Sheridan Leasing Company agrees to lease equipment to Skysong Corporation on January 1, 2020. The following information relates to the lease agreement. 1. The term of the lease is 6 years with no renewal option. and the machinery has an estimated economic life of 8 years. 2. The cost of the machinery is $323,000, and the fair value of the asset on January 1,2020 , is $408,000. 3. At the end of the lease term, the asset reverts to the lessor and has a guaranteed residual value of $33,500. Skysong estimates that the expected residual value at the end of the lease term will be $33,500. Skysong amortizes all of its leased equipment on a straight-line basis. 4. The lease agreement requires equal annual rental payments, beginning on January 1, 2020. 5. The collectibility of the lease payments is probable. 6. Sheridan desires a 6% rate of return on its investments. Skysong's incremental borrowing rate is 8%, and the lessor's implicit rate is unknown. (Assume the accounting period ends on December 31 and that neither company uses reversing entries.) Click here to view factor tables. Discuss the nature of this lease for both the lessee and the lessor. This is a for Skysong. This is a for Sheridan. List of Accounts Attempts: 0 of