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For the following six leases, determine whether they are operating leases of capital leases for the lessor. If it is a capital lease why that
- For the following six leases, determine whether they are operating leases of capital leases for the lessor. If it is a capital lease why that is true by indicating BP (bargain purchase), TR (transfer at the end of the lease), 75 (75% rule), 90 (90% rule). If it is an operating lease indicate by an OL.
| Value of the Asset | Life of the Asset | Life of the Lease | Monthly Payment | Interest Rate | Transfer at the end of the Lease | Purchase Price at the End of the Lease |
a. | 10,000 | 7 | 5 | 179 | 6% |
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b. | 12,000 | 7 | 5 | 205 | 6% |
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c. | 14,000 | 6 | 4 | 329 | 6% | Yes |
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d. | 16,000 | 6 | 4 | 371 | 6% |
| 250 |
e. | 18,000 | 5 | 4 | 374 | 6% |
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f. | 20,000 | 5 | 3 | 581 | 6% |
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