Question 2 of15 - /1 Current Attempt in Progress Ayayai Industries Limited purchased a strip mine for cash on April 1, 2020 at a cost of $5,246,000. Ayayai expects to operate the mine for 10 years, at which it is legally required to restore the surrounding area to its original state. It is estimated that it will cost $474,000 to do this at the end of the mine's useful life. The company's year-end is December 31, and Ayayai follows ASPE. Prepare thejournal entry to record the purchase of the mine and to record the asset retirement obligation for the mine on April 1, 2020. Based on the effective interest rate of 5%, the present value of the asset retirement obligation (i.e., its fair value) on the date of acquisition is $290,995. (Round answer to 0 decimal places, as. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. lf no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Apr. 1, Accounts Receivable 5536995 2020 Asset Retirement Obligation 290995 Cash 5 246000 Prepare anyjournal entries required for the mine (straight-line depreciation) and the asset retirement obligation at December 3 1, 2020. The estimated residual value of the mine is zero. (Round answer to 0 decimal places, e3. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. if no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 3 1, Depreciation Expense 5536995 :I 2020 Accumulated Depletion - Mineral Resources :| 5536995 (To record depletion for the year) Interest Expense 14550 :| Asset Retirement Obligation :I 14550 On April 1, 2030, Ayayai paid cash to an environmental rm to restore the mine's surrounding area to its original state at a cost of $484,500. Prepare the jou rnal entry for the settlement of the asset retirement. (Round answer to 0 decimal places, as. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. if no entry is required, select \"No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Apr. 1, Asset Retirement Obligation 484500 ':I 2030 Loss on Settlement of ARO Cash