On 1 January 2018Arys Co. entered into an arrangement to sell a property to a bank and lease it back for a period of 25 years. At that period the main information regarding the property and the lease as follows:

Selling price = $750 000

Carrying amount = $250 000

Fair value = $750 000

Remaining economic life = 25 years

Arys Co has intention to use the asset for its entire economic life

Residual value = nil

Lease payments = $78 045 per year (payable in arrears on 31 December each year).

Interest rate implicit in the lease = 10 % per year.

Question 21 (2 points)

Prepare accounting entries to recognize the sale of the property at 1 January 2018?

Dr

Cr

Question 22 (2 points)

Prepare accounting entries to recognize the finance lease at 1 January 2018?

Dr

Cr

Question 23 (2 points)

Prepare accounting entries to apportion the minimum lease payment between the finance charge for the year ended 31 December 2018 and the reduction of the outstanding liability on 31 December 2018?

Dr

Cr

Question 24 (2 points)

Prepare accounting entriesto recognize the depreciation of the leased factory building for the year ended 31 December 2018?

Dr

Cr

Question 25 (2 points)

Prepare accounting entries to recognize the amortization of the deferred gain for the year ended 31 December 2018?

Dr

Cr