On January 1, 2017, Bim Distributiors sold a warehouse to Jamble Leasing for $s50,000 and...
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Accounting
On January 1, 2017, Bim Distributiors sold a warehouse to Jamble Leasing for $s50,000 and immediately leased it back. The warehouse was carried on bim' books at $s11,000. The term of the lease is 5 years. The lease contains no renewal or purchase options. The warehouse reverts to Jamble at the termination of the lease. The lease requires 5 equal rental payments of 66,204 at the end of each year. The appropriate rate of interest is 8%, and the warehouse has a useful life of 20 years with no salvage value. Prepare ' 2017 journal entries.
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