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Sorocaba Ltda. sold a building to Banco Janeiro on January 1, 2017, for 250,000 reais and then leased it back under a 10-year lease agreement, which is accounted for as an operating lease. The building had a carrying amount of 198,300 reais and a fair value of 250,000 reais on the date of sale. Assume that a foreign company using IFRS is owned by a company using U.S. GAAP. Thus, IFRS balances must be converted to U.S. GAAP to prepare consolidated financial statements. Ignore income taxes. Required: a. Prepare journal entries for this sale and leaseback for the years ending December 31, 2017, and December 31, 2018, under (1) IFRS and (2) U.S. GAAP. b. Prepare the entry(ies) that the U.S. parent would make on the December 31, 2017, and December 31, 2018, conversion worksheets to convert IFRS balances to U.S. GAAP. X Answer is not complete. Complete this question by entering your answers in the tabs below. Required A Required B No Date General Journal Debit Credit 1 01/01/2017 Cash 250,000 Building Gain on sale of building 198,300 51,700 01/01/2017 250,000 N Cash Building Gain on sale of building 198,300 51,700 3 12/31/2017 5,170 Deferred gain on sale of building Gain on sale of building 5,170 4 12/31/2018 5,170 Deferred gain on sale of building Gain on sale of building 5,170 5 12/31/2018 5,170 Deferred gain on sale of building Gain on sale of building 5,170 Required A Required B Prepare the entry(ies) that the U.S. parent would make on the December 31, 2017, and December 31, 2018, conversion worksheets to convert IFRS balances to U.S. GAAP. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No Credit Date 12/31/2017 General Journal Gain on sale of building Deferred gain on sale of building Debit 46,530 1 46,530 12/31/2018 41,360 X N Gain on sale of building Deferred gain on sale of building 41,360

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