Current Attempt in Progress Sunland Co. processes jam and sells it to the public. Sunland leases equipment used in its production processes from Carla Vista, Inc. This year, Sunland leases a new piece of equipment from Carla Vista. The lease term is 5 years and requires equal rental payments of $13,000 at the beginning of each year. In addition, there is a renewal option to allow Sunland to keep the equipment one extra year for a payment at the end of the fifth year of $12,000 (which Sunland is reasonably certain it will exercise). The equipment has a fair value at the commencement of the lease of $64,225 and an estimated useful life of 7 years. Carla Vista set the annual rental to earn a rate of return of 8%, and this fact is known to Sunland. The lease does not transfer title, does not contain a bargain purchase option, and the equipment is not of a specialized nature. Click here to view factor tables. How should Sunland classify this lease? Sunland should classify the lease as a/an eTextbook and Media Save for Later lease. Attempts: 0 of 1 used Submit Answer

Current Attempt in Progress Sunland Ca. processes jam and sells it to the public. Sunland leses equipment used in its production processes from Carla Vista inc. This vear. Sunland leases a new piece of equipment from Carla Vista. The lease term is 5 vears and requires equal rental pavments of $13,000 at the becinning of each vear, in addition, there is a renewal option to allow Sunland to keep the equipment one estra year for a payment at the end of the fifth year of 512,000 (which Surland is reasonaby certain is will exerbisel. The equipment has a fair value at the commencement of the lease of 564.225 and an estinated useful life of 7 yeark. Carla Vista set the annual rental to earn a rate of return of 6K, and thin fact is known to Scriland. The lease does not transfer title, does not contain a barcain purchase option, and the equipment is not of a specialiued nature. Click here to view factor tables. How should Suniand classify this le ave? Surkand thould classity the lease as a/an lease. eTrotbock and Media Attempts: 0 of 1 uied