Company leased a machine from Lessors, Inc. on January 1, Year1. Company agreed to make 10 payments of $20,000 each at the end of each lease year. ( The payment for Year1 was due and made on 12/31/Year1.) The interest rate implicit in the leasing agreement was 5%. Title does not transfer to Company, so the machine will be returned to Lessors Inc. on December 31, Year10. The equipment has no residual value, and has a 20-year estimated useful life. On 1/1/Year1, the fair value of the machine being leased is $300,000. Company's partial lease amortization schedule for the first two years appears below: Payment Interest Amount Principle Amount Lease payable Balance 1/1/Yr1 154,435 12/31/Yr1 20,000 7,722 12,278 142,157 12/31/yr2 20,000 ?? ?? ??

1. Is this a financing lease(F) or an operating lease(O) for Company? Answer with an F or O.

2. What amount will Company record as the right of use asset at the inception of the lease?

3. How much interest expense will Company record with regards to this lease in Year2? (Round to the nearest dollar.)

4. Based just on the information you have, how much total expense (not just interest expense) will Company record related to this lease over the 10 year term of the lease? Enter JUST a number for answers 2,3, and 4 (no punctuation or text).