Bank Muslim has entered into an ljara contract with Barakah Construction to lease equipment for a period of 5 years . The bank purchased specialized equipment from a local manufacturer on 01 January 2017 for $1,100,000 and incurred a transportation cost $ 100,000 . The Bank also incurred a legal fee of $50,000 relating to the ljara contract ,which the bank considered to be material.Both parties have agreed that the installments are paid every quarter The rental payment was agreed at $40,000 per month.The residual value of the equipment after 5 years is expected to be $200,000 based on the estimate of a certified Valuer. In 2018 and 2020 Barakah Construction incurred repair costs due to mechanical default not due to the normal usage of the asset amounting to $50,000 and $40,000 respectively .Every year Barakah Construction incurred routine maintenance costs due to wear and tear amounting to $ 20,000 per year on average .

Required:

(a)Prepare a profit statement to recognize the above ljara contract in the books of Bank Muslim for the five - year period based on ljara Muntahia Bitamleek ( IMB ) through the equivalent Value method as prescribed by AAOIFI FAS 8.