Each of the four independent situations below describes a lease requiring annual lease payme each situation, determine the appropriate lease classification by the lessee and indicate Why nts of S10,000. For Situation 3 Lease term (years) Asset's useful life (years) Asset's fair value Purchase option that is reasonably certain to be exercised? 6 5 6 6 $44,00o $43,000$41.000 $39,000 No No No Beg. of yr. 5% 5% Yes End of yr. 6% 5% Beg. of yr. 5% 5% End of yr. 6% 5% Annual lease payments Lessor's implicit rate (known by lessee) Lessee's incremental borrowing rate