Garvey Company (the lessee) entered into an equipment lease with Richie Company (the lessor) on January 1 of Year 1. Use the following information to decide whether this lease qualifies as an operating or finance lease for Garvey. (1) The equipment reverts back to the lessor at the end of the lease, and there is no bargain purchase option. The equipment is not specialized for Garvey. (2) The lease term is 5 years and requires Garvey to make annual payments of $65,949.37 at the end of each year. (3) The discount rate is 10%, which is implicit in the lease. Garvey knows this rate. (4) The fair value of the equipment at the lease inception is $250,000. The present value of an ordinary annuity of five payments of $65,949.37 each at 10% is $250,000. (5) The equipment has an estimated economic life of 7 years and has zero residual value at the end of this time. Straight-line depreciation is used for similar assets. Required: Please determine the type of this lease and explain why you select this lease type?