PROBLEM FOUR Equinox leased a tooling machine on January 1, 2016, for a three-year period ending December 31, 2018. The lease agreement specified annual payments of $36,000 beginning with the first payment at the inception of the lease, and each December 31 through 2017. The company had the option to purchase the machine on December 30, 2018, for $45,000 when its fair value was expected to be $60,000. The machine's estimated useful life was six years with no salvage value. Equinox depreciates/amortizes assets by the straight-line method. The company was aware that the lessor's implicit rate of return was 12%, which was less than Equinox's incremental borrowing rate. For Time Value of Money factors, you may use the ones with five decimals - the internet will have all the needed tables. Remember to round off your FINAL answer to whole numbers (no decimals). Required: 1. Calculate the amount Equinox should record as a leased asset and lease liability for this capital lease. 2. Prepare an amortization schedule that describes the pattern of interest expense for Equinox over the lease term. 3. Prepare the appropriate entries for Equinox from the inception of the lease through December 31, 2017