Identifying Lease Payments For each of the following four separate finance leases scenarios, determine the lease payment that the lessee should use to determine the appropriate lease classification. a. Lease payments are $4,800 per month plus 5% of lessee net sales. Lessee sales for year one are estimated to be $100,000. b. Lease payments are computed as the greater ofia} 5% of lessee net sales or [b] $3,000. Lessee sales for year one are estimated to be $160,000. c. Annual lease payments are 10% of lessee annual sales, with no fixed portion. Lessee sales for year one are estimated to be $1 60,000. d. Lease payments total $8,000 in year one and increase each year based on the annual increase in the lCPI at the end of the preceding year. The CPI at the end ofthe current year is expected to he 2%. Recording Finance Lease Journal Entries- Nonlease and Initial Direct Lease Costs Frontier Inc. enters into an 8-year lease contract to lease equipment with a useful life of 8 years. Annual lease payments are due with the first payment made immediately on January 1, 2020, the commencement of the lease. No residual value is expected or guaranteed of the underlying equipment. Lease payments consist of (a) fixed lease payment of $46,200, (b) insurance on the equipment of $1,400, and (c) maintenance on the equipment of $1,680. Frontier Inc. also paid legal fees of $1,190 related to the execution of the lease on January 1, 2020. Record Frontier's journal entries at the commencement of the finance lease assuming an implicit interest rate of 6%, known by Frontier. . Note: Round your final answers to the nearest whole dollar. . Note: List multiple debits or credits (when applicable) in alphabetical order. Date Account Name Dr. Cr. Jan. 1, 2020 Right-of-Use Asset 333,097 x Cash OV 1,190 Lease Liability Ov 47,600 x To record asset and liability Jan. 1, 2020 Lease Liability Vi 47,600 Cash 47,600 To record cash lease payment Jan. 1, 2020 Prepaid Maintenance Expense 1,680 OV Cash Ov 1,680 V To record cash maintenance payment