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Prepare the journal entries to record the ARO at January

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Reference no: EM132969087

Question - On January 1, Year 1 Anteater Corp rented a building for 4 years. At the end of the 4 years, Anteater is required to remove all building improvements and return the building to it's "base structure", Anteater estimates the cost to comply will be 300,000 dollars, Anteater uses straight line depreciation and its borrowing rate is 10 percent. The present value of 1 dollar, 4 periods and 10 percent is 0.68301.

Prepare the journal entries to record the ARO at January 1 and to record depreciation expense and accretion related o the ARO at December 31, Year 1 (please show computations).

Reference no: EM132969087

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