Tirana Incorporated (a company which has a November 30 year-end and uses IFRS 16) is one of the most innovative land excavating businesses in Saskatchewan. Shkoder Limited (a company which also has a November 31 year-end and uses IFRS 16) is an up-and-coming construction business in Manitoba. On December 1, 2020, an agreement was reached for Tirana to lease land excavation machinery to Shkoder for 4 years, with payments required at the end of year. At the end of the lease term, the machinery will revert back to Tirana. Tirana would like an 8% return on investment. This agreement cannot be cancelled, there is no option to renew and there are no major uncertainties regarding costs which haven't yet been incurred by the lessor. Lease payment collectability is reasonably predictable. Shkoder assumes responsibility for any executory costs. The land excavation machinery cost Tirana $1,250,000 - this is also the machinery's fair value as at December 1, 2020. It has an economic life of 7 years with an expected residual value of $350,000.

(a) Calculate the annual lease payment.

(b) Compile an amortization table for Tirana Incorporated for the length of the lease term.

(c) Prepare the journal entries in good form (with dates) for Tirana Incorporated for 2020, 2021 and 2022. Include: - The recording of the lease agreement - The receiving of the lease payments - The recognizing of income