Use the following data to answer questions i to iii below. Commencement Date: January 1, 2021. Lease Term: 10 years. Lease Payment (paid in arrears): $10,000 annually. Lessees Incremental Borrowing Rate: 6%. Useful Life of Underlying Asset: 25 years

Required (show all your workings):

(i) Prepare the lease amortization schedule clearly depicting the interest expense, liability reduction, depreciation expense, accumulated depreciation. (5 marks)

(ii) The lease accounting journal entries for year 1 (2 marks)

(iii) With the aid of relevant practical exapmles, explain 3 advantages of leases (3 marks)