During the year end 31 December 2018, Lisbon experienced the following transactions of events: 

i. Sold an asset to a finance company and leased it back for the remainder of its useful life 

ii. The company's statement of profit and loss prepared using historical costs showed a loss from operating its shops, but the company is aware that increase in the value of its properties during the period far outweighed the operating loss. 

Required 

Explain how you would treat the items above in Lisbon's financial statements and indicate which of the Conceptual Framework's qualitative characteristics your treatment is based on (UND:6)

Answer rating: 100% (QA)

The first item would be treated as a finance lease in Lisbons financial statements This is b... View the full answer