On January 1, 2021. Majestic Mantles leased a lathe from Equipment Leasing under a finance lease. Lease payments are made annually. Title does not transfer to the lessee and there is no purchase option or guarantee of a residual value by Majestic Portions of the Equipment Leasing's lease amortization schedule appear below: Jan. 1 Paymento 2021 2022 2023 2024 2025 2026 2027 28,500 28,500 28,500 28,500 28,500 28,500 28,500 Effective Decrease in Outstanding Interest Balance Balance 283,578 28,500 255,078 22,957 5,543 249,535 22,458 6,042 243,493 21,914 6,586 236,907 21,322 7,178 229,729 20,676 7.824 221,905 19,971 8,529 213,376 I 2038 2039 2040 28,500 28,500 28,500 6,493 4,512 2,353 22,007 23,988 26,147 50,133 26,146 0 es Required: 1. What is Majestic's lease llability after the first lease payment?? 2. What amount would Majestic record as a right-of-use asset? 3. What is the lease term in years? 4. What is the effective annual interest rate? (Round your percentage answers to 1 decimal place.) 5. What is the total amount of lease payments? 6. What is the total effective interest expense recorded over the term of the lease? 1. 2. 3 Lease liability Right-of-use asset Lease term Effective annual interest rate Total of lease payments Total effective interest expense years % 4. 5 6. 4 of 9