On January 1, 2020, MAMA company purchased several machineries that will be used in the production of goods at a purchase price of P1,000,000. MAMA company paid import duties of P10,000 and non-refundable purchase taxes of P5,000. MAMA company also incurred a P30,000 installation and assembly cost. The company expects that it will incur dismantling cost amounting to P132,275 at the end of the machinery's 5-year useful life. The prevailing market rate of interest during the transaction were date was 12%. PV factors are as follows:

PV of 1 at 12% for 5 periods: 0.567

PV of ordinary annuity at 12% for 5 periods: 3.6048

How much should the machineries be initially recognized?

1,045,000

1,120,000

1,177,275

1,521,825