Question 1 Melati Bhd entered into a 8-year contract of a specialised machine with Blast Bhd on 1 January 2018. The machine has a useful life of 10 years. At the end of the contract, the ownership will be transferred to Melati Bhd. Melati Bhd will purchase the machine at the price lower than the market value. The contract stated that Melati Bhd have the capacity to determine how the machine will be used to produce the product. Blast Bhd need to provide the capacity for Melati Bhd's needs. Blast Bhd was not allowed to utilise the machine to be used for sale to other customers. The present value of minimum lease payment of the contract was RM2,653,490. Melati Bhd would pay RM700,000 on 31 December each year. The effective interest rate applicable to this contract was estimated at 10%. Required: a. Analyse whether the contract above contains a lease. (5 marks) b. Prepare the followings for Melati Bhd assuming that the contract contains a lease: i. the journal entries for the year ended 31 December 2018 ii. an extract of Statement of Financial Position as at 31 December 2019. Note to the account is not required. (10 marks) (Total: 15 marks)