Bassinger company purchases an oil tanker depot on january

Reference no: EM13597980

Bassinger Company purchases an oil tanker depot on January 1, 2010, at a cost of $600,000. Bassinger expects to operate the depot for 10 years, at which time it is legally required to dismantle the depot and remove the underground storage tanks. It is estimated that it will cost $70,000 to dismantle the depot and remove the tanks at the end of the depot's useful life. (Round all answers to 0 decimal places, e.g. 21,120. For multiple debit/credit entries, list amounts from largest to smallest, e.g. 10, 8, 6.)

(a) Prepare the journal entries to record the depot and the asset retirement obligation for the depot on January 1, 2010. Based on an effective interest rate of 6%, the present value of the asset retirement obligation on January 1, 2010, is $39,087.

(b)Prepare any journal entries required for the depot and the asset retirement obligation at December 31, 2010. Bassinger uses straight-line depreciation; the estimated residual value for the depot is zero.

Reference no: EM13597980

Questions Cloud

What is the amount of cash to be included in the august 31 : the august 31 balance shown on the bank statement is 9810. b. there is a deposit in transit of 1260 at august 31. c.

Dubois inc has 600000 to invest the company is trying to : dubois inc. has 600000 to invest. the company is trying to decide between two alternative uses of the funds. one

Firm d has net income of 83700 sales of 2790000 and average : firm d has net income of 83700 sales of 2790000 and average total assets of 1395000. calculate the firms margin

Various activities at ming corporation a manufacturing : various activities at ming corporation. a manufacturing company are listed below. each activity has been classified as

Bassinger company purchases an oil tanker depot on january : bassinger company purchases an oil tanker depot on january 1 2010 at a cost of 600000. bassinger expects to operate the

Fletcher inc produces hair brushes the selling price is 20 : fletcher inc. produces hair brushes. the selling price is 20 per unit and the variable costs are 8 per brush. fixed

Tudor construction co which operates outside hueys normal : huey concrete co. pours concrete slabs for single-family dwellings. tudor construction co which operates outside hueys

Calculate the net amount of return you would earn if 2000 : you have accumulated 8000 and are looking for the best rate of return that can be earned over the next year. a bank

Joyce hardmann is trying to decide which two different : joyce hardmann is trying to decide which two different kinds of candy to sell in her retail candy store. one type is a

User Account

All Pages