On 1 january 2015, Omega Co. purchased a processing plant for its fair value of $568,606. Subsequently, on the same day the plant was leased to Omega Co. The lease agreement contained the following provisions: Lease term: 5 years Economic Useful life: 6 years Annual rental payment, in arrears (commencing on 31 December 2015): $150,000 Interest rate implicit in lease: 10% The lease is cancellable, but cancellation will incur the lessee a monetary penalty equivalent to 2 years rental payments. The directors of Omega Co. intends to acquire the processing plant from the lessor at the end of the lease term. Required: With reference to above: Classify the lease for Omega Co. Provide three (3) reasons for this classification AP assigned to the contract i. State the main accounting standard applicable to the above situation ii. iii. iv. V. vi. vii. Calculate the present value of minimum lease payments for the contract. Prepare in the books of lessee (Omega Co.) the table showing calculations of interest to be allocated to financial year 2015 until 2019 Statement of comprehensive income for years ended 31 December 2017 Statement of financial position as at 31 December 2017 Notes to the financial statement in relation to Omega Co.'s obligations under finance lease ( (Note: For the purpose of these calculations, interest should be apportioned in accordance with the actuarial method.) On 1 january 2015, Omega Co. purchased a processing plant for its fair value of $568,606. Subsequently, on the same day the plant was leased to Omega Co. The lease agreement contained the following provisions: Lease term: 5 years Economic Useful life: 6 years Annual rental payment, in arrears (commencing on 31 December 2015): $150,000 Interest rate implicit in lease: 10% The lease is cancellable, but cancellation will incur the lessee a monetary penalty equivalent to 2 years rental payments. The directors of Omega Co. intends to acquire the processing plant from the lessor at the end of the lease term. Required: With reference to above: Classify the lease for Omega Co. Provide three (3) reasons for this classification AP assigned to the contract i. State the main accounting standard applicable to the above situation ii. iii. iv. V. vi. vii. Calculate the present value of minimum lease payments for the contract. Prepare in the books of lessee (Omega Co.) the table showing calculations of interest to be allocated to financial year 2015 until 2019 Statement of comprehensive income for years ended 31 December 2017 Statement of financial position as at 31 December 2017 Notes to the financial statement in relation to Omega Co.'s obligations under finance lease ( (Note: For the purpose of these calculations, interest should be apportioned in accordance with the actuarial method.)