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 206,028 2021 22,000 22,000 184,028 2022 22,000 18,403 3,597 180,431 2023 22,000 18,043 3,957 176,474 2024 22,000 17,647 4,353 172,121 2025 22,000 17,212 4,788 167,333 2026 22,000 16,733 5,267 162,067 2027 22,000 16,207 5,793 156,273 2038 22,000 5,471 16,529 38,181 2039 22,000 3,818 18,182 19,999 2040 22,000 2,000 20,000 0 Required: 1. What is Majestic's lease liability 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. Lease liability 2. Right-of-use asset 3. Lease term 2345 4. Effective annual interest rate 5. Total of lease payments 6. Total effective interest expense years %