On January 1, 2016, National Insulation Corporation (NIC) leased office space under a capital lease. Lease payments are made annually. Title does not transfer to the lessee and there is no bargain purchase option. Portions of the lessee's lease amortization schedule appear below: Jan. 1 Payments Effective Interest Decrease in Balance Outstanding Balance

Jan. 1	Payments			Effective Interest			Decrease in Balance			Outstanding Balance
2016											235,000
2016		22,000						22,000			213,000
2017		22,000			18,105			3,895			209,105
2018		22,000			17,774			4,226			204,879
2019		22,000			17,415			4,585			200,294
2020		22,000			17,025			4,975			195,319
2021		22,000			16,602			5,398			189,921
2033		22,000			7,632			14,368			75,423
2034		22,000			6,411			15,589			59,834
2035		22,000			5,086			16,914			42,920
2036		46,568			3,648			42,920			0

1. What is NICs lease liability at the inception of the lease (after the first payment)?

2.

What amount would NIC record as a leased asset?

3.

What is the lease term in years?

4.	What is the assets residual value expected at the end of the lease term?

5.

How much of the residual value is guaranteed by the lessee?

6.	What is the effective annual interest rate? (Round your answer to 1 decimal place.)

7.	What is the total amount of minimum lease payments?

8.	What is the total effective interest expense recorded over the term of the lease?