What amount will the company record as accretion expense

Reference no: EM132633595

Question - A company bought an oil rig for $10,000,000 on January 1, 2018. The life of the rig is 5 years and the expected cost to dismantle the rig at the end of 5 years is $1,000,000. An interest rate of 3% would be appropriate for this company for any necessary present value calculations. What amount will the company record as accretion expense for 2018?

Reference no: EM132633595

Questions Cloud

Develop to enhance citizen participation in digital age : What policies might you develop to enhance citizen participation in the digital age?

What determines the amount deducted : In 130 Characters or more explain what determines the amount deducted from an employee's wages for Federal Income Taxes

Analysis of competing hypotheses process : This discussion looks at bias in the Analysis of Competing Hypotheses process. Do you agree that ACH cannot overcome bias?

What are some effective arts-based strategies : What are some effective arts-based strategies for formatively and summatively assessing student learning?

What amount will the company record as accretion expense : A company bought an oil rig for $10,000,000 on January 1, 2018. What amount will the company record as accretion expense for 2018

Distinguish between special and extraordinary : Distinguish between "special" and "extraordinary" items. Include the appropriate financial statement for reporting each for a governmental fund

Record the adjustment and the sale : Sold used production equipment for $16,000 in cash. The equipment originally cost $43,000, Record the adjustment and the sale

Find what is the fixed overhead absorption rate per unit : Profits based on marginal costing were RM315,250 and on absorption costing were RM288,250. What is the fixed overhead absorption rate per unit?

The conflict between the boomers and millennials : The conflict between the boomers and millennials has become more hostile and team meetings unproductive.

Reviews

Write a Review

Required(*) Message

Accounting Basics Questions & Answers

How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest. How much control does the Fed have over this longer real rate?

Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

Accounting problems

Accounting problems, Draw a detailed timeline incorporating the dividends, calculate the exact Payback Period b) the discounted Payback Period. the IRR, the NPV, the Profitability Index.

Theory of interest - term structure of interest rates

Term Structure of Interest Rates

Write a report on internal controls

Write a report on Internal Controls

Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

Liquidity and profitability

Distinguish between liquidity and profitability.

What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

Capm and venture capital

CAPM and Venture Capital

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

User Account

All Pages