Groton Corporation leased a machine on December 31, 2019, for a three-year period. The lease agreement calls for annual payments in the amount of $50,000 on December 31 of each year beginning on December 31, 2019. Groton has the option to purchase the machine on December 31, 2022, for $10,000 when its fair value is expected to be $30,000. Exercise of the option is reasonably certain. The machine's estimated useful life is expected to be five years with no residual value. The appropriate interest rate for this lease is 7%. 1. Calculate the amount to be recorded as a right-of-use asset and the associated lease payable. Present value of annual lease payments Plus: Present value of the exercise price Present value of lease payments 2. Prepare an amortization schedule for this lease. Lease Payment Effective Interest Date Decrease in Balance Outstanding Balance 12/31/19 12/31/20 12/31/21 12/31/22 3. Prepare Rumsfeld's journal entries for this lease for 2019, 2020 and 2022. December 31, 2019: December 31, 2020: December 31, 2022