agreement called fo...

Dowell leased the warehouses one year ago on December 31. The five-year lease agreement called for Dowell to make quarterly lease payments of $2,398,303, payable each December 31, March 31, June 30, and September 30, with the first payment at the leases beginning. As a finance lease, Dowell had recorded the right-of-use asset and liability at $40 million, the present value of the lease payments at 8%. Dowell records depreciation on a straight-line basis at the end of each fiscal year. Today, Jason True, Dowells controller, explained a proposal to sublease the underused warehouses to American Tankers, Inc. for the remaining four years of the lease term. American Tankers would be substituted as lessee under the original lease agreement. As the new lessee, it would become the primary obligor under the agreement, and Dowell would not be secondarily liable for fulfilling the obligations under the lease agreement. Check on how we would need to account for this and get back to me, he had said. need to use the FASBs Codification Research System to obtain the relevant authoritative literature and explain the specific Codification citation that Dowell would rely on. 1)determine whether the proposal to sublease will qualify as a termination of a finance lease. Keywords:

Codification Reference(s):

2)Whats the appropriate accounting treatment for the sublease? Keywords:

Codification Reference(s):

can you please just put the keywords use to find the answer and the codification.