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 Leasings lease amortization schedule appear below:

Jan. 1	Payments		Effective Interest		Decrease in Balance		Outstanding Balance
							291,599
2021	27,500				27,500		264,099
2022	27,500		21,128		6,372		257,727
2023	27,500		20,618		6,882		250,845
2024	27,500		20,068		7,432		243,413
2025	27,500		19,473		8,027		235,386
2026	27,500		18,831		8,669		226,717
2027	27,500		18,137		9,363		217,354
2038	27,500		5,670		21,830		49,040
2039	27,500		3,923		23,577		25,463
2040	27,500		2,037		25,463		0

Required: 1. What is Majestics 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?