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Deferred revenue from the sale of the machine

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On December 31, 2017, Cheyenne Co. sold a machine to Cross Co. and simultaneously leased it back for one year. The sales price of the machine was $475,800, the carrying amount is $419,700, and it had an estimated remaining useful life of 14 years. The present value of the rental payments for the one year is $34,800. At December 31, 2017, how much should Cheyenne report as deferred revenue from the sale of the machine?

The amount of deferred revenue to be reported?

On January 1, 2017, Ayayai Corp. sold an airplane with an estimated useful life of 10 years. At the same time, Ayayai leased back the plane for 10 years. The sales price of the airplane was $497,200, the carrying amount $379,500, and the annual rental $74,571. Ayayai Corp. intends to depreciate the leased asset using the sum-of-the-years'-digits depreciation method. How much gain on the sale should be reported at the end of 2017 in the financial statements?

The gain on the sale should be reported?

Reference no: EM132440602

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