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Which of the following entries should co make

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Question - On January 1, 2018, Co built a coal mine in Florida. Co is legally required to remove any metal used in building the mine, seal the entrance, and to the extent possible, restore the surrounding area to its natural condition at the end of the mine's 10 year useful life. Co estimates this process will cost $1,500,000. Assuming the current discount rate is 6%, which of the following entries should Co make in 2018 to record this Asset Retirement Obligation?

Debit Mine $1,500,000

Debit Accumulated Depreciation $83,759

Debit Asset Retirement Obligation $837,585

Debit Mine $83,759

Debit Interest Expense $50,255

Reference no: EM132593587

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