To raise operating funds, Signal Aviation sold an airplane on January 1, 2016, to a finance company for $930,000. Signal immediately leased the plane back for a 13-year period, at which time ownership of the airplane will transfer to Signal. The airplane has a fair value of $960,000. Its cost and its book value were $700,000. Its useful life is estimated to be 15 years. The lease requires Signal to make payments of $124,126 to the finance company each January 1. Signal depreciates assets on a straight-line basis. The lease has an implicit rate of 11%. Assume Signal Aviation prepares its financial statements according to International Financial Reporting Standards.

Required: 1.&2. Prepare the appropriate entries for Signal on January 1, 2016 and December 31, 2016, to record the sale-leaseback and necessary adjustments. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 1.Record the sale of the airplane. 2.Record the lease. 3.Record the cash payment. 4.Record accrued interest. 5.Record the depreciation expense. 6.Record adjustment for the gain.