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On 1 July 2020, Jackie Ltd entered into a lease agreement with Norman Ltd, agreeing to lease an item of equipment from Norman Ltd for three years. On 1 July 2020, the equipment has a fair value of $139,511. The estimated useful life of the machine is four years, and at the end of the lease term, it has no residual value. The title of the equipment is to be transferred to Jackie Ltd at the end of the lease. Jackie Ltd will make an annual payment of $60,000 in advance, including $9,000 which is the reimbursement of insurance and maintenance costs made to Norman Ltd. The interest rate implicit in the lease is 10%. The first payment is to be made on 30 June 2020. The lease is cancellable by Jackie Ltd. However, any cancellation will incur a monetary penalty borne by Jackie Ltd, equivalent to the remaining time of the lease term. Required: Answer this question in an excel/word file and upload the file when completed. Name your file in your last name and student ID. Calculate the present value of lease payment. (1 mark) What is the lease liability recognised by Jackie Ltd on 1 July 2020? (1 mark) Prepare a schedule of lease payments for Jackie Ltd. (4 marks) From the perspective of Norman Ltd, discuss whether this is a finance lease or operating lease considering all the relevant information provided above. Justify your answer by making specific references to relevant paragraphs in AASB16. (4 marks).

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