2. Jameson Company leases an asset. Information regarding the lease:

-fair value of the asset: 400,000

-useful life of the asset: 6 years with no salvage value

-lease term is 5 years

-annual lease payments are $60,000

-implicit interest rate: 10%

-Jameson can purchase the asset at the end of the lease period for $50,000

What type of lease is this?

1. Operating

2. Finance

3. Short Term

4. Long Term