(Fair Value Estimate) Murphy Mining Company recently purchased a quarts mine that mine that it intends to work for the next 10 years. According to state environmental laws, Murphy must restore the mine site to its original natural prairie state after it ceases mining operations at the site. To properly account for the mine, Murphy must estimate the fair value of this asset retirement obligation. This amount will be recorded as a liability and added to the value of the mine on Murphys books. (You will learn more about these asset retirement obligations in Chapter 10 and 13.)