2. On January 1, 2020 a sign lease on a piece of equipment. Annual payments of $16,554.85 will be made at the beginning of each year starting on 1/1/20. The fair value of the leased asset is $60,000. The term of the lease is 4 years. Its economic life is 4 years with no residual value. The lessor set payments to earn 7% rate of return. Our incremental borrowing rate is 7%. This is a financing lease.

Required: Prepare the amortization table and the journal entries for this lease.