Maker Corp. manufactures imaging equipment. Easy Leasing purchased an MRI machine from Maker for $1,000,000 and leased it to Imaging Group Inc on Jan 1, 2013. Lease Description Quarterly rental payments $65,258 beginning of each period Lease Term 5 years (20quarters) No residual value, no BPO Economic life of machine 5 yrs Implicit interest rate and lessee's incremental borrowing rate= 12% Fair value of asset $1,000,000 Present value of an annuity due of $1: n=20, i=3% 15.3238 Collectibility of the rental payments is reasonably assured, and there are no lessor costs yet to be incurred. Required: 1. How should this lease be classified by Imaging Group and by Easy Leasing? 2. Prepare appropriate entries for both Imaging Group and Easy Leasing from the inception of the lease through the second rental payment on April 1, 2013. Depreciation is recorded at the end of each fiscal year (December 31) 3. Assume Imaging Group leased the machine directly from the manufacturer, Maker Corp, which produced the machine at a cost of $700,000. Prepare appropriate entries for Maker from the inception of the lease through the second rental payment on April1, 2013.