Modern Ltd has decided to lease a plant from a supplier and has agreed the following terms with the supplier:

Date of inception of lease: 1 July 2019

Duration of lease: 10 years

Life of leased asset: 10 years

Unguaranteed residual value: $15,000

Lease payments: 10,000 at lease inception and $12,000 on 30 June each year for the next 10 years.

Fair value of leased plant at date of lease inception: $97,469

Question: Determine the interest rate implicit in the lease (show detailed workings).