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Loved, lectures on sale and lease back.. However had one doubt.
Dr Proceeds (f.v asset)
Cr Asset (c.v)
Cr Lease Liab
Dr ROU(as a % of cv/fc ×Lease liab)
The last as you said was a
Cr gain/Dr exp ? figure.
How to find gain / exp..
Which two of the aforementioned balances must be subtracted?
The final entry is just a balancing figure overall after processing the other entries.
Sorry sir but I couldn’t get grasp of the last Profit/loss entry…
By subtracting what will we get the gain or loss.?
Total up the debit entries and then total up the credit entries. The difference is the number and there is an excess of debits over credits, hence why the balancing figure is a credit and therefore a gain.