On 31 December 20X5, Cendral completes the construction of a telecommunications tower on public land; the permit requires it to dismantle the tower in 5 years, at an estimated cost of 500,000. The pre-tax rate used is 4%. The IAS 16 criteria for including the initial estimate of the dismantling cost in the cost of the tower are met (case data). Record the entry setting up the provision (amount rounded to the nearest unit).
- Expected dismantling cost
- 500,000
- Pre-tax rate (%)
- 4 %
- Years until dismantling
- 5