Current Attempt in Progress Marin Leasing Company signs a lease agreement on January 1, 2020, to lease electronic equipment to Cullumber Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement: 1. 2. 3. 4. Cullumber has the option to purchase the equipment for $21,500 upon termination of the lease. It is not reasonably certain that Cullumber will exercise this option. The equipment has a cost of $230,000 and fair value of $277,500 to Marin Leasing. The useful economic life is 2 years, with a residual value of $21,500. Marin Leasing desires to earn a return of 5% on its investment. Collectibility of the payments by Marin Leasing is probable.