On January 1, 2023, SGC Ltd. purchased the right to extract oil from proven oil reserves on provincial government land. It paid $3,100,000 for production equipment and debited the "Equipment" account for the purchase price. Operations began on that day, and the agreement provided for three years of operations (until December 31,2025), at which time it was estimated the oil reserves would be exhausted. SGC planned to extract the oil evenly over the three-year period and therefore decided to depreciate the cost of the equipment using the straight-line method, with no residual or salvage value. Included in the agreement with the government was a provision that the business would clean up the site at the end of the three years. On the date of purchase, SGC's engineers and accountants estimated that the total cost to clean up the site on December 31, 2025 would total $382,000, and the discount rate to be applied to that future cost would be 8%. (Note: clean-up costs are also being debited to "Equipment"). On December 31, 2025, a contractor was paid $372,800 to clean up the site, and in January 2026 the site was closed. SGC's fiscal year end was December 31 , and the company followed ASPE. Click here to view the factor table. Click here to view the factor table. Prepare the required journal entries for each of the following dates, using the expense approach. (Note: no inventory or sales related journal entries are required): - January 1, 2023 Use (a) factor Table A.2, (b) a financial calculator, or (c) Excel function PV. - December 31, 2023 - December 31, 2024 - December 31, 2025 (Round present value factor calculations to 5 decimal places, e.g. 0.52750 and round answers to 0 decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.) \begin{tabular}{|c|c|c|c|} \hline Date & Account Titles and Explanation & Debit & Credit \\ \hline \multirow[t]{3}{*}{ Jan. 1,2023v} & Equipment & & \\ \hline & Asset Retirement Obligation & & \\ \hline & Cash & & 3100000 \\ \hline \multirow[t]{3}{*}{ Dec. 31,2023} & Accretion Expense & & \\ \hline & Asset Retirement Obligation & & \\ \hline & (To record accretion expense) & & \\ \hline \multirow[t]{3}{*}{ Dec. 31,2023v} & Depreciation Expense & & \\ \hline & Accumulated Depreciation - Equipment & & \\ \hline & (To record depreciation for the produc & & \\ \hline \multirow[t]{3}{*}{ Dec. 31,2024} & Accretion Expense & & \\ \hline & Asset Retirement Obligation & & \\ \hline & (To record accretion expense) & & \\ \hline \multirow[t]{3}{*}{ Dec. 31,2024v} & Depreciation Expense & & \\ \hline & Accumulated Depreciation - Equipment & & \\ \hline & (To record depreciation for the produc & & \\ \hline Dec. 31,2025 & Accretion Expense & & \\ \hline \end{tabular} Asset Retirement Obligation (To record accretion expense) Dec. 31,2025 Depreciation Expense Accumulated Depreciation - Equipment (To record depreciation for the production equipment) Dec. 31, 2025 Asset Retirement Obligation Gain on Settlement of ARO Cash (To record settlement of asset retirement obligation) On January 1, 2023, SGC Ltd. purchased the right to extract oil from proven oil reserves on provincial government land. It paid $3,100,000 for production equipment and debited the "Equipment" account for the purchase price. Operations began on that day, and the agreement provided for three years of operations (until December 31,2025), at which time it was estimated the oil reserves would be exhausted. SGC planned to extract the oil evenly over the three-year period and therefore decided to depreciate the cost of the equipment using the straight-line method, with no residual or salvage value. Included in the agreement with the government was a provision that the business would clean up the site at the end of the three years. On the date of purchase, SGC's engineers and accountants estimated that the total cost to clean up the site on December 31, 2025 would total $382,000, and the discount rate to be applied to that future cost would be 8%. (Note: clean-up costs are also being debited to "Equipment"). On December 31, 2025, a contractor was paid $372,800 to clean up the site, and in January 2026 the site was closed. SGC's fiscal year end was December 31 , and the company followed ASPE. Click here to view the factor table. Click here to view the factor table. Prepare the required journal entries for each of the following dates, using the expense approach. (Note: no inventory or sales related journal entries are required): - January 1, 2023 Use (a) factor Table A.2, (b) a financial calculator, or (c) Excel function PV. - December 31, 2023 - December 31, 2024 - December 31, 2025 (Round present value factor calculations to 5 decimal places, e.g. 0.52750 and round answers to 0 decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.) \begin{tabular}{|c|c|c|c|} \hline Date & Account Titles and Explanation & Debit & Credit \\ \hline \multirow[t]{3}{*}{ Jan. 1,2023v} & Equipment & & \\ \hline & Asset Retirement Obligation & & \\ \hline & Cash & & 3100000 \\ \hline \multirow[t]{3}{*}{ Dec. 31,2023} & Accretion Expense & & \\ \hline & Asset Retirement Obligation & & \\ \hline & (To record accretion expense) & & \\ \hline \multirow[t]{3}{*}{ Dec. 31,2023v} & Depreciation Expense & & \\ \hline & Accumulated Depreciation - Equipment & & \\ \hline & (To record depreciation for the produc & & \\ \hline \multirow[t]{3}{*}{ Dec. 31,2024} & Accretion Expense & & \\ \hline & Asset Retirement Obligation & & \\ \hline & (To record accretion expense) & & \\ \hline \multirow[t]{3}{*}{ Dec. 31,2024v} & Depreciation Expense & & \\ \hline & Accumulated Depreciation - Equipment & & \\ \hline & (To record depreciation for the produc & & \\ \hline Dec. 31,2025 & Accretion Expense & & \\ \hline \end{tabular} Asset Retirement Obligation (To record accretion expense) Dec. 31,2025 Depreciation Expense Accumulated Depreciation - Equipment (To record depreciation for the production equipment) Dec. 31, 2025 Asset Retirement Obligation Gain on Settlement of ARO Cash (To record settlement of asset retirement obligation)