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Lease A contains an unguaranteed residual value and the lease term is equal to 85% of the estimated economic life of the leased asset. Lease

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Lease A contains an unguaranteed residual value and the lease term is equal to 85% of the estimated economic life of the leased asset. Lease B does not contain a bargain purchase option and the present value of the lease payments is 92% of the fair value of the asset. How should the lessee classify these leases? a. A, finance lease; B, operating lease b. A, finance lease; B, finance lease C. A, operating lease; B, finance lease d. A, operating lease; B, operating lease

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