Lease Amortization Schedule

Annual Interest on Reduction of Balance of

Date__ Lease Payment Unpaid Obligation Lease Obligation Lease Obligation

Jul 1/20 $ 420,000

Jun 30/21 $ 126,807 $ 33,600 $ 93,207 326,793

Jun 30/22 126,807 26,143 100,664 226,129

Required:

1)Prepare all the necessary entries according to the lease amortization schedule.

2)Comment on the nature of the lease from the perspective of lessee and lessor.