Just explain the solution plz. Only for question5.

And for the other question, plz explain why using$25000+25000* the number in table at 12% for 4 years not 5 years

The following data relates to questions 3-5 Adam Limited and Davies Limited enter into a finance lease agreement with the following terms: ease term is 3 years estimated economic life of the leased asset is 6 years 3 x annual rental payments of $23 000 each payment is one year in arrears residual value at the end of the lease term is not guaranteed by the lessee interest rate implicit in the lease is 7% (use tables provided) 3. On inception date, the present value of the minimum lease payments is? A. $64,170 B. $64,584 C. $69,000 $60,352 t23K x 1624 4. The period over which the asset should be depreciated by the lessee is? 3 years B. 6 years C. the rate as determined by the commissioner of taxation D. cannot be determined from the information provided 5. The journal entry recorded by the lessee when the payment is made at the end of the first year is? Dr Interest expense $4 225; Dr Lease liability $18 775; cr cash $23 000 B. Dr Lease liability $4 225; Dr Interest expense $18 775; cr Cash $23 000 c. Dr Interest expense $1 610; Dr Lease liability $21 39o; cr cash $23 000 D. Dr Lease liability $1 610; Dr Interest expense $21.390; cr Cash $23 000