JenCo purchased a landfill on January 5, 2020 for $5 million. It will use the landfill for 8 years at which time it will be closed. The cost of closing the landfill after 8 years is $1.50 million. The effective rate of interest for JenCo is 5% and all purchases were made for cash. JenCo’s fiscal year end is December

Sep 8, 2023

JenCo purchased a landfill on January 5, 2020 for $5 million. It will use the landfill for 8 years at which time it will be closed. The cost of closing the landfill after 8 years is $1.50 million. The effective rate of interest for JenCo is 5% and all purchases were made for cash. JenCo’s fiscal year end is December 31, 2020. 
Record the following entries: 
a) The purchase of the landfill. 
b) The recognition of the asset retirement obligation

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JenCo purchased a landfill on January 5, 2020 for $5 million. It will use the landfill for 8 years at which time it will be closed. The cost of closing the landfill after 8 years is $1.50 million. The effective rate of interest for JenCo is 5% and all purchases were made for cash. JenCo’s fiscal year end is December
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