Perform base on IFRS.

Question 2 (3 points): Grady Company signs an agreement on January 1, 2020, to lease equipment to Azure Company. The following information relates to this agreement. 1. The term of the non-cancelable lease is 5 years with no renewal option. The equipment has an estimated economic life of 5 years. 2. The fair value of the asset January 1, 2020 is $120,000. 3. The asset will revert to the lessor at the end of the lease term, at which time the asset is expected to have a residual value of $12,000, none of which is guaranteed. 4. The agreement requires equal annual rental payments to the lessor beginning on January 1, 2020. 5. The lessee's implicit rate is 10%. 6. Azure Company uses the straight-line depreciation method for all equipment. Instructions: a. Prepare an amortization schedule that would be suitable for the lessee for the lease term. b. Prepare all the journal entries for the lessee for 2020 AND 2021 to record the lease agreement, the lease payments, and all expenses related to this lease. Assume the lessee's annual accounting period ends on December 31. c. Assume that the equipment has an estimated economic life of 10 years (instead of 5 years), what is the amount of Minimum Lease Payment (MLP) for the lease to be classified as capital lease