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To raise operating funds, National Distribution Center sold its office building to an insurance company on January 1, 2021, for $940,000 and immediately leased the building back. The operating lease is for the final 10 years of the building's estimated 20-year remaining useful life. The building has a fair value of $940,000 and a book value of $720,000 (its original cost was $1 million). The rental payments of $240,000 are payable to the insurance company each December 31. The lease has an implicit rate of 8%. (FV of $1. PV of $1. FVA of $1. PVA of S1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. & 2. Prepare the appropriate entries for National Distribution Center on January 1, 2021 and December 31, 2021. 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.) View transaction list View journal entry worksheet Credil No Debit 940,000 280.000 1 enes Date General Journal January 01, 2021 Cash Accumulated depreciation Building Gain on sale leaseback 1,000,000 220,000 240,000 7 2 January 01, 2021 Right-ouest Lease payable 280,000 3 December 31, 2021 Interest expense Lease payable Cash December 31, 2021 No journal entry required

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