On 2 January 20X4, Yvan Ltd., a public company, entered into a five-year equipment lease with Jeffery Leasing Inc. The lease calls for annual lease payments of $150,000, payable at the beginning of each lease year. Yvan’s IBR is 7%. Yvan does not know the lessor’s interest rate. The fair value of the equipment is $675,000. Yvan depreciates equipment on a straight-line basis, taking a full year’s depreciation in the year of acquisition.

Required:
1. Prepare the lease liability amortization schedule for Yvan.
2. Prepare the journal entries relating to the leased asset and the lease liability for 20X4 and 20X5 for Yvan.
3. What amounts will appear on Yvan’s statement of financial position, statement of comprehensive income, and statement of cash flows as of 31 December 20X4?