Crane Gas Co. purchases a gas station and convenience store on January 1, 2017, at a cost of $963,000. Crane expects to operate the store and gas station for 20 years. The company is legally required to remove the underground gas storage tanks from the facility at the end of its useful life. Crane estimates that it will cost $132,000 to remove the tanks at the end of the facility's useful life. Prepare the journal entries to record the purchase of the gas station/convenience store, as well as the asset retirement obligation for the gas station/convenience store on January 1, 2017. Based on an effective-interest rate of 8%, the present value of the asset retirement obligation on January 1, 2017, is $28,321. (If no entry is required, select "No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit de (To record the depot) (To record the asset retirement obligation) e Textbook and Media List of Accounts Prepare any journal entries required for the depot and the asset retirement obligation at December 31, 2017. Crane uses straight-line depreciation; the estimated salvage value for the facility is zero. (If no entry is required, select "No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (To record depreciation for the depot) (To record depreciation on asset retirement obligation) (To record interest on asset retirement obligation) e Textbook and Media List of Accounts On December 31, 2036 Crane pays an environmental contractor to dismantle and remove the underground storage tanks at a price of $144,000. Prepare the journal entry for the settlement of the asset retirement obligation. (If no entry is required, select "No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit e Textbook and Media List of Accounts Culver Appliances provides a 3-year warranty with one of its products, which was first sold in 2017. Culver sold $1,640,000 of products subject to the warranty. Culver expects $180,000 of warranty costs over the next 3 years. In 2017, Culver spent $94,000 servicing warranty claims. Prepare Culver's journal entries to record the sales (ignore cost of goods sold) and the December 31 adjusting entry, assuming the expenditures are inventory costs; Culver now expects future warranty costs of $103,000. (If no entry is required, select "No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit During 2017 Inventory (Cash, Salaries and Wages Payable) 94000 Warranty Expense 94000 (To record sales) Sales Revenue 1640000 Cash 1640000 (To record cash spent on servicing warranty claims) Decemebr 31, 2017 Warranty Expense 86000 Warranty Liability 86000