Cobalt Plc Owns an Item of Machinery That Has a Cost

Cobalt Plc owns an item of machinery that has a cost of €700 000 and accumulated depreciation of €200 000 as at 1 July 2013.On that date the machine is sold to Blue Plc for €533 493,and then leased back over 8 years (the remaining life of the machine) .The lease is non-cancellable.The lease payments are €100 000 per annum,payable in arrears on 30 June each year.The interest rate implicit in the lease is 10% and the economic benefits of the asset are expected to be realised evenly over its life.What are the entries to record the transactions in Blue's books on 1 July 2013 and 30 June 2014 (rounded to the nearest euro) ?

A) 01 July 2013
$\begin{array}{|c|l|c|c|}\hline \mathrm{Dr} & \text { Machine } & 533493 & \\\hline \mathrm{Cr} & \text { Cash } & & 533493 \\\hline & & & \\\hline \mathrm{Dr} & \text { Lease receivable } & 533493 & \\\hline \mathrm{Cr} & \text { Lease payable } & & 533493 \\\hline\end{array}$

$30 \text { June } 2014$
$\begin{array}{|c|l|c|c|}\hline \mathrm{Dr} & \text { Cash } & 100000 & \\\hline \mathrm{Cr} & \text { Interest revenue } & & 53349 \\\hline \mathrm{Cr} & \text { Lease receivable } & & 46651 \\\hline & & & \\\hline \mathrm{Dr} & \text { Depreciation machine } & 66687 & \\\hline \mathrm{Cr} & \text { Accumulated depreciation machine } & & 66687 \\\hline\end{array}$
B) 01 July 2013
$\begin{array}{|c|l|c|c|}\hline \mathrm{Dr} & \text { Machine } & 533493 & \\\hline \mathrm{Cr} & \text { Cash } & & 533493 \\\hline & & & \\\hline \mathrm{Dr} & \text { Lease receivable } & 533493 & \\\hline \mathrm{Cr} & \text { Machine } & & 533493 \\\hline\end{array}$

$30 \text { June } 2014$
$\begin{array}{|l|l|l|l|}\hline \mathrm{Dr} & \text { Cash } & 100000 & \\\hline \mathrm{Cr} & \text { Interest revenue } & & 53349 \\\hline \mathrm{Cr} & \text { Lease receivable } & & 46651 \\\hline\end{array}$
C) 01 July 2013
$\begin{array}{|c|l|r|r|}\hline \mathrm{Dr} & \text { Machine } & 500000 & \\\hline \mathrm{Dr} & \text { Loss on machine } & 33493 & \\\hline \mathrm{Cr} & \text { Cash } & & 533493 \\\hline & & & \\\hline \mathrm{Dr} & \text { Lease receivable } & 533493 & \\\hline \mathrm{Cr} & \text { Machine } & & 500000 \\\hline \mathrm{Cr} & \text { Loss on machine } & & 33493 \\\hline\end{array}$

$30 \text { June } 2014$
$\begin{array}{|l|l|l|l|}\hline \mathrm{Dr} & \text { Cash } & 100000 & \\\hline \mathrm{Cr} & \text { Interest revenue } & & 100000 \\\hline\end{array}$

D) 01 July 2013
$\begin{array}{|c|l|c|c|}\hline \mathrm{Dr} & \text { Machine } & 533493 & \\\hline \mathrm{Cr} & \text { Cash } & & 533493 \\\hline & & & \\\hline \mathrm{Dr} & \text { Lease receivable } & 533493 & \\\hline \mathrm{Cr} & \text { Machine } & & 533493 \\\hline\end{array}$

$\text { 30 June } 2014$
$\begin{array}{|l|l|l|l|}\hline \mathrm{Dr} & \text { Cash } & 100000 & \\\hline \mathrm{Cr} & \text { Lease revenue } & & 100000 \\\hline\end{array}$