1. Whistler Inc. signed a 6 year non-cancelable lease at the beginning of the year. The leased equipment has a 9 year economic life. The fair value of the leased equipment is $29,000. Annual lease payments due at the beginning of each year are $5,200. There is no bargain purchase option, and the leased asset reverts to the lessor at the end of the lease term. The implicit rate of interest on the lease (known by the lessee) is 6%. Collection of all lease payments is reasonably assured.
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3.  A. What is the classification of this lease from the perspective of the lessee? 
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5.  B. What is the classification of this lease from the perspective of the lessor?

Answer rating: 100% (QA)

A From the perspective of the lessee this lease is a finance lease ... View the full answer