Question 2 Sugar Co leased a machine from Spice Co. The terms of the lease are as follows: Inception of lease 1 January 20X1 Lease term 4 years at $78,864 per annum payable in arrears Present value of minim. lease payments $250,000 Useful life of asset 4 years Required (a) Calculate the interest rate implicit in the lease, using the table below (15 marks) This table shows the present value of $1 per annum, receivable or payable at the end of each year for n years. Years (n) Interest rates 6% 8% 10% 1 0.943 0.926 0.909 2 1.833 1.783 1.736 3 2.673 2.577 2.487 4 3.465 3.312 3.170 5 4.212 3.993 3.791 (b) Prepare the extracts from the financial statements of Sugar Co for the year ended 31 December 20X1. (25 marks)