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Intermediate Accounting: Reporting...
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Intermediate Accounting: Reporting...
What are asset retirement obligations? How should a company account for them?
Explain the term ‘asset retirement obligation “and explain the manner in which they are accounted.
Asset retirement obligations:
- The procurement of certain operational assets creates an “asset retirement obligation”, which is considered as a legal obligation associated to the retirement of the asset.
- The fair value of an “asset retirement obligation” is reported as liability, with an offsetting increase in the caring value of the related asset, according to GAAP...
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