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Sheffield Company purchases an oil tanker depot on January 1, 2020, at a cost of $2,436,000 for cash. Sheffield expects to operate the depot for 10 years, at which time it is legally required to dismantle the depot and remove the underground storage tanks. It is estimated that it will cost $323,000 to dismantle the depot and remove the tanks at the end of the depots useful life. (a) Prepare the journal entries to record the depot and the asset retirement obligation for the depot on January 1, 2020. Based on an effective interest rate of 7%, the present value of the asset retirement obligation on January 1, 2020, is $164,197. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit January 1, 2020 enter an account title to record the depot on January 1, 2020 enter a debit amount enter a credit amount enter an account title to record the depot on January 1, 2020 enter a debit amount enter a credit amount (To record the depot) January 1, 2020 enter an account title to record the asset retirement obligation on January 1, 2020 enter a debit amount enter a credit amount enter an account title to record the asset retirement obligation on January 1, 2020 enter a debit amount enter a credit amount (To record the asset retirement obligation)

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