I. for lease Krause onpang on January 2015, enters into a op Leasing Co. The lease noreaneelable lewse to lease an requires equal the following provisions on annual rental payments of S289,000 beginning s13 oISS costs related o 3. The fair val of the equipment on The equipment has economic life of value SI00,000. Krause uses the straighe line The case is of the lease, the asset reverts to the lessor. At the termination rate is g% and is known by Krause, PV factor for annuity due of 10 annual payments at 10% annual rate 6.75902, Pv factor for annuity due of 10 annual payments at 8% annual rate 724689) Round to nearest dollar.) Instructions (a) Is this a capital lease or operating lease to Krause? Explain why? Show necessary computation (b) Prepare the journal entries for Krause on Jan 1, 2015 to record signing of the lease agreement and first rental payment. Show computation of the amounts the entry. 5 to record depreciation expense (e) Prepare the journal entries for Krause on Dec 31 and interest expense. Show computation of the amounts of the entries