Sharke Inc. was incorporated in 2017 to operate as a computer software service firm with an accounting fiscal year ending July 31. Sharke's primary product is an on-line inventory-control system: its customers pay a fixed fee plus usage charges for using the system. On August 1, 2019, Sharke leased a large computer system from the manufacturer. The lease terms are shown below: Annual lease payment $ 62,500.00 paid at the beginning of the year Date of first payment Aug. 1. 2019 Lease term 8 years from date of first payment Implied interest rate in the contract 5% Depreciation method Straight-line Bargain purchase option $ 6,000.00 to be exercised at the end of the 5th year Expected service life of the computer system 8 years This lease is to be accounted for as a finance lease. Following is a schedule of the present value factors (both present value of $1 and present value of annuities due). 7% Present value of Annuity Due for Syrs. Present value of Annuity Due for Syrs. Present value of $1 for 5 yrs. Present value of $1 for 8 yrs. 4.38721 6.38929 0.71299 0.58201 5% 4.54595 6.78637 0.78353 0.67684 Required: 1. Identify the criteria for determining finance leases. 2. Prepare an amortization schedule for this lease agreement Prepare, in general journal form, all entries Sharke should make in its accounting records for the first two fiscal years relating to this lease