Indicate whether each of the following statements is true or false, and include a brief explanation for your answer.

1. A city leases several ambulances to use for five years although they have an expected life of 10 years. The city must determine whether this is an operating lease or a financing lease.

2. A city has an old school building that it leases to a hospital for its entire remaining life. The city must remove the school building from its government-wide financial statements.

3. A city leases several large trucks to use by its fire department for the next eight years. Total payments will be $260,000. The present value of those payments at an appropriate interest rate is $173,000. On the date of signing, the city immediately records an expenditure and another financing source of $173,000 for its fund financial statements.