Each of the four independent situations below describes a lease requiring annual lease payments of $30,000. Lease term (years) Asset's useful life (years) Asset's fair value $132,000 Situati 1 2 4 4 6 6 $114,000 Bargain purchase option? No No Annual lease payments Beg. of yr. End of yr. Be Lessor's implicit rate (known by lessee) 5% 6% Lessee's incremental borrowing rate 5% 5% Required: For each situation, determine the appropriate lease classification by the lessee. (FV of $1, PV of $1. FVA of $1, PVA of $1, EVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Situation Lease Classification 1. 2. 3. 4