$On$ January $1,2025,$ Oriole Animation sold a truck $to$ Pharoah Finance for $$42,000$ and immediately leased $it$ back. The truck was

carried $on$ Oriole's books $at$ $$37,000.$ The term $of$ the lease $is3$ years, there $isno$ bargain purchase option, and title does not transfer $to$

Oriole $at$ lease$-$end. The lease requires three equal rental payments $of$ $$12,0007\%,$ the truck has a useful life $of5$ years, and the residual value $at$ the end $of$ the lease term $is$

expected $tobe$ $$14,000$