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: Effective Decrease in Outstanding Jan. 1 Payments Interest Balance Balance 236,474 2021 26,000 26,000 210,474 2022 26,000 22,100 3,900 206,574 2023 26,000 21,690 4,310 202,264 2024 26,000 21,238 4,762 197,502 2025 26,000 20,738 5,262 192,240 2026 26,000 20,185 5,815 186,425 2027 26,000 19,575 6,425 179,999 - 2038 26,000 6,730 19,270 2039 26,000 4,706 21,294 2040 26,000 2,471 23,529 44,823 23,529