Eastern Publishers Ltd (EPL) is preparing its December 31, 2020 year-end financial statements. EPL focuses on corporate clients by binding and publishing corporate directories, policy manuals, and other large documents along with publishing short novels and books. This is the first year of operations.

Lease expense 14,525

You are working in EPL's accounting department and have been asked to prepare a preliminary estimate of the income tax expense. The current tax expense will not be paid until the next fiscal year. The controller of EPL provides you with the following few notes to help you get started:

The lease expense is related to a 3D printer that is being leased for two years for $34,525 per year. The printer has an expected useful life of five years. There is no provision in the lease that would allow EPL to purchase the printer. If purchased, the printer would cost $150,000.

EPL has an average tax rate of 35% and an incremental borrowing rate of 10%. EPL follows ASPE.

Part A:

In the table below, indicate whether the lease for the 3D printer satisfies any of the criteria listed for a capital lease classification under ASPE. Place an "x" where applicable. The implicit rate embedded in the lease is equal to EPL's incremental borrowing rate of 10%. Thanks.

Test	Met	Not met	Not Determinable
Economic life test
Recoverability test
Specialized asset test
Ownership transfer test