lease, paying cash of $20,000 in total.
b. On April 1, Year 1, the company paid delinquent property taxes of $1,800 on the leased property. Assume that these taxes are recoverable out of future delay rental or royalty payments.
c. On February 1, Year 2, a delay rental payment of $1,000 is due.
d. On August 1, Year 2, the company decided to abandon the lease. (Hint: Journal entries are related to both the delinquent property taxes and the acquisition costs.)
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