Lease $Y$ contains a bargain purchase option and the lease term is equal to $75\%$ of the estimated economic life of the leased

property. Lease $Z$ contains a bargain purchase option and the lease term is less than $75\%$ of the estimated economic life of

the leased property. How should the lessee classify these leases?

Lease $Y,$ Lease $Z$

Operating lease Operating lease

Operating lease Finance lease

Finance lease Finance lease

Finance lease Operating lease