8 E21-8 (Lessee Entries with Bargain-Purchase Option) The following facts pertain to a noncancelable lease agreement between Mooney Leasing Company and Rode Company, a lessee. Inception date: Annual lease payment due at the beginning of each year, beginning with May 1, 2014 Bargain-purchase option price at end of lease term Lease term Economic life of leased equipment Lessor's cost Fair value of asset at May 1, 2014 Lessor's implicit rate Lessee's incremental borrowing rate May 1, 2014 $21,227.65 $ 4,000.00 5 years 10 years $65,000.00 $91,000.00 10% 10%