The Following Information Relates to a Lease Contract

The following information relates to a lease contract:
The lessor contracted with an insurance company, which guaranteed the residual value at 1-1-x4. There are no uncertainties with respect to collectability of lease payments or performance by lessor.
(a)Determine the annual lease payment
(b)Classify the lease for both lessee and lessor
(c)Record the 2014 entries for both parties

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