Problem 1 Evergreen C0 manufactures a machine, incurring $157,000 in manufacturing costs. Upon completion, on January 1, 2021, Evergreen Co. leases the machine to Leadville Lessee Co. Relevant facts pertaining to the lease appear below: - Annual lease payments of $23,574,69 are due at the beginning of each year - Lease is nor-cancelable, with a term of 9 years - Lessor's required rate of return on the lease is 5%. The lessee is aware of this rate. - The fair value of the equipment on the lease commencement date is $197,215. - The estimated economic life of the machine is 10 years - The residual value (which is not guaranteed by the lessee) is $33,000. - The lessor deems the collectability of the lease payments as reasonably predictable. Part A. What is the correct classification of this lease from the perspective of the lessor? Part B. Prepare a lease amortization schedule for the lease receivable. Part C. Prepare all of the lessor's journal entries for 2021