Bramble's Steelers Inc. (BSI) is a steel manufacturing company located in Ontario. On November 1, 2021, BSI acquired land on which it constructed a facility for steel manufacturing purposes. Since its manufacturing process produces excessive waste, the government of Ontario has imposed a requirement for BSI to clean up property. As part of its agreement with the province of Ontario, BSI is allowed to operate on this site for only 15 years after which time BSI estimates it will need to incur $2,000,000 to clean up the site. Bramble went ahead with the construction of the building and recognized the asset retirement obligation at that time. The company's discount rate is 4% and BSI reports under IFRS with a December 31 year-end. What adjusting journal entry should BSI have made to initially recognize the ARO under IFRS? (For calculation purposes, use 5 decimal places as displayed in the factor table provided, e.g. 0.52750 and round final answer to 0 decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List debit entry before credit entry. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

Bramble's Steelers Inc. (BSI) is a steel manufacturing company located in Ontario. On November 1, 2021, BSI acquired land on which it constructed a facility for steel manufacturing purposes. Since its manufacturing process produces excessive waste, the government of Ontario has imposed a requirement for BSI to clean up property. As part of its agreement with the province of Ontario, BSI is allowed to operate on this site for only 15 years after which time BSI estimates it will need to incur $2,000,000 to clean up the site. Bramble went ahead with the construction of the building and recognized the asset retirement obligation at that time. The company's discount rate is 4% and BSI reports under IFRS with a December 31 year-end. What adjusting journal entry should BSI have made to initially recognize the ARO under IFRS? (For calculation purposes, use 5 decimal places as displayed in the factor table provided, e.g. 0.52750 and round final answer to 0 decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List debit entry before credit entry. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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