Monty Corporation leased equipment to Teal Mountain, Inc. on January 1, 2020. The lease agreement called for annual rental payments of $1,350 at the beginning of each year of the 3-year lease. The equipment has an economic useful life of 7 years, a fair value of $8,600, a book value of $6.600, and Monty expects a residual value of $6,100 at the end of the lease term. Monty set the lease payments with the intent of earning a 8% return, though Teal Mountain is unaware of the rate implicit in the lease and has an incremental borrowing rate of 10%. There is no bargain purchase option, ownership of the lease does not transfer at the end of the lease term, and the asset is not of a specialized nature. Click here to view factor tables. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Determine the nature of the lease to both Monty and Teal Mountain. The lease is a/an lease to Teal Mountain. The lease is a/an lease to Monty. eTextbook and Media List of Accounts Prepare all necessary journal entries for Teal Mountain in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to O decimal places, eg. 5,275. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation (To record the lease) (To record lease payment) Debit Credit eTextbook and Media List of Accounts How would the measurement of the lease liability and right-of-use asset be affected if, as a result of the lease contract, Teal Mountain was also required to pay $600 in commissions, prepay $800 in addition to the first rental payment, and pay $200 of insurance each year? (Round answers to O decimal places, e.g. 5,275.) Lease liability Right-of-use-asset $ eTextbook and Media List of Accounts Right-of-use-asset $ eTextbook and Media List of Accounts Suppose, instead of a 3-year lease term, Teal Mountain and Monty agree to a one-year lease with a payment of $1,350 at the start of the lease. Prepare necessary journal entry for Teal Mountain in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation 1/1/20 Debit Credit eTextbook and Media List of Accounts