On December $31,2016,$ IU Corporation signed a $6-$year, non$-$cancelable lease for a machine. The terms of the lease called for IU Corporation to make payments of $$12,108$ at the beginning of each year, starting January $1,2017.$ The machine has an estimated useful life of $8$ years and a $$6,000$ unguaranteed residual value. The machine reverts to the lessor at the end of the lease term. IU Corporation uses the straight$-$line method of depreciation for all of its plant assets. IU$$s incremental borrowing rate is $8$ percent, and the lessor$$s implicit rate is unknown. $1.$ What type of lease is this? Base your answer on the lease term test. A$.$ Finance Lease B$.$ Operating Lease $2.$ Compute the present value of IU$$s lease payments $($rounded to the nearest dollar$)$ this equals the lease liability.