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When an an asset retirment obligation is recorded on the balance sheet, the following entry is recorded: Debit: Asset retirement cost (ARC, a long-lived asset)

When an an asset retirment obligation is recorded on the balance sheet, the following entry is recorded:

Debit: Asset retirement cost (ARC, a long-lived asset)

Credit: Asset retirment obligation (ARO, a long-term liability)

What are the corresponding expenses on the income statement recorded over time? Briefly describe how the matching principle is applied by explaining the nature of these expenses, and how they are recorded to the income statement.

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