InternationalClothiersLtd.hasofficesinCanada,Bermuda,EuropeandtheUnitedStates. Eachofthe following events have occurred after the companys 31 December 2019 year-end, but before their financial statements had been finalized:

1. On January 25, International Clothiers Ltd entered into a long-term lease for a private airplane for the company president and CEO. The lease requires payments of US$75,000 per month for 60 months.

2. One of the companys major retail customers declared bankruptcy on March 22. The retail customer accounted for 20% of International Clothiers year-end receivables and 35% of International Clothiers revenue in 2019.

Required:

Identify and explain the appropriate accounting treatment for the subsequent events described above.