BE 15-16 Lessor's initial direct costs; sales-type lease LO15-3, LO15-7 Aa Bryant leased equipment that had a retail cash selling price of $600,000 and a useful life of five years with no residual value. The lessor spent $530,000 to manufacture the equipment and used an implicit rate of 8% when calculating annual lease payments of $139.142 beginning January 1. the beginning of the lease. Lease payments will be made January 1 each year of the lease. Incremental costs of consummating the lease transaction incurred by the lessor were $15,000. What is the effect of the lease on the lessor's earnings during the first year, not including any effect of depreciation no longer required on the asset under lease (ignore taxes)? BE 15-17 is it a lease? LO15-7 Financial Machinery entered into an arrangement to provide Viable Bank with equipment for the bank's data center. The contract does not explicitly identify the equipment to be used to fulfill the contract. Financial Machinery has several data centers that are interchangeable and can service multiple customers at one time. Due to security processes in place for its customer data, Viable Bank insists on specific restrictions on the equipment to be utilized and the arrangement imposes restrictions on access and substitution by Financial Machinery for the term of the contract Does the contract include an identifiable asset for purposes of determining whether it contains a lease? BE 15-18 Is it a lease? LO15-7 4