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When a company has a financial obligation associated with the retirement of a long lived asset (i.e. an asset retirement obli
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C. the company accrues the present value of the obligation when it is determined the obligation exists

Financial Accounting Standard Board (FASB) have issued Rule on Asset Retirement Obligation (Rule 143: Accounting for Asset Retirement Obligation) which states that public company should recognize the financial obligation on Long lived assets and disclose in the balance sheet at present value to represent the exact financial position.

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