Select from the option list provided whether each item is a criterion that, if satisfied, results in classification of a lease as a capital lease by the lessee. Each choice may be used once, more than once, or not at all.

a) For a capital lease

b) NOT for a capital lease

Criterion
1. The lease term is 90% or more of the estimated economic life of the leased property.
2. The lease contains a bargain purchase option.
3. The present value of the minimum lease payments must include the executory costs.
4. The lease provides for the transfer of ownership of the leased property.
5. The present value of the minimum lease payments is at least 90% of the fair value of the leased property.
6. The beginning of the lease term falls within the last 25% of the total estimated economic life, and the present value of the minimum lease payments is at least 90% of the fair value of the leased property.
7. The lease term is 75% or more of the estimated economic life of the leased property.