6. Entity X sells a building to Entity Y and simultaneously leasesSale and leaseback6. Entity X sells a building to Entity Y and simultaneouslyit back. Relevant information follows:P2,000,00Cash selling price of buildingFair,value of buildingCarrying amount of buildingAnnual rent payable at the end of each year1,800,001,000,00120,00018 yearsLease term4.5%Implicit interest rate (readily determinable to Entity X)The terms and conditions of the transaction are such that thetransfer of the building qualifies as a sale under PFRS 15.Requirements: Prepare the journal entries in the books of Entity X(seller-lessee) and Entity Y (buyer-lessor) on lease commencement.(Adapted - IFRS 16. IE11)

Gain on sale of building = Fair Value - Carrying Amount Additional financing provided = Sale Price -…

6. Entity X sells a building to Entity Y and simultaneously leases Sale and a it back. Relevant information follows: P2,000,000 Cash selling price of building Fair,value of building Carrying amount of building Annual rent payable at the end of each year 1,800,000 1,000,000 120,000 18 years Lease term 4.5% Implicit interest rate (readily determinable to Entity X) The terms and conditions of the transaction are such that the transfer of the building qualifies as a sale under PFRS 15. Requirements: Prepare the journal entries in the books of Entity X (seller-lessee) and Entity Y (buyer-lessor) on lease commencement. (Adapted - IFRS 16. IE11)

6. Entity X sells a building to Entity Y and simultaneously leases Sale and a it back. Relevant information follows: P2,000,000 Cash selling price of building Fair,value of building Carrying amount of building Annual rent payable at the end of each year 1,800,000 1,000,000 120,000 18 years Lease term 4.5% Implicit interest rate (readily determinable to Entity X) The terms and conditions of the transaction are such that the transfer of the building qualifies as a sale under PFRS 15. Requirements: Prepare the journal entries in the books of Entity X (seller-lessee) and Entity Y (buyer-lessor) on lease commencement. (Adapted - IFRS 16. IE11)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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H2.
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Aa.31.