At the beginning of 2013, VHF Industries acquired a machine with a fair value of $8,504,580 by signing a four-year lease. The lease is payable in four annual payments of $2.8 million at the end of each year. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. What is the effective rate of interest implicit in the agreement? 2-4. Prepare the lessees journal entries at the inception of the lease, the first lease payment at December 31, 2013 and the second lease payment at December 31, 2014. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.Enter your answers in whole dollars.) Transaction list: a.Record lease.(Jan 1, 2013) b.Record cash payment.(Dec 31, 2013) c.Record cash payment.(Dec 31, 2014) 5. Suppose the fair value of the machine and the lessors implicit rate were unknown at the time of the lease, but that the lessees incremental borrowing rate of interest for notes of similar risk was 11%. Prepare the lessees entry at the inception of the lease. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) Transaction list: a.Record lease.(Jan 1, 2013)