Shuttle: o Carrying amount of the asset $40,000. o Fair value of the asset $50,000. o Remaining economic life of the asset 8 years. o Sales price of the asset $50,000. o The lease term is 7 years with no renewal options. o The lease payments are paid annually at a fixed amount of $7,000 per year. o The present value of minimum lease payments based on Eat Thats incremental borrowing rate and equals $40,504. o Ownership does not transfer to Eat That at the end of the lease. o The shuttle is not specialized and will have alternative use to LMH Inc. at the end of the lease. o Eat That has an option to repurchase the shuttle at the end of the lease for the then fair market value. At lease commencement, Eat That concludes that exercise of the purchase option is not reasonably certain. o There are many similar shuttles that are readily available in the marketplace.

1) Eat That entered into a sale-and-leaseback agreement with LMH Inc. for its corporate shuttle. Assuming the agreement meets the definition of a contract and that certain indicators related to the transfer of control of a point-in-time performance obligation have been met, how would Eat That (as seller-lessee) recognize the sale of the shuttle? Assume the use of IFRS standards.