PLEASE READ THE FOLLOWING SCENARIO AND ANSWER QUESTIONS 1 to QUESTION 5 FOR THESE QUESTIONS PLEASE MAKE SURE TO SHOW ALL WORKINGS SMITH Company bought a Nuclear Processing Plant (NPP) for $80,000,000 cash on January 1, 20X1. The expected life of the NPP is 8 years. After 8 years (i.e., December 31, 20X8), SMITH is legally obliged (i.e., has an environmental liability) to remove (i.e., dismantle) the NPP. The expected cost to dismantle the NPP on December 31, 20X8 is $10,000,000. Assume that 2% is the effective rate for SMITH. SMITH uses straight-line depreciation and the estimated residual value of the NPP is zero. SAMPLE QUESTION 1 Show the Journal Entries required at 1 January 20X1 SAMPLE QUESTION 2 Show the Journal Entries required at 31 December 20X1 SAMPLE QUESTION 3 Show the Financial Statement Extracts for 20X1 SAMPLE QUESTION 4 Calculate the Carrying Amount of the Environmental Liability at the end of 20X2: SAMPLE QUESTION 5 Suppose that on Dec 31 20X8, the cost to dismantle (i.e., remove) the NPP is (a) $11,000,000 (b) $9,500,000. Show the journal entries for situations (a) and (b)