On January 1, 2018, Lima Leasing Company acquired an airplane to be leased to LA Sky Company. LLC paid $950,000 to acquire the plane, which is also its fair value. The lease term follow:

- Annual rental payments of $190,000 are due January 1 of each year, beginning on January 1, 2018 There are no non lease payments.

- The lease term is 6 year

- There is neither a residual value or a purchase option

- The economic life of the asset is 8 years, and the airplane is not specialized in nature

- The lessee's incremental borrowing rate is 8%, and the lessee does not know the lessor's implicit rate.

LLC indicates the collectability of lease payments is reasonably assured. LA Sky depreciates similar vehicles it owns using the straight-line method.

Assume the lease is correctly classified as a financing lease.

a. Prepare the journal entry to recognize the right to use asset and lease liability at commencement of the lease

b. Prepare the amortization table showing the annual interest expense and principal reduction.

c. What amount of amortization expense would be recognized each year for the leased asset?