Capacity Adjustments
Example: You purchase an oil well for $10,000. You expect to extract 10,000 barrels of oil from this well. Each quarter you extract 2,000 barrels of oil. In Year 1, Quarter 4 you discover that you entered the wrong capacity. You increase the production capacity to 50,000 barrels.
Expensed
![](image072.gif)
Amortized
![](image073.gif)
See Also
Assets Depreciating Under Units of Production
Amortized and Expensed Adjustments
Changing Financial and Depreciation Information
Entering Production Amounts