Lazy Leasing Corporation, which uses IFRS 16, signs a lease agreement on January 1, 2022, to lease electronic equipment to Careful Corporation, which also uses IFRS 16. The term of the non-cancellable lease is two years and payments are required at the end of each year. The following information relates to this agreement. 1 Careful Corporation has the option to purchase the equipment for $11,000 upon the termination of the lease and this option is reasonably certain to be exercised. 2. The equipment has a cost and fair value of $270,000 to Lazy Leasing Corporation. The useful economic life is seven years, with a residual value of $12,000. 3 Careful Corporation is required to pay $3,000 each year to the lessor for insurance costs. 4 Lazy Leasing Corporation wants to earn a return of 13% on its investment. 5 Collectibility of the payments is reasonably predictable, and there are no important uncertainties surrounding the costs that have not yet been incurred by the lessor. Required 1 Calculate the minimum annual payments that Lazy Leasing Corporation will require from Careful Corporation. Show your work. (2 marks) Round to the nearest dollar. 2 What classification will Careful Corporation give the lease? What classification will Lazy Leasing Corporation give it? Why? Explain your reasoning for each response.(2 marks) 4. Prepare the journal entries on Lazy Leasing Corporation's books at the inception of the lease and for year 1. (3 marks) 5 Assuming Careful Corporation exercises its option to purchase the equipment at the end of it's life, prepare the journal entry(ies) on Careful Corporation's books to during the 12 months leading up to exercise of the option and for the exercise of the option itself. Remember to show your work and explain your thought process. (4 marks)