Question 10.11 Accounting for a sale and leaseback transaction by the lessee and lessor Squeal Ltd is asset rich but cash poor. In an attempt to alleviate its liquidity problems, it entered into an agreement on 1 July 2015 to sell its processing plant to Tyres Ltd for $467 100. At the date of sale, the plant had a carrying amount of $400 000 and a future useful life of 5 years. Tyres Ltd immediately leased the processing plant back to Squeal Ltd. The terms of the lease agreement were: Lease term 3 years Economic life of plant 5 years Annual rental payment, in arrears (commencing $165 000