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 Payments 2821 2022 2023 2024 2025 2926 2027 27,500 27,500 27,500 27,500 27,500 27,5ee 27,500 Effective Decrease in Outstanding Interest Balance Balance 291,599 27,500 264,099 21,128 6,372 257,727 20,618 6.882 250,845 20,068 7.432 243, 413 19,473 8,027 235, 386 18,831 8,669 226,717 18,137 9,363 217,354 2038 2039 2040 27,500 27,500 27,500 5,670 3,923 2,037 21,830 23,577 25,463 49,040 25,463 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 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