On January 1,2017,Cory Company sold a building to Billy Board Bank for $52,000,000 and immediately leased it back under a 15-year non-cancellable lease at $5,918,000 per year,payable at the beginning of each year.Billy Board used an implicit rate of 10.08% to determine the lease payments,and this rate is known to Cory.The building had a carrying value of $34,000,000 on Cory's books.
Required:
Assume that the lease is an operating lease for both the lessee and lessor.Prepare all necessary journal entries for 2017 for Cory (the seller-lessee)and Billy Board (the buyer-lessor).Billy Board will depreciate the building on a straight-line basis over the remaining useful life of 15 years.

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The Answer of On January 1,2017,Cory Company sold a building to Billy Board Bank for $52,000,000 and immediately leased it back under a 15-year non-cancellable lease at $5,918,000 per year,payable at the beginning of each year.Billy Board used an implicit rate of 10.08% to determine the lease payments,and this rate is known to Cory.The building had a carrying value of $34,000,000 on Cory's books.
Required:
Assume that the lease is an operating lease for both the lessee and lessor.Prepare all necessary journal entries for 2017 for Cory (the seller-lessee)and Billy Board (the buyer-lessor).Billy Board will depreciate the building on a straight-line basis over the remaining useful life of 15 years.

On January 1,2017,Cory Company Sold a Building to Billy Board