Explore BrainMass

Explore BrainMass

    Sale and Lease Back

    Not what you're looking for? Search our solutions OR ask your own Custom question.

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    What is Sale and Lease Back? Further, what are the accounting entries for Sale and Lease Back in case of finance lease?

    © BrainMass Inc. brainmass.com March 5, 2021, 12:36 am ad1c9bdddf

    Solution Preview

    Accounting Entries for Sale and Lease Back

    Sale and lease back is a financing transaction between the lessee and lessor, where a person in need of funding sells their asset and then leases it back so that the asset remains with the seller and they enjoy its use through leasing.

    Finance Lease

    The following is the criteria for the classification of a finance lease:

    • Transfer of ownership to the lessee by the end of the lease term.
    • The lessee has the option to purchase the asset at a price that ...

    Solution Summary

    This solution defines the concept of 'sale and lease back' and explains what its accounting entries would be in the case of a finance lease.